What next year will mean for our economy, environment and neighborhoods
Will Westside rents continue to climb?
By Kelly King
Yes, I believe rents will continue to rise on the Westside for several reasons. One of the most sought-after rental markets is Marina del Rey and its immediate surrounding area, now commonly referred to as Silicon Beach. Numerous technology companies have moved into the area, bringing with them highly paid employees who seek quality rental living options, thus putting upward pressure on rental rates.
In Marina del Rey, several apartments are going through massive construction and modernization. Many of the buildings are at least 45 years old and need to compete with the newer buildings that offer faster Internet technology and other modern amenities such as common space for social areas, state-of-the-art fitness centers and office/computer centers for common use. Because most Marina del Rey lease agreements with Los Angeles County will expire in 2021 if not they are not renegotiated, many leaseholders are compelled to upgrade their properties and have already started or will soon begin major renovations.
Many projects are spending up to $400 million in upgrades both to their own facilities and also to common areas (such as the Marina del Rey pedestrian promenade). We are currently renovating Villa del Mar, which features some of the largest floor plans in the marina, to add washers and dryers to each residence as well as state-of-the-art Internet connections and numerous common area upgrades.
With all of these renovations, upgrades and major improvements, rents will most likely continue to rise at a gradual to moderate pace. It is also important to mention that established apartments are now finding themselves competing with securing renters that are also looking at many of the new communities coming online in Playa Vista and its surrounding areas. Overall, these highly desirable waterfront neighborhoods are benefiting from growing renter demand and a strong employment base
in these areas.
Kelly King has been the general manager and dockmaster at Villa del Mar Apartments for the past 26 years and is currently chairman of the board for the LAX Coastal Chamber of Commerce.
Will there be more sharks along the L.A. coastline this year?
By Sarah Sikich
We could possibly see more sharks in Santa Monica Bay in 2015.
A lot will depend on their food sources and if the temperature of the water stays warm. We think those are two reasons why there were a significant number of juvenile shark sightings in 2014.
One reason why there seemed to be more sharks along our coasts last year was because people were out on the water more — kayaking, paddleboarding and surfing.
We’ve noticed over the last five years that many marine species have been coming back, but there’s still a lot that we have to learn about sharks.
We still don’t know where they go to have their young or why they are attracted to certain areas. But we do know that a population of juvenile sharks seemed to be more prominent last year in the Santa Monica Bay.
Sarah Sikich is vice president of Heal the Bay. healthebay.org
Can workers expect to get a raise in 2015?
By Bahaa Mikhail
We predict salaries will increase for employees of Westside-based companies in 2015. In fact, that has been the trend for the last couple of years.
According to our data, employees working for Los Angeles-based companies enjoyed salary increases over the last two years. However, Westside based companies had a higher percentage increase. In 2013 and 2014, Los Angeles based companies had salary increases of 3.57% and 3.92%, respectively. Westside-based companies increased employee salaries by 7.74% and 8.42% for the same time period. The figures take into consideration the minimum wage increase implemented July 1, 2014.
Our research includes data from nearly 250 businesses in Los Angeles, of which 60% are on the Westside. In every case, the businesses had two or more years of pay rate history.
We also discovered a few other interesting statistics. For example, the average hourly rate for employees of our Los Angeles-based client companies in 2014 was $25.39. The average hourly rate for employees working on the Westside was $14.79. We initially questioned the statistic, but as we drilled down we found that many of the businesses on the Westside are in the retail and restaurant industries, primarily offering part-time positions. In comparison, our next largest cluster of businesses is located in downtown Los Angeles, with many of those businesses employing full-time white-collar professionals.
Bahaa Mikhail is the founder and president of PayrollCentric, an HR and payroll service provider based in the LAX area. payrollcentric.com
Will Westside home values continue to rise?
By Stephanie Younger
There’s a famous saying, often attributed to Yogi Berra, that “prediction is difficult, especially about the future.” As a real estate agent, I’m often asked whether home prices are on the rise. While I always remind my clients that I don’t have a crystal ball, I am both personally and professionally very excited for the future of Westside real estate and optimistic that we will continue to see home values increase, particularly in the parts of West L.A. that are benefitting from the emergence of Silicon Beach.
With the arrival of technology, advertising, and media/entertainment firms, the dynamics of the marketplace have shifted. The demand for unique corporate and creative space brings these industries to Playa Vista, one of the rare places in West L.A. that still boasts available space, opportunity to build and resources for commercial development. The shift also highlights a demand for exceptional retail, restaurants and services, as well as the need for housing. Marina del Rey and Venice have already experienced a buoy effect from this business development, and as the second and third phases of Playa Vista are underway, increased demand resulting in increased home values is evident. All of this activity is shining a light on the previously overlooked communities of Westchester and Playa del Rey.
As a realtor who specializes in Westchester, Playa del Rey and Playa Vista, I see both statistical and anecdotal evidence of a surge in home values and area desirability. According to the Multiple Listing Service, the median home price in Westchester (90045) has increased by 11% year over year and 39% overall since 2011. Simultaneously, prices are increasing dramatically both in the Playa del Rey and Playa Vista communities. Based on open house visitor traffic, incoming calls and online inquiries, the demand shows no sign of stopping. On average, our newly listed homes are visited by approximately 100 people at open house, and the majority of our homes sell in the first two weeks on the market. Although inventory increased in 2014 over the extremely low levels of 2013, the number of available homes for sale in all of these areas still remains low when compared to the number of overall units; in Westchester alone, available homes for sale represents only 0.25% of the total number of existing single-family homes.
As a Westchester homeowner, I know there were many of us who thought that it would take at least a decade before we’d see pre-crash home prices again. Seven years after the peak of the market, prices are not only meeting pre-recession levels, but exceeding them in Westchester and the Silicon Beach-adjacent areas. Mortgage rates have also remained low enough to support buyers in their efforts even as prices continue to rise.
More and more of my clients are looking for shorter commutes and friendlier communities in our sprawling metropolis. In the coastal communities extending from Venice to Westchester, the Silicon Beach phenomena has illuminated a thriving community of wonderful people, lovely homes and envy-worthy yards on tree-lined streets. It’s the best value on the Westside, and I for one am bullish on the future of real estate in West L.A.
Stephanie Younger has specialized in Westchester, Playa del Rey and Playa Vista real estate for 13 years. stephanieyounger.com
Will the controversial TriCal project at 74th Street and La Tijera Boulevard really lead to the “ruin” of Westchester?
By Kimberly Fox
If you consider a big jump from low density to high density in the next generation of projects as “ruining” Westchester, then yes, the TriCal building — as planned — is part of that story.
But this is a very complicated moment for Westchester in general. We have Google and other Silicon Beach players coming in big-time to Playa Vista, accompanied by a gigantic block of new housing along Jefferson Boulevard. In that context, I would argue that Westchester should fight hard to keep its low-density and single-family homes profile because that is going to protect the style of living Westchester uniquely offers and, ultimately, housing values throughout Westchester. We’re currently the “Un-Playa Vista,” and we’re going to have to work hard to protect that positioning.
Westchester, as a community, is under incredible pressure from outside forces pushing for high density wherever it can place it. We’re going to have to fight hard and smart — politically — to keep the character of our neighborhood intact. But it’s absolutely worth the good fight to preserve the special thing we’ve got, in terms of the Westchester living experience. Westchester has been patently uncool for decades — a kind of lost “Mayberry R.F.D.” neighborhood that no one was interested in. Well, now people are interested, big-time. And that’s going to bring even more developer pressure into the neighborhood, pushing for density that’s completely out of character for Westchester.
Kimberly Fox is a Westchester community activist.
Does the outlook for the local business community look strong in 2015?
By Christina Davis
To quote the Magic 8 Ball: As I see it, yes!
From my perspective as president and CEO of the LAX Coastal Chamber of Commerce, which serves more than 550 members, I predict positive growth for our business community in 2015.
The LAX Coastal area is thriving. Tourism is booming — we experienced record-breaking travel this past year. In this past month alone, we’ve seen local media coverage of Google purchasing 12 acres of land in Playa Vista, a proposed NFL football stadium in Inglewood and the increasing desirability of Westchester housing.
From the Silicon Beach tech boom at Playa Vista to the modernization of LAX, from the much needed transportation improvements of the Crenshaw Line to the redevelopment of Marina del Rey, there is no doubt that we are in the epicenter of the hottest spot in LA. There is a surge of new and emerging industries and trendy businesses moving into our area. All of this translates into more jobs and greater economic growth.
There is an overwhelming spirit of entrepreneurship that continues to grow in our local business community. I am consistently amazed by the number of individuals I meet each month that are looking to launch a new business. The idea of being your own boss, partnered with open source technology, hard work and the dream of “hitting it big,” has created an influx of new business owners — a trend that I believe will only continue in 2015 and for many years to come.
Today’s traditional small-business owners are more than ready to climb out of the recent economic downturn. They have ridden the wave of the recession and have learned to do more with less, making them stronger business owners. For the more established or seasoned businesses, I see a future that includes technological upgrades and a heightened online presence. Small businesses have learned that technology is not a fad and have started to address the digital divide. They have engaged in e-commerce, learned about the power of social media and discovered the virtual workplace. It’s an exciting time for our community; from the more traditional roles of business to a surge in new and emerging ventures, our area is quickly becoming a beacon for the Los Angeles economic climate. The way I see it, 2015 is going to be a year of growth and prosperity for our local business community, and I could not be more excited.
Christina Davis is president and CEO of the LAX Coastal Chamber of Commerce. laxcoastal.com
What will become of the Ballona Wetlands in 2015?
By David Kay
Positive things that I predict will happen in the Ballona Wetlands in 2015 are a return of several endangered species, including the El Segundo Blue Butterfly reproducing in the western dunes area restored by the Friends of the Ballona Wetlands and the Least Bell’s Vireo nesting at the freshwater marsh and riparian corridor.
Unfortunately, Areas A and C (north of Ballona Creek) will remain degraded and off-limits. They’ll eventually be addressed by the state’s restoration project, but that is many years away. I do also expect that the California Department of Fish and Wildlife will at long last release a draft environmental impact report for the Ballona Wetlands Restoration Project next year, giving the public a chance to review the impacts of several restoration alternatives.
However, we will see good progress on the Oxford Lagoon refurbishment. That area was historically part of the Ballona Wetlands, so it will be nice to see native vegetation replace the invasive species being removed by the county and to have a few viewing platforms for the public to watch birds from. The lagoon is not technically part of the Ballona Ecological Reserve, but as far as I’m concerned it counts as Ballona!
David Kay is outgoing president of the Friends of the Ballona Wetlands Board of Directors. ballonafriends.org
Can Santa Monica save the Civic?
By Sepp Donahower
The Santa Monica Civic Auditorium could be saved in a New York minute. All the city has to do is make some smart deals with the right developers and operators for economically viable uses consistent with the desired use. The Civic could be a revenue generator for the city rather than the financial sinkhole it was in the past due to poor management. Worst case, it could be revenue neutral.
The entire Santa Monica Civic area should become a cultural campus that merges with the wonderful existing facilities across the street on the high school campus, The Greek Amphitheatre and Barnum Hall. I would also suggest an additional multipurpose flex indoor venue on the Civic site that could house small conventions, larger concerts, traveling art shows and fairs, and other types of special events. A large outdoor plaza and international food court would also be great for free films and concerts and a gathering place for all.
Local hotels need such venues and would feed business to them and do revenue sharing. All these wonderful assets, along with a smartly restored Santa Monica Civic Auditorium, could generate robust revenues for the city and provide an international cultural mecca. Madison Square Garden Co., AEG, Live Nation — there’s no shortage of qualified producers and operators, and they are all developers as well.
Sepp Donahower is a founding member of “Save the Civic” and has produced many concerts there.
Will Bergamot Station Arts Center survive becoming a light rail station?
By William Turner
Bergamot Station is a very unlikely cultural oasis, a jewel in Santa Monica, but it’s also unique in the country as a destination for arts and nonprofits. We’ve also become a city square and forum for other community events. It has that kind of open access, but it’s a fragile ecosystem.
Galleries tend to be nomadic. We have a very delicate balance between profitability and costs, and we’re always looking for cheaper rent. What’s kept Bergamot as the exception is that we’ve had very stable rents for the past 20 years. And so, in terms of the future, we’re very optimistic. We have developers (Worthe Real Estate Group and Fred Fisher and Associates) who seem not to be overly aggressive and understand the needs and limitations of the current tenants. They have a sense of the aesthetics and the community’s concerns.
We also have neighborhood groups invested in supporting Bergamot and we have a City Council who gets how valuable Bergamot is. They realize that if the galleries left Bergamot, they wouldn’t move to another part of Santa Monica, they would move to other parts of L.A.
Even if no development happened, the train is coming. How do we deal with that pressure? We need to address additional parking to address that new capacity requirement. That’s the immediate challenge.
William Turner operates a gallery at Bergamot and is a member of the Bergamot Arts Steering Committee. williamturnergallery.com
Will the Santa Monica Airport close?
By John Fairweather
I think the overall trend is toward closure, but it will take many years and many lawsuits.
The one thing that I think will happen for sure is the lease rates for many airport businesses will change due to the expiration of lease agreements with the city and the FAA. The city has the right to set airport lease rates at market rate once the existing agreement expires. The city might also disallow subleasing by some of the businesses, and that will change the economic and the business dynamic significantly.
John Fairweather is a member of Airport2Park, a group seeking to convert the airport into public parkland. airport2park.org