The Downtown News has a feel-almost-good story about a building struggling to gentrify in the southern end of the Historic Core. In September 2010, Rod Goldberg and a group of investors bought the Huntington Hotel on Main Street in Downtown hoping to transform the notorious "drug dealing hot spot" into market rate housing stock (a 20 year affordable housing deal with the city's Community Redevelopment Agency expired in July 2010). But the building's shady past and city regulations meant to protect tenants from the abuses of slumlords have made the transition a little rocky.
Goldberg and his associates bought the the 1910 building, which includes 20,000 square feet of retail, for $4.2 million and spent $3 million renovating. The first element of the remodel--change the paint color from "bruise purple" to "cream." Goldberg also changed the exterior signage from Huntington Hotel to Huntington Apartments, in addition to rebuilding rooms and utility infrastructure, and ripping out a metal cage around the clerk's desk.
They also evicted anyone who hadn't paid rent or didn't have a lease, relocated some tenants, and scared a few away with new 24 hour security. (There had been about 60 tenants when the building sold.)
According to the DN, under previous owner Darren Stern, the Huntington racked up 314 city code violations, forcing the property into the city's Rent Escrow Account Program, which requires slumlords to get their buildings in order before they can collect more rent. Tenants pay 50 percent of their rents and can put their rent into escrow accounts if the want.
Even though Goldberg has fixed the building up, it's still in REAP, and he won't be able to raise rents for 12 months after the property is freed up (which could happen as early as November).
That's the problem. As the DN reports: "According to a Housing Department record of rents paid by Huntington residents between 2005 and 2007, rates ranged from about $200 to $800." Apartments are currently being offered at $499 a month for 135 square foot studios with no bathroom or kitchen. Units totaling 300 square feet and including a bathroom go for $1,100. The city's REAP supervisor says the old records are unreliable, but some people have complained, including a lawyer for the Legal Aid Foundation.
The DN says that "after hearing complaints from tenant advocates, the [REAP] department reached out to Goldberg to try to establish proper rent levels. Talks are ongoing." On the bright side, the LAPD says that since the new owners have come "there has been a notable drop in crime around the area."
· From Blight to Bright: Remaking the Huntington Hotel [Downtown News]