The L.A. County industrial neighborhood of City Terrace has seen increased buyer and investor activity in the past few years. Not only have several properties sold in this up and coming area, but a new 200,000 square foot industrial building is under construction by a well known developer.
The heightened interest in this once sleepy area may be due to it’s proximity to the Arts District, Boyle Heights, and Lincoln Heights, and also between Cal State University L.A. and the USC Keck School of Medicine. Nearby a Biotech/Bioscience campus is being built with heavy interest from prospective tenants. These are exciting developments for one of the oldest industrial tracks in L.A.
A new opportunity is a 106,141 square foot land parcel with 40,000 square feet of old manufacturing buildings on it. This site is being offered for sale at land value. Allowed uses in this M2 zone are manufacturing, distribution, trucking, cannabis, and a variety of other industrial and commercial uses. One advantage of operating a business in unincorporated county lands is that there is no gross receipts revenue tax as there exists in the City of Los Angeles.
Contact us regarding this property.
Great industrial concrete warehouse and manufacturing building available for a buyer to purchase. 35,750 square feet of building including roll down security shutters on all windows and 600 amps of 480 volt power. The City of Commerce in recent months passed an ordinance legalizing several types of cannabis operations in the city including cultivation (growing), manufacturing, and distribution. Don’t miss this opportunity. Whether you have applied for a cannabis permit or are simply a real estate investor wishing to lease to the industry, get in before everybody finds out about the recent allowance of marijuana operations in this city. Call real estate listing agent directly at 323-767-2033.
The below paragraphs are excerpted from “Economic Trends in California Real Estate: Realty Almanac 2018-2020“. It describes the mortgage interest deduction origin, whether buyer or seller reaps the benefit, and the fiscal impact upon the national treasury. After reading it you may come to agree with my view that this deduction should be phased out and the $70 billion in lost tax revenue could then be applied towards balancing the budget.
Interest deductions took root in the late 19th century. The first federal income tax was established in 1894 and all forms of interest were deductible. However, homeownership was not what motivated Congress to enact such a policy. An interest deduction was viewed primarily as a business situation. Most people at that time in history paid cash for their homes (as is the case today in countries with less sophisticated financial systems). Mortgages were generally only taken out by farmers or investors.
Not until the 1950s did the home mortgage gain anything close to its current significance. Since then, the home mortgage has become the common concern of the housing industry. Without a mortgage, most tenants wait until they accumulate savings equal to the price. The tax deductions and exclusions are now considered entitlements for those homebuyers who need to borrow and for those homeowners who sell.
The true tax benefits to the taxpayer of interest rate deductions for buying and owning a home were lost long ago. They were arbitraged away by increased home pricing and interest rates. Thus, the benefits are passed on to the seller (increased price) and the lender (interest and charges on increased principal). The howl today by industry insiders is that prices will drop if the deductions go away: exactly the evidence that subsidies go to the seller and the lender, not the buyer/owner.
The interest deduction loophole costs the Department of Treasury over $70 billion in lost tax revenue annually, to the benefit of sellers and lenders received indirectly via the buyer. However, the majority of debt- encumbered homeowners don’t see much for it, except for the wealthier among them. Only half of the tax filers who are homeowners are able to claim the deduction. Usually, they receive less than $2,000 in reduced tax liability (the rest have no mortgages and thus no risk of loss).
More than 50% of the federal tax benefit is taken by those few homeowners with incomes exceeding $100,000. It is fair to say those wealthier homeowners have the least need for a subsidy as an inducement to buy a home, since they are financially capable and most likely to purchase anyway.
The online coupon company, Honey, has signed a lease to occupy the former Coca-Cola syrup manufacturing plant in 2019. Hudson Pacific, the property owner, paid $49 million in 2015 and renamed the site to Fourth+Traction. They purchased it from GPI who purchased it for $19 million in 2014. One of my colleagues and I represented the buyer in that sale, where they then more than doubled their money flipping it. The seller then was a woman related to the man that once occupied the building as a toy distributor, T.T. Toys.
The Honey lease follows other recent DTLA Arts District transactions such as Warner Music at the Ford Building and Spotify at the At Mateo complex.
Historical photo below showing occupancy of Coca-Coca at the building.
Los Angeles has an abundance of street art, especially DTLA and in the DTLA Arts District. I and many downtown dwellers view and define “street art” as artwork in a public space that has a generally pleasing design. Contrast that with typical street-gang graffiti, which was primarily composed of dreadfully designed words and dominated the public realm prior to 2000. Most denizens consider graffiti to be blight. Street art adds value to the public realm as well as property values, especially in areas such as the Arts District. Check out some great examples here: https://www.instagram.com/explore/tags/lastreetart/. A large portion of DTLA street art has been painted on industrial buildings.
Street art is not exclusive to gentrifying areas. See below in the heart of Skid Row with homeless encampments.