ULI Los Angeles News

Development without Displacement: ULI Urban Marketplace

“Development without displacement: How can LA grow ‘up’ without pushing people out?” was the question addressed by a keynote panel at the Urban Land Institute (ULI) Los Angeles’ 17th annual Urban Marketplace conference and expo held on April 12th, 2017 at The Reef in Downtown Los Angeles. Themed “Make a Deal, Make a Difference”, the event brought together urban leaders, municipal officials, investors and other stakeholders to examine and discuss the implications and consequences of multiplying urban development and redevelopment projects throughout Los Angeles County.

Keynote moderator Dr. Raphael Bostic, Bedrosian Chair in Governance and the Public Enterprise, USC, noted that Los Angeles is ranked as one of the most expensive cities in the world to live in, while in LA and throughout California, production of housing units has lagged. With the need for more affordable housing reaching crisis proportions, the Urban Marketplace conference also presented a range of real estate investment opportunities and development strategies for lower-income neighborhoods in LA.

img_1697300dpiFeatured speakers at the event opined on whether Los Angeles’ mixed, rich cultural texture is at risk of becoming attenuated amidst today’s thriving economy and changing cityscape. Throughout Los Angeles, there are fears that development will displace existing residents of a neighborhood, and their traditions, shops, restaurants, music and more with them. Los Angeles County 1st District Supervisor Hilda L. Solis discussed the challenge to the Board of Supervisors of helping to lift disadvantaged areas in an era of increasing rents and congestion.

“Gentrification is a displacement but also an opportunity to develop good jobs,” Solis said. “With the rising minimum wage, we are looking at ways to use federal funds to put displaced people in construction and health care jobs, and ensure that local employees have access to jobs in public constructions, as well as apprenticeships and training,” she added.

Offering a closer look at the increased pressure on housing supply in LA, Hasan Ikhrata, Executive Director, Southern California Association of Governments (SCAG), said, “We need to add 180,000 units per year. We are not even close.” Ikhrata believes “nimbyism” is a leading reason for keeping the housing supply low. “Everywhere we go, cities claim that they are already built out, and send us on to other cities.” In order for the situation to change, he cautioned, “Land use is also a political exercise – we need to be there, and be engaged.”

img_1793300dpiKen Lombard, President of MacFarlane Partners, cited two new projects that include housing opportunities for lower-income residents as examples of a new, more inclusive development strategy. “The more inclusive developers are, the more successful,” he said.

“Investment in people is the most important strategy for creating investment without triggering displacement,” said Alex Guerrero, Senior VP of External Affairs, Valley Economic Development Center (VEDC). “We need first to identify local needs, then engage the local community to encourage wealth-building,” he added. “Then communities can partner with the public sector and the non-profit sector to get things accomplished.” Communities ideally would own the housing/real estate assets, and build local capacity through one-on-one training, business assistance workshops, and incubator programs. Guerrero identified high poverty rates, unemployment, a history of disinvestment, and environmental degradation as the most urgent challenges to such solutions.

“Underserved communities deserve the best,” said Mark Vallianatos, Director, LAplus. Summarizing the growing body of research on gentrification and displacement, he explained that neighborhood change is more often the result of higher barriers to entry for those interested in moving into a particular area than direct displacement of current residents by newcomers. Vallianatos observed that gentrification is the “fin of the shark”, signaling larger issues of segregation and income inequalities.

The city of Pacoima is a case study for the effort to avoid displacement in anticipation of increased investment, said the VEDC’s Guerrero. With a new transit corridor being planned by LA Metro, real estate investment will soon follow: “Investment is coming. Is Pacoima ready?” Guerrero asked. He cited Pacoima’s strengths, including an entrepreneurial spirit, strong stakeholder advocacy, the environmental movement, and Pacoima’s potential as an “entrepreneur incubator.”

img_1840300dpiWith persistent segregation, inequality, and concentrated poverty as the region’s main socio-economic challenges, keynoters concluded that LA needs a “pro-change, pro-inclusion, pro-sustainability coalition.” The goal: “safe streets, bustling sidewalks, economic development, healthy people with money in their pockets.” Lombard noted that the LA Metro expansion brings opportunities to accomplish all of the solutions that emerged from the discussion: “The measure of success needs to be inclusion.”

In that vein, 22 smaller breakout groups at the conference addressed a broad range of proposed solutions, providing attendees with abundant food for further thought about the future: To cite just a few:

Representatives of the LA City Planning Department presented an update on the Central City Community Plan for retooling land use for job creation. City personnel provided useful regulatory updates, including on LA’s Small Lot Ordinance (tighter regulations and new design standards).

Planners and developers can expect a reduced need for parking in LA, said Ann Cheng, Program Director for GreenTrip. Millennials, proponents of sustainability and users of public transportation, bikes, and ride-sharing solutions like Uber and Lyft are less interested in owning cars. Could parking structures be converted into housing? Other uses?

img_1987300dpiCars are still part of LA’s future—self-driving cars or “autobots,” according to Ryan Snyder, Principal, TranspoGroup, and Jay Kim, LA Dept. of Transportation Assistant General Manager for Mobility Management. “Automated vehicles are coming whether we want them or not,” said Ryan. “Equipment technology will lead us through levels of greater and greater automation, and there will be interim phases before vehicles are fully automated,” said Kim. “The tipping point will come.”

Envisioning further innovations based on the sharing economy, CEO Prophet Walker and COO Brent Gaisford, co-founders of Upwell Real Estate presented a new multifamily trend: “co-living” apartments. For the price of a small studio apartment rental, people can opt for an updated version of communal living: a room and bathroom, with central, shared facilities that offer each resident his or her preferred ratio of privacy to social interaction.

img_2236300dpiDiscussions of autobots; shipping containers as a creative solution for housing; quantifying the benefits of urban design; storefront retail in a digital world; retooling land use for job creation; using tax increment to fund private projects; and presentations of projects such as a multi-tenant adaptive re-use in Compton also offered new, thought-provoking perspectives. For more information on the stimulating Urban Marketplace 2017, visit http://la.uli.org/events/urban-marketplace-2017

This article was written by Nadene Gallagher of Lauter + Gallagher.

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