RIC FRANCIS / Associated Press
Views from a former Broadway department store remodeled into luxury lofts include the landmark Capitol Records building and the Hollywood sign.
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LOS ANGELES – Hollywood's best days were behind.
The glamour of the 1920s had long ago been replaced by crime and grime. Teenage runaways mingled with prostitutes at the city's most storied intersection, Hollywood and Vine.
Yet something curious happened. Hollywood refused to fade away.
The first signs of life surfaced a decade ago with new nightclubs and restaurants. Now, people are flocking to Hollywood to live in thousands of luxury condos and apartments.
More than $1 billion in residential development is slated for a few blocks surrounding Hollywood Boulevard and Vine Street – an unprecedented buildup designed to bring the “It” factor back to a place that once was the epicenter of cool.
“Five years ago we were desperate for any development. Now we can pick and choose,” said Los Angeles City Council President Eric Garcetti, whose district includes Hollywood.
The turnaround began in the mid-'80s when the city created a redevelopment area in Hollywood. Subway stops were later added, and a group of merchants banded together a decade ago to form a business improvement district and step up security patrols.
All this prompted developers to invest hundreds of millions of dollars to revitalize the area's entertainment core, anchored by the Hollywood & Highland Center, home of the Kodak Theatre and the Academy Awards.
Now Hollywood is a place to be rather than flee, with more than 3,500 residential units in the works.
“Everywhere we looked we saw an opportunity,” said Shaul Kuba, principal and founder of CIM Group, owner of Hollywood & Highland and developer of several pending residential-retail projects.
The renaissance is reshaping Hollywood and Vine, where two major developments are leading the residential makeover.
The KOR Group is renovating the old Broadway department store for a project that includes 96 luxury lofts and cinematic views of the Hollywood sign and the landmark Capitol Records building.
The Broadway Hollywood is nearly sold out after just two weekend sales events, with prices from the high $500,000 to $3 million.
“What you have is people that maybe two years ago would never have thought about buying in Hollywood are now literally fighting among themselves for units,” said Kate Bartolo, vice president of development for The KOR Group.
For Peter Varano, a 48-year-old New York transplant, it was an easy decision to buy a loft.
“I like the city feel and the city vibe,” said Varano, a voice-over agent who recently sold his Hollywood Hills home. “It's kind of like now I'm creating my own little New York because of the revitalization that's happening in Hollywood.”
Celebrities are also taking another look at Hollywood. Actress Charlize Theron has reportedly purchased a penthouse, and starlet Lindsay Lohan is looking. Bartolo declined to comment, citing buyer privacy.
Hollywood's hip factor will also be boosted by the arrival of the other major development, a W Hotel at Hollywood and Vine, part of a $500 million retail-residential project with more than 300 apartments and 150 condos.
Not everyone is happy with the plan. About 30 local businesses are being forced to vacate after the city invoked eminent domain.
Bob Blue, who owns a luggage shop opened by his father in 1946, has twice sued to stop the project. He lost the first lawsuit but feels confident he can win on the eminent domain issue.
“Hollywood is reviving without any government help or eminent domain,” Blue said. “It does seem wrong that things are going good, and you're getting kicked out.”
Other critics had feared the famed Capitol Records building might be bought and converted to condos. But city leaders said the landmark is off-limits.
Developers are seeing astonishing returns on their investment in Hollywood, spending about $150 a square foot to convert office space into residential units, then selling 1,000-square-foot condos for somewhere between $400,000 and $1 million-plus, according to Steven Tronson, vice president of Ramsey-Shilling Commercial Real Estate Services.
Rents now run as much as $2,400 a month for an 800-square-foot apartment, compared to about $800 a decade ago.
Despite concerns about residential saturation and lost office space, the pending projects will bring lasting changes.
“There is no going back,” Tronson said. “There is too much political will, too many serious investors and too much money being spent for this not to succeed.”
Challenges remain, however. Crime has dropped, but teenage runaways and prostitutes are still seen off Hollywood Boulevard.
“It's really still a work in progress,” said Kerry Morrison, executive director of the Hollywood Entertainment District, the merchant group. “Hollywood took many decades to fall into a state of decline so it's not going to be rebuilt in a decade's time.”
