Monday, September 22, 2008

NoHo Goes Upscale

While some residents of the Valley use New York to characterize the type of development they wish to reject, others see the city, at least in some ways, as a model to emulate. The clearest example of this can be found in the creation of the NoHo Arts District, whose name was inspired by the SoHo district in Manhattan. However, while promoters of North Hollywood redevelopment intended "NoHo" to connote an image of urban diversity, for critics of gentrification, SoHo has become a place of social exclusivity and in this sense increasingly suburban (Lippard, 2007; Sorkin, 2007). In this way, becoming like New York could actually make the neighborhood less diverse--or at least maintain the suburban segregation that "density" supposedly threatens.

In 1992, the North Hollywood Universal City Chamber of Commerce named former downtown Lankershim "The NoHo District" (Kapitanoff, 1992). Although the Academy Complex had just opened at the corner of Lankershim and Magnolia, the CRA did not create the district. Rather, declining rents in the area helped attract artist and actors to the area. A variety of small shops, galleries and theaters also opened up, leading some to describe it as the "Melrose of the Valley," referring to Melrose Avenue in Hollywood, known for it vintage clothing stores, galleries and eclectic restaurants. The proximity of film and television production facilities in Burbank and Studio City also benefited many of these businesses. Studios purchased props and clothing from vintage stores and drew upon the talent of local actors and artists working in theaters and post-production facilities (Blankstein, 2001; Llanos, 2008a).

Although the CRA was not responsible for the district's emergence, it did support its growth. For example, the agency funded the transformation of a former Department of Water and Power building into the Lankershim Arts Center (Kapitanoff, 1992). Several theaters, including the historic El Portal, built in 1926, also received funding for their renovation (More, 1999). In 1995 the city officially designated NoHo a "Commercial and Artcraft District" permitting artists to create and sell handcrafted products in their residences (Los Angeles Department of City Planning, 1995).

This change in zoning that gave artists the right to live and work in the same space had parallels to the creation of SoHo in New York. Originally artists occupied industrial buildings in lower Manhattan illegally, but in the 1960s, in response to a series of evictions, artists fought for and won the right to reside in their studio lofts. The long-term consequence of this victory was that the formerly undervalued manufacturing and storage space of cast iron buildings became highly valued real estate. The New York Times, architecture magazines and other media began to celebrate the idea of living like an artist in open space with high ceilings and large windows. This aesthetic spread to cities throughout the U.S. and soon wealthy professionals replaced working artists as the primary consumers of loft space (Zukin, 1982).

Several recent residential developments in North Hollywood explicitly draw upon the loft aesthetic. The Lofts at NoHo Commons, part of the CRA financed project, promotes itself as a "fusion of traditional apartments, Live/Work spaces and loft living." and a place "where urban and lifestyle meet" ("The Lofts at NoHo Commons"). Another building that received agency assistance, NoHo 14, promises floor to ceiling windows and a "colorful lifestyle" ("NoHo 14"). While borrowing the loft aesthetic, neither of these projects are converted industrial buildings. Moreover, although they appeal to an "urban lifestyle", they also contain typically suburban elements such as swimming pools, fitness centers and parking garages.

At least one new residential complex in North Hollywood did convert a former manufacturing facility. The developer of NoHo Lofts fabricated 68 live/work spaces out of a former meat tenderizer plant. The project was completed without CRA assistance, but it still involved a real estate developer rather than artists and features a fitness center, rooftop clubhouse and gated parking("The NoHo Lofts"). An interview with the developer further suggests the target is largely "upscale professionals" (Mascaro, 2004).

The rent for The Lofts at NoHo Commons ranges from $1565/month for a studio to $2510/month for a one bedroom ("The Lofts at NoHo Commons"). The one bedroom is well above the average rent of $1588/month for all apartments in Los Angeles County, and even the studio is above what most Angelenos can afford (Southern California Association for Non-Profit Housing, 2007b). The median household income in Los Angeles for 2006 was $44,445 (U.S. Census Bureau, 2006). An applicant for The Lofts at NoHo Commons must have a monthly gross income three times the rent, which for the smallest unit would require $56,340 a year.

The type of stores and restaurants that have so far located in NoHo Commons also suggests a slightly upscale and even more clearly suburban clientele. In the grocery store, a Hows Market, the deli features a gourmet olive bar and a flat panel TV above a fireplace around its seating area. Other shops are chains found commonly in shopping malls such as Panera Bread, Cold Stone Ice Cream, Daphne's Greek Restaurant and a T-Mobile store. These stores contrast dramatically with those found less than a mile north along Lankershim outside the border of the NoHo Arts district. Here a wide variety of businesses cater to a working class Latino population. Interspersed among auto dealers and repair shops are thrift stores, hairdressers, second-hand furniture traders and a bargain supermarket that specializes in bulk items. A variety of Mexican, Salvadoran and Armenian Restaurants can also be found.

Not surprisingly, this contrast in retail parallels a contrast in the demographics of North Hollywood. As already noted, the San Fernando Valley has historically fought first racial integration and then the integration of low-income groups. This has led to significant segregation within the Valley. For example, according to the 2000 census North Hollywood was 51% white, while Valley Village to the West was 73%, Burbank to the East 72%, Toluca Lake and Studio City to the South were both 85% (Kotkin & Ozuna, 2002). But more interesting is how North Hollywood itself is divided. In the zip code 91601, which covers the NoHo arts district, per capita income was $16,817, 49.5% were Hispanic, 39.6% were foreign born and 55.5% spoke a language other than English at home (U.S. Census Bureau, 2000a). In the zip code 91606 above the district, per capita income was $14,095, 56.8% were Hispanic, 51% were foreign born and 71.6% spoke a language other than English at home (U.S. Census Bureau, 2000b).

Moving the analysis to the level of census tracts within the NoHo district, the northern part of the district has a higher percentage of Hispanics and foreign born and a lower per capita income (U.S. Census Bureau, 2000a). However, this data is from 2000, before the new housing was built as part of redevelopment. Since the rent for the least expensive of these new units requires a household income in the 50,000 range, significantly higher than the $31,671 for the zip code in 2000, the population in this part of the district will now have a much higher income than it did in 2000.

It should be noted that a stated goal of the CRA is to build affordable housing, and all the CRA sponsored projects set aside some units for residents who earn the median area income or less. The percentage of units varies with each project, ranging from less than 10 to 25 (Community Redevelopment Agency, 2007). As an indication of the demand for these affordable units, The Lofts at NoHo Commons has a waiting list of three to five years.

The overall impact of new development may actually be to reduce the amount of affordable housing in the area. As NoHo becomes a desirable neighborhood, real estate becomes more valuable and rents increase. Furthermore, older housing is being demolished and replaced with new apartments and condominiums. Signs of new construction can be found on nearly every block of NoHo. This is problematic not just because the newer units cost more, but also because they are not covered by the city's rent stabilization law which limits yearly rental increases but only applies to units built before 1978.

According to a report by the Southern California Association for Non Profit Housing, the high number of demolitions and condominium conversions has seriously harmed the city's effort to address its affordable housing crisis. The housing element of the city's general plan states the city must produce 4000 units of affordable homes each year. Between 2001 and 2006 the city produced 12,800 units but lost over 11,000 to demolition and conversion, a net gain of less than 2000 units over 5 years (Southern California Association for Non-Profit Housing, 2007a).

Because efforts to restrict the demolition of old apartment buildings have failed, the changes occurring in NoHo will likely continue (Dellinger, 2008). Older rent controlled units will be replaced by costly condominiums. In May of 2007, the city council passed a law requiring new apartments that replace demolished ones also be covered by rent control (Hymon, 2007). However, these units will still start out at a significantly higher rent. Moreover, an exception is provided if 20% of the building's units are affordable. Thus, nothing prevents the number of affordable apartments from continuing to decline. In short, wealthy residents will increasingly displace lower income groups in neighborhoods like NoHo.

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