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Broadway Retail Only Part of the Problem

By Eric Richardson
Published: Tuesday, August 28, 2007, at 08:26AM

517 S. BroadwaySchulte United -- 529 S. Broadway735 S. Broadway

This week's LA Business Journal runs a piece on the changing nature of Broadway. The story that's painted is of good-hearted property owners are doing what they can to make the neighborhood better, but are held back by the great difference in rents between Broadway's current tenants and the kinds of stores many wish the street would attract.

For years the mercados between Second and Eighth streets have been known as a primary Hispanic shopping destination. Particularly on weekends, they bustle with thousands of shoppers, who buy jewelry, food, T-shirts and knick-knacks. Business is so good, in fact, that merchants there pay rents as high as $10 per square foot per month – about the same as rents along the famous Third Street Promenade in Santa Monica.

But as the long-underused space above the mercados is being adapted into higher-end residential, the same landlords feel pressure to bring in national coffee shops, book stores and the like to cater to the professional class that’s moving in.

Problem is, the national chains are not willing to pay those high prices because their sales per square foot are not as high as the mercados. Also, the chains aren’t sure that the downtown renaissance is mature enough for their arrival.

The article does not mention how many Broadway buildings have been left to rot while their owners kept charging that great ground-floor rent. The bill to clean up Broadway's disrepair is going to involve far more than just varying up the retail scene a bit. While scattered projects like the Eastern Columbia and Chapman are great starts, it's quite a mountain still left to be climbed.


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