Los Angeles Times, December 14, 1993, Tuesday

 COLUMN ONE 

Bringing Life Back to City's Heart:
Slowed by a Requiem of Despair Over Crime, Squalor and High Vacancy Rates, Downtown L.A.iIs Fighting Back. Merchants And Developers Try Luring More People to Live, Shop and Work There.

By KARL SCHOENBERGER, Times Staff Writer

LOS ANGELES - Its worst streets, filthy with graffiti and sometimes rank with urine, have the aura of vagrancy, providing a hard-slab home to the city's dispossessed. Even its best streets, high atop Bunker Hill, are labyrinths that intimidate pedestrians and take on a barren, spooky atmosphere at dusk.

Downtown Los Angeles, deservedly or not, has gained notoriety for crime and squalor that drives away tourists, business visitors and even many Southern Californians, chilling commerce and deflating civic pride.

Yet Downtown remains the strategic hub of a $380-billion regional economy -- a role that has not changed through riots and recession.

Despite Los Angeles' infamous sprawl, more jobs are concentrated Downtown -- 353,000 -- than anywhere in Southern California. And Downtown is the focal point of a massive investment in public transportation destined, seemingly, to make the Central City even more of an urban powerhouse in the coming century.

What kind of business and social environment it will have, however, is difficult to predict. Because at the same time that city boosters celebrate the new Central Library and the $500-million Convention Center expansion as unifying symbols, Downtown is suffering a crisis in confidence.

This center of economic gravity is in turmoil, both reaching out for the future and treading water in the present.

Fashion wholesalers vow to abandon the garment district because their retail clients are repulsed by the neighborhood. A third-generation theater operator on Broadway bemoans the lack of customers to keep his vintage movie palaces alive. A visionary developer can't find tenants to fill the splendid historic edifice he renovated.

So although the future may hold promise, right now it is overshadowed by a requiem of despair over half-empty hotels, alarmingly high vacancy rates in office towers and a rapidly shrinking residential population.

Urban planners have some ideas about what to do. The Downtown Strategic Plan, put together by a panel of citizens and city technocrats over four years, proposes new priorities for redevelopment on a more human scale. It also urges steps to reverse the area's depopulation by building housing.

The planning document, which will be formally unveiled to the Community Redevelopment Agency's board of directors today, endorses a shift from the humongous Bunker Hill projects of the 1980s to more modest renovations in Downtown's historic areas, deemed appropriate for an era of limited resources.

Today's market forces, however, do not bode well for a fresh supply of private office tenants in rehabilitated buildings -- even the architectural gems.

Vacancy rates are hovering near 26% in the premium "Class A" office buildings on and around Bunker Hill and range higher for less desirable structures elsewhere Downtown, said Robert Caudill, senior vice president for the commercial real estate firm Grubb & Ellis.

Consider the $12-million Bradbury Building renovation at Broadway and 3rd Street, a National Historic Landmark that has been meticulously rehabilitated to its 1893 splendor, with a dazzling atrium of oak paneling, marble floors and wrought-iron railings.

The Bradbury has been ready to lease space for two years, but is 60% unoccupied -- even after the developer himself moved in.

"Whether or not I make money out of the Bradbury Building will be the result of activities and forces outside my control," said Ira Yellin, a civic-minded lawyer turned urban redeveloper. "In an economic recession, we can't do a damn thing without the tenants."

But then, there's more to urban redevelopment than the proverbial invisible hand of the free market.

Like other developers bold enough to invest Downtown, Yellin is anticipating succor from the state bureaucracy. Sacramento is making plans to consolidate its regional work force in renovated historic buildings Downtown, which already is the preeminent center of government in Southern California.

Dan Rosenfeld, deputy director of the state Department of General Services, said he envisions giving the Downtown commercial real estate market a little nudge with a demand for about 750,000 square feet of office space, enough to accommodate 3,500 workers. (Half of these workers would be transferred from other Downtown locations, he said.)

Studies show that it is cheaper to rehabilitate historic structures than to build anew or lease space in other buildings, Rosenfeld said. "We think this would give the critical mass of development that can really turn around that neighborhood," Rosenfeld said. "We're very bullish on Downtown Los Angeles."

But Caudill is skeptical about Rosenfeld's logic: "Economically, the numbers really don't pan out. I just don't understand what forces are behind the renovation of buildings on Broadway and Spring (Street)."

Yellin, meanwhile, is also the private end of the "public-private" development across from the Bradbury on Broadway: the $65-million Grand Central Square. (About $44 million has been secured from the sale of redevelopment bonds.) The project will improve the Grand Central Market, add a parking garage and turn the historic Million Dollar Theater Building into mixed low-income and market-rate housing.

"These apartments are going to be wonderful quality for people who like living in cities," said Yellin, who with his investors has $32 million riding on the Central City's revival.

Yet it remains to be seen whether the housing demand that fills the elite residential complexes on Bunker Hill will extend to unsubsidized apartments in marginal areas.

Broadway is a thriving retail center for the Latino community, with a festive street life that is sorely lacking in the city. But the street dies after dark and lacks the perceived security enjoyed by Bunker Hill housing a few blocks away.

Indeed, the scene on Broadway illustrates the contradictions as well as the rich diversity Downtown can offer -- a microcosm for the larger city it has flung outward, as if by centrifugal force, in the past century.

This area bounded by freeways to the north, west and south and by Alameda Street to the east is a patchwork of disconnected neighborhoods, from Bunker Hill to the historic Broadway and Spring Street corridor to Little Tokyo and the industrial zones to the south and east.

Each neighborhood means different things to different people, an illustration of the contrasting values of urban street life.

That is certainly the case in the garment district, where a dispute has erupted over changes in the texture of the neighborhood over the past three years.

Much to the chagrin of garment wholesalers, the neighborhood has been transformed into an ethnic bazaar, enlivened by Korean, Chinese and Latin American entrepreneurs.

The retail scene attracts tourists and bargain hunters, feeding a lot of hard-working people. But the wholesalers feel besieged.

This tension has resulted in a tenants' revolt that threatens to gut the California Mart, the financially beleaguered complex of fashion wholesalers that has been a pillar of Southern California's textile industry since 1964. The rag trade, in turn, has been an essential anchor of the regional economy.

Fed up with what they perceive to be a deteriorating neighborhood that discourages their best retail clients from visiting their showrooms, a group of more than 400 Cal Mart tenants is poised to bail out of Downtown -- en masse -- as soon as they can find a suitable site on the more glamorous Westside.

Their complaints range from sanitation and safety concerns to their sense that the neighborhood's funky, new flea market atmosphere cheapens their high-brow profile as legitimate wholesalers.

"The neighborhood is a terrible distraction to what we're trying to do here," said Jeffery Krinsky, a sales representative who is leading the rebellious tenants group. "We're in the fashion business, and so much of the fashion business is about image."

The Cal Mart's owner, Sydney Morse, responded nimbly to the threat of desertion by forming the Downtown Property Owners Assn., which aims to clean up and provide security for the area.

Working with city grants of $75,000 and another $120,000 in donations from garment district landlords, the association in August launched a three-month pilot project covering 13 blocks.

It hired security guards on bicycles; it contracted crews of homeless people to pick up trash, paint over graffiti and chase away aggressive panhandlers. The teams wear green polo shirt uniforms and carry walkie-talkies.

"They provide a certain reassurance to the man or woman on the street," said Marianne Giblin, association director. "Everybody is really impressed with what's happening in the area."

The project was successful enough to be extended in November for another three months, and the association is lobbying for city "business improvement district" status that would support the plan permanently through a special assessment on area property owners.

Still, the disgruntled Cal Mart tenants do not appear to be mollified.

"All these efforts are duly appreciated, but they're small aspirins for a big cancer," Krinsky said. "The big picture has not been altered.

"Our clients express a tremendous amount of loathing for Downtown Los Angeles," he said. "They use words like prisoner and hostage to describe what it feels like to stay overnight in a Downtown hotel, because they're warned it's not safe to go out at night."

To be fair, Downtown's reputation as a cesspool of crime may be somewhat undeserved.

Los Angeles Police Department statistics show that in the Central District -- which basically matches Downtown's borders -- murders, robberies, aggravated assaults and auto thefts have steadily declined since peaking disturbingly in the mid-1980s.

When the high density of Downtown's daytime population is taken into account, the per capita crime rate compares favorably to many other areas of the city. The Hollywood District had 39 murders this year through mid-November, while the Central District had 25. (In 1986, the district recorded 80 homicides.)

But the crime rate is drastically higher if only the small number of full-time residents are counted. And the Central City certainly has suffered from the stigma of crime, especially after last year's riots.

Michael Collins, senior vice president of the Los Angeles Convention and Visitors Bureau, uses the "doughnut analogy" to describe what happened to tourism in Los Angeles after the burning and looting was shown on television around the world.

Downtown became the hole in the center.

"After awhile, the traffic came back into the rest of the market," Collins said. "But Downtown just fell apart."

Area hotel occupancy already was slipping precariously below 60% in 1991; after the riots it plummeted, hitting bottom with about a 47% average this year, said Bruce Baltin, director of PKF Consulting, which analyzes the hospitality industry.

However, with last month's opening of the expanded Convention Center, a jump in demand by business travelers appears to be reversing the trend. The unveiling of the remodeled Central Library has also boosted interest in staying Downtown, Baltin added.

"There's a momentum beginning that is really energizing Downtown," Baltin said. "But I think Downtown still definitely needs more in the way of street activity for tourists to be happy here."

Many of Downtown's cultural assets have been under siege for years. The Los Angeles Theater Center on Spring Street won ephemeral acclaim before flickering out in the late 1980s for lack of patrons who would brave the neighborhood; it is now stirring back to life with help from the city Cultural Affairs Department.

The art galleries in the pockets of artists' lofts scattered throughout decaying industrial zones have vanished, along with many of the artists-in-residence. The closure this year of Gorky's Cafe, the bohemian hangout on 8th and San Julian streets, signaled the end of an era.

Indeed, although statistics are difficult to come by, indications are that the residential population of the Central City has declined dramatically in recent years. The exodus appears to have hastened after the spring, 1992, riots.

A study by the city Planning Department suggests that the Downtown population fell as much as 8% in the 18 months between the April, 1990, U.S. census and a city survey in September, 1992. (The city's population fell less than 0.7% during the same period.)

An estimated 20,804 people live Downtown, according to the city's study. Only 14,646 of these people are "in dwellings"; 6,158 people -- nearly 30% of the total -- are not. In other words, they are homeless.

Graphic evidence of the depopulation of Downtown -- and of the reluctance of people to come in for entertainment after sunset -- can be seen in the movie palaces that line Broadway.

A few show movies in Spanish or with Spanish subtitles, catering to the needs of the people who now support the area. But most of the theaters have been shuttered or converted to swap meets and churches.

Bruce Corwin -- whose family business, Metropolitan Theaters, owns two of the Broadway theaters and has long-term management contracts for four others -- is distraught about the near-term future of the street.

"Any normal businessman would be out of there by now, and I don't know how much longer I can hold on," Corwin said. "I'm there for tradition's sake because I'm the third generation. I do think Broadway will come back, but I don't think it will be in my lifetime."

Last month, Corwin was on the verge of closing his showcase Los Angeles Theater, on Broadway below 6th Street, when he had a change of heart.

The theater -- perhaps the most extravagant and elegant of all the movie palaces -- was still showing first-run movies in English, and no one came. But an epiphany triggered by a breakfast special at Corwin's favorite Beverly Hills diner inspired him to give the theater one more try. He's now offering four movies for $2.49.

A few hundred seats were occupied during a recent matinee screening of "Robocop III," suggesting that the gimmick may be working. But it is too soon to tell whether the 2,000-seat theater can make a comeback. With the widespread perception that Broadway is unsafe -- and the sky-high costs of parking -- Corwin has little hope for an immediate rebound.

"Ira (Yellin) and I feel like Custer against the Indians," said Corwin, who keeps his company afloat by operating theaters on the Westside. "There's no political support for what we're doing here. We're fighting the battle alone."

Eventually, though, huge public works projects -- such as the $1.8-billion Alameda Corridor to the ports and the $137-billion Metro Rail/Metrolink public transit system -- may well draw hordes of workers and consumers Downtown.

If they come, these people are liable to line up at the movie palaces -- if the theaters are still there. With some improvement in security and sanitation, people might stay after work for dinner, attend stage shows, maybe even rent apartments in historic buildings on Broadway.

The energetic suburban centers on the outskirts of the sprawl -- the so-called "edge cities" that have overshadowed Downtown for decades -- are likely to see themselves, finally, as orbiting the center. But then, in terms of the regional economy, they already do.

"This is the nerve center," said Charlie Woo, a toy wholesaler and chairman of the Central City East Assn.

"When you talk about economic growth for the whole area, each type of business is interconnected. The lawyers and the trading companies and the accountants all feed off each other," Woo said. "If part of Downtown is neglected, every other sector suffers. If Downtown grows, the whole region benefits."
 
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BACKGROUND

The Downtown Strategic Plan, prepared over four years by a 60-member citizens panel, calls for revitalizing the city's core by improving its economic base and quality of life. Set to be unveiled today before the Community Redevelopment Agency's board of directors, the 25-year plan envisions the creation of Downtown housing for another 100,000 people -- five times the current population. Arguing that restoring Downtown's health will benefit the larger region, it puts a priority on cleaning up Downtown streets and making them safe, boosting industrial and white-collar jobs, and undertaking small-scale redevelopment projects.
 
The Streets of Downtown

Downtown Los Angeles is undergoing a difficult transformation. The area is buoyed by new public works such as the Central Library and expanded Convention Center. But it still is stigmatized by a reputation for vagrancy and crime, which drives away visitors and chills commerce. This map shows general boundaries for some of Downtown's districts and landmarks.

GRAPHIC: Photo, COLOR, Modern skyscrapers, older businesses and luxury apartments in Downtown L.A. A new Downtown redevelopment plan will be presented today. TED S. WARREN / Los Angeles Times; Photo, COLOR, Bruce Corwin of Metropolitan Theaters, left, and Ira Yellin, who renovated Bradbury Building, are pinning their hopes on Downtown renovation. MICHAEL EDWARDS / Los Angeles Times; Map, COLOR, The Streets of Downtown, VICTOR KOTOWITZ / Los Angeles Times