ECHO PARK — A stroll down Sunset Boulevard through the heart of Echo Park finds many storefronts shuttered behind metal roll down doors. Banners and signs reading “For Lease” and “Available” are draped over several buildings. What’s going on? It’s the most recent phase of Echo Park’s ongoing commercial gentrification, as discount stores, checking cashing outlets and pawn shops give way to tenants catering to a more affluent clientele.
Rents have been climbing and are approaching $4 a square-foot in some choice spots, say real estate brokers. Potential tenants, ranging from Orange County barbershops to local restaurateurs and apparel stores, have been checking out the new available spaces, some of which have been renovated to show off exposed brick walls and soaring bow-truss ceilings. The opening of Lassen’s, a pricey organic foods store, has not only attracted more upscale shoppers to Sunset Boulevard but has also attracted more potential tenants to the area, too.
“Lassen’s is not a cheap market,” said Michael Pakravan with Kennedy Wilson, the brokerage firm that is seeking a tenant for the former Jumbo Bargain discount store. “It says something about the area. It shows that people in the area have money and are willing to spend it for daily needs.”
But Pakravan has competitors chasing after some of the same tenants. Pakravan’s listing, for example, is located on the north side of Sunset between Echo Park Avenue and Laveta Terrace, where most of the buildings are available for lease.
“There’s no doubt [there has been] more turnover in recent years and a little more space available,” said broker Clint Lukens, who is seeking a tenant for the building next to Pakravan’s listing, the former Fashions for Eva apparel store. “As spaces turnover, I anticipate continued interest in being in our neighborhood.”
Broker Eric Friedland of CIRE Commercial Real Estate helped bring Lassen’s to Echo Park, where the market occupies the former home of Save A Lot discount grocery. Now, Friedland is seeking tenants for the former medical center across the street at Echo Park and Sunset. Friedland said he’s also close to signing a deal with a “modern” barbershop from Orange County to fill the adjoining storefront, the former Crown Shoes store, that has been vacant since June.
“That whole area is changing,” Friedland said. “Lassen’s is pretty much become one of the main reasons to be at that intersection besides Walgreens.”
But finding tenants to fill these increasingly pricey Sunset Boulevard spaces can be a challenge. Also, many of the Sunset storefronts, especially on the north side of the street, have little or no off-street parking, a big draw back for many potential tenants. “Spaces can sit for a week,” Pakravan. “Sometimes they sit for a year or two.”
Still, with little in the way of new retail construction on Sunset Boulevard and more homes and apartments being built nearby, demand and Sunset rents are expected to keep rising, say the brokers.
“Rents have risen as there’s only so much space on Sunset Boulevard,” said Lukens.”We’re starting to see what feels like some steady state of rental rates for the moment, but overall continued growth as economy strengthens.”
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