Sunday, October 23, 2016

American Apparel to close its first store in Echo Park


Storefront ReportECHO PARK — A lot has happened in the dozen years since American Apparel opened its first store, a large outlet on Sunset Boulevard in Echo Park. The underwear and t-shirt maker mushroomed into a nationwide hipster apparel chain known for its racy advertising and controversial founder Dov Charney before he was ousted from the company, and American Apparel  plunged  into bankruptcy. Now, the company is preparing to close the Echo Park outlet, which will leave another big retail space to fill on Sunset Boulevard.

“This store closure is a next step in implementing our previously announced turnaround plan, which includes closing underperforming locations and investing in new stores in promising areas,” the company said in a statement in response to an inquiry by The Eastsider.

The 5,300-square-foot store on Sunset near Alvarado is already up for lease and available in February, according to a listing on LoopNet.  The listing material says the rent is negotiable but there is mention of an asking rent of more than $29,000 a month. In addition, an adjacent storefront and the second-floor above the American Apparel shop is also available.

All that vacant space arrives on the market as several other Echo Park landlords are seeking tenants to fill empty storefronts along Sunset Boulevard.

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  1. not a surprise given the parent company’s troubles.

    the last thing we need along sunset is another vacant storefront. brokers, get your owners to lower asking rents and fill these places!

  2. Only $29 K a month?
    Someone should open a $20 a cup coffee joint here !

  3. wasn’t it’s first store on Robertson…?

  4. ohhhh as in it’s first store to close?

  5. This was AA’s flagship store – the first one they opened. Honestly, it’s no real loss, given the crappy product and the other issues with their founder and the company’s (lack of) finances.

    And the landlords in SL and EP have really screwed over so many of their tenants that they’ve now also succeeded in screwing themselves over. The astronomic rents really prevent small businesses from filling all the empty commercial spaces along Sunset and elsewhere. Not every business can bring in the dollars like La Mill, Mohawk Bent or Intelligentsia. Most will fail. Landlords need to get a grip – they have every right to charge a premium price for premium space, but tripling or quadrupling rent on existing tenants is a hostile act. I’d love to be happy about their empty spaces, but that doesn’t help the community remain vital.

    • “. . . but tripling or quadrupling rent on existing tenants is a hostile act.” One of the most concise and accurate descriptions/definitions of the business of gentrification I’ve ever read. Gentrification IS a hostile act perpetrated on the entire community. Well Said.

    • Give me a break. AA is one of the only American clothing companies that makes all their clothes in the U.S. The workers were paid a living wage and had fantastic benefits. They have a medical clinic on site, ESL classes, subsidized lunches, and bonuses. Say what you want about Charney, he built a company that employs thousands and thousands of people all over the world. Everyone screams how important “Made in the USA” is, but when it comes down to it, no one wants to pay the extra for clothes that support a living wage. People would rather buy a $5 shirt at Walmart than spend $15 on a shirt at AA. If it costs a little more to support fellow Americans, most are all talk.

  6. There has been talk of Fred Segal /Ron Herman looking for space in the neighborhood of a size similar to their Malibu outpost. I imagine Fred Segal would be able to afford $29,000 per month and to my eyes this looks like a space that could work for them as it is about the same size as the Malibu location. Unless I can get my sales associate at the Melrose store to spill the beans on this I suppose only time will tell…..

  7. I wish someone would open a gym there. Not a pilates or a crossfit, just a regular old gym.

  8. With the Fed lending to financial institutions at a short term rate of nominal 0.00% sustained over the past few years, this has an effect which may have seeped into sectors of the commercial real-estate market.
    The investors can acquire commercial property in a hot market and then hold it easily. They use the monthly rental income to pay their loan. They keep their cost low by doing minimal improvement to the property and looking for new tenants who will pay higher rents.
    Its alright if the property is 50% vacant, they don’t want to lower their asking rate because that is the rate used to value the property in the next sale. The new owner is a short-termer looking to pocket a chunk in the next quick flip. If rates change and the owner becomes over-leveraged and loses the property to the bank, then it becomes the banks problem.
    If the bank goes under, then it becomes the taxpayers problem.
    Rising commercial property prices and rents coupled with rising vacancy rates.
    Rhymes with “trouble”.

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