Real Estate Industry Shows Increased Interest in Urban Projects

In a sign of renewed interest in inner city investment, an estimated 500 people attended a recent one-day workshop on the opportunities and pitfalls of real estate development in urban Los Angeles.

The larger-than-expected turnout at the Urban Marketplace, which was organized by the Los Angeles chapter of the Urban Land Institute, reflected a shift in the real estate industry’s perception of inner city neighborhoods, according to several participants.

Developer and former Rebuild LA chief Linda Griego recalled a retailer who a few years ago asked that escorts be provided to employees traveling to and from stores located in inner city neighborhoods, but “that attitude has changed.”

The event, which was held in a downtown Los Angeles hotel, drew a wide variety of developers, brokers, property owners, tenants, community activists and government officials. A panel discussion, round tables and expo were designed to help provide practical information and connections.

“We want people to realize that it’s possible to make a profit and also do something good for the community,” said Robert Arbour, chairman of the Urban Land Institute’s inner city and urban politics committee.

Though household incomes usually are low, the dense population of many urban neighborhoods still makes them attractive to many retailers, said Patrick Barber, senior vice president of real estate for Ralphs Grocery Co.

“If people are there,” Barber said, “I want to be there.”

But the upbeat talk was tempered with descriptions of the many challenges--class divisions, skittish lenders, volatile politics--that face urban developers.

In seeking to build large commercial and housing projects, developers often must respond to a wide range of demands to deal with such issues as affordable housing, living wages and economic and environmental justice, said Bill Delvac, a land-use attorney. “It’s a whole range of issues you might not expect to face.”

Many developers complicate matters by failing to take community history and concerns into consideration, conference panelists said. They need to team up with local nonprofits, community groups and small businesses.

“You get a lot nicer project, a lot more solid project,” said Glenn Sanada, a construction lending specialist at Bank of America.