By love-89.com In a recent interview, architect Scott Johnson and development manager Stuart Morkun discussed the complexities and challenges behind the newly completed Figueroa Eight, a 530-foot skyscraper in downtown Los Angeles. Morkun described the project as both thrilling and nerve-wracking, noting that their goal was to create a high-end rental apartment building in an area that had traditionally been dominated by office space.
The project was backed by Japan’s Mitsui Fudosan, which invested $350 million into its development. This decision raised eyebrows, as downtown LA has faced issues like a growing homeless population and declining office occupancy rates. However, Morkun believes Figueroa Eight demonstrates a significant trend: as the physical office market struggles, the demand for high-quality residential spaces is on the rise, with the downtown population exceeding 90,000 residents living in around 47,000 units.
Despite potential concerns, the management team behind Figueroa Eight remains optimistic. While they didn’t disclose specific occupancy rates for the building’s 438 apartments, they noted that rental agreements are progressing as expected, and the quality of the building itself has attracted interest.
Interestingly, the success of downtown LA’s residential sector contrasts with other major cities, where residential developments rely heavily on the presence of nearby office workers. A notable factor here is the shift accelerated by the COVID-19 pandemic, which has prompted many offices to close while people increasingly seek residential options in areas with more reasonable rent prices. According to commercial real estate firm CBRE, only 65% of downtown office spaces had inquiries in the first quarter of this year, prompting some landlords to mortgage their properties.
Historical trends indicate that the 2000s saw many office buildings constructed with little residential development, creating a cycle where the lack of amenities discouraged further investment. However, regulatory changes in the early 2000s, combined with the introduction of attractions like the Staples Center, have transformed the landscape, allowing for the conversion of office space into living quarters.
Lall stated that between 2004 and 2024, downtown LA has accounted for 30% of new multi-family housing developments, with plans for an additional 20% by 2040.
Morkun shared three key factors fueling this residential growth: an ample supply of new units, a comparative price advantage over neighborhoods like Santa Monica and Marina del Rey, and competitive incentives offered by developers eager to attract renters.
When discussing the design of Figueroa Eight, Johnson reflected on the differences between American and Japanese architectural approaches, emphasizing that Japanese designers prioritize long-term ownership and sustainability, while American projects often focus on short-term gains.
The pandemic has also influenced design choices, with Figueroa Eight featuring amenities that cater to remote workers, such as a dog park that’s open 24 hours, a fitness center, and outdoor spaces for relaxation and socializing. Morkun pointed out that developers who provide a wealth of amenities often see higher tenant retention rates.
As downtown LA continues to evolve, experts predict that over the next decade, more than 2,000 apartment units will be introduced to the rental market each year, suggesting that Figueroa Eight may be the beginning of a new chapter rather than an endpoint in the city’s ongoing transformation.