Could Streamlining Adaptive Reuse Throughout LA Help The City Respond To Covid-Fueled Real Estate Changes?

Despite a rolling-back of pandemic-related restrictions and a wide-ranging, statewide reopening in the works for June, the full effects of the coronavirus pandemic on commercial real estate are still playing out. For the retail, hotel and office sectors, whether they will rebound, to what extent and when seem to be the subject of near-daily debate.

One group of business and property owners in Downtown Los Angeles, the Central City Association, sees an opportunity to help the commercial real estate community respond to whatever comes next by making it easier to repurpose buildings throughout LA whose uses are outdated. The organization published a white paper this week making the case for doing just that and offering recommendations on improving the rules to create even more flexibility for owners and developers.

“This is a proactive response to major challenges facing Downtown and the rest of the city,” Central City Association CEO and President Jessica Lall said.

After all, notes Lall, many credit the smooth process for adaptive reuse projects in Downtown LA with helping to kick-start the area's transformation from a jobs hub that emptied out at night to a place where high-rise workers and other professionals live and enjoy restaurants, bars and other entertainment.

The city’s existing adaptive reuse rules incentivize conversions of older buildings in certain areas from one outdated use to a new, more relevant use, including housing and hotels, by streamlining the process to get such projects approved. But that only applies to a handful of areas around the city, including Lincoln Heights, Chinatown, the former Hollywood Community Redevelopment Project Area and parts of the Wilshire Center/Koreatown redevelopment area.

The CCA wants to see a similarly simplified process applied throughout the city so that building owners beyond that small group of neighborhoods could more easily respond to whatever changes come out of the coronavirus pandemic. In the process, the CCA said, the city would make it easier to create new housing units.

During the pandemic, Downtown LA emptied out as office workers became remote workers, restaurants shifted to takeout, if they stayed open at all, and hotels waited for tourists and travelers to return. Even as recently as Q1 of this year, a quarter of office space in the city was available for lease and many independent businesses across town were reporting they were unsure whether or if their business would return to pre-pandemic levels.

The pandemic might create an opportunity where buildings downtown and throughout the city are not being fully utilized for their intended use. At a time where the city’s need for housing is clear and urgent, it won’t make sense to let them stay that way, the CCA’s white paper said. Making adaptive reuse easier citywide would maximize the effectiveness of a valuable tool “with a track record that shows what it can do to revitalize communities," Lall said.

Jamison Realty CEO Jaime Lee, whose company has developed adaptive reuse and ground-up projects and is an owner of office properties, said that while she doesn’t see major permanent changes to the way that office space in LA is used as a result of Covid-19, she does agree that making adaptive reuse easier throughout LA would mean making it easier for much-needed housing to be created throughout the city.

“We still have a housing crisis,” Lee said, adding that tens of thousands of people are unsheltered in LA, according to the last annual homeless count. “To the extent that certain buildings are underutilized, regardless of the reasons why — whether it’s the pandemic or the useful life of the building or the changing neighborhood surrounding the building — owners should have the flexibility to meet the needs of the marketplace with their properties.”

Architect Karin Liljegren, founder and principal of Omgivning, sees the potential of adaptive reuse to help add more housing units to a neighborhood without changing its built landscape. It is a worry that often presents itself when neighbors push back against new ground-up developments.

Keeping some of the older, background buildings that help give a neighborhood its own unique feel — “some of them, not all of them,” Liljegren said — will keep connections to the past while allowing neighborhoods to grow into their future. The architecture firm specializes in adaptive reuse projects and has worked on a number of historic reuse projects downtown, but Liljegren said that she thinks even more humble older structures could make good reuse projects.

“I still really love the idea of a strip mall being converted into housing,” Liljegren said.

The CCA publication touts the benefits of adaptive reuse as a housing generator and as a sustainable option, citing, among other sources, a 2016 National Trust for Historic Preservation report that found that “building reuse almost always yields fewer environmental impacts than new construction when comparing buildings of similar size and functionality.” The white paper also highlights a misconception about the practice, noting that it isn’t always cheaper or faster than ground-up construction.

The pathway to really harnessing the power of adaptive reuse, beyond having it apply to the whole city, would include ensuring projects are allowed by-right across LA, not requiring any new parking as part of these projects, and broadening the ages of the buildings that can be used. Buildings built after 1974 presently have “a more onerous, discretionary approval process for conversion that triggers CEQA requirements,” the CCA paper notes. 

The CCA’s white paper comes as the Department of City Planning is in the process of updating the community plan for Downtown LA and, in the process, will be updating the rules around adaptive reuse that exist for that area. They would go into effect when that plan, called DTLA 2040, is adopted by the city. 

Los Angeles also is undergoing a years-long process of updating its zoning code — previously known as re:Code LA. The new version would propose changes that could simplify the process through a citywide program for adaptive reuse projects that include affordable housing units, a department spokesperson said in an email. Those changes would go into effect area by area, as applicable community plans are updated and go into effect across the city. That piecemeal process is something that could take years, the CCA said.