Quantcast

The Real Deal Los Angeles

Neighborhood Spotlight: Escaping its tragic past, Koreatown embarks on a golden era

Flood of conversion projects is reshaping the once-blighted community
By Gregory Cornfield |
Research by Laura Hanrahan
September 21, 2018 04:44PM

Koreatown has rebounded from its painful past due to a slew of multi-family redevelopments.

UPDATED, 6:24 p.m., Sept. 24, 2018:

For years, the tension between African Americans and Koreans in Los Angeles had been building. The breaking point came in 1991.

Just 13 days after Rodney King was famously beaten by police, Korean store owner Soon Ja Du fatally shot 15-year-old Latasha Harlins in the head for allegedly stealing a bottle of juice.

Koreatown, the urban neighborhood adjacent to Downtown L.A., became a target for revenge.

A year later, after the officers who beat King were acquitted, mass rioting broke out across the city. Koreatown store owners fended off looters who set fire to their shops. They boarded up buildings and stacked shopping carts in the doors. And they carried shotguns and assault rifles on top of supermarkets on Western Avenue.

An estimated 2,200 Korean-owned businesses suffered some $400 million in damage – almost half the amount of damage inflicted on the entire city from the riots, the Los Angeles Times reported.

The chaos led many investors and property owners to flee the area. But a man named David Lee saw opportunity. Lee started to acquire office buildings on the cheap from people wanting to leave. Over the next decade he built a real estate empire known as Jamison, and quietly waited for Koreatown’s turnaround.

“All the developers fled to suburbia and we came in,” said Lee’s daughter, Jaime Lee, the CEO of Jamison Services, the leasing arm of Jamison.

In the beginning

Small Korean communities have existed in Los Angeles since the early 1900s. But the Koreatown of 2018 didn’t begin to form until the 1960s. The Immigration and Nationality Act of 1965 lifted restrictions on Asian migration and led to a wave of Koreans to U.S. shores. After the Watts Riots in 1965, many Koreans began moving to the area seeking inexpensive housing. By the 1970s, many businesses along Olympic Boulevard and 8th Street were owned by Koreans. Korean media outlets and local organizations formed, further establishing the area’s identity.

Then a man named Hi-Duk Lee solidified it.

Lee saw Chinatown and Little Tokyo, and wanted to create an enclave of similar stature. In 1971, he purchased a market at 3122 W. Olympic Blvd., which become just the second Korean-owned market in Los Angeles. By 1974, Lee owned a bookstore, photoshop, and barber shop. Then, he built a restaurant and shopping mall. More Korean-owned businesses started to pop up nearby as well.

After opening Young Bin Kwan at 3014 W. Olympic Blvd. — one of the city’s first Korean restaurants — Lee purchased five blocks near Olympic and Normandie and named it “Korean Village.” Soon after, Mayor Tom Bradley joined Lee to install the Koreatown sign on the Santa Monica Freeway. Many point to Lee’s first store, the Olympic Market, as the true spark for Koreatown.

By 1985, the neighborhood was “suffering growing pains,” the Times reported. The community was overrun with nondescript strip malls, hotels and medical centers. Korean business signs were the only clue to its population.

Signs of change

Today, visitors would be hard-pressed to guess the destruction that ravaged the community more than a quarter-century ago. The stage is set for Koreatown to enter a golden era. Its reputation as a cultural hub has been growing. That reputation – built partly on karaoke bars and affordable Korean barbeque — has attracted a flood of redevelopment over the past six years.

The influx has been reshaping the enclave with taller projects and denser developments.

In the post-riot years, the community continued to grow from a flow of Latino immigrants, and today Koreatown is the most densely populated district in Los Angeles County, according to the city planning department’s population estimates.

Affordable, rent-controlled units made Koreatown increasingly more attractive for young people and middle class families, offering an alternative to rising rents downtown and in Hollywood.

But the zoning limited development to narrow commercial strips.

Koreatown has since experienced a construction boom like few other neighborhoods in Los Angeles. A big part of that is because of Jamison Services.

In 2013, the firm had to decide what to do with an aging office building on the edge of Koreatown, where the anchor tenant was moving out. It could rehabilitate the property in the gentrifying neighborhood and hope to lure another anchor tenant. Or it could try something new: remodel the nine-story property as an adaptive reuse and meet the growing demand for new residential construction in housing-strapped Los Angeles.

After the success of that property, Jamison Services stepped up its move into residential, converting more of its sizable portfolio of office space into multi-family complexes. David Lee became the largest private office landlord in the county – with most of his properties residing in Koreatown.

Jamison was behind three of the 10 biggest projects filed with the planning department in 2016, according to an analysis by The Real Deal of city records. That year, Koreatown was one of the top L.A. submarkets with the most ground-up residential and hotel projects in the pipeline, the TRD analysis found. And Jamison was behind two of the district’s biggest projects: a pair of 23-story buildings at 3600 Wilshire Blvd. and a 644-unit highrise just down the street at 2908 Wilshire Blvd.

Earlier this year, the firm had an estimated portfolio of 18 million square feet, valued at $5 billion.

Along Western Boulevard – in the same spots where Korean business owners and employees famously guarded their stores during the 1992 riots – there are busy markets with retail stores on the roof. Lines spread down the block for new boutique dessert shops, bars, and popup restaurants with colorful exteriors that make good backgrounds for Instagram posts.

Public electric scooters are piled at a parking lot at Beer Belly each night, and new 24-hour Korean bbq restaurants are mixed with older ones near the historic Koreatown Chapman Plaza on 6th Street.

Transportation

Three Metro Purple Line stops have opened along Wilshire Boulevard at Vermont Boulevard, Normandie Avenue and Western Avenue. The subway added significant value to prospective residents by offering a quick connection to downtown. And the Red Line is available at Vermont to take riders through Hollywood to the Valley.

Those train stops are attracting developers seeking to benefit from the city’s recently enacted Transit Oriented Communities program. So far, rapidly-growing Koreatown and Hollywood have seen the highest number of applications for developments seeking affordable housing incentives.

Residential Take

“After the recession, it didn’t make sense to rehab office space,” said Jamie Lee, CEO at Jamison Services. “We offered a residential option that wasn’t as popular yet in Koreatown, which was still filled with 1920s buildings with no modern amenities, no parking or washer and dryer.”

Commercial Take

“Over the past couple years, there have been a lot of properties jumping to almost A-class,” said Jordan Mandel, a commercial broker at Secured Properties. “It’s getting a lot harder to come into K-Town and get anything below market.

Koreatown has been more lenient with zoning than areas like Hollywood and Beverly Hills, Mandel said.

“If a cool new company or startup moved in they would have no trouble getting talent, and the food and nightlife draw people in unlike anywhere else,” Mandel said.

New Development

Jamison Services has a number of new projects in the pipeline, including dense high-rises with new commercial space. In August, the firm filed for permits to redevelop an aging strip mall at 800 Western Ave. with 230 apartment units and 12,000 square feet of commercial space within a new eight-story building.

In July, the firm filed plans for a 227-unit apartment complex on St. Andrews Place. And in May, the firm announced plans to convert its 17-story office tower at 3255 W. Wilshire Blvd. into a 240-unit rental project, which will only be a little taller than their 16-story residential tower project with 196 units that was approved this year near the Wilshire Professional Building.

Other developers making noise in Koreatown include Brooklyn Cos. which made its first purchase in Los Angeles in August when it paid $11.25 million to acquire a 45,000-square-foot property at 240 S. Western Ave. In July, a Beijing-based developer filed for a 33-story high-rise on South Vermont Avenue.

Harridge Development Group is planning to build a 160-room hotel and 555-unit apartment complex at the Wilshire Galleria complex, and Urban Offers plans a 256-unit mixed use project at 550 S. Shatto Place, on the corner of West 6th Street. Ennabe Properties also recently filed plans for a 73-unit project at 401 S. Western Ave. with 6,500-square-feet of ground floor retail space.

Average residential sale price within:
Last 12 months: $584,545 – $505/sqft
Last 2 years: $570,000 – $495/sqft
Last 3 years: $559,000 – $467/sqft

Average current residential listing price: $665,000 – $502/sqft

Priciest residential sale: 715 Irolo St – $1,722,286

Most expensive home on the market: 432 S Serrano Ave – $2,300,000

Least expensive home on the market: 425 S Kenmore Ave #110 – $449,000

Correction: An earlier version incorrectly referred to the company David Lee built as Jamison Services, not Jamison. The story also incorrectly attributed Jaime Lee, his daughter, as CEO of his company. She is CEO of Jamison Services, the leasing arm of Jamison.