REAL ESTATE QUARTERLY: As Los Angeles matures, a conflict has emerged between preserving its distinctive character and allowing for development
By RACHEL BROWN
Los Angeles Business Journal Staff
On Washington Boulevard next to Giroux Glass Inc. used to stand a small, rat-infested and derelict market that had been built about 1950.
Singling out the market affect of preservation boards is difficult, but Christian Redfearn, an assistant professor at the USC Lusk Center for Real Estate Development, has studied it. It may be counterintuitive, but he has found that the influence of preservation boards on property values is greatest in pricey areas. His study uses data from properties inside and outside HPOZ areas before and after adoption.
Redfearn detected a premium due to preservation boards of around $40,000 – about the same as for a pool – in the expensive HPOZ areas clustered around Wilshire Boulevard relative to neighboring streets. “It looks like the designation by itself generated a positive outcome,” he said. “In neighborhoods where there are high-income individuals, they have strong preferences for the feel of the street.”
Even so, it is the high-income areas that have often experienced the fiercest resistance to preservation boards. Hancock Park is certainly an example, where opposition is made clear by the many anti-HPOZ signs on lawns.