Mixed-use buildings ditch ground-floor retail to add more housing

With Los Angeles facing both a pronounced housing shortage and a long-term decline in its office market, the adaptive reuse of vacant buildings into apartments has been pitched as a way to kill two birds with one stone. But faced with similar prospects for brick-and-mortar retail in the era of online shopping, some property owners of mixed-use buildings are also rethinking their commercial spaces.

Back in 2020, the Dinerstein Cos. redeveloped the former Santa Monica Trailer Park at 2929 Pennsylvania Avenue into a mixed-use complex consisting of 356 apartments and approximately 25,000 square feet of ground-floor commercial space. Now, with much of that street-level space remaining vacant after five years, the Texas-based development firm is looking to transform it into housing.

Per a project website, approximately 20,300 square feet of the of the property's retail square footage is to be converted into 18 residential units. All of the construction would occur within the envelope of the existing buildings, although new landscaping is proposed for the exterior. Not included in that total is a commercial space at the northeast corner of the site at Colorado Avenue and Bachner Way, which is leased to a bakery.

Far away in Woodland Hills, Acacia Capital has submitted an application to the Los Angeles Department of City Planning seeking approvals to convert the ground-floor space of the Boulevard apartments at 20600 Ventura Boulevard into housing. Five retail spaces would be converted into five apartments, according to a project description, adding to the 123 apartments on the upper floors of the property.

Such projects are not limited to the ground floor - Canadian real estate investment firm Morguard recently initiated its own plans with the City of Los Angeles to convert parking and vacant offices at the Lumina Hollywood tower at 5929 Sunset Boulevard into 36 apartments. The 22-story building already includes 299 residential units on its upper levels.

Similar projects are also undertaken regularly without requiring entitlements using the provisions of state law, which allows owners of multifamily properties to add accessory dwelling units within the envelope of an existing building through a by-right process in lieu of unused space or non-required parking areas. The law permits a developer to add up to 25 percent of the number of existing apartments, and there are no affordability restrictions applied to ADUs built through this process.

Follow us on social media: 

Twitter / Facebook / LinkedIn / Threads / Instagram / Bluesky