A MULTI-FAMILY MILLENNIAL HOUSING MARKET IN HOLLYWOOD GOES “BOOM!”

A MULTI-FAMILY MILLENNIAL HOUSING MARKET IN HOLLYWOOD GOES “BOOM!”

Developers have big Hollywood dreams, and their target audience is millennials. Several multifamily projects are slated to hit the Hollywood market over the next few years as young creative professionals clamor for apartments in the thriving new media hub.
The neighborhood hit 96.2 percent of its residential capacity at the beginning of December, according to Rainmaker Insights, the research partner of apartment search engine Rent Jungle. That’s somewhat tighter than the 95 percent the firm recorded for the City of Los Angeles as a whole. With very few vacancy signs in Hollywood, rents are climbing — a fact that hasn’t escaped the notice of developers.
The average Hollywood apartment asking rent rose nearly 14 percent to $2,947 in November 2016, up from $2,595 a year earlier, according to Rainmaker Insights data scientist Michael Mele. By contrast, the firm clocked in the Los Angeles countywide rent increases at around 1 percent. The 10 largest multifamily projects that are either proposed or in construction would add 5,410 residences to the Hollywood market.

 

A handful of the units that have been added to the residential market are creative live/work space, a type of housing typically associated more with New York than with new Hollywood. Phase one of “Eastown,” completed in 2014, has 517 apartments and 18 live/work spaces, as well as 74,000 square feet of ground-floor retail. Phase two of the development, which is rising along the Hollywood Walk of Fame, will replace a parking lot at the 6200 West Hollywood Boulevard parcel.
The passage of Measure JJJ requires that all new developments requiring zoning changes include a percentage of affordable units, and Eastown will comply with these rules. However, Frank Stephan, a Clarett West senior managing director, says affordable housing was always a part of the plan, and not a forced concession. There are also over 1,300 below-ground parking spots for residents and patrons of the Pantages Theatre, located on the opposite corner.
The largest multifamily project already under construction, AVA Hollywood, is slated to add nearly 700 units to the market. Located at 6677 West Santa Monica Boulevard, it will include 20,000 square feet of retail and three roof decks with views of the Hollywood Hills for residents. Developer AvalonBay plans to begin renting apartments around 2018. Mark Janda, a senior vice president at the developer, said they are looking for a food hall concept attractive to renters, such as a celebrity chef or a high-end coffeehouse.
Although there are thousands of new units planned for Hollywood, Janda said he isn’t concerned about the potential for oversupply. “No one has a perfect crystal ball,” he said. “The bottom line is, housing has been so under-produced in Los Angeles that there is a lot of pent-up demand.”
AvalonBay Chairman and CEO Timothy Naughton said during an October earnings conference call that apartments are in high demand across the nation, and that Southern California is one of the top markets on which their executives are focusing their attention.
Market watchers say the trend toward denser housing developments in the area began in nearby West Hollywood, which is an incorporated city, then edged toward Hollywood. “West Hollywood has been moving east, and the area has been getting nicer and nicer,” says millennial Realtor Chris Jacobs of L.A. Luxe Group at Keller Williams Realty. “People’s property values have been increasing.”
Not everyone is elated by the trend. Although millennials may relish the notion of living in upscale apartments in an urban setting, some of old Hollywood is saying, “Not so fast.”
In early 2015, for example, the Los Angeles City Council temporarily blocked the Millennium Hollywood, a big mixed-use project that will add 492 residential units totaling about 700,000 square feet, up to 200 luxury hotel rooms and upscale restaurants and retail stores to the neighborhood. There was a lot of neighborhood push-back against the plan, and the opponents of the large-scale project gained real traction when they said that a corner of the site, which is located at 1720 North Vine Street, was on top of an earthquake fault. However, city planners found no active fault and signed off on the project in July 2015. It is now under construction.
Meanwhile, one of the biggest Hollywood projects proposed has been slapped with a not-in-my-backyard lawsuit. Palladium Tower, a 731-unit mixed-use complex that would include the historic Palladium Theater, was scheduled to begin construction in 2017. Then the AIDS Healthcare Foundation sued. If the project were built, it would block the panoramic views from the organization’s international headquarters on the 21st floor of the Sunset Media Center.

“Because we’re in litigation, we’re taking a deep breath and waiting to see how it all comes out,” said Steven Afriat, a consultant who is advising Miami developer Crescent Heights. The future of the project remains an open question while the lawsuit proceeds through the courts.

If your future involves making a move in the complex world of L.A. real estate, then don’t hesitate: Help is just a click away. See you in February.

L.A. IS AMERICA’S MOST VALUABLE HOUSING MARKET

L.A. IS AMERICA’S MOST VALUABLE HOUSING MARKET

When it comes to the value of all the real estate in America’s biggest cities, New York and L.A. are usually first and second on the list, often switching places, depending on what analysis you read. A year-end market-value report from home listings site Zillow concludes that Greater Los Angeles is the U.S. champion. “The total value…

A RECORD YEAR OF SALES FROM JEFF YARBROUGH AND L.A. LUXE GROUP

A RECORD YEAR OF SALES FROM JEFF YARBROUGH AND L.A. LUXE GROUP

This time of year lends itself to look back and to look forward. I thought it would be fun to review each of 2016’s months and highlight one sale that I had an exceptional time working on. Whether it be a client I supremely enjoyed spending time with, a property that felt great to hold…

HAVE YOURSELF A GLAMOROUS LITTLE CHRISTMAS

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Somehow it’s fitting that a woman known for white fur-lined clothing died just before Christmas. Zsa Zsa Gabor, the Hungarian-American actress best known for her over-the-top lifestyle and many marriages, died Sunday in Los Angeles. The Hollywood legend once famously proclaimed, “I am a marvelous housekeeper. Every time I leave a man, I keep his…

OBAMA CARES… ABOUT BUYING REAL ESTATE

OBAMA CARES… ABOUT BUYING REAL ESTATE

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NETFLIX AND AMAZON BOOST THE FORTUNES OF SELLERS AND LANDLORDS

NETFLIX AND AMAZON BOOST THE FORTUNES OF SELLERS AND LANDLORDS

The rising tide of original online programming—specifically from Netflix and Amazon—is causing rents, occupancy, and prices to rise in parts of Los Angeles. Aside from taking over swaths of commercial spaces, the streaming companies are on hiring binges and are also relocating employees to L.A. offices. In non-rent controlled residential L.A. neighborhoods, rents have risen…

THE PATH FORWARD: HOW WILL TRUMP AFFECT THE HOUSING MARKET?

THE PATH FORWARD: HOW WILL TRUMP AFFECT THE HOUSING MARKET?

Political pundits around the country were stunned this week when Donald Trump secured enough electoral votes to beat Hillary Clinton to become the next President of the United States (although after days of counting, it appears Clinton will win the national popular vote 59.9 million to 59.7 million). While supporters from both sides are still…

REAL ESTATE CLIMATE CHANGE: 3RD QUARTER SALES WARMER THIS YEAR THAN LAST

REAL ESTATE CLIMATE CHANGE: 3RD QUARTER SALES WARMER THIS YEAR THAN LAST

My job as your agent is usually to find you a home, or sell your existing one. But I’m also here to keep you at the forefront of information on our local market. Here is some of the most current data we have on area home sales: In over half of Los Angeles metropolitan areas, the number…

SEPTEMBER SLOW-DOWN: HOW SCARY WILL FALL’S HOUSING MARKET GET?

SEPTEMBER SLOW-DOWN: HOW SCARY WILL FALL’S HOUSING MARKET GET?

 The Southern California real estate market took a breather in September, with sales dipping slightly as the market entered a typically slower season amid price gains that have made homes less affordable. Real estate firm CoreLogic said this week that sales in the six-county region fell nearly 1% last month compared with a year earlier. The…

HOW WILL THE 2016 ELECTION AFFECT THE REAL ESTATE MARKET?

HOW WILL THE 2016 ELECTION AFFECT THE REAL ESTATE MARKET?

As a home seller or buyer, you might be wondering: Will the 2016 Presidential election affect the real estate market? The answer is Yes. And No. YES, the next President of the United States will have the opportunity to have a direct impact on the real estate market. For example, the current administration looked to…

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