Economic Boom Boosts Even Blighted Areas

At an intersection near downtown Compton that only three years ago was marked by vacant lots and prostitutes, the beginnings of a comeback have emerged.

Today the corner of Wilmington Avenue and Compton Boulevard is home to a 37-unit condominium complex with a community center and playground. Twenty-eight single-family homes will soon rise from a litter-strewn parcel around the corner. An AutoZone store sprouted last summer. Not far away is a new Chevron-McDonald’s complex that last year became the fast-food chain’s first new outlet in Compton in nearly 50 years.

Those early signs of community and commercial renewal are not an isolated phenomenon in America’s poor minority neighborhoods. As the nation’s record-length economic boom chugs into its 10th year and unemployment among Latinos and African Americans hovers near historic lows, long-distressed communities are finally reaping noticeable benefits.

Probably nowhere is the trend as vivid as in Southern California. Unlike other inner cities hollowed out by dwindling populations, the poorest neighborhoods here have seen a surge of immigrant Latinos who have boosted employment rolls, launched storefront enterprises and attracted national retail chains.

The modesty of the projects that pass for economic progress in such neighborhoods--a fast-food outlet, an occasional big retailer--in itself underscores the vast disparities that remain between middle-class and poor districts.

Roughly four out of every 10 people in some of Southern California’s most distressed areas are below the federal poverty line. That’s double the overall average for Los Angeles County and a reflection of decades of neighborhood decline that are only beginning to be reversed. The areas are still being hurt by the long-running exodus of middle-class and working-class African Americans and others.

Yet the inroads against blight represent real change and coincide with the improved economic status over the last few years of many of the people living there.

Unemployment is down, and many of those with jobs are earning higher wages or working longer hours. This is enabling more renters to buy homes, in some cases lifting rundown neighborhoods. Meanwhile, shopping center developers and retailers have shown a growing willingness to move in, enticed by the more plentiful dollars and lack of competition.

“Compared to the unemployment and the general disenfranchisement that we observed in the recession, what we see now is a substantial improvement,” said Thomas Tseng, author of a 1999 economic report on South Los Angeles and research director of the Community Development Technologies Center, a local nonprofit group. “In everything you look at, you do see a lot of economic activity.”

Take, for example, the decline in unemployment. In 1993, when the Southern California recession hit rock bottom, the Florence-Firestone area posted the worst jobless rate among the 114 communities in Los Angeles County where unemployment is tracked: a Depression-like 21.2%.

But this year, the estimated unemployment level for Florence-Firestone--a predominantly Latino and African American unincorporated area north of Watts--has averaged 12.7%, still brutally high but far better than before.

Likewise, the largely Latino city of Santa Ana posted the recession’s highest unemployment rate in Orange County, at 11.8%, in 1993. This year it’s estimated at 4.5%, less than the statewide average.

A patchwork of other economic indicators shows that these areas-- along with Compton and South-Central Los Angeles, two of the other most depressed Latino and African American communities in Southern California--are improving.

Many more people are buying homes in all four communities, and, at least by some yardsticks, home prices have risen. People are buying more goods: Retail sales tax revenue (which is not tracked for Florence-Firestone and South-Central) is up slightly in Compton versus 1993, and is up dramatically in Santa Ana.

The progress in South-Central, Florence-Firestone and Compton is particularly noteworthy. These areas faced both the recession and the 1992 riots, which left droves of neighborhood businesses burned and ransacked, devastating already lagging commercial districts. Although many national chain retailers promised to move into the neighborhoods, few delivered--until the last couple of years.

Los Angeles Councilman Mark Ridley-Thomas, whose district covers most of South-Central, credits the healthy economy with spurring national retailers “to build in communities that were once thought of as undevelopable, veritable wastelands.”

What’s more, despite a recent rash of gang murders and other gang-related trouble, violent crime has fallen in all of the four communities since the early 1990s. This mirrors a nationwide trend that has accompanied the long economic boom.

The figures available to social scientists are only part of the picture. Some of the pickup is off their radar screen--coming, for example, from a robust cash, or underground, economy and from the region’s numerous mom-and-pop shops.

All this--new homes, new stores and a general improvement in the quality of life--is even bringing some people back, notably some of the African Americans who left years ago.

Denise Carroll always knew she would return. A postal employee with fond memories of her childhood in Compton, she wanted a home close to her mother’s. When she saw a flier in 1998 for Central Park Estates, a collection of new two-story houses built by the nonprofit Nehemiah West Housing Corp., she jumped at the chance. Her new home in tidy northeast Compton, along with new stores and other improvements, exceeded her expectations.

“I could have done some back flips,” Carroll said.

With luck, she will soon enjoy a movie theater nearby--there are none in Compton--part of a proposal for a residential and commercial complex at the site of a brickyard due to close.

“There was a time when money wasn’t really flowing back and forth in the community,” said the 47-year-old Carroll, a quiet woman whose graying hair is pulled back with a neat headband. “Now it is.”

With the national economy apparently cooling, there’s a danger that recent gains could be wiped out before long-standing benefits take root in these communities. Their recoveries began late in the boom and, if past patterns hold true, they could be among the first to suffer in a downturn.

Still, a close examination reveals ways in which these communities are healing.

South-Central

Perhaps nothing demonstrates shifting attitudes toward South-Central as much as Chesterfield Square, a $75-million shopping center under construction at Western and Slauson avenues. It is South Los Angeles’ largest commercial development in more than a decade.

Anchoring the privately financed project is Home Depot’s first store in the area. Food 4 Less and Hollywood Video are also on board. Their target: the more than 400,000 residents within three miles who have average household incomes of $39,231 and few comparable shopping choices nearby.

“There’s incredibly pent-up demand,” said Christopher W. Hammond, one of the developers.

The Home Depot, he said, expects sales of more than $60 million its first year, and the enthusiasm has spread to other merchants. “Electronics stores that told us ‘no’ when we started are now calling and asking to be involved,” he said.

Also important are the scattered individual stores and small shopping centers that have sprung up across South-Central in recent years, reversing some of the commercial decay.

E’Vann Tavares, manager of Art’s World Famous Chili Dogs at Florence and Normandie avenues--an intersection that was a flash point of the 1992 riots--is upbeat. He points to the gas station next door and an AutoZone store across the street that opened since he began at Art’s two years ago.

“As far as the gangs [go] and business-wise, everything has come anew,” he said. “When I first started here, it was terrible.”

Especially poignant was the opening two years ago of the Numero Uno Market on South Figueroa Street. It stands on the site of the former Empire Liquor Market Deli, where 15-year-old Latasha Harlins was shot to death by a Korean shopkeeper who accused her of stealing a bottle of orange juice.

The 1991 tragedy, which came just two weeks after the Rodney G. King beating inflamed Los Angeles, brought tensions between the black and Korean American communities to a boil.

Some African Americans still avoid the mid-sized Numero Uno supermarket, even though the old shop and its owner are gone. But others are happy to have the cheerful-looking, pink-and-aqua market around.

“It’s run by different people, who want to help the community,” said Elaine Clay, 42, who lives with her five sons three blocks away. “They bring the groceries to my car. They greet you coming in and leaving, and they say, ‘Thank you for coming.’ ”

Real estate firms too have noted some recovery: The number of homes sold annually in South-Central nearly tripled between 1993 and 1999, according to DataQuick Information Systems. Median purchase prices have edged up 6.4% to $129,500 this year since bottoming out in 1996.

But progress is a matter of perspective. The commercial parts of South-Central, such as the area around Florence and Normandie, are home to both new stores and vacant, trash-filled lots. Important retailers such as Vons supermarkets, which once promised to come to South Los Angeles, have either largely or entirely avoided the area.

Mailman William Milton, whose route for the last five years has covered the Florence-Normandie area, dismissed the idea that things have changed, citing drug addicts and blight. “I’ve seen businesses come and go,” he said. “It’s basically the same.”

Florence-Firestone

Like much of the South Los Angeles area, the Florence-Firestone community was in the grip of decline long before the early 1990s recession. The neighborhood was hammered in the late 1970s and early 1980s as major industrial employers, including General Motors, Bethlehem Steel and Goodyear, closed nearby factories.

The 1992 riots, which left some businesses ransacked, seemed to seal the neighborhood’s fate.

“A lot of people were saying they weren’t sure they would come back,” said Dimitrios Stavros, director of operations for La Isla Super Outlet, a discount clothing store.

But Stavros, whose family had done business in the area through the 1970s and 1980s, came back to run La Isla in 1995, and he was joined by other small merchants and chain stores. His boldly painted yellow-and-black store is part of a shopping center in Florence-Firestone’s main business zone, at East Florence and Compton avenues.

All of the stores in the center--including Superior Super Warehouse Foods, Payless ShoeSource and Kragen Auto Parts--have opened or remodeled their buildings since the mid-1990s.

Elsewhere in the neighborhood, too, “where you used to see lots of vacant buildings, there are small businesses going in,” said Stavros, 37, now president of the reinvigorated Florence-Firestone Chamber of Commerce.

More stores appear to be coming. A Buena Park-based developer, Merona Enterprises, plans a small shopping center on an East Florence Avenue site that has been vacant for more than 10 years.

One possible tenant is Century 21 A-Team real estate. The company opened what still is the only residential real estate firm in Florence-Firestone two years ago and, after quickly growing to 25 agents, is running out of space, said Mario Nunez Toro, general manager.

“The market’s good. That’s the only thing I can attribute it to,” Toro said.

Longtime residents notice improvement as well. The Rev. Willie Williams, one of the pastors at Traveler’s Rest Missionary Baptist Church on East Florence and a member there for 47 years, gives some of the credit to an influx of Latino families. “They’re buying property and fixing it up, and giving the community a face lift,” he said.

But gangs remain a problem. Business owners say they make it a point to quickly paint over or clean off the gang graffiti constantly left on their buildings.

“If you show that you possess the building and don’t let the gangs own it, they respect it,” said Irv Sitkoff, who has operated Florence Owl Rexall Drugs for 38 years. “If you don’t, they’ll own it for you.”

Poverty remains widespread. Sitkoff says most of his customers receive welfare assistance. But all the same, more residents appear to have jobs and money to spend than in the early 1990s. “It is better around here. There’s no question about it,” he said.

Compton

Compton’s gradual upswing is a daily fact of life for Duly Gonzalez, who turns low-income applicants into first-time homeowners for Nehemiah West Housing Corp. The nonprofit development firm has built nearly all of Compton’s new homes since the recession and will soon break ground for more.

The first townhomes hit the market in 1995. Despite subsidies, most applicants were rejected because of their low incomes, sporadic employment and bad credit.

By 1998, things had changed. When Gonzalez sat down with lenders, she held a fistful of payroll documents from prospective buyers showing months of overtime pay and letters from employers promising more of the same.

Among those to benefit: Norma Rafael, a Guatemala-born accountant whose 60-hour weeks at H&R; Block propelled her and her husband, a truck driver, into the gated condominium complex at Compton Boulevard and Wilmington Avenue.

Compton has “gotten a little bit better,” said Rafael, a 32-year-old mother of three.

Citywide, 603 homes were purchased during the first five months of this year, almost matching the total bought during all of 1993.

The face lift at Rafael’s corner isn’t the only one in the 10-square-mile city. Several miles east, a KFC and a Rite Aid--the second in town--opened late last year on land vacant for a decade. Among other developments, the local Food 4 Less was expanded to nearly double its original size.

Still, Compton, hit by more than 200 fires during the 1992 riots, has yet to fully recover.

It has blocks-long stretches of abandoned buildings and boarded-up storefronts. On a recent day, a liquor store in an otherwise abandoned strip mall bore the scars of dilapidation and menacing gang graffiti: “Can’t Stop Us.”

Political instability and infighting have also hurt.

Doing business in Compton “is sort of like investing in a Third World nation,” said one developer who asked not to be identified. “You never know when a coup is going to take place.”

And unemployment remains particularly high among African American men.

“Right now, I’d dig ditches with a toothpick,” said Dave Floyd, 50, who lost his San Diego trucking job to downsizing in 1996 and lives with his sister in Compton on $212 in monthly General Relief.

For 2 1/2 years, Floyd said, he has searched for solid, full-time work, discovering instead a world of low-wage and temporary gigs. The nearby KFC and Rite Aid and other fast-food newcomers are a start, he said, but far from enough.

“Compton is trying to build up,” said Floyd, who grew up in town, “but it’s gonna be a while.”

Santa Ana

Sergio Bravo and his two brothers each earn $8 an hour at a mailing service, stuffing fliers into machine-labeled envelopes. They don’t receive health insurance or any other benefits, and it would be a stretch to call them well off. Still, in April they joined Santa Ana’s burgeoning class of first-time home-buyers.

That happened partly because they make more than they did in 1994 when, newly arrived from the Mexican state of Guanajuato, they drew minimum wages of $4.25 an hour and shared a cramped one-bedroom apartment. But mostly, they are among a growing number of Latino immigrants who have saved diligently to buy jointly, sharing homes with extended families.

The front and rear yards of the Bravos’ Santa Ana house were once piled with trash. The brothers cleared the mess, repainted the house and laid down new carpet. Now, with a monthly mortgage of $1,425, they have four times the space of their apartment.

“When you rent, you never have anything,” Bravo said.

Others obviously think the same way. The number of homes purchased in Santa Ana last year was 3,200, up 70% from 1992, when the market was at its slowest.

The home-buying trend is due in part to lenders. Eager to reach new customers in a time of economic prosperity, they have blanketed the city with programs boasting zero down payments, zero closing costs. Santa Ana’s astronomical rents have also coaxed some low-wage workers into buying homes.

Although the Bravos say they still struggle financially, others have seen their salaries triple in recent years, said Ana Maria Alvarez, owner of Santa Ana’s A-Plus Realty since 1993.

Among her other clients: waiters, gardeners and construction workers. Many work two jobs or log lots of overtime in the insatiable Orange County economy, where unemployment so far this year has been 2.5%. The result, she said, is the transformation of neighborhoods.

Renters too have noticed the economy’s turn. For Maria Lopez, who maintains an elaborate flower garden and manicured lawn at her rented home on Spruce Street, the change came in late 1996.

Her husband has made circuit boards since 1982 for Universal Circuits Inc. But during the downturn his salary was frozen, and cost-cutting was so strict that he was forced to drop to a four-day week. Today, he is working enough overtime to pay for toys, televisions and vacations to visit family in Mexico.

The Lopez family’s neighborhood was once plagued by loitering gang members and drug dealers. But these days they are nowhere in sight. Last year, 1,828 violent crimes were reported in the city, down 43% from 1993.

Teresa Saldivar, the operator of a downtown jewelry store, notices a difference too. She used to find nannies and baby-sitters for some of her affluent customers. But these days, she says, her old candidates for those jobs are no longer available.

“They’re all working,” Saldivar said, adding that the good economy “trickles down.”

It also trickles back up, and Saldivar has the numbers to prove it. This has been the best year in her store’s 14-year history.

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Comparing the Economic Comebacks

Although low-income minority communities in Southern California have not benefited from the economic recovery as much as the region as a whole, they have improved. The following figures document some of that progress since 1993, when Southern California was in the depths of its recession.

Source: Estimates from the Urban Research Division of the Los Angeles County Chief Administrative Office

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Poor Pockets

The four predominantly minority communities examined by The Times were the cities of Santa Ana and Compton, along with the City of Los Angeles’ South Central community planning area and the unincorporated Florence-Firestone district near South Los Angeles.