Revival of Downtown Los Angeles Stalls
The Wall Street Journal, March 13, 2009
By Nick Timiraos
...Executives say they remain committed to the idea of residential development in downtown Los Angeles. "Downtown L.A., the economy aside, will continue along its evolution unabated because so much has already occurred," Mr. Murray said.
Unlike in Miami or San Diego, the downtown area doesn't have a large supply overhang. Real-estate brokerage Marcus & Millichap forecasts that 39 new condo and 394 rental units will be added to the downtown market this year.
But while the district's troubles may reflect economic headwinds that have battered real estate nationally, some experts say downtown has also suffered from too many high-priced developments. "The price points that were projected aren't sustainable," said Raphael Bostic, a real-estate professor at the University of Southern California. "The prices you have to charge now make the returns relatively unattractive."...
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