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. Last Updated: 07/27/2016

Medici Site Breathing Life Into L.A.

LOS ANGELES -- An upscale rental project that will eventually fill three city blocks and have 658 apartments is rising at the edge of L.A.'s central business district, where no market-rate housing has been built for nearly a decade.

The $100 million development, known as the Medici, is one of a number of recent projects in downtown Los Angeles that have brought - or will bring - a new sports arena, a new museum, a new concert hall, a new cathedral and new housing to a business district that formerly had little but high-rise office buildings and hotels.

The first phase of 92 apartments is expected to be completed in July, and all have been leased, except two penthouses, said Geoff Palmer, the Medici's developer and the president of G.H. Palmer Associates of Los Angeles.

As an entirely private development with no public subsidies, the Medici is an anomaly in an area where nearly all housing in recent years has been subsidized, low-income apartments.

"It's a major turning point to have a private developer take the initiative to build housing downtown on his own," said Donald Spivack, the deputy administrator of the Los Angeles Community Redevelopment Agency, the leading builder of low-income housing downtown.

Palmer said, "I'm ahead of the curve," but he added that his project was a response to a demonstrable demand. Downtown has a vacancy rate of only 2 percent, he said, and rents are rising sharply.

The Medici project is now under construction immediately west of the Harbor Freeway, an elevated 10-lane road that serves as the unofficial western boundary of the central business district.

The project's only neighbors are office buildings and busy streets, although two or three restaurants are within 90 meters of the project, and the Staples Center sports arena is within easy walking distance.

Palmer said his rents would be about 15 percent higher than those of other market-rate apartments downtown. In the first phase, rents will range from $1,280 for a 60-square-meter one-bedroom to $2,608 for a 112-square-meter two-bedroom, two-bath apartment. A small number of penthouses will also be available; $8,200 a month will rent the largest, with 204 square meters.

Palmer, who developed an apartment building in downtown Los Angeles in the 1980s but has spent much of his career putting up rental apartments in the suburbs, said that downtown living had found a new cachet in Los Angeles, and that, along with a growing frustration over traffic congestion, helped him sell his project.

Location was the overriding concern of Loren Stassart, one of the first tenants to reserve an apartment at the Medici.

"I figured I was driving 19 hours a week," said Stassart, who owns a produce company and drives 105 kilometers from Riverside County to his company on the southern edge of downtown. "I had to buy a new truck every two years just to go back and forth to L.A."

Stassart said he was looking for "a nice, clean place that was well secured." He is pleased with the view from his fourth-floor apartment and is looking forward to moving in. "There are city lights at night," he said. "It's almost like coming home to a resort."

Marketing for the Medici makes note of the Italian marble vanities in the bathrooms, the black granite counter tops and maple cabinets in the kitchens, the solid oak front doors, the 2.7-meter ceilings and the double-paned windows. The complex also has an outdoor pool with a 7.3-meter waterfall and a rubberized running track and a golf driving range, both in a private park. About 1,580 square meters will be devoted to retail space, with a coffee bar, a juice bar and a convenience store.

The Medici's second phase, with 133 apartments, including some studios, is scheduled to open in August, and the third and final phase is to open next year.

The new apartments are part of a larger change in the development patterns downtown. In the 1970s and '80s, the city's redevelopment agency aggressively promoted office development, in the attempt to make downtown into a traditional city center. That created a forest of high-rise office buildings on Bunker Hill and in the financial district a few blocks west of City Hall.

Critics contended that the enormous public investment in downtown was inappropriate for a nontraditional city like Los Angeles, which has many business centers. By one estimate, the city and state governments have spent $2 billion on downtown in the last two decades, $1 billion of that from the redevelopment agency alone. Office development boomed during the economically confident early and mid-1980s, and between 1979 and 1992, developers built nearly 1.8 million square meters of office space downtown.

The recession of the early 1990s halted the construction of speculative office space, and vacancy rates remained in the 20 percent range for much of the decade.

In recent years, developers have concentrated on entertainment and cultural projects, not office buildings. Two recent projects - the Medici and a set of six motion-picture sound stages completed last year - were both built on sites originally zoned for high-rise office buildings.

The Japanese-American History Museum in the Little Tokyo District on the east end of downtown has expanded. Last month, the Southern California Institute of Architecture, a private professional school, announced that it would relocate from Santa Monica to a building on the east end of downtown. And the long-delayed Walt Disney Concert Hall, designed by Frank Gehry, resumed construction in December after a five-year fund drive.

The new Roman Catholic Cathedral of Los Angeles is rising at the north end of downtown, between the Los Angeles Music Center and the Hollywood Freeway.

The east end of downtown has a growing number of artists' lofts in aging warehouses. Loft conversions are continuing on Fourth Street in the historic district just east of City Hall; the Bank District development, by Glimmer Associates of Los Angeles, will have 250 rental lofts.

But the venture that will possibly have the biggest impact on downtown is the $350 million Staples Center, a basketball and hockey arena that doubles as a concert hall. It was completed last October.