LOS ANGELES | Downtown Project Rundown 6.0

[citywatch]

https://abc7.com/post/original-pantry-caf-set-reopen-downtown-la-6-month-closure-prompted-labor-dispute/17786509/


cbsnews.com

The Original Pantry Café will reopen with members of its previous staff, the union representing its employees announced, six months after it closed because of a labor dispute. The downtown diner's new owner, real estate entrepreneur Leo Pustilnikov, and officials with Unite Here Local 11, which represents its employees, will provide details of the agreement that will allow the restaurant that opened in 1924 to reopen at a news conference Thursday.

The union called the restaurant's reopening, "A ray of hope in a dark time for our city."

The union credits the restaurant's reopening to "a community-led campaign, including protests, pancake fundraisers, and public pressure.

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[HusBy]

Originally Posted by citywatch

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Great news!

[LA21st]

I'm hearing the state is getting involved to get rid of ULA on reddit. And City Hall is trying to get out of it.

Someone on reddit said the state could do something to end this nightmare. The ULA people are freaking out

[sopas ej]

^^^
I don't think they want to get rid of ULA entirely, only overhaul it.

From the Los Angeles Times:

Looking to boost housing construction, lawmakers seek to overhaul L.A.’s ‘mansion tax’

Lawmakers in Sacramento unveiled a proposal this week to overhaul Measure ULA, the so-called mansion tax in Los Angeles, as part of a larger gambit to keep a statewide tax cut measure from making it onto next year’s ballot.

The legislation, negotiated in part by Mayor Karen Bass, would make pivotal changes to Measure ULA, which was passed by city voters in 2022 and provides hundreds of millions of dollars for programs to address and prevent homelessness.

Senate Bill 423, co-written by state Sen. Lena Gonzalez and Assemblymember Tina McKinnor, seeks to strip away parts of Measure ULA that have been viewed by critics as harmful to housing production in L.A. The bill would significantly reduce the taxes that are imposed by Measure ULA for sellers of apartment buildings, offices and shopping centers — if those structures were built within the last 15 years.

[...]

[LA21st]

Originally Posted by sopas ej

^^^
I don't think they want to get rid of ULA entirely, only overhaul it.

From the Los Angeles Times:

Looking to boost housing construction, lawmakers seek to overhaul L.A.’s ‘mansion tax’

Lawmakers in Sacramento unveiled a proposal this week to overhaul Measure ULA, the so-called mansion tax in Los Angeles, as part of a larger gambit to keep a statewide tax cut measure from making it onto next year’s ballot.

The legislation, negotiated in part by Mayor Karen Bass, would make pivotal changes to Measure ULA, which was passed by city voters in 2022 and provides hundreds of millions of dollars for programs to address and prevent homelessness.

Senate Bill 423, co-written by state Sen. Lena Gonzalez and Assemblymember Tina McKinnor, seeks to strip away parts of Measure ULA that have been viewed by critics as harmful to housing production in L.A. The bill would significantly reduce the taxes that are imposed by Measure ULA for sellers of apartment buildings, offices and shopping centers — if those structures were built within the last 15 years.

[...]

So theres a measure next year to get rid of it though.

[citywatch]

they climbed to the top of onni's new Olympic & Hill apt tower....some ppl have no fear of height.....

https://youtu.be/Ae2iokjPLj4?si=M7x9r93uHXEKVyii

I saw a vid showing crews in the 1930s working on the empire State bldg. They were standing on a narrow steel beam while hundreds of ft in the air.

[craigs]

Originally Posted by sopas ej

^^^
I don't think they want to get rid of ULA entirely, only overhaul it.

From the Los Angeles Times:

Looking to boost housing construction, lawmakers seek to overhaul L.A.’s ‘mansion tax’

Lawmakers in Sacramento unveiled a proposal this week to overhaul Measure ULA, the so-called mansion tax in Los Angeles, as part of a larger gambit to keep a statewide tax cut measure from making it onto next year’s ballot.

The legislation, negotiated in part by Mayor Karen Bass, would make pivotal changes to Measure ULA, which was passed by city voters in 2022 and provides hundreds of millions of dollars for programs to address and prevent homelessness.

Senate Bill 423, co-written by state Sen. Lena Gonzalez and Assemblymember Tina McKinnor, seeks to strip away parts of Measure ULA that have been viewed by critics as harmful to housing production in L.A. The bill would significantly reduce the taxes that are imposed by Measure ULA for sellers of apartment buildings, offices and shopping centers — if those structures were built within the last 15 years.

[...]

That's good news.

[citywatch]

urbanizela

A residential skyscraper has been approved for construction in the South Park neighborhood of downtown Los Angeles, though it's unclear how soon construction will begin.

The City Council last week signed off on a proposed 51-story apartment tower at 11th and Olive streets, a few blocks east of Crypto.com Arena and the L.A. Live entertainment district.

New York developer Mack Real Estate Development declined to talk about the planned tower, but documents filed with the city show a tall tower with 536 rental units and ground floor spaces for bars, restaurants and other retail uses. It would have parking for 581 vehicles both underground and above ground.

The site at 1105 S. Olive St. is now a surface parking lot.

Even though demand for housing is high in Los Angeles, it's challenging to construct ground-up multi-unit housing in the current financial climate, urban development consultant Hamid Behdad said.

Just over one month after securing approvals for the construction of a 51-story residential high-rise in at 1115 S. Olive Street in Downtown Los Angeles, Mack Real Estate Group is pulling the plug on a sister project across the street.

In early September, a representative of the developer requested the withdrawal of an entitlement application for a site located at 1120 S. Olive Street. The property, a surface parking lot, had been slated for the construction of a 60-story building featuring 713 homes above ground-floor commercial space and parking.

dtla has been down this road before....regrettably it's again taking another trip back to the future. I don't know if enough ppl in LA....at city hall....care enough to really change the status quo.

[Zapatan]

That's a shame, as long as they build the smaller tower that's something though.

[SoCalKid]

They are not building the second tower. I hate to be a downer, but the reality is that as a developer, you can't build when existing, cash flowing buildings sell for less than the cost for you to build a new building. You build when the completed building will be worth more than it costs to build (typically with a 20%-35% margin). That is unfortunately very much not the case right now.

[Illithid Dude]

honestly all you can do is laugh

[Zapatan]

You read about sales going great then this. What a mess...

[scania]

It takes time for things to come to fruition. If they build the 51 story tower, then great. Let’s not pretend there’s another 60 story tower being built here in LA, BH, or SM. Never less not many in any other city in the U.S. If the company feels that’s it’s more lucrative to get the 51 story tower built, then so be it. Building a 51 story instead of a 60 story doesn’t mean that the city is in decline. The fact that they are still in the process of building is a major huge positive. Let’s look at the big picture and not be small minded.

[38 Geary]

If the entitlement application is withdrawn for 1120 S. Olive Street, what does that mean for 1115 S. Olive Street which was just approved by the City Council?

[Zapatan]

Originally Posted by scania

Building a 51 story instead of a 60 story doesn’t mean that the city is in decline..

Sure but it's nothing particularly special either, I do like the design though.

Most major US cities should play in higher leagues than they do. Maybe next cycle we'll see some cool projects, Oceanwide getting potentially revamped is huge for downtown if it happens.

[scania]

Originally Posted by Zapatan

Sure but it's nothing particularly special either, I do like the design though.

Most major US cities should play in higher leagues than they do. Maybe next cycle we'll see some cool projects, Oceanwide getting potentially revamped is huge for downtown if it happens.

I totally agree. But if Onni, Mack Urban, Mitsui, etc. not build another building in DTLA…so what! They’ve done a lot of the city already. Some people on here are corny acting as if it’s the end of the world or it’s the demise of DTLA if one of these companies pull out or not build another tower in DTLA. Just my opinion.

[SoCalKid]

My point was that Mack Urban isn't going to be either tower in mid term future, nor will any other developer (other than maybe Onni - they seem to be extremely aggressive). The economics of building in DTLA just don't make sense right now, and particularly not for a tower.

[Zapatan]

Originally Posted by SoCalKid

My point was that Mack Urban isn't going to be either tower in mid term future, nor will any other developer (other than maybe Onni - they seem to be extremely aggressive). The economics of building in DTLA just don't make sense right now, and particularly not for a tower.

DTLA needs a cleanup for sure, if sales are going well with current projects then I don't see why not aside from construction costs and interest rates (hopefully another cut will come soon).

[LAsam]

^That's the thing, sales are not going well. Mack listed Aven for sale in early August for $280 million, or $522K/unit (which is below replacement cost). They previously listed it for sale in 2022 for $420 million, or $784K/unit but there weren't any takers at that price. Building is 96% occupied and ground floor retail is 85% leased. At the reduced price, I still haven't heard of any takers as of yet. Not trying to be pessimistic, just realistic.

[SoCalKid]

Originally Posted by LAsam

^That's the thing, sales are not going well. Mack listed Aven for sale in early August for $280 million, or $522K/unit (which is below replacement cost). They previously listed it for sale in 2022 for $420 million, or $784K/unit but there weren't any takers at that price. Building is 96% occupied and ground floor retail is 85% leased. At the reduced price, I still haven't heard of any takers as of yet. Not trying to be pessimistic, just realistic.

This. A tower is going to cost $750k-$1 million/unit to build these days. If it's only worth $522k/unit when its completed and leased up, then the developer has lost money building the tower. Instead, an investor can just buy an existing building rather than backing a developer. Investors take on immense risk to back a developer building a tower and require heavy returns in exchange. Right now, the returns for building a tower in DTLA are literally negative.

What a lot of people don't understand is that the vast majority of developers need to get investors to fund their projects - not just banks to give loans, but equity investors who are the real owners of the projects. Those investors demand returns, and if developers can't provide adequate returns, investors just move on to another region or another asset class (they can just decide to fund startups, buy bonds, invest in stocks, etc. instead). That's why it's so important to not enact policies that are punitive to investors like ULA, eviction moratoriums, etc. I know I always harp on this stuff, but this is THE deciding factor on whether we see buildings and housing get built in our city. If you punish the investor, they flee, and nothing gets built.