Is the Westside suffering the woes of recession? Yes and no. While the number of Lamborghinis and Ferraris cruising the palm and coral-treed streets seems undiminished, there are clear signs that the nation’s economic crisis is having an impact even on our most affluent neighborhoods.
It isn’t just that Starbucks, which found good reason to introduce a new “short cup†(priced some pennies below their former minimal offering) is experiencing brisk sales for that minimized container, or that Whole Foods has been expanding their cheaper-priced line of goods bearing their “365†store brand. There are bigger, though harder to discern, signs that the financial dilemma is being felt here.
“The Westside Bubble,†a blogspot that tracks declines in real estate values, is experiencing an increasing number of hits from worried homeowners who keep double-checking the falling values of their real estate and the rising cost of rentals.
Office rents on the Westside have risen from about 10 to 15% in the past six months, while those in Santa Monica are thought to have increased by as much as 25 to 35%. “Rarely are the markets ever in balance, but this is one of the fastest and most dramatic shifts that I can remember,†said Allan Wolf, president of Wolf Commercial Brokerage. Others in the real estate industry concur. Eric Olafson, of Cushman Realty Corporation, told the LA Business Journal (that): “the world has changed†since the recession. “For a while, tenants were able to take advantage of a good market, and now it’s the landlords’ turn.â€
The Los Angeles Unified School District has been affected by the downturn in the economy. “The number of people who can’t afford private schools is increasing,†according to School Board member Marlene Canter who has represented the Westside’s Fourth District which covers an area that includes the Palisades, Westwood and Brentwood among other neighborhoods. Parents who once never gave much thought to sending their children to public schools are having more than second thoughts as they watch their stock portfolios dwindle and home values fall.
Before 2008 came to a close, Ray Cortines (then deputy superintendent of LAUSD and now its leader) met with a group of parents at a Westside “Coffee Bean†to talk up the virtues of being educated at University High School. Emerson Middle School had its principal, Kathy Gonella, host a wine and cheese reception for parents who were considering sending their kids to public school instead of one of the highly touted and expensive private schools on the Westside they always figured their children would attend.
Take a look at websites that tout Westside restaurants and you will find bloggers pointing out meals they advise as being price-attractive to those watching their budgets due to the recession. The emphasis in such blogs used to celebrate the high-cost, sumptuous dinners offered by area eateries. Now, they’re addressing the needs of dollar-watching readers looking for cheaper lunches.
Rethink, a green building consortium of consultants, domain experts, governmental policy advisors and developers (they’ve developed policy and green building guidelines for Santa Monica, among other municipalities), sees good through the cloud of fiscal doom. In their blog from this past November, they wrote: “While you and I may fret over current difficult economic times, the planet is loving it. With reduced economic activity in the developed world comes reduced consumption, reduced energy use and overall lower environmental destruction. For those of us that are advocates of green business, it is also an opportunity, albeit cloaked in wolves’ clothing.†Rethink thinks that progressive Santa Monica will really benefit from the kind of investment in greening buildings that the Federal government is promising.
Vinnie Donohue, who runs All Star Star Rooter/Perfect Plumbing from offices in Mar Vista and who serves commercial buildings as well as private homes and condominiums from Beverly Hills to the beach, has noticed some recession-caused change in his business. “I think the service industries here, in general, are not feeling much if any reduction in the volume of business,†he said. “I know that mine hasn’t. What is different is the time people are taking in paying their bills. It’s taking longer now,†he said. “My prices aren’t lower, the need for my services is just as great … it’s only the pace of the flow of money that’s ebbing.â€
