The Hollywood Partnership 6562 Hollywood Boulevard Los Angeles, CA 90028 323.463.6767
2020 ANNUAL + hollywoodpartnership.com Q4 MARKET REPORT hollywoodpartnership JANUARY 29, 2021
1 CONTENTS
4 Letter from the President & CEO
6 SECTION I: The HP’s Organizational Performance 6 HED Strategic Plan 8 Goal 1: Place Management 10 Goal 2: Place Enhancement 12 Goal 3: Stakeholder Engagement 14 Goal 4: Advocacy & Economic Development 16 The HP By the Numbers
18 SECTION II: Q4 Market Report & Annual Reflections 18 The Year-End Market Review 20 Residential 24 Office 26 Hotels & Tourism 28 Retail 30 Neighborhood Mobility 32 Demographics 34 Impact of COVID-19 36 Spotlight on Hollywood
38 SECTION III: Looking Ahead to 2021 40 Appendix 40 About The Hollywood Partnership 41 Map 41 Sources 42 Market Review Tables 44 Active Developments Summary
3 On behalf of The Hollywood Partnership’s Board of Directors and its Advocacy and Economic Development Committee, thank you for your interest in learning more about the Hollywood community and for picking up our 2020 annual report. Unlike the previous quarterly reports from 2020, this report expands on the regular market-based reporting to also include highlights from the work of The Hollywood Partnership in implementing its strategic plan, Hollywood In Focus.
In a normal year, a letter such as this would celebrate the improvements within a community and acknowledge the many different public, private, and nonprofit partners that helped drive the progress forward. Of course, it was anything but a normal year, and understandably, many were eager to close the books on 2020 simply thankful that the four horsemen couldn’t ride together due to social distancing restrictions.
Nevertheless, there are some noteworthy highlights to share. On the real estate side, construction in Los Angeles was able to continue throughout the pandemic, which was not the case within many U.S. cities. Keeping construction moving forward allowed for the supply side to gain a step in its dogged pursuit of demand. Detailed, comprehensive information about the entire development pipeline for multifamily, office, hotel, and other commercial space is included in this report both within their corresponding sections and collectively in the appendix. Additionally, an online representation of the development pipeline is now also available on our new website, www.hollywoodpartnership.com.
Sticking with the built environment, but transitioning into the public realm, in 2020 the Hollywood Historic Trust (the Trust) and partners advanced a significant restoration effort to the iconic Walk of Fame. The Trust is funded through proceeds from star ceremonies produced by the Hollywood Chamber of Commerce. Motivated by the onset of the pandemic and the stark reduction in pedestrian activity, the Trust used the boulevard’s downtime to advance the largest terrazzo Letter from the restoration effort in over 30 years. Noteworthy areas of improvement included a five-block area in the district’s tourism epicenter around Hollywood & Highland, plus areas near major activity centers such as the Pantages Theatre, the Hollywood & Vine intersection, and Hollywood’s eastern Metro Red Line station adjacent to the W Hollywood hotel. All told, the restoration effort improved 50% of President & CEO the blocks that comprise the Walk of Fame.
On the planning and zoning side, 2020 saw the release of the draft Hollywood Community Plan Update (HCPU) and its sister zoning overlay. This represents a critical step in the right direction for enabling a sound regulatory framework for development. The HCPU would modernize Hollywood’s decades-old zoning and contested, discretionary approval-dependent entitlement processes, which have enabled protracted litigation. While the HCPU is still within the public vetting and refinement process, it is The Hollywood Partnership’s goal to support fairness, clarity, and predictability to guide real property investment, and it is our hope that its eventual consideration by the city council will reflect those same values.
Finally, 2020 provided the establishment of a formalized community coalition, called Hollywood 4WRD, to address homelessness in Hollywood. In response to one of the prevailing issues of our time, Hollywood 4WRD will devise solutions to emergent challenges, keep apprised of emergent local and regional policy measures, exercise leadership in seeking and implementing novel approaches, and find ways to address gaps in homeless services provision. Moreover, the new organization will serve as a convener and conductor of the symphony of service providers and community members who share a desire to get people into services and ultimately housing. When operating in 2021, the coalition will work to link and align the resources available within the community to better address the systemic issue of homelessness.
Indeed, 2020 will easily go down as one of the most bizarre and challenging years of the last century. However unfortunate the pandemic, civil unrest, political discord, and economic hardships may be, the ensuing reactions and creative destruction will punch back in ways that will better prepare us for the years ahead. As we look to the near future — one where mass immunization brings us back to more familiar environs — know that our team will continue to measure and catalog everything along the way to ensure we truly know when we are back to being the Hollywood we all know and love.
Stay safe and be well,
Kristopher Larson, AICP President & CEO
Hollywood Market Report Q4 2020 – Published January 2021 5 SECTION I The HP’s Organizational Performance
HED Strategic Plan
Nearly 25 years ago in 1996, property owners in Hollywood banded together to form one of the first property-based business improvement districts (PBID) in the state of California. The PBID was named the Hollywood Entertainment District PBID (HED) and was designed to provide enhanced services to properties within the district, with the goal of improving the area’s cleanliness, safety, beautification, and economic vitality. In 2019, the HED was renewed for the fourth time, and the district boundary was expanded to include the expiring Sunset & Vine PBID. The expanded HED now encompasses 70 square blocks and incorporates the two main east-west corridors in Hollywood, Hollywood Boulevard and Sunset Boulevard.
The HED is managed by The Hollywood Partnership (The HP), a non-profit 501(c)(6) organization. The 2019 renewal and expansion of the HED prompted a strategic planning process, Hollywood In Focus, to develop a five-year plan for The HP that aligns the priorities of the organization with the HED’s evolving landscape and most pressing needs. Hollywood In Focus provided The HP with a clear vision and mission, measurable goals and objectives, and a refreshed organizational structure capable of delivering on the expectations set forth in the plan. The plan is divided into four key goals for achieving the community’s vision of becoming a Hollywood where experiences exceed expectations. The HP has established four stakeholder committees corresponding to the plan’s four key goals to provide insight and direction throughout plan implementation. Summaries of The HP’s achievements from 2020 appear on the following pages and are grouped according to their respective goal and committee.
The Hollywood Partnership’s Mission Statement: To enhance the appeal, vitality, and well-being of the Hollywood community from the ground up.
Hollywood Market Report Q4 2020 – Published January 2021 7 GOAL Place Management ANNUAL PERFORMANCE METRICS ESTABLISH AND MAINTAIN A CONSISTENTLY HIGH STANDARD trash collected 754 tons OF CLEANLINESS, HOSPITALITY & SAFETY • street sweeping 355 tons
COMMITTEE MEMBERS: FRANK STEPHAN (CHAIR), MICHAEL BEZERRA, AMY BROWN, JOSH GARZA, STEVE GENTRY, RANA GHADBAN, CAROL MASSIE, FRED • trash cans 398 tons ROSENTHAL, CHERYL ST. JULIAN, NASH TENNANT, ANGELA VOORHEES, KATIE ZANDONA, TONY ZIMBARDI; COMMITTEE STAFF LEAD: RUBEN LECHUGA graffiti removals/cover 9,308 sticker removals 9,567 Cleanliness and safety are fundamental to influencing the perception of place and foundational to The HP’s ultimate success. Welcoming communities that deliver ambassador interactions/duties 17,223 positive, memorable human experiences generate encouraging word-of-mouth and • business contacts 3,438 1 helpful media coverage which support a virtuous investment cycle. • directions assist 1,493 • hospitality assist 11,891 The overall goal of The HP’s Place Management Program is ensuring that the HED • litter removal 16,052 is clean, safe, and welcoming. Place Management activities are the organization’s homeless outreach interactions 1,185 highest budgetary investment, and as such, require streamlined collaboration among 16,900 the service providers in order to ensure operational success and meet or exceed scooter adjustments stakeholder expectations. • hospitality 12,563 • security 4,337 7,683 754 overall calls for services TONS OF TRASH COLLECTED Highlights and Achievements • phone CFS 6,470 • flagdown CFS 835 HIGHLIGHT #1 Create an integrated clean, safe, and stakeholders during their business contacts along with • observation CFS 738 hospitality ambassador program that proactively conducting a weekly inventory check of all retail/eatery overall security proactive engagement 107,761 manages the multidimensional demands of Hollywood. business properties to confirm their status (e.g., open/ The Safety, Cleaning, and Hospitality Teams now work closed, vacancy, delivery options). business contacts between 78,817 18,875 hospitality and security under one “Ambassador” umbrella which has integrated GRAFFITI/STICKER REMOVALS their work duties and communications. Although there HIGHLIGHT #3 Ensure that The HP is providing proper security 75,379 are three different service providers, they are working management and oversight of vendors and their work hospitality 3,438 together to keep Hollywood safe, clean, and welcoming programs, including submission of detailed reports that through collaboration and teamwork. This includes reflect the delivery of services. communicating via email, radio, and weekly team In late 2019, The HP hired a vice president of Urban meetings. In 2020, two new IP-based radio repeaters Place Management to provide management, leadership, This will ensure staffing levels are appropriate on days were installed to improve dependability of the teams’ and accountability of the Place Management Program where there is a high demand for cleaning services. radio communications. Every Ambassador team member and its service providers. During the monthly Goal 1 takes ownership in ensuring that the district is safe, clean, Committee meetings, information sharing has increased HIGHLIGHT #5 Implement an approach to manage and hospitable through their individual actions, which in comparison to previous years as technology tools have the externalities related to homelessness that is include providing hospitality assistance, removing litter, been integrated to present data on all security, cleaning, compassionate and impactful. standing up scooters, and reporting suspicious activities. and hospitality activities within the district. Key data- In 2020, the organization’s small homeless outreach team informed decisions are made utilizing these reports, (1.5 FTE) conducted 1,185 individual contacts within our HIGHLIGHT #2 Provide a hospitable and welcoming including the increased staffing for 2021 with the new district. The team also conducted weekly counts during environment by deploying well-trained Hospitality Special Projects Cleaning and Homeless Outreach Teams. the early morning hours on the approximate number of Ambassadors that are highly visible, knowledgeable, tents and individuals that were living on the streets of 7,683 friendly, and responsive. HIGHLIGHT #4 Refine, enrich, and innovate the cleaning the district. OVERALL CALLS FOR SERVICES In August 2020, the Hospitality Ambassador Team began and maintenance program to provide a value that their deployment in the district. This team hit the ground exceeds assessment contributions. running through their responsiveness to stakeholders The cleaning and maintenance program has shown solid through wayfinding and information sharing. The team results during 2020 to ensure Hollywood is presentable was also very proactive in reporting security or cleaning and clean. The Team has managed to remove more trash 78,817 issues in the district. They have been instrumental in in 2020 than 2019. They are also currently using GPS BUSINESS CONTACTS BETWEEN the sharing of important organizational programs with mapping technology to ensure the distribution of cleaning HOSPITALITY & SECURITY and personal staff are commensurate to service demand. Hollywood Annual Report 2020 – Published January 2021 GOAL Place Enhancement ANNUAL PERFORMANCE METRICS ENHANCE AND BEAUTIFY THE PUBLIC REALM TO CREATE A POSITIVE trees maintained 450 AND MEMORABLE HOLLYWOOD EXPERIENCE waste recepticals added 37
COMMITTEE MEMBERS: CHASE GORDON (CHAIR), DAN HALDEN, JACKIE LUGO, TONY ZIMBARDI, JEFF MOGHAVEM, PARISA FISCHER, place enhancement projects 3 TOM POLLACK, JEFF LOEB; COMMITTEE STAFF LEAD: RICH SARIAN • new mural 1 • holiday decorations installed 27 The efforts of the Place Enhancement Committee contribute to the beautification of Hollywood’s public realm, ensuring a positive and memorable Hollywood experience • palms illuminated 30 for all. As Hollywood continues to evolve into a multidimensional neighborhood, 2 enhancements to the public realm benefit visitors and the growing number of employees and residents who call Hollywood home.
Highlights and Achievements
HIGHLIGHT #1 Collaborate with the city, the Heart of The committee also was a financial sponsor of the HIGHLIGHT #4 Cultivate the flora of Hollywood, Hollywood initiative, and property owners to consider Hollywood Chamber of Commerce’s Walk of Fame 60th including the health of its street trees, plantings, implications and opportunities for improved public and Anniversary mural that is being finalized and will be and hanging baskets. private spaces along Hollywood Boulevard. located at 7028 Hollywood Blvd. The HP has been tracking the health of each of the The HP, in partnership with the Trust, Hollywood street trees in the district. This inventory has been Chamber, and Council District 13, managed a major The HP also completed its first lighting project adopted crucial in plans for annual tree trimmings and plantings. terrazzo restoration effort for an area that covered from the Lighting Master Plan, the Sunset Boulevard Palm The HP has also partnered with the City’s Urban more than half of the Walk of Fame. This scope of Lights. This project will uplight the 30 palm trees from Ivar Forestry Department to have the dead trees and stumps repair included troubleshooting root damage from the Avenue to Argyle Avenue along Sunset Boulevard. removed so the wells can be filled with new trees in the existing trees along the sidewalk and ensuring the trees coming years. remained unharmed and healthy as the wells were Additionally, due to repeated vandalism to the palm lights rebuilt around them. located along Cahuenga Boulevard from Hollywood to HIGHLIGHT #5 Curate better experiences for people Sunset, The HP needed to develop a solution to rewrap visiting area monuments and other attractions. HIGHLIGHT #2 Reflect the creativity and imagination of the lights at a height unreachable from street level. Work The HP developed and adopted a policy and procedure Hollywood through public art, lighting, and other place has also been underway on activating the long-neglected for managing changes to The Hollywood Wayfinding enhancements that build upon the community’s assets “Skytracker” klieg lights at the intersection of Hollywood & System to continue the success of the program and its and are intriguing to diverse audiences. Vine. Finally, The HP oversaw the installation of holiday relevance in the ever-evolving neighborhood. The HP launched “Set the Scene,” its place enhancement decorations again this year as part of its partnership with partnership program, that provided funding to projects the Hollywood Chamber of Commerce. 3 that enhanced the community. Numerous applications PLACE ENHANCEMENT PROJECTS were received and four were approved for funding. Of HIGHLIGHT #3 Establish and maintain a sidewalk the four approved, Arts Bridging the Gap completed environment that is clean and clutter-free. their project and received complete funding for “The The HP purchased 27 new waste receptacles and Beauty of Hollywood” mural by artist Noah Humes. This received an additional 10 waste receptacles from Council mural is located along the roll-down doors at 1655 N Las District 13, adding a total of 37 waste receptacles to Palmas Ave. the streets of Hollywood. Plaques with The HP’s new logo were designed and installed on each of the waste receptacles in the district. 450 TREES MAINTAINED
Hollywood Annual Report 2020 – Published January 2021 GOAL Stakeholder Engagement CREATE MEANINGFUL OPPORTUNITIES TO CONVENE AND CONNECT WITH HOLLYWOOD’S DIVERSE COMMUNITY
COMMITTEE MEMBERS: BRIAN FOLB (CHAIR), AMY BERKHOLTZ, LESLIE BLUMBERG, DINA GOLDSTEIN, CHASE GORDON, JOE REHFELD; 27,874 VIDEO VIEWS ACROSS YOUTUBE, COMMITTEE STAFF LEAD: DEVIN STRECKER FACEBOOK, AND INSTAGRAM
Hollywood has a vast number and array of stakeholders, including property owners, business owners, residents, employees, visitors, and cultural institutions. Through the organization’s social media, online, and in-person engagement 3 events, and other forms of direct outreach, The HP partners with all who care for the neighborhood and share The HP’s vision for Hollywood as a place where experiences exceed expectations. 13 PRESS ARTICLES ABOUT HOLLYWOOD FROM OUR OUTREACH Highlights and Achievements
#1 Organizational rebranding. The HP selected #4 The #SHOPLOCALHOLLYWOOD campaign. Following Streetsense LLC as the contractor for our rebranding shutdowns associated with the COVID-19 pandemic, the initiative. Following the merger of the Sunset & Vine stakeholder engagement committee worked to publicize PBID with the HED in 2019, The HP’s synthesized Board the businesses in Hollywood that remained open or of Directors expressed the need for a new name for the re-opened following temporary closures. In addition to organization that would represent the new direction developing a “Currently Operating Businesses” section 2,788 forged through its Hollywood In Focus strategic plan. on The HP’s website, a mass mailing campaign was NEW FOLLOWERS ACROSS THE HP Streetsense worked with the stakeholder engagement undertaken to educate neighbors about the importance SOCIAL MEDIA PLATFORMS committee to develop the new name, logo, and branding, of supporting local businesses. In the summertime, plus refreshed brand guidelines. postcards were mailed to all addresses in the 90028 ZIP code, encouraging recipients to visit the website #2 New Website for The HP. Following the rebranding to learn which businesses were operating and how. project, the stakeholder engagement committee selected Additionally, interviews were conducted with business ANNUAL PERFORMANCE METRICS Geocentric to build a completely new website for the owners to connect them with customers; the videos were organization. In addition to reflecting the new name featured on our social media platforms, website, and 750 and brand, the new site added a business directory and YouTube channel. In the fall, another postcard mailing printed newsletters (mailed to all property owners) interactive development map. The site was optimized for was distributed to let residents know how safe and easy all devices, including phones and tablets. The new site supporting local businesses in Hollywood could be during digital newsletter subscribers 2,400 debuted at the annual All Property Owners Meeting the holiday season. website visits 121,354 in November. video views across Youtube, Facebook, 27,874 #5 COVID-19 crisis communications. Throughout the and Instagram #3 The HP videography project. To better communicate pandemic and the periods of civil unrest, staff worked to the work being done by the organization, The HP ensure that vital information was shared with residents, press articles about Hollywood from 13 contracted with Watto Studios to produce video content employees, business managers, property owners, and our outreach highlighting six different initiatives. The videos included visitors on the changing regulations and resources related new followers across The HP social 2,788 Hollywood’s Urban Tree Canopy, Resilient Hollywood, to public health and the economy. The organization’s media platforms Place Enhancement in Hollywood, Hollywood Back to new CRM, PBID Manager, was utilized to target email impressions across The HP social 847,272 Business, and Advocacy and Economic Development. communications to various stakeholder segments media platforms They also assembled Year in Review, a video which was regarding programs, grants, and news updates. 51,806 shown as part of the annual All Property Owners Meeting. engagement across The HP social media platforms
Hollywood Annual Report 2020 – Published January 2021 GOAL Advocacy & Economic ANNUAL PERFORMANCE METRICS quarterly reports published 4 Development community data requests fulfilled 15 BECOME THE LOCAL MARKET EXPERT TO ADVANCE AND ADVOCATE FOR staff hirings 2 HOLLYWOOD’S ECONOMIC INTERESTS
COMMITTEE MEMBERS: MICHAEL GARGANO (CHAIR), DAVID GAJDA, RANA GHADBAN, DINA GOLDSTEIN, DAN HALDEN, PEGGY INGS, DAVE LAPIDUS, CHAD LEWIS, PEYTON NEALIS, DREW PLANTING, MARTY SHELTON, MONICA YAMADA; COMMITTEE STAFF LEAD: DAVON BARBOUR
Economic vitality is the foundation of a vibrant community. To this end, the overarching 4 goal of The HP’s Goal 4 Committee is to inspire economic investment within the district. Through its 2019 Hollywood Strategic Plan process, The HP’s Board of Directors established a new priority of advocating for programs, policies, and regulations that would further economic growth in the district with the activation of 26 COMMUNITY DATA underutilized properties, increased leasing activity, and new capital investment. REQUESTS FULFILLED
Highlights and Achievements
#1 Recruit personnel to advance the objectives of the #3 Create the Hollywood Restaurant Support Program. organization. To mitigate the financial impact of COVID-19 on The HP established the foundation for a new economic Hollywood restaurants, The HP approved the newly development team through its hiring of a research created Outdoor Dining Furniture Support Program to manager and, in Q4 2020, a vice president of Advocacy assist restaurants in temporarily adding or expanding and Economic Development to build and execute a outside dining options to accommodate COVID-19 related comprehensive economic development strategy. The health standards. Specifically, the program will provide addition of this staff builds upon the Strategic Plan’s furniture and fixtures to ground-floor food and beverage ambition to strengthen the organization and expand its businesses located within the district which offer outdoor areas of impact. patio dining.
#2 Produce Quarterly Market Reports. #4 Analyze the proposed HCPU and Community Plan In 2020, The HP launched its formal research program Implementation Overlay (CPIO). with the production of quarterly market reports that To ensure that that the stage is set for a full economic serve the dual purpose of communicating economic recovery, The HP closely monitored the development of conditions within the district and attracting public/private the HPCU and CPIO and the steps taken to advance their investment. The publishing of the reports has resulted in approval process. Specifically, the organization provided greater recognition of The HP as the go-to organization detailed written and verbal testimony. If adopted by for market intel on Hollywood by local media and the Los Angeles City Council, the HPCU and CPIO can business leaders. potentially provide greater flexibility and predictability for entitlement processes to continue Hollywood’s growth.
Hollywood Annual Report 2020 – Published January 2021 The HP by the Numbers Goal 3: Stakeholder Engagement
The Hollywood Partnership prides itself on its 2,788 multifaceted outcomes, and the following dashboard represents a sample of key organizational metrics that reflect its core mission. 27,874 VIDEO VIEWS
Goal 1: Place Management 2,788 NEW 13 FOLLOWERS EARNED MEDIA ACROSS THE HP SOCIAL 754 ARTICLES MEDIA PLATFORMS TONS 7,683 OF TRASH Goal 2: Place Enhancement Goal 4: Advocacy & COLLECTED CALLS FOR SERVICE Economic Development 450 TREES TRIMMED, PLANTED, & MAINTAINED
18,875 GRAFFITI/STICKERS REMOVED 3 26 COMMUNITY DATA REQUESTS PLACE ENHANCEMENT FULFILLED PROJECTS COMPLETED
Hollywood Annual Report 2020 – Published January 2021 SECTION II Q4 Market Report & Annual Reflections Year-End Market Review
Q4 marks the end of a tumultuous year that will be remembered for COVID-19, social unrest, and political transition. While the long-term outlook for Hollywood remains upbeat, the numerous challenges of the past year cannot be severed from the effects on the local market related to changing geopolitical dynamics. First, the successful conclusion of the U.S. presidential election provided clarity to the markets on economic policy that will steer capital markets. Now-President Joseph R. Biden nominated former Federal Reserve Chairwoman Janet Yellen to become Treasury Secretary. Wall Street appeared satisfied with the selection given her prior financial leadership. Confidence in Pedestrians Walking Across Hollywood & Highland the capital markets is vitally important to continue the private investment that Hollywood has enjoyed over this year despite a global pandemic.
Although COVID-19 continued its onslaught, Hollywood’s residential market held steady. There was remarkably no decline in the asking rental rates. Comparatively, New York City, whose expensive rental housing market has been driven by office workers and the wealthy, now reports dramatic rent reductions as the suburbs became synonymous with “safety.” Construction continued unabated, with 735 residential units under construction within the HED. Compared to cities such as New York or San Francisco and their precipitous drops in rental rates, average rental rates in Los Angeles and Hollywood PHOTO are leveling off, with only a minor decrease quarter over quarter. Across Hollywood, a number of residential projects received their Certificates of Occupancy, including 6630 Sunset and Sunset Rise.
Meanwhile, the office sector is virtually frozen in time. The vacancy rate is less than ideal, but the Hollywood submarket is faring well when compared to Greater Los Angeles trends. Hollywood’s office space vacancy increased 7% year over year compared to the overall Greater Los Angeles increase of 17.9%. With tourism central to Hollywood’s Lumina Apartments economy, impacts were most evident on hotels, visitation, and the storefront economy. Whereas hotel occupancy enjoyed a slight recovery in Q3, this progress diminished Float Coffee Shop in Q4 as COVID-19 ravaged throughout the state and forced the enactment of travel restrictions. In fact, year over year, there was a 59% decline in occupancy. Several Hollywood area hotels remain closed.
The storefront economy treaded the rocky waters of ever-changing COVID-19 operating restrictions imposed by state and local governments. Just as quickly as food and beverage operators offered al fresco dining experiences in Q3, this operating model was unfortunately put on hold due the unwelcomed COVID-19 surge. Nonetheless, 71% of operational businesses remained open in the district.
Given the Hollywood market’s dependence on local consumers and tourists, it is clear that a full economic recovery is dependent on successful vaccination programs both locally and abroad.
Hollywood Market Report Q4 2020 – Published January 2021 19 53 Residential 37 23 KEY 45 38
HED 26 44 25 14 32 55 Completed 43 1 22 Under Construction 29 42 Entitled 27 16 Seeking Entitlement 36 28 41 56 12 4 24 40 2 31 39 3 46 51 The Bonnie – Announced in Q4 49 20 50
35 33 17 48 21 9 52 5 18 19 15 47 6 34 30 Hollywood Wilcox – 11 Now Entitled 10 8 7 54 13 Active Projects
1 1621 N McCadden Pl 10 6535 Melrose Ave 19 MR2 Lofts 28 Palladium Residences 37 Montecito II 46 Hollywood Tower 55 Entrepreneur
2 6200 Sunset Blvd 11 700 Highland 20 The Rise Hollywood 29 Selma Place 38 The Lombardi 47 1114 N St Andrews Pl 56 SunWest
3 On Vine 12 7500 Sunset Blvd 21 Sky Lexington 30 1025 N Wilcox Ave 39 PATHS Villa Hollywood 48 1233 N Highland Ave
4 Wallace on Sunset 13 901 Vine St 22 1601 N Las Palmas Ave 31 1375 St Andrews Pl 40 1400 Vine St 49 1301 N Cherokee Ave
5 1130-1134 N Orange Dr 14 Alta Ink 23 6220 Yucca St 32 5600 Hollywood Blvd 41 6007 Sunset Blvd 50 1310 Gordon St
6 5245 Santa Monica Blvd 15 Ariadne Getty Foundation Sr. Housing 24 6400 Sunset Blvd (Amoeba Tower) 33 5817 W Lexington Ave 42 Artisan Hollywood Tower 51 1333 Tamarind Ave
7 5570 Melrose Ave 16 Inspire Hollywood 25 Hollywood & Gower 34 747 N Western Ave 43 The Bonnie 52 5530 Virginia Ave
8 5801-5809 Camerford Ave 17 La Mirada at Central Park 26 Hollywood Wilcox 35 Citrus & Highland 44 Hollywood Arts Collective 53 5600 Franklin Ave
9 5806 Lexington Ave 18 Michaeljohn Horne & Thomas E. Jones 27 Modera Argyle 36 Crossroads of the World 45 Hollywood Center 54 7100 Melrose Ave Youth Housing
Hollywood Market Report Q4 2020 – Published January 2021 21 Residential RESIDENTIAL HOUSING MARKET Q4 Q4 QoQ HED Hollywood Change
Total Residential Inventory (Units) 5,543 16,010 -
Despite challenges in the broader Los Angeles residential presents Raintree the opportunity to substantially increase market, the greater Hollywood neighborhood witnessed our presence in east Ventura County as well as the Avg. Residential Vacancy Rate (%) - 10.70% +0.80% an increase ($21+) in its average rental rate in Q4 from Hollywood area and the San Fernando Valley. With a host the prior reporting period. Additionally, Hollywood’s of well-paying jobs and entertainment options in each Avg. Price per Square Foot - $2.87 $0 overall vacancy rate rose to 10.7% in Q4, which is nearly of these markets, the properties are well positioned for a two-point increase from Q3 (9.0%). The true impact of future growth.” COVID-19 will not be truly understood until the current Avg. Rental Rate for One-Bedroom - $2,132 +$21 statewide eviction moratorium expires in March 2021. Construction activities continued to move along within the Moreover, given the fragile economy, many renters are HED and across Hollywood. As of Q4, there are 735 units Cap Rate - 4.3% -0.3% budget-conscious and are opting to downsize for more (11% affordable) in the HED and 2,376 residential units affordable housing options. The shutdown of major (14% affordable) under construction across the broader Quarterly Absorption - 51 -2 employment sectors such as tourism and entertainment Hollywood area. Several projects moved forward with has dampened demand for housing in the area, meaning entitlements in the HED and across Hollywood, including Sources: CoStar, Hollywood Multi-Family Housing Report - Quarter Four 2020, the effects on housing in Hollywood stand to shift even the Lefrak Organization’s Hollywood Wilcox project on Yardi Matrix, MySidewalk more in early 2021 pending an imminent turnaround in Hollywood Boulevard. those sectors. PIPELINE HOUSING UNITS As part of its 2021 economic forecast, CBRE identified Q4 HED Q4 Hollywood five major COVID-19 related factors that tarnished the PIPELINE HOUSING PROJECTS attraction of urban submarkets in 2020: (1) closure of Q4 Q4 Under Construction amenities (e.g., gyms, meeting rooms), (2) teleworking HED Hollywood availability, (3) fear of public transit, (4) increased living Market Rate 654 2,054 14% space area, and (5) proximity to the outdoors. If these Under 4 21 Affordable 81 322 factors are considered, it would explain the dramatic Construction 14% of pipeline housing rent declines in peer markets such as San Francisco and % Affordable 11% 14% units are affordable. New York which were both hit hard by the pandemic. Entitled 8 18 TOTAL 735 2,376 Although a regional center of activity, Hollywood like Entitled much of Southern California benefits from close proximity Proposed 7 17 to beaches and other outdoor activities. Markets like Market Rate 2,018 3,311 New York and San Francisco lack this highly desirable TOTAL 19 56 Affordable 191 435 attribute. While Hollywood’s overall vacancy rate held % Affordable 9% 12% steady, luxury residential product was significantly Source: The HP, Zone Information and Map Access System impacted. According to CoStar data, upper-end rental (ZIMAS) TOTAL 2,209 3,746 unit vacancy hovered at around 19% compared to the Seeking Entitlement overall average of 10.7%. As the economy begins to 1,912 2,738 safely reopen, increased occupancy in this product Market Rate class is anticipated. Affordable 341 448 60% % Affordable 15% 14% Despite the current hardships, long-term confidence Nearly 60% increase in 2,253 remained. For example, in November 2020, Orange 2x TOTAL 3,186 Greater Hollywood housing County-based firm Raintree Partners purchased the The HED housing stock MASTER TOTAL 5,197 9,308 stock if all Q4 2020 under 137-unit Canyon Drive Manor Apartments located at 1738 will double if all Q4 construction, entitled, and Source: The HP, Zone Information and Map Access System (ZIMAS) Canyon Drive in Hollywood as part of a larger portfolio 2020 pipeline projects seeking entitlement projects from a private seller. Raintree’s plans for significant come to fruition over are built. upgrades to the property reflects long-term confidence the next several years. in the Hollywood market despite the current softened market. According to Mathew Barbiasz, vice president of acquisitions for Raintree Partners, “This acquisition
Hollywood Market Report Q4 2020 – Published January 2021 23 Office KEY
HED Like much of the region, office activity within Hollywood was adversely impacted due to the ongoing COVID-19 Completed pandemic. Until mass vaccinations are successfully 4 completed and stay-at-home orders are rescinded, Under Construction leasing activity and rental rate gains will continue to be hampered. At the end of Q4, Hollywood reported an Entitled office vacancy rate of 21.1%, which is a 3.4% increase from Seeking Entitlement Q3. While Hollywood’s vacancy rate increased 7% year over year, this is much lower than the Greater Los Angeles average increase in vacancies at 17.9%. Overall asking rents increased from $4.53 per square foot in Q3 to $4.77 2 in Q4. This trend has been observed across Los Angeles, and the most recent Cushman & Wakefield Greater Los 5 6 Angeles report noted that office space rents held steady. Throughout Greater Los Angeles, asking rents increased +3.4% 7.1% year over year. Increase in Hollywood Office Space Harlow – Completed 1 On the investment side, Hollywood ended the year with Vacancy Quarter Over Quarter one of the largest office sale transactions in the Los Angeles market. A 261,000-square-foot complex located at 959 Seward and 6555 Barton Avenue collectively sold 3 for $186 million to a partnership between Russell Geyser and LPC West. While already home to several post- production and production-related companies, the facility will continue to operate accordingly and help sustain Hollywood’s reputation for entertainment production. Within the HED, Kilroy Realty Corporation is anticipated to complete construction of On Vine in February 2021, and nearby, the Hudson Pacific property, Harlow, received its certificate of occupancy. 7
While the office market may have been bruised by the multifaceted impacts of COVID-19, it also shows signs Kilroy Realty Corporation of resiliency thanks in part to the digital media and unveiled a new public art entertainment industry. Streaming digital content has project at On Vine, whose specifically fueled demand for office and production signature tenant Netflix will space throughout the area. Netflix, which has steadily occupy over 300,000 square grown and anchored roots in Hollywood over the past feet of office space. few years, noted in the prior reporting quarter that Active Projects it expected to triple the number of its productions. Hollywood’s office market is poised to benefit from the demands for space generated by streaming providers. 1 On Vine 6 Sunset Gower Studios
2 Crossroads of the World 7 1000 Seward St
*Additional tables can be found in the Appendix. 3 1235 N Vine St
4 6381 Hollywood Blvd
5 Sunset & Wilcox
Hollywood Market Report Q4 2020 – Published January 2021 25 Hotels & Tourism
The importance of tourism to the local economy cannot 114 Relevant Group’s Selma Wilcox Hotel be understated. Like other sectors, COVID-19 wreaked 12 havoc on the market and was unforgiving. Throughout received a temporary certificate of 9 5 6 Q4, public health officials nationally pleaded for occupancy, bringing 114 new hotel 13 Americans to avoid holiday travel to stem the continued rooms to Hollywood. and growing COVID-19 threat. Consequently, the 11 15 lackluster hotel market performance was anticipated. 8 While Q3 provided some reason for short-term optimism, positive gains were quickly erased in Q4. Los Angeles 4 County reported an occupancy rate of 43.6% in November prohibited non-essential travel and use of hotels for 3 2 2020. Comparatively, the Hollywood submarket only leisure travel, which effectively limited the potential 17 10 14 7 reached an occupancy level of 32.4%. Across the county market share to in-market residents. in Q4, Average Daily Rate (ADR) conversely suffered. ADR 16 in Hollywood fell to $167.87 (-27.9%). Within Hollywood At the end Q4, five hotel properties were under specifically, there was a steep decline in Revenue per construction and account for 820 new rooms to be added 1 Available Room (REVPAR): $54.43 (-70.9%) from the to the Hollywood inventory. Additionally, Stay Hotels prior reporting period. It should be noted, however that Group sought approval for its six-story, 24-room hotel to Hollywood outperformed the downtown Los Angeles be located at 6830 Sunset Blvd. submarket in occupancy, ADR, and REVPAR. Despite travel advisories by public health officials, In Q4 2020, a mandatory stay-at-home order by air travel, although restrained, continued nationwide. Governor Gavin Newsom was enacted after the Southern Throughout Q4, over five million domestic passengers California region fell below hospital capacity thresholds traveled through Los Angeles International Airport (LAX). for COVID-19 emergency care. The order restricted This figure reflects a 66.7% drop year over year; in Q4 non-essential movement and closed certain business 2019, over 15 million traveled through LAX. Related, activity. For Hollywood’s hoteliers, this order inflicted a international travel was down by 83.5% at the end of Q4 KEY double punch to available revenue streams. First, just compared to that of the prior year. Despite the steep two weeks prior, outdoor dining was halted. Many hotels decline in air travel from 2019, Q4 saw a significant HED with outdoor dining previously leveraged this amenity uptick in air travel compared to Q3 2020. Notably, Q4 Completed to stay connected with guests. An additional order then international travel was up by 50% compared to Q3. Selma Wilcox – Under Construction Recently Completed
Entitled Q4 HOTEL MARKET CONDITIONS Hollywood Q3 2020 Q4 2020 QoQ % Change YoY % Change Seeking Entitlement *Additional tables can be Hotel Occupancy 44.60% 33.40% -22.11% -58.50% found in the Appendix. Active Projects Hotel Room Demand 165,588 152,469 -7.92% -62.00% 1 Godfrey Hotel 7 Ivar Gardens 13 6751 Hollywood Blvd 370,988 456,872 +23.15% -8.30% Hotel Room Supply 2 Hyatt’s Unbound Collection Hotel 8 Schrader Hotel 14 6445 W Sunset Blvd Source: Los 3 Thompson Hotel 9 Whitley Hotel 15 Palmer Hotel Average Daily Rate $144.97 132 -8.72% -35.90% Angeles Tourism & Convention 4 Tommie Hotel 10 Crossroads of the World 16 6830 Sunset Blvd Board (LATCB), Revenue per Available Room $64.71 $44.16 -31.76% -73.40% Smith Travel 5 Whisky Hotel 11 1700 N La Brea Ave 17 Chaplin Hotel Research 6 Citizen M 12 1723 Wilcox Ave Hollywood Market Report Q4 2020 – Published January 2021 27 Retail 43 646 businesses permanently closed during Occupied or Available Retail Spaces in the COVID-19 pandemic. 21 of these Retail activity in Q4 was not only impacted by the were food and beverage retail. global pandemic, but it continued to be impacted the HED (14% are Currently Vacant) by sociopolitical events such as the U.S. presidential election. Businesses throughout the region boarded their storefronts as a precaution to potential protests. Total Open and Operating Fortunately, Hollywood, like other communities, was Finally, CBRE announced the signing of a lease at the spared from anticipated damage as peace prevailed. turnkey restaurant space located at 7046 Hollywood Blvd. Businesses (%/Q) There was an inventory of 717 ground floor retail spaces The tenant had not been disclosed at the publishing of throughout the HED identified in Q4, and approximately this report. 100%
“I am beyond thrilled to be able to announce the realization of our plan to expand 75%
the Gelato Festival brand with this second location in Los Angeles...With COVID 50% affecting the entire population and so many businesses going through difficult times, 25% we sympathize with our fellow retailers and are thankful to our loyal customers, our
community supporters and our partners at Hollywood & Highland – they have made 0 Q4 Q1 Q2 Q3 Q4 it possible for us to remain open and thriving in West Hollywood and now bring our 2019 2020 delicious gelato, coffee and breakfast items to a new neighborhood with this second location. It’s a very exciting time and we look forward to the future.”
- Gabriele Poli, Gelato Festival Founder & President Top % of Open Businesses by Retail Type
646 were occupied by operating businesses or were Q4 wraps up the year with the distinction of hosting actively available for tenants. Of these 646 spaces, 86% the busiest shopping season. Notable retail events such (555) were occupied by businesses (open or temporarily as Small Business Saturday, Black Friday, and Cyber 29% closed) and 71% were open for business despite the Monday all converge to feed consumer frenzy. According Other Retail constraints of the pandemic. The number of open and to Forbes, Cyber Monday sales hit $10.8 billion nationally, operating businesses in Q4 increased by 20% compared the largest online shopping day in U.S. history and a 15.1% to the previous quarter. increase over last year. With a new stay-at-home order 41% enacted, many Hollywood consumers were likely drawn Food & Beverage There was reason for optimism in the retail sector of to the convenience and safety of online shopping. the HED as several leases were announced. First, the 7% HED celebrated the opening of Gelato Festival, which is Fitness & now operational at Ovation Hollywood. The transaction Wellness reflects an expansion of the brand and their second location. The Paleta Bar, a franchised fresh gourmet 7% Mexican popsicle store, signed a lease at 6806 Hollywood Gifts & Blvd. With the majority of The Paleta Bar stores located in 10 Souveniers New Mexico, their expansion into Hollywood represents 9% Retail Grand Openings in 2020 11% confidence in the tourism market to drive retail food and Apparel Misc. Retail beverage sales. (e.g., tattoo Hollywood Market Report Q4 2020 – Published January 2021 parlors, CBD) 29 Neighborhood Mobility
PEDESTRIAN COUNTS
LOCATION DAILY PEAK QoQ% AVG COUNT M M Hollywood & 7,603 17,672 -4.38% Highland
Hollywood Hollywood & Vine 4,575 6,924 -7% & Schrader Hollywood & Vine
Hollywood & 2,997 11,114 -10.30% Selma & Cahuenga Schrader
Sunset & Vine 1,187 5,017 -7.34%
Sunset & Vine Selma & 864 2,815 -10.28% Hollywood & Highland Cahuenga
Pedestrian Count Locations Metro
Pedestrian & Cyclists Tracked M Metro Station
Pedestrian Only Metro Red Line
The positive momentum of Q3 was slowed by the onset of the pandemic. That counter closed the quarter Average Estimated Ridership enactment of further restrictions in late November, with an average daily count of 7,951, which is 86% resulting in reduced overall vibrancy within the HED. higher than the second-highest average at for the Metro Red Line Weekday Saturday Sunday Spread across the entire quarter, the 3% reduction in Hollywood & Vine (4,279). pedestrian activity in Q4 does not appear to be a stark 150,000 drop-off from Q3. However, the reduction is largely Like pedestrian activity, Metro Red Line ridership followed due to issuance of the renewed stay-at-home order a similar pattern of building through October and into compounded by the closure of amenities such as outdoor November, only to fall following the issuance of the public dining. To that end, the total number of pedestrians health order. Average weekday ridership increased by counted in December 2020 was 38.4% lower in the final 8.2% (+4,822) in October 2020 vs. the Q3 average and month of the quarter vs. the first month in October. grew again by 1.8% (+1,108 daily riders) in November. 100,000 Peak daily activity for each of the system’s five counters However, average weekday ridership dropped by 10,140 was recorded within the first half of the quarter before in December 2020 vs. the month prior, representing a the tightened restrictions, with Halloween being the 15.18% drop-off. Comparable reductions were also seen driver for peak traffic along Hollywood Boulevard in average Saturday ridership (-21.46%) and average and demonstrations intended to bring awareness to Sunday ridership (-16.14%) in December vs. November. 50,000 the conflict in Armenia driving activity for the system’s Despite the reductions in ridership following the public two southern counters. At Hollywood & Highland, the health order, Q4 showed an average uptick in weekday epicenter of pedestrian activity in the district, counts ridership of 3.42% vs. Q3, plus a 7% increase on weekends. peaked at 17,672 on November 7, a figure which stands as the highest number of pedestrians recorded since the 0 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 2019 2020 Hollywood Market Report Q4 2020 – Published January 2021 COVID-19 31 Race & Black Generations Educational Demographics Asian Ethnicity Hawaiian Attainment Silent/ 6% White 5% Greatest Gen Hispanic or Latino American Indian Baby 11% 50% This demographic analysis Single Race Other Boomers 18% Two or More Races Other 20% People over of Hollywood examines two Gen X 23% geographies within the greater age 25 with 0.7% 0.6% Millennials 55% a Bachelor’s Hollywood area: 1) the HED and 42% 4.6% 2) the Hollywood Trade Area degree or higher 8% 11.5% Gen Z in the HED and (Hollywood Neighborhood and 12% HED Hollywood Trade Hollywood Hills). The Hollywood Area residents 8.2% 0% 10% 20% 30% 40% 50% 60% Trade Area roughly includes the 28.0% Hollywood Trade Area area within a two-mile radius of HED Enrollment Numbers Hollywood & Highland. Hollywood Trade Area K-12: Public/Private These areas are examined side- 46.4% 10,500 Millennials make up of the by-side for two reasons. The 55% Post-Secondary first - it is important to The HP population in the HED compared to 7,500 to understand the demography 55% 36% in Los Angeles as a whole. of the area within the area it 3.5% manages, the HED. Understanding .04% .04% the unique traits of the HED Household Incomes can lead to more intentional 5.8% and impactful services. The $80,000 second reason is the Hollywood 8.3% Trade Area reflects the range of $70,000 residents and employees that play an essential role in supporting the $60,000 52.0% Hollywood economy. 29.6% $50,000
$40,000
$30,000
Hollywood $20,000
Trade Area $10,000 1990 1995 2000 2005 2010 2015 2020 Source: MySidewalk, mysidewalk.com (American Community Survey, Census Bureau of Labor) HED Hollywood Trade Area Los Angeles, CA
Hollywood Market Report Q4 2020 – Published January 2021 33 With COVID-19 already troublesome, the announcement of a more easily transmissible strain that would accelerate the rate of infected individuals was unwelcomed news. The overall economy remained under duress. Businesses throughout Los Angeles County continued to navigate a myriad of ever changing COVID-19 related regulations. In mid-November, the Los Angeles County Board of Supervisors voted to sustain a measure that temporarily halted outdoor dining operations for a minimum period of three weeks due to a rapid escalation in new COVID-19 cases. Additionally, essential businesses were authorized to operate at 35% capacity while non-essential businesses have been required to operate at 20% capacity provided that they implemented the County of Los Angeles Department of Public Health Protocols for Retail Establishments Opening for In-Person Shopping. Soon thereafter, the city issued a supplemental order that mirrored that of Los Angeles County’s restricting non-essential movement and ordering individuals to stay at home. Impact of COVID-19 To protect public health and sustain the economy, the The full impacts of the pandemic on the residential county launched a public awareness campaign called market remain difficult to ascertain. For the protection “Safer at Work Los Angeles.” Through the free program, of staff and existing tenants, many apartment building businesses are able to download and print pre-designed owners turned to virtual tours for rental prospects. signage that promotes social distancing and safety, Additionally, access to community amenities, such as and encourages customers to continue safe shopping. It gyms and meeting rooms, remain restricted due to should be noted that some stakeholders grew frustrated county public health requirements. Eviction moratoriums with the competing messages of “stay safely at home” remained in place throughout the year upon declarations and “safely at work,” which reflected the delicate dance of emergency by the state and local municipalities. It is of sustaining a fragile economy while minimizing the anticipated that these protections will extend well into the number of COVID-19 cases. In fact, the California new year until economic conditions greatly improve. At Restaurant Association sought legal action against Los the end of Q4, there are rumors of a rent relief stimulus Angeles County to repeal its halt on outdoor dining. package which may help fill the nearly $2 billion backlog experienced by landlords across the state. Like much of the region, office activity within Hollywood was in a state of paralysis due to the pandemic. Until Finally, the tourism industry experienced the full brunt mass vaccinations are successfully administered and of the pandemic. Normally abundant with tourists, stay-at-home orders are rescinded, leasing activity will Hollywood was starved of the usual stargazers that continue to be slow. Platforms like Zoom became the new fuel the economy. Guest safety was front and center for office in 2020. Even as COVID-19 vaccinations roll out in Hollywood’s hotels. For example, Dream Hollywood Hotel the new year, there is recognition that many employers implemented new contactless guest check-in technology will continue to evaluate office configurations and staff to improve customer service and generate new revenue. hours to maintain social distancing requirements. The The Hollywood Roosevelt Hotel turned to providing a bright spot for Hollywood is the increasing office demand safe guest entertainment experience through its drive- driven by streaming content providers such as Netflix. in theater. Tactics like this would become invaluable as With Americans trapped at home, there is limitless digital the amenity of outdoor dining capability was lost in Q4 content to help them be entertained safely from their due to widespread COVID-19 community infection. What homes. This in turn serves as motivation to return to work was to have been a three-week cessation of outdoor for Hollywood content producers, as demand for content, dining continued into the new year. This restriction was and therefore space to produce it, soars. devastating news not only to hoteliers, but also to food and beverage establishments in the district whom were surviving on that stream of business.
Hollywood Market Report Q4 2020 – Published January 2021 35 Spotlight on Hollywood Evolution of Retail and the Rise of Ghost Kitchens
While the retail industry was already undergoing a dramatic evolution, COVID-19 accelerated the need for innovation in order to remain profitable during the global pandemic. One innovative trend that emerged in Hollywood was the arrival of the ghost kitchen. Fairly new to the food scene, a ghost kitchen is shared commercial real estate where professional food The Bonnie Rendering preparation and cooking can occur for the purpose of food delivery. These facilities are ideal for food concepts to provide their goods to a trade area without the overhead of maintaining and operating a permanent brick and mortar location. One such facility is located at 1650 Schrader Blvd, a pickup/delivery hub for Development Moving Ahead Umami, Sam’s Crispy Chicken, and Krispy Rice. SocialEats operates at 1542 N Cahuenga Blvd. Virtual Despite Grim Market Conditions Dining Concepts will soon operate at 6363 Yucca St. Another ghost kitchen at 6464 Sunset Blvd served Dodger Across Hollywood, existing and new development Stadium food throughout the playoffs and World Series. projects moved forward despite the effects of COVID-19. Its operation ceased at the conclusion of the MLB season. While 2020 unsurprisingly slowed the development Until outdoor dining becomes permitted once again, food boom of the last several years in Hollywood, a number Exterior of Fingers Crossed takeout and delivery demand will remain strong. of projects were announced, existing projects received entitlements and broke ground, and in Q4, several projects received their certificates of occupancy. In the HED, the Selma Wilcox Hotel (114 hotel rooms) completed construction, and the Hollywood Wilcox (260 units) Small Business Support in Q4 residential project began construction. A new residential project at Highland & Hawthorne, The Bonnie (137 units), was announced as well. As COVID-19 continued to ravage the economy, local and their tax returns. The tentative credit reservation is state governments nimbly created financial programs allocated on a first-come, first-served basis. Finally, the Across greater Hollywood and outside of the HED, at to give small businesses in Hollywood and beyond a state of California unveiled various small business tax least four residential projects received their certificates much-needed boost. First, through its Secure Emergency relief measures including filing extensions and payment of occupancy and introduced 272 units into the housing Relief for Vulnerable Employees (SERVE) program, the plans. Hollywood businesses will be busy preparing their stock. Additionally, five residential projects began city of Los Angeles provided a one-time $800 stipend various applications. construction (358 units), and three new projects were to food service workers who reside in Los Angeles. Also, announced, including two residential projects (107 units) at the end of Q4, Governor Gavin Newsom announced and one hotel project (24 hotel rooms). several new programs to assist small businesses. At the time of publishing this Q4 report, the program guidelines for the governor’s Small Business Grant had yet to be developed. Beginning December 1, 2020, and continuing through January 15, 2021, the state’s Main Street Small Business Tax Credit would allow qualified small business owners to reserve up to a $100,000 hiring tax credit. The small business hiring tax credit provides a credit that a small business employer can use to offset their income taxes or their sales and use taxes when filing Ghost Kitchen Interior
Hollywood Market Report Q4 2020 – Published January 2021 37 With the exciting news and rollout of approved COVID-19 vaccines, Hollywood looks forward to a steady recovery in 2021. Despite the achievement of this critical medical milestone, the district will not simply revert back to business as usual. Hollywood SECTION III must continue its vigilance towards a full economic recovery. Social distancing and sanitization practices remain important. One real estate executive recently stated: “Safe doesn’t have to mean sterile.” As an organization, The Hollywood Partnership Looking Ahead to 2021 will continue to innovate in 2021 with partners to create safe and compelling visits within the district that help the economy recover.
Tackling Homelessness Hollywood Community COVID-19 Recovery Walk of Fame Master Plan
The Los Angeles region faces a historic crisis with Plan Update (HPCU) During the pandemic, the International Council of Another transformative physical project that shapes respect to housing affordability and homelessness. Shopping Centers (ICSC) issued a series of surveys market opportunities in Hollywood is the planned When surveyed in 2020, Hollywood stakeholders and Community Plan that evaluated consumers’ shopping attitudes during makeover of the world-renowned Hollywood Walk of identified homelessness as one of the top issues the pandemic. One of the key findings was that the Fame. Led by Councilmember Mitch O’Farrell of District affecting the district. The HP, alongside dozens of Implementation Ordinance pandemic reinforced the importance of small businesses 13 (CD13), the Walk of Fame Master Plan seeks to community-based organizations, has collaborated to (CPIO) in local communities. To this end, The HP is working reimagine Hollywood’s central commercial corridor by create Hollywood 4WRD, a coalition driven to create to develop and deploy programs that aid in recovery increasing sidewalks for more pedestrian activity, better and partner with local, regional, and federal assets to accommodating multi-modal modes of transportation, systemic change to effectively address homelessness One of the most important initiatives that define the avail resources to businesses within Hollywood. One increasing landscaped areas, and providing other safety in Hollywood through advocacy, education, service growth potential of Hollywood for years to come is the such effort that The HP looks forward to launching is its and infrastructure enhancements. The Hollywood Walk coordination, and innovation. In the fall of 2020, a HCPU. If approved, the HCPU would provide a much- Outdoor Dining Support Program, which was delayed of Fame Master Plan continues to move forward and is steering committee was formed to draft a strategic need update and modernization to the area’s current due to the reissuance of a statewide stay-at-home order now at 50% schematic design. The steady progress of the blueprint to formalize the coalition and set its strategic 33-year-old zoning. As everyone knows, a lot has and a county-wide closure of outdoor dining. master plan can be attributed to extensive community direction. The strategic plan to drive the organization changed since that zoning was established. For example, engagement led by CD13. Despite the pandemic, CD13 forward was approved in December 2020. The outlook the rise of the gig economy has shaped our lives in ways Additionally, efforts will continue providing technical and convened 51 roundtables of community members for the organization looks promising as recruitment unimagined. Mixed-use development is now prevalent financial assistance to ailing businesses. Specifically, throughout 2020 to provide comprehensive updates efforts for its executive director launch in early 2021. across the nation. Ridesharing is a normal way of life the federal stimulus bill that was finally signed into law on the project and field questions. Once completed, as millennials ditch automobiles in favor of eco-friendly paved the way for a new round of Paycheck Protection the refurbished Walk of Fame will enhance storefront lifestyles and memorable experiences. The nation is Program (PPP) funding and a new funding provision for vibrancy and bolster Hollywood’s infamous allure. over-retailed. What opportunities exist to reimagine how live entertainment venues. Hollywood’s multiple venues vacant retail spaces may be better utilized? look forward to this long-awaited boost. Listening to our stakeholders, connecting them to resources, and At the conclusion of 2020, The HP provided public advocating for tools and resources are central to the testimony for specific recommendations that included: efforts of The HP in 2021. These collective efforts are correcting inconsistencies between the HCPU/CPIO vital to strengthening our businesses and increasing and other plans and policies, expanding opportunities commercial occupancy. to propel Hollywood as a regional employment center, supporting the preservation of historic resources, aligning the approach to and plans for a multi-modal community, and simplifying the process for investing in Hollywood’s future as a dynamic mixed-use neighborhood. These changes will be particularly important in a post- pandemic world as newfound workplace flexibility will allow businesses and residents to choose any place in the world to live and work. The ability to compete for, attract, and retain talent and investment has become more important than ever before. The HP’s advocacy on this front will carry on throughout the HPCU and CPIO public approval process.
Hollywood Market Report Q4 2020 – Published January 2021 39 APPENDIX About Map
GREATER HOLLYWOOD & HED BOUNDARIES The Hollywood HED Boundary Partnership Greater Hollywood Boundary* NOTE: Boundaries of the Hollywood Trade For many years, the organization that manages Area include the Greater THE HP BOARD Hollywood Boundary as the HED was known within the community as The well as the Hollywood Hollywood Property Owners Alliance (HPOA), or more C. Drew Planting, Goldstein Planting Investments – Chair Hills neighborhood to Katie Zandona, Ullman Investments – Vice Chair colloquially, “The BID.” As these pages illustrate in the north. Tony Zimbardi, AMDA College And Conservatory of Performing great detail, change continues within the Hollywood Arts – Secretary community. Just as the community has evolved and Monica Yamada, CIM – Treasurer will continue to do so, the HPOA has evolved its name Leslie Blumberg, The Fonda Theatre to become The Hollywood Partnership (The HP). Vaughn Davis, Dream Hotel Brian Folb, Paramount Contractors & Developers David Gajda, Hollywood Media Center The HP is a 501(c)(6) nonprofit corporation that Michael Gargano, Argent Ventures manages the HED. The HP is governed by dozens of David Green, Nederlander West Coast property owners and stakeholders representing the Chase Gordon, Avison Young diverse array of property types in the HED, including David Gordon, 1645 Vine St. office, industrial, residential, hotel, retail, nonprofit, Bill Humphrey, Hudson Pacific Properties Amy Lemisch, Netflix and government uses. Chad Lewis, Klein Financial Corporation Jeffrey Moghavem, Archway Holdings The HED is funded by more than 600 property owners Michael Nazzal, Yorkwood LLC Sources who assess themselves at more than $7.4 million Michael Pogorzelski, Academy of Motion Picture Arts & Sciences annually to pay for cleaning, safety, placemaking, Joe Rehfeld, 6250 Hollywood Blvd. PRIMARY SOURCE Frank Stephan, Clarett West Development communication, research, marketing, and advocacy The Hollywood Partnership Larry Wilkes, Related services. In 2019, the HED was renewed for a period of
10 years and expanded to include the area formerly Ex-Officio Members known as the Sunset & Vine PBID. Rana Ghadban, Hollywood Chamber of Commerce SECONDARY SOURCES Dan Halden, Council District 13/Heart of Hollywood RESIDENTIAL RETAIL Colleen Jimenez, Downtown Properties The Hollywood Chamber of Commerce California Employment Development Department
CoStar, costar.com Advocacy & Economic Development Committee THE HP STAFF Michael Gargano, Committee Chair CBRE NEIGHBORHOOD MOBILITY Kristopher Larson, AICP Scott Blakeslee LA Business Journal Los Angeles County Metropolitan Transportation Authority, President & CEO David Gajda REbusinessonline.com metro.net Rana Ghadban Rent Cafe Davon Barbour Dina Goldstein Realtor.com DEMOGRAPHICS Vice President of Advocacy & Economic Development Dan Halden Bill Humphrey Yardi Matrix, yardimatrix.com MySidewalk, mysidewalk.com (American Community April Clemmer David Lapidus Yieldpro.com Survey, Census Bureau of Labor) Communications & Administrative Coordinator Amy Lemisch ZIMAS, The City of Los Angeles, Department of City Cassie Hoeprich Chad Lewis Planning This report was composed by Kristopher Larson, Davon Joseph Mariani Research Manager Burbour, and Cassie Hoeprich. Data research and Peyton Nealis OFFICE Lorin Lappin Michael Nazzal analysis was led by Cassie Hoeprich. Copy was produced Business & Finance Manager Drew Planting California Employment Development Department by Kristopher Larson, Davon Barbour, Cassie Hoeprich, Marty Shelton CoStar, costar.com Ruben Lechuga, EMBA and Devin Tait Strecker. Special thanks to the featured Vice President of Urban Place Management Monica Yamada Cushman & Wakefield, cushmanwakefield.com photographers and partners. Kastle Systems Rich Sarian Place Enhancement Manager If you have inquiries related to the data and information HOTEL & TOURISM presented in this document, please reach out to The HP’s Devin Strecker Los Angeles Tourism & Convention Bureau, Research Manager, Cassie Hoeprich, at Vice President for Communication discoverlosangeles.com [email protected]. Los Angeles Worlds Airports, lawa.org Smith Travel Research Hollywood Market Report Q4 2020 – Published January 2021 41 APPENDIX Market Review Tables
TABLE 1: OFFICE SPACE MARKET AND DEVELOPMENT INSIGHTS TABLE 3: PIPELINE HOTEL ROOMS
Hollywood Hollywood Hollywood QoQ YoY HED HED HOLLYWOOD HOLLYWOOD Q4 2019 Q3 2020 Q4 2020 Change Change # of projects # of rooms # of projects # of rooms
Overall Asking Rents (per SF) $4.54 $4.56 $4.77 +$0.21 +$0.23 Under Construction 5 820 5 820 Class A Asking Rents (per SF) $4.77 $4.66 $4.80 +$0.14 +$0.03 Entitled 5 1,014 5 1,014 Inventory (SF) 4,453,027 4,369,143 4,497,868 +128,725 +44,841 2020 YTD Absorption 8,806 -141,425 -190,285 -48,860 -199,091 Proposed 6 681 7 705
Overall Vacant Space (SF) 631,943 773,368 950,953 +177,585 +319,010 TOTAL 16 2,515 17 2,539 Overall Vacancy Rates 14% 17.7% 21.1% +3.44% +6.94% Source: The Hollywood Partnership, Zone Information and Map Access System (ZIMAS) 2020 YTD Leasing Activity (SF) 346,129 101,499 108,735 +7,236 -237,394
Source: Cushman & Wakefield, Los Angeles Office Report, Quarter Four 2020 TABLE 4: HOTEL PROPERTIES AND ROOM INVENTORY
Q4 Q4 TABLE 2: PIPELINE OFFICE SQUARE FEET HED Hollywood
HED HED HOLLYWOOD HOLLYWOOD Hotel Properties 29 64 # of projects SF # of projects SF
Under Construction 1 335,509 sf 1 335,509 sf Hotel Room Inventory 2,660 5,422
Entitled - - 1 95,000 sf Source: The Hollywood Partnership, Zone Information and Map Access System (ZIMAS)
Proposed 5 1,512,444 sf 6 1,648,444 sf
TOTAL 6 1,847,953 sf 8 2,078,953 sf TABLE 5: LAX AIR TRAVEL
Passenger Travel Totals Q4 2019 Q3 2020 Q4 2020 QoQ % YoY % Source: The Hollywood Partnership, Zone Information and Map Access System (ZIMAS)
Domestic 15,317,071 4,317,372 5,098,849 +18.10% -66.71%
International 6,087,758 662,950 1,003,955 +51.44% -83.51%
TOTAL 21,404,829 4,980,322 6,102,804 +22.54% -71.49%
Source: Los Angeles World Airports (LAWA) Traffic Comparison (TCOM)
Hollywood Market Report Q4 2020 – Published January 2021 43 UNDER CONSTRUCTION APPENDIX Active Developments Summary ENTITLED HED & GREATER HOLLYWOOD AREA PROPOSED HED TYPE NAME DEVELOPER ADDRESS # TOTAL TOTAL TOTAL UNITS MARKET AFFORDABLE AFFORDABLE HOTEL STORIES SQ FT OFFICE RETAIL RATE RATE UNITS RATE % ROOMS SQ FT SQ FT UNITS Y Hotel Godfrey Hotel Oxford Capital Group 1400 Cahuenga Blvd 8 74,362 - 3,713 - - - - 220 Y Hotel Hyatt's Unbound Collection PNK Group 1525 N Cahuenga Blvd 7 42,953 - 1,495 - - - - 64 Hotel Y Hotel Thompson Hotel Relevant Group 1541 Wilcox Ave 11 109,502 - 9,000 - - - - 190 Y Hotel Tommie Hotel Relevant Group 6516 Selma Ave 8 36,656 - 8,500 - - - - 212 Y Hotel Whisky Hotel Adolfo Suaya 1717 Wilcox Ave 7 62,213 ------134 Y Office, Residential On Vine Kilroy Realty 1341 Vine St 20 498,599 335,509 13,000 196 196 - 0.0% - Y Residential 1621 N McCadden Pl Housing Diversity Corporation 1621 N McCadden Pl 8 - - 69 - 69 - Y Residential 6200 Sunset Hanover Company 6200 Sunset Blvd 7 243,315 - 12,120 270 270 - 0% - Y Residential Wallace on Sunset Essex Property Trust 6254 Sunset Blvd 7 177,300 - 4,678 200 188 12 6.0% - N Residential 1130-1134 N Orange Drive MCAP Partners 1130-1134 N Orange Dr 5 - - - 24 21 3 12.5% - N Residential 5245 Santa Monica Blvd Petros Taglyan 5245 Santa Monica Blvd - - - - 49 39 10 20.4% N Residential 5570 Melrose Ave Crecent Capital Partners 5570 Melrose Ave - - - - 58 52 6 10.3% - N Residential 5801-5809 Camerford Ave Empire Property Group 5801-5809 Camerford Ave 4 41,995 - 36 31 5 13.9% - N Residential 5806 Lexington Ave Proper Development 5806 Lexington Ave 5 - - - 17 15 2 11.8% - N Residential 6535 Melrose Ave Melrose Highland, LLC 6535 Melrose Ave - - - - 33 30 3 9% - N Residential 700 Highland Kambiz Hakim 700 Highland Ave 4 - - 4,900 33 30 3 9.1% - N Residential 7500 Sunset Faring Capital 7500 Sunset Blvd 5 - - 30,000 200 180 20 10% N Residential 901 Vine Street Massoud Shabahang 901 Vine St 5 75,411 - - 76 69 7 9.2% - N Residential Alta Ink Wood Partners 5750 Hollywood Blvd 7 166,800 - 5,700 161 147 14 8.7% - N Residential Ariadne Getty Foundation Sr. LA LGBT Center and Thomas Safran & 1127 N Las Palmas 6 32,600 25 25 - Housing Associates N Residential Inspire Hollywood Bond Companies 1522-1538 Cassil Pl 8 107,012 - 1,089 200 190 10 5% - N Residential La Mirada at Central Park Pedram Mehrian 5608 W La Mirada Ave - 18,915 - - 13 13 - - - N Residential Michaeljohn Home & Thomas LA LGBT Center and Thomas Safran & 1119 N McCadden Pl 6 69,585 - - 123 - 123 100% - E. Jones Youth Housing Associates N Residential MR2 Lofts Onni Group 6901 W Santa Monica Blvd 7 218,316 - 14,093 231 216 15 6% - N Residential The Rise Hollywood Cal-Coast Development and Rescore 1311 N Cahuenga Blvd 7 347,019 - 2,570 369 349 20 5.4% - N Residential Skye Lexington Skye Urban Home - Bernal Capital 6517-6533 Lexington Ave 3 - - - 18 18 - - - Y Hotel Citizen M Citizen M 1718 Vine Street 14 73,440 - 3,600 - - - - 240 Y Hotel Ivar Gardens R.D. Olson Development 6407 Sunset Blvd 21 141,895 - 1,900 - - - - 275 Y Hotel Schrader Hotel Koar Institutional Advisors 1600 N Schrader Blvd 11 83,605 - 5,557 - - - - 191 Y Hotel Whitley Hotel Whitley Apartments, LLC 1719 N Whitley Ave 10 99,375 ------156 N Hotel, Office, Crossroads of the World Harridge Development Group 6671 Sunset Blvd 30 1,300,000 95,000 190,000 950 845 105 11.1% 308 Residential Y Residential 1601 North Las Palmas RW Selby & Company 1601 N Las Palmas Ave - 28,000 - - 202 133 69 34.2% - Y Residential 6220 Yucca Champion Development 6220 Yucca St 30 - - 7,700 269 252 17 6.3% - Y Residential 6400 Sunset Boulevard GPI Companies 6400 Sunset Blvd 28 451,313 - 7,000 200 190 10 5.0% - (Amoeba Tower) Y Residential Hollywood and Gower Trammell Crow Company 6100-6116 Hollywood Blvd 22 197,503 - 3,270 220 209 11 5.0% - Y Residential Hollywood Wilcox LeFrak Organization 6430 Hollywood Blvd 15 278,892 - 17,800 260 234 26 10.0% - Y Residential Modera Argyle Mill Creek Residential Trust 1546 Argyle Ave 7 260,250 - 30,431 276 263 13 4.7% - Y Residential Palladium Residences Crescent Heights 6215 Sunset Blvd 28 927,354 - 24,000 731 694 37 5.1% - 45 UNDER CONSTRUCTION APPENDIX Active Developments Summary Cont. ENTITLED HED & GREATER HOLLYWOOD AREA PROPOSED HED TYPE NAME DEVELOPER ADDRESS # TOTAL TOTAL TOTAL UNITS MARKET AFFORDABLE AFFORDABLE HOTEL STORIES SQ FT OFFICE RETAIL RATE RATE UNITS RATE % ROOMS SQ FT SQ FT UNITS Y Residential Selma Place HBCS 6753 Selma Ave 7 20,000 - - 51 43 8 15.7% - N Residential 1025 N Wilcox Avenue 1025 N Wilcox Avenue LP 1025 N Wilcox Ave 4 - - - 12 12 - 0% - N Residential 1375 St. Andrews Nash-Holland 1375 St. Andrews 1375 St. Andrews Pl 8 226,160 - 1,279 185 185 - 0% - Investors, LLC N Residential 5600 Hollywood Blvd Hollywood Square, LLC 5600 Hollywood Blvd 7 28,371 - 32 29 3 9.4% - N Residential 5817 W Lexington Avenue 4D Development & Investments 5817 W Lexington Ave 5 - - - 21 19 2 9.5% - N Residential 747 N Western Ave Lee Family Trust 747 N Western Ave 7,700 51 45 6 11.8% N Residential Citrus & Highland The Illulian Group 1242 North Citrus Ave 6 149,651 - 5,667 72 72 - 0% - N Residential Montecito II Thomas Safran & Associates 6650 West Franklin Ave 6 53,370 - - 68 - 68 100% - N Residential The Lombardi MCAP Partners 1729 Bronson Ave 7 146,836 - - 86 86 - 0% - N Residential PATH Villas Hollywood PVH LA LP 5627 Fernwood Ave 6 - - 60 - 60 100% - Y Hotel 1700 N La Brea Avenue PNK Group 1700-1710 N La Brea Ave 9 70,029 ------77 Y Hotel 1723 Wilcox Avenue Korman, Nathan 1723 Wilcox Ave 7 43,163 ------81 Y Hotel 6445 W Sunset Blvd Nela Development 6445 W Sunset Blvd 175 Y Hotel 6751 Hollywood Boulevard Mehdi Bolour 6751 Hollywood Blvd 12 ------168 Y Hotel Palmer Hotel Artist Guild Hotels 6360-6366 Hollywood Blvd 10 ------87 N Hotel 6830 Sunset Stay Hotels Group 6830 Sunset Blvd 6 ------24 Y Hotel Chaplin Hotel 7219-7225 West Sunset, LLC 7225 Sunset Blvd 11 ------93 Y Office 1235 N Vine Street The Post Group and Plus 1235 N Vine St 8 124,800 117,000 7,800 - - - - - Development Y Office 6381 Hollywood Blvd Onni Group 6381 Hollywood Blvd 14 217,269 210,000 6,500 - - - - - Y Office Sunset & Wilcox MP/Shorenstein 6450 Sunset Blvd 15 445,158 433,148 12,141 - - - - - Y Office Sunset Gower Studios Hudson Pacific Properties, Inc. 6050 W Sunset Blvd 18 628,000 628,000 - - - - 0% - N Office 1000 Seward The Post Group and Plus 1000 Seward St 10 - 136,200 14,400 - - - - - Development Y Residential 1400 Vine Patrick Tooley & Legacy Partners 1400 Vine St - 197,243 - 16,000 198 198 - 0% - Y Residential 6007 Sunset Boulevard CIM Group 6007 Sunset Blvd 7 45,000 - - 63 63 - 0% - Y Residential Artisan Hollywood Tower Artisan Realty Advisors 6350 Selma Ave 23 - - 6,576 270 243 29 10.0% - Y Residential The Bonnie Michael Nazzal 6831 Hawthorn Ave 8 - - 1,200 137 123 14 10.2% - Y Residential Hollywood Arts Collective Thomas Safran & Associates 1637 N Wilcox Ave 7 - - 6,586 151 - 151 100% - Y Residential Hollywood Center Millenium Partners 1720 Vine St 35 1,272,741 - 30,000 1,005 872 133 15.3% - Y Residential Hollywood Tower Onni Group 1360 N Vine St 21 475,423 - 68,988 429 413 16 3.7% - N Residential 1114 N St. Andrews Place Bang Ja Kim 1114 NSt. Andrews Pl - - - - 60 54 6 10% - N Residential 1233 N Highland Ave The Illulian Group 1233 N Highland Ave 6 12,160 72 66 6 8.3% - N Residential 1301 N Cherokee Avenue Uncommon Developers 1301 N Cherokee Ave - - - - 18 18 - - - N Residential 1310 Gordon Street Wiseman Residential 1310 Gordon St - - - - 60 55 5 8.3% - N Residential 1333 Tamarind Avenue Wiseman Residential 1333 Tamarind Ave 5 55,888 - - 45 41 4 8.9% - N Residential 5530 Virginia Avenue Bang Ja Kim 5530 Virginia Ave - - - - 64 57 7 10.9% - N Residential 5600 Franklin Ave Ilan Gorodezki 5600 Franklin Ave 5 - - - 41 41 - - - N Residential 7100 Melrose Ave Markwood Enterprise 7100 Melrose Ave 4 15,962 - - 66 66 - - - N Residential Entrepreneur ASB Properties 1657-1665 N Western Ave 7 - - 13,192 95 81 14 14.7% - N Residential SunWest Reliable Properties 5525 W Sunset Blvd 6 - - 35,694 412 347 65 15.8% -
Hollywood Market Report Q4 2020 – Published January 2021 47 The Hollywood Partnership 6562 Hollywood Boulevard Los Angeles, CA 90028 323.463.6767
2020 ANNUAL + hollywoodpartnership.com Q4 MARKET REPORT hollywoodpartnership JANUARY 29, 2021
Hollywood Market Report Q4 2020 – Published January 2021