Living Gets Loftier in Downtown L.A.

Pedro Galindo moved into the Higgins Building four years ago, part of the first wave of urban adventurers who set roots in the fledging loft district north of skid row.

Back then, the 24-year-old substitute teacher recalls, the converted 1910 beaux-arts office tower had a definite vibe.

“The coolest people were here. There were rooftop parties and barbecues,” he said. “It was a very social building. You would have parties every weekend.”

That began to change two years ago, when the Higgins converted from apartments to condos, with units now selling for up to $700,000.

The new crop of resident-owners -- who include Galindo and his sister, Natalia, who bought the unit they were renting -- hired a concierge to provide “enhanced security” for the building. The new owners brought in a valet to park their cars at a nearby lot. Galindo said the social scene took a hit, too, as the building seemed to become more insular.

“I think the last get-together we had was four or five months ago,” he said.

What happened at the Higgins speaks to a growing gap among those who are rapidly changing the face of downtown Los Angeles.

The recent wave of downtown residents began about six years ago and consisted mostly of renters taking a chance on the first crop of converted lofts in the Old Bank district. They were lured by reasonable rents and the prospect of living in an urban environment.

But much of the residential development since has been condos, changing downtown’s residential population. With prices rising, many new residents are making a bet that downtown will continue to gentrify, homelessness and crime will decline and more upscale retail shops will open. In other words, they see living downtown as an investment.

“As prices have increased and amenities have increased, there is no question you are seeing a demographic shift,” said Tom Cody, a principal in the South Group, which is building three upscale residential projects in the South Park area of downtown, near Staples Center.

“The first generations of pioneers and early adopters were going on faith that certain things were going to come,” he said. “The lifestyle is actually there now. Only now are you going to see people who are leaving decent neighborhoods and ... choosing downtown.”

Indeed, the days of the spartan industrial loft are over. Developers say downtown buyers are demanding high-end amenities, including rooftop pools, 24-hour doormen-security guards and elaborate gyms.

Urban planners say Los Angeles’ demographic shift is similar to changes seen in urban neighborhoods in San Diego, Denver, Chicago and Washington, D.C.

The first adopters in struggling downtowns are often artists and young professionals -- frequently without families -- who begin gentrifying an area. They are followed by a wave of more established -- and often wealthier -- people, including “empty nester” couples typically selling large houses and downsizing with lots of equity to invest in their new condos.

“It’s a very classic pattern we are seeing around the country,” said John McIlwain, a senior resident fellow at the Urban Land Institute.

Like many residents new to downtown Los Angeles, Frank Weber had been watching the transformation over the last few years.

With residential development booming across the city center, Weber decided it was time to buy. So he recently made a down payment on a studio unit in the trendy Elleven condo tower scheduled to open next year near Staples Center.

Weber, a 51-year-old Los Angeles Police detective, had been living in the suburbs of Riverside County and making a 2 1/2 -hour commute. But his children are grown, and his wife died a few years ago.

“It’s appropriate now,” he said of the move. “I have always thought downtown areas are nice. I am hoping this one will be just as nice as the others, like New York and San Francisco.”

For Qathryn Brehm, the latest influx of residents is both a blessing and a burden.

Brehm, an artist, arrived downtown in 1979, paying $300 a month for a 3,000-square-foot apartment at the corner of 8th and Spring streets. “There were a lot of people moving from all parts,” she said. “Downtown was very economical.”

Brehm made a life for herself downtown, later moving into the area’s burgeoning artists district east of Little Tokyo.

The renaissance, said Brehm, who works in marketing and community relations for the Central City East Assn., which represents business interests in parts of downtown, “was bound to happen.... It’s exciting that people are finally using the city to live and work and play.”

Even those conflicted by the upscale shift are quick to admit the growing residential population -- 24,000 and expected to double by 2015 -- is giving those who live downtown a political voice they haven’t had before.

Community groups have demanded beefed-up police patrols and successfully fought for a redesign of the new LAPD headquarters, to be built just south of City Hall, to include more open space.

Still, the changes, Brehm said, are squeezing out many of “the people who have been there a long time, who moved there because of the rent and the workspace.”

“Everyone loves the amenities, of course,” she added, “but it’s mostly that when you are an artist, you need larger spaces to work in, at a reasonable rent. Now, the rents are going up and the spaces aren’t that big.”

That is largely because of the economics of creating lofts. Developers have found that buying historic buildings and rehabbing them as lofts is so costly that the only way to make money back is to quickly sell the units. And the costs of old buildings and land are rising as downtown becomes more popular.

The shift is becoming increasingly evident, said five-year loft resident Marie Condron, a founder of the popular Internet listserv newdowntown, where residents talk about local issues and offer tips on shopping and services.

She too sees a divide between the renters and the buyers. “The people who are buying are investing in a hot market,” she said. “The renters are more here for the community and the neighborhood.”

Dan Parker, 33, decided to buy a unit at 1100 Wilshire, a 37-story onetime office tower that is being converted into high-end condos, because he believes prices will continue to rise.

Parker, a software engineer, lives in Hollywood but is making the move east because of all the projects planned for downtown, especially L.A. Live, a $1.7-billion retail and entertainment sector that has broken ground near Staples Center.

He said he believes he’s getting in on the ground floor of something big.

“I think property will be worth more in five to 10 years,” Parker said.

Daniel Abas, 26, is also moving to 1100 Wilshire after living for several years in the Higgins Building. The Higgins Building attracted “people who can rough it,” Abas said, and “1100 is going to attract a more refined audience who enjoys an urban lifestyle.”

Abas, an entrepreneur, predicts that L.A. Live and other projects in the works will appeal to a new generation of residents who thus far have been hesitant.

“The third wave will be the people who come along with the services,” he said. “All these new services -- restaurants and dry cleaners -- will ultimately provide them with an L.A. lifestyle that we have all become accustomed to, with all the perks.”

Ownership has changed Galindo’s perspective on downtown. He’s been involved in the movement to push for a public park in the Civic Center area. And he’s joined his building’s condo board.

“We have become very invested in seeing downtown L.A. thrive,” he said. “Before, I used to think L.A. is a dump. Now I am very optimistic.”