Speculators Discover Westlake: Will the “Lake on Wilshire” Complete the Takeover of Central Los Angeles?

Inquilinos Unidos rally for affordable housing. Photo courtesy Jesús Hermosillo
Inquilinos Unidos rally for affordable housing. Photo courtesy Jesús Hermosillo

Tomorrow, October 12, will be the 525th anniversary of Columbus’ landing in America, a momentous event in world history. It is also when the City Planning Commission will support or deny another entrepreneur’s enterprise of great social consequence, if on a smaller scale: the “Lake on Wilshire” project in the heart of Westlake. One block from MacArthur Park, the proposed megaproject includes a 41-story, 478-unit luxury apartment tower, a 220-room hotel, an 850-seat performing arts space, and the usual retail and meeting spaces. The undeniably upscale vision juxtaposed against the blend of characteristics that make the Westlake community one of the most vulnerable in Los Angeles has the potential to mark a significant turning point in the lives of thousands of families who struggle to maintain their foothold in the city.

Westlake has largely been spared the gentrification seen elsewhere with the arrival of relatively affluent new neighbors or of a single huge development project and the soaring rents capable of uprooting longtime residents that follow in their wake. Served by the Red Line, between downtown and Koreatown, rents have risen here, too, and sent many a family packing, while worsening the hardship and overcrowding among those who stay. Still, it had remained a relatively opaque region on the map of urban imperialism, giving temporary respite to many others in the poorest echelons of L.A.’s working class. Until now.

The Lake on Wilshire project will reshape the MacArthur Park area. Source: Lake on Wilshire
The Lake on Wilshire project will reshape the MacArthur Park landscape. Source: Lake on Wilshire

Few places in the United States match the collective disenfranchisement glimpsed in Westlake’s demographic profile. In 2015, according to the U.S. Census, the 90057 zip code, which covers the central and largest part of the neighborhood, had a median household income of $27,890, a poverty rate of 36.5 percent, and severe overcrowding in over 30 percent of renter households. In 2010, it had reported that renter households were 96 percent. Such is the case in a metropolitan area where, as it is, rents in black and brown communities consume 63 percent of a household’s income. Finally, a UCLA Labor Center study on Westlake and neighboring Pico Union revealed in 2015 that households with an annual income below $15,000 made up 23 percent, and that, aside from having a Latino-immigrant majority, 44 percent of both districts’ population consisted of undocumented immigrants.

The latter has implications for housing policymakers, since undocumented people are barred from government benefits and often lack paperwork required by private institutional providers. It also helps explain why so many in Westlake work as street vendors to survive. And given the widespread fear and distrust that haunt the community, a report based heavily on self-reported information may well be understating the challenges.

Adding to the specter accompanying the “Lake on Wilshire” project (LOW), plans for a hotel in what is currently an office building involve displacing several organizations that serve local needs, including two of the city’s most important tenant-rights centers: Inquilinos Unidos and Eviction Defense Network. The two nonprofits have been critical in the fight against evictions and slum conditions, as well as in educating renters about their rights and responsibilities. We all know that the LOW would trigger skyrocketing rents in the area, further incentivizing landlords to push out tenants, but nobody knows what will happen after anti-displacement lawyers and organizers have themselves been displaced.

Rendering of the performing arts center planned for the Lake on Wilshire project. Source: Lake on Wilshire
Rendering of the multi-cultural and performing arts center planned for the Lake on Wilshire project. Source: Lake on Wilshire

Unlike several other projects its size, the LOW comes with no Community Benefits Agreement (CBA) to soften its impact on the community. Despite demands for housing affordable to locals at the LOW, the bare-bones Development Agreement includes only the 39 Very Low-Income (VLI) units required under the Density Bonus program. Either way, VLI housing, requiring an income for a 4-person family ranging from $27,051 to $45,050, automatically excludes most people in Westlake. All other units would be priced at market rates, currently estimated at $2,112 for a 1-bedroom and $3,328 for a 2-bedroom. Instead of a CBA, the LOW—whose reported construction costs are $213.8 million—includes promises of limited, and somewhat dubious, social value:

  • $2 million to renovate an existing transitional shelter for women (good, but will lead to no new housing),
  • $450,000 for the 1st District’s Public Benefits Trust Fund (good, but nobody knows how it will be spent),
  • $30,000 for future hotel employees’ job training (good, but it serves the employer just as much), and
  • $20,000 for the LAPD to install surveillance cameras within a 2-block radius of the project (no comment).

The developer is Walter Jayasinghe, or “Dr. J”, a well-known plastic surgeon and major local property owner who recently turned 80. Founder of the Sri Lanka Foundation, whose cultural activities include a Miss Sri Lanka America beauty pageant, he was named 2016’s “philanthropist of the year by the Sri Lankan Medical Association of North America-West “for his desire to promote the welfare of others, generosity, kindness and humanitarianism.”

The LOW’s website states that Dr. J ran a free clinic “every Saturday for many years” that catered to the homeless population around the downtown area and still raises funds for various humanitarian needs in his native Sri Lanka. Yet, there is no mention of caring about what Westlake residents most urgently need right now. His largesse has instead been directed toward the development of houses of worship – the acquisition or construction of several Buddhist temples, including several here in Southern California, and he played a “key role in setting up” the Dianetics Centre of Sri Lanka.

Dr. J’s generosity toward various causes may reflect genuinely held humanitarian values, even if some of us disagree on how to best promote the welfare of others. But at the end of the day, one private citizen’s values and intentions shouldn’t figure so heavily into city and neighborhood planning decisions that have the potential to affect so many lives so fundamentally. Perhaps this is the best argument for why the city government shouldn’t delegate its duties as the steward of equitable, humane urban development guided by a comprehensive understanding of its residents’ needs to market forces or even to well-intended philanthropists.

Thus, the question: Have the people of Westlake been left to fend for themselves?   

Los Angeles City Councilmember Gil Cedillo—who represents the 1st District, including Westlake—is known for his pro-immigrant, pro-labor stances, but he has consistently sided with developers since joining the City Council, even dismissing gentrification as “a myth.” He has thus far been silent on the LOW project, but the fact that the developer accepted labor unions’ fair-wage demands for future employees could persuade him (after all, he has long relied on union support for winning elections). As the district’s representative, he has tremendous influence over development here, and more so because he is on the City Council’s Planning & Land Use Management Committee, which must approve any project that gets past the (notoriously pro-business) planning commission.

Unlike Dr. J, Mr. Cedillo was actually elected, and recently re-elected, to represent the interests of some of the most vulnerable people in the country, like those in Westlake. His values and intentions do matter because how he chooses to act in this matter will ultimately determine the life chances of tens of thousands of his constituents: Families forced from their homes may need to move to a faraway city altogether to find new jobs and a new community–often in a city with poorer schools, fewer services, and fewer transit connections. The stress that accompanies displacement also often makes it hard for families to remain intact.

How Cedillo acts may also determine how he is remembered by posterity. Has he supported labor causes all these years only because he could get something in return? Did he champion immigrant rights in Sacramento because there was little risk in doing so? Was he an early supporter of LGBT rights because he knew it was the civil-rights issue of tomorrow? Is he willing now to do something to prevent an impending humanitarian disaster—to be suffered by many immigrants, workers, and LGBT folks who will be left in need of shelter—even if there is nothing in it for him?

Years ago, in response to an interviewer’s question, Dr. J remarked, “The American dream is a reality that anyone could achieve with honest hard work. Set a goal and go for it!” The renters of Westlake, and throughout Los Angeles, are indeed honest, hardworking people who pay the full price of the housing they live in, and then some. Now it is time for policymakers to ensure that they are not cheated from reaching their most cherished goals and dreams.

Jesús Hermosillo is a former organizer and researcher for labor unions and housing-rights organizations, including Inquilinos Unidos. He has a master’s degree in urban planning from UCLA. Raised in Boyle Heights, he is the only remaining member of his family in Los Angeles, thanks to the rising cost of housing.

  • Jesus Hermosillo
  • Vooch

    more housing is always better for everyone

  • Richard

    Great project. nearly 500 housing units, 39 of them subsidized for very low income tenants is better than a blighted parking lot.

  • Ian Mitchell

    Want affordable housing?

    It’s simple: Get lots of luxury housing built. Every year, more and more.
    Then wait.
    Luxury housing isn’t luxury after 5-10 years when there’s new and better being built.
    You get displacement because folks who want luxury don’t have new housing to buy, so they buy up formerly affordable housing and booge it out.

    We need more housing. Period.

  • You’re arguing that new development causes rents to rise, but this is a mostly market-rate development in an area where most housing has been under rent control for a long time. So, of course this project will have higher rents. As for the surrounding housing, if anything this project puts downward pressure on rents because tenants now have more choice about where to live, meaning landlords have to compete more for tenants.

    I don’t know if this project is demolishing any existing housing, but if not, this is all positive for renters in LA. It’s also an example of the success of the density bonus law. The city’s population keeps growing. Are we going to build enough housing for everyone or not?

  • Richard

    The new construction is being built on a surface parking lot.
    An existing commercial office building is being converted into a hotel.

  • Matt

    Read the comments. People don’t agree with you or the petition. The project will provide vital housing on a piece of land that is a parking lot now. No displacement is taking place so a completely false argument is being presented.

    The tenants rights center signed a lease for their office space. They don’t own the office building where the hotel is going to go. They can and will rent another office space of which there is plenty in LA. You seem very confused in understanding the difference between ownership and a lease.

    This type of journalism is really below Streetsblog’s standards. The “writer” should not be advertising in the comments, but should instead present an unbiased account of the facts. Very disappointed in Streetsblog for allowing this to take place.

  • Dion Noravian

    Exactly right Matt.

  • Jesus Hermosillo

    Hi Matt—-Yes, I’m aware of the comments, and not surprised by the criticism. I’m a bit taken aback, however, by the hostility my opinion article has elicited. In any case, I’m not sure what you’d like me to take away from this…. That I shouldn’t be expressing minority viewpoints? Personally, I’m a big believer in the exchange of ideas, though I know this, too, may be controversial. (I was recently kicked off some downtown-based YIMBY Facebook group for insisting on expressing viewpoints that others found irritating.)

    Anyway, if you read the article—and I do hope you will, because I sense you haven’t—you’ll see that I’m not arguing that residential tenants will be directly displaced by the project, but that it will cause rents in the vicinity to rise, thus making the neighborhood more expensive, thus encouraging landlords to replace their impoverished tenants with richer ones who can pay more.

    Regarding the difference between renting and owning: I’m not confused, I just disagree with unbridled capitalism. But I’d be happy to read a piece refuting my arguments (none of the comments here do that). So why not just pitch your own op-ed to Streetsblog? (I promise I won’t attempt to disqualify you by only mockingly referring to you as a writer.)

    Goodnight.

  • Matt

    Jesus,

    I did read your opinion piece and it is full of all sorts of assertions that are all over the place. You state that this project will raise rents in the neighborhood as a matter of fact yet provide no rationale for this. In an area where nearly all tenants are covered by rent control this makes no sense. How does this building affect rents anywhere else? Should we not build any housing in this City? If not should we just kick out every 18 year old from LAUSD since there won’t be any place to house them? If we should build housing, then why not on a parking lot next to a park and subway station that is supported by taxpayers across the City?

    Then you dismiss the developer’s desperately needed homeless shelter contribution for $2M by saying it won’t result in any new housing. You really think that money won’t help provide much needed services to the homeless, and I thought you said new housing was bad? Where are these 39 very low income families supposed to live now that they won’t be able to live in this building if it is killed?

    You state that you understand the difference between renting and ownership, but take exception to the fact that tenant rights organizations won’t be in the office building that is being replaced by the hotel. These organizations signed a lease agreeing to pay rent to occupy office space for a period of time. By all accounts both parties have lived up to the lease. There is no unwritten agreement that the tenant gets to stay in the office space any longer than their lease allows. This is the difference between renting and ownership, which you are missing.

    You criticized Cedillo, which is fine. However, he was just re-elected. You should realize your opinions on him are in the minority for his council district unless your just don’t respect the Community that chose him as their Rep.

    You state you don’t believe in unbridled capitalism, which is fine. However, much of the Westlake community are immigrants who have chosen to move here for our economic system. They could have easily chosen to go to a country with a similar language and culture that has sharp limits on capitalism like Cuba, Venezuela, or Bolivia. It seems like most locals disagree with you as they rejected those places in favor of unbridled capitalism.

    Finally, Streetsblog LA would never print an opinion piece by me, since it has become an anti-gentrification site more than a complete streets advocate. Now they seem to advocate for leaving parking lots open right next to a vital subway station.

  • JameKT

    More housing that will help the Middle Class that make up the bulk of LA is always good. They need help the most and more housing helps them, the poor have help from the government. Who will stand up for the middle class? The County and City are making tons of housing for the poor (in fact taxing all of us more for it), they are very well taken care of, I can see it on my VERY high taxes and $180 billion California State budget. So much money goes too the poor in LA, just look at the County and City Budgets, it’s close to 30% of our taxes go to public services for them. But how much to the Middle Class who pay all the taxes and come out and Vote. Glad this got approved, Middle Class needs to make sure the poor don’t dictate our City stays behind.

  • Joe Linton

    If you can advertise your point of view in the comments (as long as you stay on topic, and refrain from obscenities) then so can anyone else – including the author. I am grateful for Hermosillo’s article – and I think it’s wholly appropriate for him to include the petition for people who want to sign it.

  • Jesus Hermosillo

    Hi Matt—Thanks for pointing out the things I say that appear vague or unclear. Keeping these points in mind next time I write something will allow me to address them in the article. One example is the suggestion that no rationale exists for the idea that a large real-estate development affects rents in the surrounding neighborhood (or maybe just not “rent control” rents).

    In fact, I didn’t provide evidence for this point because it’s long been my understanding that this isn’t a widely disputed notion at all (like global warming—only people we generally don’t take seriously deny it as fact). In fact, developers themselves routinely tout as a social benefit the rise in local property values their development projects will trigger. A shiny new building attracts more affluent people to a neighborhood, whom other local property owners then see as potential renters or buyers willing to pay more (this makes owners hurry up and fix up properties for this very purpose, and not to appease the impoverished people already living there).

    As for “rent control” keeping rents unchanged: We don’t have true rent control, which would keep price controls on both vacant as well as occupied units; we have the Rent Stabilization Ordinance, a watered-down version of rent control that allows rents rise to market levels the moment they become vacant. This means that landlords, who see their property values go up (who see a chance to attract more affluent renters/buyers), then see an incentive to kick out their low-income tenants. Despite restrictions on evicting tenants who pay the rent on time and break no rules, there are legal loopholes that allow landlords to evict—like the Ellis Act, or owner-move-in.

    There are also myriad unscrupulous ways of evicting people from their homes, especially poor people who don’t know their rights, or don’t know how to enforce them, or cannot afford a lawyer. Many landlords also break the law by not providing maintenance and allowing tenants to live in dangerous and unhealthy conditions—despite this, prosecution of slumlords is extremely rare.

    I didn’t say I don’t support the building of housing—we definitely need lots of new housing built. But we need affordable housing. People say that luxury housing will eventually become affordable for poor people, that we should just increase the supply without caring about its price. As you may or may not know, there is a glut of “fancy apartments” in downtown (https://la.curbed.com/2017/9/15/16316040/downtown-la-high-vacancy-rate-rent). Their excessive supply may eventually bring down their prices, but this takes decades. I have a friend with two kids who urgently needed housing ten years ago on her small paycheck so she could move out of a room she rents inside another family’s tiny apartment. She still can’t find any a decade later. I think choosing to wait for the market to “naturally” drop rents is wrong. We need affordable housing right now. One small way of contributing toward this is requiring developers to set aside some of their new housing at affordable rates to poor people.

    The $2 million for renovating an existing shelter is good, but it won’t house more people than are currently housed there now. It means their building will be nicer, which is cool. But we need more housing. That’s the point I make there. As for the 39 “Very Low Income” units, I say in the article that they are not actually affordable enough—-not affordable for extremely poor people, like those in Westlake. I’d love to see this project get built—but with much more affordable housing, not just these not-so-affordable 39 units.

    Again, I’m not confused about renting vs. owning. I just believe it’s immoral to kick out a low-budget nonprofit organization doing “God’s work”—just because you legally can, and because you’re going to get richer from it. And I think it’s totally fine to speak my mind on this (i.e., to write an article saying I think it’s wrong). As for being in the minority… again, am I supposed to worry about this? I was taught as a little boy that I should be an independent thinker and not worry about whether others were going to agree with me all the time. And my intention here is to persuade. In any case, I disagree that most people in Westlake, or in CD 1, agree with his actions. When it came to tenant rights, they had two terrible choices to choose from, and so almost nobody voted. Also, many here cannot vote. And no, a desperately poor person cannot easily get on a plane to any of those countries you mention, or walk there, or take a cheap bus there. Nor did they come here because the approve of unbridled capitalism. They simply heard that somebody here was willing to pay them a little more than where they’re from, and they were desperate.

  • Matt

    Joe,

    I state my opinion. I don’t post pleas for signing controversial petitions. I just never thought I’d see the day that Streetsblog pushes an agenda on its readers to support keeping a parking lot near a subway station. Things have really gone downhill here from the early days of Streetsblog LA.

  • GlobalLA

    “I’m not arguing that residential tenants will be directly displaced by the project, but that it will cause rents in the vicinity to rise”

    You can blame people like yourself who keep holding back development and thus suppress our housing stock relative to demand. You can GUARANTEE rents will rise even further thanks to articles such as this one. Hold back progress and all you get is limited future housing inventory that only the rich can afford. You think affordable housing is something that can just be constructed easily and rented/sold at a loss WITHOUT building more density? You want something for nothing? You belong in the wrong country, there are other governments better suited to your restrictive ideology.

  • Jesus Hermosillo

    I’m strongly in favor of more housing and greater density. If you read my article, you’ll see I’m not arguing against that. There is something else I’m hugely concerned about. Go back and see if you can pick out what that is (it’s in the first paragraph).

  • GlobalLA

    Not buying your first paragraph because you simply ignore the dynamics of limited land, supply, and demand in the context of our heavily regulated free market. It’s like saying “I want more free and affordable muscles but I’m not against gyms, I just don’t want the unfair workouts and discriminatory exercise!”. If that doesn’t make sense, neither does this article…

    You should give more thought about EVERYONE’s needs (yes, that includes the MIDDLE-CLASS) and not just those to fit your agenda. You may not care about the rich because they can afford what they want but there is a large spectrum of us who also need the development so we can have more healthy competition by increasing the housing inventory.

  • Matt

    Since my first comment was taken off, I’ll keep reposting
    it. Not sure why it was removed as it was very fair even if the Streetsblog team does not agree with it. This is why I’ll never get an opinion piece here on Streetsblog.

    Jesus, you state it as fact that this project will increase rents throughout the District. What is your basis for that? If we can’t build next to a subway station on an empty parking lot, where are we supposed to put housing, including very low income housing in this City?

    You state that the $2M contribution to a homeless organization has questionable benefits because it is not building any new
    housing? Yet, new housing is supposed to be bad according to your piece.

    You are entitled to your opinion on Cedillo, but he was just
    re-elected by locals in the area and has been a very popular politician winning many elections among the locals for years, so is your problem with the people of the District? Otherwise, why not respect their votes?

    Finally, the unbridled capitalism that you rail against is the central piece of the economic system that so many immigrants in Westlake have flocked here for. They could have easily chosen to emigrate to Spanish speaking countries with limited capitalism
    like Cuba, Venezuela, or Bolivia, but they all chose to come here. Seems like they don’t share your views on capitalism or economics.

  • JameKT

    Damn Matt, you rock. well said.

  • Marcotico

    Some of you other commenters might benefit from reading the following:

    https://lisaschweitzer.com/2017/02/24/what-people-write-about-when-they-write-about-measure-s/

    “The most likely way to sustain victories from things like JJJ and counter straight-up NIMBY-related anti-growth is to build bridges with folks like the Tenants Union who are, for the moment, advocating for Measure S because they want things to change and are worried about the *effects* of development, but whose language and interests do not necessarily center *specifically* on stopping development entirely.”

  • sahra

    Just FYI, Matt, I poked through the back end of our site to see if a comment of yours had been unapproved, put in the trash, or marked as spam. I don’t see it, so that may have been a quirk of disqus. I had one of my own comments eaten recently on Streetsblog USA for reasons I still have no explanation for…sometimes that appears to happen.

    As for the points you’re actually raising, I’m sure we’ll have an opportunity to engage around them on one of my future stories one of these days.

    sahra

  • Matt

    Thanks Sahra. That makes sense, because I couldn’t see why it would have been deleted except it was kinda long.

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