The Los Angeles City Council voted and approved new regulations for recreational cannabis businesses. Recreational marijuana will officially spread like wildfire on January 1, 2018, per California state law. This will be a boon for industrial real estate landlords as cannabis growers and cultivation operations typically pay premium industrial rental rates compared to regular warehouse and manufacturing users. Pot growers often pay in excess of 2X the market rate. Some key rules are below from the L.A. Times article. The mayor is expected to sign the ordinance soon.
Under the new regulations, pot shops can open their doors only in specific commercial and industrial zones and must operate at least 700 feet from schools, public parks and libraries, child care centers, alcohol and drug treatment centers and other “sensitive” sites, as well as from other pot retailers.
Other kinds of marijuana businesses, including growers and manufacturers, would be confined to industrial zones and banned within 600 feet of schools. And marijuana manufacturers that use volatile solvents would also be prohibited within 200 feet of residential areas.
To prevent an “undue concentration” in neighborhoods, city leaders also decided to cap the number of pot shops, growers, manufacturers and marijuana “micro-businesses,” which do a combination of things, allowed in each community.
Although the local CPI has hovered between 0-2% since the recession. In 2017 we have seen it steadily rise above 2% to a current 2.5%. This will affect the annual increase increments for new leases signed. Historically industrial escalation clauses demanded a floating increase between 3-5%, whatever the CPI at the time.
Former American Apparel Facility.
Classic Brick Buildings, BowTruss Roof Roof, Great Natural Light.
Creative Campus conversion: art gallery, live/work.
Warehouse, Manufacturing, or Cannabis/Cultivation/Growing Uses.
Skylights, Sprinklers, Gated Parking.
1,200 AMPS of power, 120/240 Volts, 3 phase.
Adjacent to Slauson Central Retail Plaza: Starbucks, Fatburger, etc.
10 minutes south of DTLA Arts District.
The city’s wage law, which will raise the base pay by 50% over five years, serves as a test for urban minimum wages. Advocates say it will provide much needed help for working families but manufacturers warn it will undercut their competitiveness and drive them out of town.
Contract apparel manufacturer 5 Thread Factory, whose garments include shirts for men and women, mountain-bike gear and other products, has outgrown its two floors of space in a gritty downtown neighborhood just three years after it opened. But with wages rising, CEO Brian Zuckerman said he won’t sign another lease in the city.
“The simple answer to this whole conversation is we’re moving out of the city of L.A.,” he said.
Although many artists have flocked to industrial areas of Los Angeles for decades, there has been a rapid increase in this movement over the past 5 years. Especially in the Downtown Arts District and the NorthEast L.A. neighborhoods of Silverlake, Glassell Park, Mt. Washington, Frogtown, and Atwater.
The below is excerpted from a WSJ Magazine feature article on Michael Kelley in 2013.
At a time when rising-star artists earned their stripes in New York, Kelley also stood apart for championing Los Angeles, a once-sleepy art scene that now simmers with younger talents like painter Mark Grotjahn and sculptor Sterling Ruby—both in their early-to-mid forties—who say they moved there in part to study with Kelley or work nearby. In fact, his thrift-store aesthetic has arguably influenced the way younger artists everywhere think about making art. “Mike brought the lowest, base forms of pop culture into the arts,” says Ruby. “That’s big with my generation, but he was the pioneer.”
It just so happens that we were involved in real estate transactions with each of these artists (Kelley, Ruby and Grotjahn). The neighborhoods were, Glassell Park, Frogtown, and Vernon, respectively.
Currently we have a 9,000 square foot brick building with fenced yard available for lease along the L.A. River bordering Glassell Park and Frogtown.