Once More, with Enthusiasm

Clifton’s Cafeteria, by some miracle, still stands on Broadway in downtown Los Angeles. Opened in the darkest years of the Depression, Clifton’s ushers its diners into a fake redwood forest where they can pass the lunch hour agreeably. A tiny creek meanders between some tables and a moose head hangs from the wall.

Once, in the heyday of urban cafeterias, Clifton’s drew large lunchtime crowds of secretaries, bankers and lawyers. Now the clientele consists of the working poor and a few others who could afford better but admire Clifton’s refusal to succumb to the tides of economic ruin downtown.

Tom Gilmore numbers among the latter. He owns an interest in Cicada, the high-toned restaurant near Pershing Square, but makes the two-block walk to Clifton’s several times a month, orders a veggie plate from the steam counter, and settles down with garment district seamstresses, store guards, and hi-fi clerks. “You can feel the city when you’re inside this place,” he says when we meet at Clifton’s for lunch. “You don’t get high rollers coming in, just people who work in the neighborhood and want some lunch. Los Angeles has destroyed most of these places. They’re all gone, just like the street life in downtown has gone.”

Gilmore pauses. “We’re going to bring that back. If our plan works out, people will want to walk downtown streets again. In fact, everything depends on it.”

Gilmore, as usual, is talking about The Bet.

A former New Yorker, Gilmore stands 6-foot-3 and has the handsome, off-balance face of a hockey player. He arrived in Los Angeles in 1992 but attracted virtually no notice until last fall when, suddenly, he emerged as a downtown proselytizer, a sort of combination Robert Moses and Aimee Semple McPherson. These days he can be seen everywhere in the small universe of downtown, presenting awards, sitting next to the mayor, preaching the gospel of city life.

All because of The Bet.

At its core, The Bet amounts to a wager that Gilmore and his development firm, Gilmore Associates, can re-civilize the ruins of downtown’s historic district and restore urban life to the city’s core. And he’s not talking about the high-culture life or mega-project life represented by the upcoming Staples Center and Walt Disney Concert Hall, but everyday life that flows from people strolling, eating, shopping and hanging out on the city’s streets.

In other words, Gilmore believes he can make downtown into a living city again. No fooling.

To prove his point, Gilmore plans to open his first project early next year. Named the Old Bank District, it will encompass three office buildings, now deserted, that fill the entire south side of 4th Street between Spring and Main. And not just any buildings, either. One, the 12-story Continental Building, is regarded as the first skyscraper in Los Angeles. Another, the Farmers and Merchants Bank Building, served at the turn of the century as one of the city’s dominant financial institutions. One by one, these will be converted to 240 loft apartments with the high ceilings and big windows favored by the young and restless. This appeal to the young coincides with what Gilmore believes is a new urban spirit blowing across the land, fueling revivals of downtowns in city after city.

The Bet goes further, however. After populating the upper floors with young careerists, Gilmore plans to fill the street level with the modern touchstones of city life: bookstores, cafes, a dry cleaner on the corner, a small bar tucked into an alley. Chunk by chunk, in other words, he wants to re-create the fabric of urban life.

In all, the Old Bank District will cost $32 million. What distinguishes Gilmore’s bet, however, is not so much the size of the financial investment as the strategy. Other developers have rehabilitated individual buildings downtown and the master planners of local government have built one futile monument after another to the gods of urban renewal. But no one has marched into the great dead zone, now populated by the deranged and besotted, and vowed to build a working neighborhood.

“In Los Angeles we’re ashamed of our downtown,” Gilmore says during lunch. “We have dozens of beautiful old buildings, the kind that people die for in New York, and we treat them like eyesores, as if we’re waiting for them to fall down so we can sweep the bricks away and build another parking garage.

“Those buildings can be filled with people. There’s a segment of the population that’s hungry for city life. I look at those empty streets and I see little cafes along the sidewalk and a canopy of trees. I see lights in the windows of the buildings because someone lives up there. And that picture won’t leave my mind. It just makes sense.”

Gilmore pauses. “Look, a year from now people will either see me as a hero or just another dreamer who lost his shirt trying to save downtown. There’s not much room for in-between.”

*

The idea of a revitalized downtown has tantalized, even teased, our city for decades. Since the 1960s, in fact, each decade has contained a new strategy to reverse the downward spiral. The sum total of these strategies, thus far, has been the creation of one of the strangest bifurcated central cities on earth. Unlike many cities, Los Angeles did not level its original downtown to make way for the windy plazas of modern high-rises. It didn’t even intersperse the new with the old. Los Angeles simply walked away from its old downtown, abandoned it totally, and built a new one on Bunker Hill.

So we have inherited these two downtowns, looking like before and after shots. The old one, largely abandoned by the whites, has been partially repopulated by Latino retail districts, but otherwise stands empty. The new one shines on the hill, a robotic collection of glass towers looking like Century City’s twin brother. After 5:30 p.m., both downtowns are comatose.

Our central city has been sick for so long that many have forgotten it once functioned as the beating heart of Los Angeles. But it did. You can actually catch a glimpse of those glory days at the Los Angeles County Natural History Museum in Exposition Park, where a sprawling replica of the old downtown sits behind a plexiglass barrier. Built by the WPA, it shows every building on every street in the years preceding World War II.

One day I stand next to the replica and watch coveys of schoolchildren gawk at it. They are staring at something unfamiliar in their experience: a functioning downtown. They can see an unbroken wall of ornate offices built by banks and investment houses along Spring Street. One block over on Broadway, dozens of 1920s-style movie houses, vaudeville theaters and massive department stores formed the theater district. A leafy Pershing Square basked in the sunshine. The kids look for a while and then wander off. The replica doesn’t connect with anything they know. It may as well be part of Chicago.

But that downtown disappeared only culturally. Physically, it still exists. Never cleared out for urban renewal, the old bank headquarters, department stores and theaters of the 1920s remain today, waiting. Recently Ed Rosenthal took me on a tour to examine some of these waiting ones. Rosenthal is a real estate broker who’s worked in old downtown for 20 years, and he began his tour with an instruction. Keep looking upward, he said, if you want to really see the buildings. “Most people, they look along the sidewalk and all they see is the trash and grime and the drunks,” he says. “That’s how they miss the buildings and what’s really here.”

We pass the green-glazed Stowell Hotel, which catered to the swells of Spring Street during the 1920s; the headquarter buildings for Valley magnates J.B. Lankershim and Isaac Newton Van Nuys; the old Pacific Stock Exchange. On and on they go, dozens of buildings. “Most of the owners simply sit on the buildings and do nothing. That’s a big problem all over the historic core,” Rosenthal says. “They make a nice income from the swap meets and the check-cashing operations at the street level and they figure, hey, why should I do anything else? They’re shnorrers.”

For 20 years, this hard-luck story has hardly changed in spite of all the efforts by government agencies to turn it around. In the 1980s, the city’s Community Redevelopment Agency spent $29 million on the Los Angeles Theatre Center in the middle of the dead zone. The idea was to draw nighttime crowds to the district, which just might, in turn, inspire shops and restaurants to open. The crowds did come, for a while, but scattered to the suburbs after the shows. Later on, the city rented several empty buildings and filled them with city employees. But, unlike the state, which recently converted the old Broadway department store into a handsome and much-applauded office building, the city did little to upgrade the buildings it rented. Employees were barricaded on the upper floors, leaving the street level mostly barren.

On the day Rosenthal and I tour the district, the city-rented buildings are barely distinguishable from empty ones. On some, not even a small sign indicates a city department operating within. The city seems to be hiding its presence, as if embarrassed. Rosenthal waves his hand dismissively toward one city-occupied building, an elegant artifact of the 1920s that is covered in grime. “Dreck,” he repeats. “You can get discouraged here.”

*

This record of nearly perfect failure has hovered over Gilmore ever since he embarked on the Old Bank District. The first reaction of his real estate colleagues, to put it politely, was skeptical. One friend went on a tour of the buildings and told him he was going to lose his shirt. Another developer, who asked not to be identified, says the extreme risk of such a project comes from the unknowns. “In an old building, you never know what you’re going to find when you open up the walls,” he says. “You hit one problem, then another. It’s like bombs going off underneath you. You start bleeding, but you’re bleeding money, and pretty soon you’ve bled to death.”

That sequence of events, in fact, pretty much describes the fate of Ira Yellin, the developer who converted the Million Dollar Theater building on Broadway to apartments in the early ‘90s. The conversion resulted in a beautiful restoration of the building that once served as the headquarters of the Metropolitan Water District, but costs ran so high that the project has yet to yield a profit.

Among the small community of downtown real estate veterans, some also question Gilmore’s credentials. One such veteran says he always applauds the Old Bank District in public but personally regards it as a one-in-a-hundred long shot. “Tom has never done a project like this on his own,” the developer says. “He’s gotten a tremendous amount of attention because he’s a wonderful salesman and gets people excited. But to pull this off, he’ll have to prove himself more than just a salesman.”

Actually, Gilmore has worked in downtown real estate for most of the decade, although not on his own. He arrived in Los Angeles in the early ‘90s after heading a small architectural firm in New York and eventually was appointed president of the Hertz Investment Group, a downtown real estate firm owned by developer Judah Hertz. Together the two men acquired and leased several historic structures, including the Oviatt Building, which houses Cicada restaurant.

Gilmore left Hertz’s firm in 1998. Both Hertz and Gilmore say the reason was Glmore’s insistence on pursuing the Old Bank District. “Tom’s not what you call employee material,” Hertz says dryly. “He needs to be an owner. So I wished him well.”

If Gilmore is wounded by the skepticism of his colleagues, he rarely reveals it. Most developers have missed the point, he believes, because they focus solely on the financial arithmetic of their buildings. They fail to see that a project like the Old Bank District can thrive--and make a potful of money--if the developer embraces and encourages the neighborhood around it.

“They also miss the fact that people want this to happen,” he says one day. “I don’t mean big shots, I mean just ordinary people. They are hungry for the kind of neighborhood we are going to build. I think most real estate people downtown don’t have a clue about that hunger.”

And, thus far, to the shock of some critics, the Old Bank District has made rapid progress. Architectural plans have passed their initial city reviews, earthquake retrofits have been approved, and two government agencies, including the federal Housing and Urban Development Department, have made initial commitments to finance the construction work to the tune of about $29 million. The project also has become a favorite of the mayor’s office and downtown’s Central City Assn. “The Old Bank District is just crucial to downtown,” says Carol E. Schatz, president of the association. “We would do anything--and I repeat, anything--to make it succeed.”

This enthusiasm flows, in part, from Gilmore’s promise to deliver what other projects have failed to provide: people walking the streets. Without it, the current thinking goes, the upcoming mega-projects will fail to revive downtown. With it, they just might succeed. But much of the enthusiasm flows from Gilmore’s sunny optimism and his nearly religious belief in downtown’s future. In many ways, he does not resemble the modern businessman as much as the old-time entrepreneurs who built Los Angeles during the boom years of the 1920s. Like them, Gilmore can fill a room with his presence, inoculating people with his enthusiasm, repeating his vision time and again until others begin to see it and believe it.

One evening I stand with Gilmore’s wife, Trish, on the balcony of the gilded Tower Theater on Broadway. Originally built as a movie house for silent films, the Tower is one of a dozen old theaters still standing on Broadway and, on this night, is filled with supporters of the Los Angeles Conservancy. Trish Keefer is tall, blond and English and looks like the kind of woman who provides the scenery in the background of James Bond movies. And, in fact, she did exactly that in one Bond movie, though she now works as a project manager for Park La Brea in the Miracle Mile. As the two of us watch from above, we can see Gilmore moving from person to person on the main floor, laughing, waving his hands animatedly. He is charming the socks off the people below, converting them to the cause. I ask Trish if he ever runs out of steam. “No,” she says. “When you believe in something, you get a certain kind of energy. And that’s the thing about Tom and downtown. He never stops thinking about it, never stops working on it.”

Gilmore occasionally reveals another resemblance to the old-time entrepreneurs: He can lapse into hyperbole, presenting only the silver lining. When I first met Gilmore last fall, for example, and we toured the urine-stained buildings of the Old Bank District for the first time, he smiled upward at the buildings and pronounced it a “can’t lose” venture. At the time, the Old Bank District had no financing, no permits, no tenants. No seismic studies of the buildings had been done and Gilmore had no idea what a seismic retrofit would cost. One building had no plumbing and no electrical wiring, and all of them would require vast amounts of work.

Even now, with the Old Bank District sailing forward, Gilmore’s out-sized character and his penchant for talking without editing can cause strains with his two partners, Jerri Perrone and Charles Loveman. Perrone, who has known Gilmore for more than 10 years, says they once had regular screaming matches over his penchant for striding into their office in the old Pacific Mutual building on 6th Street and announcing that he had found five new buildings to buy during lunch. But if Gilmore often seems like a half-grown puppy with big paws, he can transform into a shrewd political player and strategist. Not for nothing has Gilmore allied himself with Los Angeles Conservancy head Linda Dishman, whose powerful organization can promote or condemn projects in the historic core. And not for nothing did Gilmore accept the chairman’s position on the board of the Los Angeles Homeless Services Authority, the local government organization providing $50 million per year for the homeless, whose large presence downtown could eventually conflict with Gilmore’s revival plans.

But it’s Gilmore’s passion for risk that truly sets him apart. One night Gilmore and I are at the top of the San Fernando Building, the first building scheduled to be opened in the Old Bank District. We are discussing several other housing projects downtown, including the Medici Apartments west of the Harbor Freeway and the Subway Terminal Building at the base of Bunker Hill, and I observe that none of these developers have shown any sign of joining Gilmore’s efforts in the historic core. “I understand why,” Gilmore replies. “They’re too scared. They’re waiting to see if I get mowed down. When the shooting stops, they’ll come out and count the bullet holes in my body and decide if it’s safe enough for them to try.” All around us the city is glittering and quiet. “At one level, you could argue their hanging back is the smart move,” he says. “But you don’t rebuild downtown that way.”

*

Those who believe Gilmore will win his bet--and there’s more than a few--base their confidence on one simple fact: Downtowns are roaring back in many other places. In cities as disparate as Tampa, Houston, Portland and Denver, downtowns are teeming in a manner not seen in generations. These new downtowns, of course, hardly resemble the predecessors from which they sprang. They are reincarnated, initially, as cool places to live rather than centers of commerce. Theaters and restaurants follow, and then come the crowds of people on the sidewalks.

In Denver, the overachiever of the ‘90s, downtown has grown so popular that it now contains some of the most expensive residential real estate in the city. Law firms and other businesses have abandoned their high-rises and begun to move to the old section. If you walk around downtown Denver today, it all looks inevitable. Just like Old Town Pasadena looks inevitable or the Third Street Promenade in Santa Monica. But in the late ‘80s, the first developers to convert buildings in Denver were regarded as lunatics.

“The first developers took a huge, huge risk,” says Ben Kelly of Denver’s downtown business association. “You have to understand, nobody lived downtown at that point. You could roll a bowling ball down the street and hit nothing. People laughed at the idea of downtown coming back.”

The downtown phenomenon appears rooted in a startling rejection of suburbia on the part of many young people. In sheer numbers they amount to a small fraction of their generation, but they have displayed, time after time, the willingness to accept grit, noise and a few mean streets to gain an urban neighborhood where they can stroll and hang out with others of a like mind.

Such neighborhoods offer what sociologist Ray Oldenburg calls “the third place,” an essential locale that is different from home or work. The third place offers a gathering point for a community, whether it be a pub or plaza, where people can mix with their neighbors, stay for as long or as short a time as they like, and then find their way home. Suburbia, Oldenburg contends in his book “The Great Good Place,” never has and never will supply the third place. “Let us learn from cities,” Oldenburg writes, “where sidewalks are, among other things, a good place to put chairs.”

This hunger for urban life has, in some measure, found expression here. Old Town Pasadena, Melrose Avenue, parts of La Brea Avenue and Sunset Boulevard have all grown into urban walking streets, and whole neighborhoods of Los Angeles are beginning to look suspiciously like a city.

So what’s with downtown? It contains one of the richest collections of available vintage buildings in the nation, yet it remains as wasted and derelict as ever. “Sometimes I wonder if there’s something different about downtown that makes it a harder nut to crack than other downtowns,” says Dan Rosenfeld, the former head of the city’s real estate assets. “You see these other downtowns taking off but nothing on the same scale here. You have to consider the possibility that Los Angeles operates on other principles.”

*

Gilmore, of course, is betting otherwise. Downtown Los Angeles will take up its blanket and walk, he believes, when the right project appears at the right time. Exactly what constitutes “right,” no one knows. Somehow it must invite a new culture to germinate on the streets of the historic district. Walk down the streets today and you will catch the steady scent of old urine drifting from the alleys and pass drunks dozing in their cardboard shelters. At night you may even witness warming fires burning on the sidewalks.

To turn this around, Gilmore concluded early in the process that the Old Bank District must differ substantially from previous efforts. First and foremost, it would need bulk. Earlier efforts lacked sufficient size, he decided. One of those, a condominium project on Spring Street financed by the CRA, carved 120 units out of two former office buildings in the 1980s. Small and isolated, it left the residents surrounded by empty buildings and proved a disaster.

So Gilmore decided he would need more, a project with enough bulk to develop a critical mass, a whole row of buildings that amounted to something more than a tiny island in a sea of squalor. Thus was born the concept of the Old Bank District. The three contiguous buildings along 4th Street fill the entire block between Spring and Main, plus a little more. It amounts to a sizable chunk of real estate and, if you stand across the street and gaze at it, you can almost imagine the 240 units operating as a small community on their own.

And then there’s the struggle for the street. Past projects often ignored it, Gilmore says, focusing solely on the creation of living spaces. When the street remained hostile or empty of life, the new residents were left feeling like prisoners in their buildings. “We will win it or lose it on the street,” Gilmore says. “People who rent apartments in the Old Bank District will want to feel like they live in a city with street life. They may love their apartments with the high ceilings and big windows and all that, but the essential thing is the street.”

In Los Angeles, at least, no downtown developer has ever framed the struggle in this way. New buildings are constructed, or old ones rehabilitated, with little or no thought as to how they will relate to the street. The issue is daunting: How, exactly, does anyone engineer a street life? Gilmore has grappled with this question for months. Once he invited a group of young people to share his table at Cicada and tell him what they wanted in the way of neighborhood life. The answers were not surprising. They wanted a “good” coffee shop, a bookstore, a dry cleaner, a bar. Not a big bar, mind you, but one where the neighborhood regulars know each other.

The problem is producing those cozy features in a wasteland neighborhood. Any potential shopkeeper who saw a current market survey of the Old Bank District would run away screening. Yet Gilmore already has gained a formidable ally. She is restaurateur Susan Fine Moore, a 20-year veteran of the culinary wars in Los Angeles whose unorthodox style and passion for cities matches Gilmore’s.

If you’re familiar with Moore’s reputation, it’s probably because of her current establishment, the Hollywood Hills Coffee Shop. Moore opened it five years ago on a desolate stretch of Franklin Avenue and watched it grow into a celebrated haunt of young Hollywood writers and actors. By local legend, the concept for the 1996 movie “Swingers” was developed there over a late breakfast, and one of the movie’s funnier scenes was shot there. Even the New York Times came calling at the coffee shop to write about its nourishing ways with young Hollywood’s body and soul.

So it figures that Moore would be intrigued when Gilmore proposed that she open another coffee shop in the bottom corner of the San Fernando Building. If asked, Moore can already describe the way the restaurant will look and what it will serve. Which is not to say that Moore sees no problems. “In the beginning you’ll have a coffee shop and maybe a couple other businesses along the street,” she says one day at her restaurant, “and that can be murder. When you look isolated, people get scared and they stay away.”

Moore has an idea about a possible fix. It springs from a serendipitous visit to the neighborhood of the Old Bank District several years ago. “I was driving down the street and suddenly was startled. The whole place looked different. Little shops had appeared all along the sidewalks and the whole neighborhood looked great. I thought, ‘Wow, this is great,’ and I stopped the car.

“Then I realized I had been fooled. A movie company was shooting a film and they had made the neighborhood look like a working, healthy street. So, the question is, if a movie company can do it, why can’t we? Create storefronts and windows that give the illusion of a commercial neighborhood so people will feel comfortable going there. As more real shops open, we let the illusion fade away and reality take over.”

As it turns out, Gilmore likes the illusion idea. Most likely he will try it while he seeks to sign up a retinue of shops. High on his recruitment list is a Trader Joe’s, a bookstore, a small bar tucked into an alley, and possibly a ballet school that could be seen through second-floor windows. It makes a pretty picture, ballet students practicing over a bookstore, an urban picture. But how can he get them? “I’m gonna hijack ‘em,” Gilmore says breezily. “I’m gonna do whatever I gotta do. We’ll make them offers they can’t refuse. Maybe that means we go into partnership with them and help with the initial costs. Maybe it means that the rent stays very low in the first couple of years. But we will get them because we have to.”

*

Over the next year and a half, Gilmore’s gamble will play out like a poker game. That is to say, the outcome will reveal itself slowly, hand by hand.

The first hand will go down this fall when HUD and a secondary lender, the Los Angeles Community Development Department, make their final decisions on financing the project. Based on their initial responses, which have all been positive, Gilmore will likely clear this step easily. Then the conversion of the buildings will begin and, if all goes smoothly, the first building scheduled for completion--the San Fernando--will open for occupancy this spring.

Then comes the second hand. If the San Fernando rents quickly, it will signal that Gilmore’s instincts are correct. If it rents slowly, the project’s momentum will be broken and Gilmore will find himself in early trouble. Assuming the happier outcome, the last and most crucial hand will then be dealt. And that, of course, involves the street. Will customers walk from the two state office buildings, from City Hall, from Bunker Hill, to eat lunch and shop at the Old Bank District, giving it momentum? Or not?

No one knows. And that’s what makes The Bet. For Gilmore, it constitutes the biggest game of chance in his life, the great gamble that will determine his reputation and fortune. For the rest of us, the outcome of The Bet will determine, in large part, whether we regain our downtown and whether, in 10 years, the old joke about Los Angeles not having a downtown will seem quaint and outdated. In many ways, Gilmore’s bet has become our own.

One night Gilmore and I cross Broadway near 8th Street. We stop for a moment and look up Broadway. As far as we can see, the great buildings stretch north in an unbroken line. Stone-covered department stores, Moorish and Beaux Arts office buildings, movie palaces larger than Carnegie Hall. Most of the buildings are dark and empty from the street level up. Most of the movie houses are closed and shuttered.

“It’s so strange and, in a way, so exciting because you just know it’s going to change,” Gilmore says. “And in this kind of environment, one person can make a big difference. I grew up in New York and love New York, but no single individual will ever change it. Here, it’s still like the Wild West. You can stake your claim and leave a mark on the city that people will remember for a long time, if you’re lucky.”

We part ways then and Gilmore strides back to his office. He looks like someone who believes that he is, in fact, a very lucky man.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

What It Takes

Converting abandoned office buildings into loft apartments may sound straightforward. It’s not. The pitfalls are many and disaster awaits the unwary.

Among the issues that can scuttle a project: lead and asbestos contamination; earthquake repair and retrofitting; the application of modern construction codes to an aged structure; and the dearth of financing. What’s worse, old building conversions must be accomplished at a price. Go over budget and you’re headed for big trouble because rents, initially at least, must stay low.

So how do the numbers look for Gilmore? Pretty good, thus far. In part he has benefited from a sea change at City Hall, which recently took a cue from other cities and relaxed code requirements for historic buildings. The Old Bank District, in fact, likely will be the first rehabilitation project carried out under the new program that Andrew A. Adelman, Building and Safety’s general manager, helped create. The change could save millions for Gilmore and his partners.

Gilmore has also gotten a break from science. In the last decade, seismic studies have shown that older stone-and-brick buildings resist earthquake shaking far better than previously believed. Nabih Youssef, the structural engineer retrofitting Los Angeles’ City Hall as well as the Gilmore buildings, has used these studies to develop lower-cost techniques for rendering historic structures earthquake safe. Gilmore believes that these cost breaks will allow him to complete the Old Bank District for about $95 per square foot, with a purchase price of $10 per square foot for the buildings and another $85 per square foot for the rehab work. The entire project of 240 apartments and a dozen retail establishments will come to about $32 million.

That’s a big number, but cheap by almost any measure, and it will allow Gilmore to hit his marks on the rents. A typical two-bedroom loft in the Old Bank District is now scheduled to rent for $1,400, or $1.35 per square foot, as opposed to an average of $1.50 per square foot in other downtown buildings and $1.95 in West Los Angeles. At those prices, most predict that the Old Bank District’s lofts will fill quickly because, surprising as it may seem, demand for rental apartments downtown is high, outstripping supply by a wide margin. To see layouts of specific apartments, you can dial up the project’s Web site, https://www.LAloft.com.

Just east of downtown in the warehouse district, for example, loft conversions often are snapped up before construction is finished. Overall, the vacancy rate downtown is among the lowest in the city. And one report by Robert Charles Lesser & Co. estimates that there is unmet demand for 2,200 apartments downtown. Still, these numbers suggest a movement in its infancy. The entire supply of market-rate apartments downtown currently numbers 1,950, a tiny figure compared to the tens of thousands of units in areas like West Los Angeles.

If the supply of apartments increases dramatically in coming years, will demand rise with it? Gilmore believes it will, although no one knows for sure. Should demand not follow, the market could collapse. And that’s the nature of The Bet.