Through the 1980s, the 85-block L.A. Fashion District was a mess. Many of the buildings were vacant, the streets were overrun by panhandlers and graffiti was the art form of choice.
But that began to change in 1995 when the Downtown Property Owners Association launched the area's Business Improvement District, with members being assessed $3 million annually. Those funds have helped pay for additional security, street cleaning, tree planting and construction of cobblestone crosswalks.
The district attracts millions of wholesale and retail buyers each year. At Santee Alley, consumers shop in an open-air bazaar, where merchants peddle everything from silk dresses to household supplies.
No one has benefited more from the renaissance than Steven Needleman, owner of the Anjac Fashion Buildings.
Based on a survey conducted for the Business Journal by CB Richard Ellis, the company owns about 50 properties covering nearly 16 acres in the neighborhood, which Needleman's father Jack targeted for investment beginning in the early 1960s.
Anjac's holdings include a score of properties, including the Orpheum Theatre and the Wurlitzer building at 818 South Broadway.
That success is partly due to a strategy that Steven Needleman says he inherited from his father invest your own money and don't take on partners. So, for example, the nearly $8 million he invested to renovate the Orpheum theater and convert the upper floors into 37 lofts came out of his own pocket.
"Every property I own, I manage," said Needleman. "I am a very hands-on property owner. It might limit growth not to have outside investors, but my needs are not that great."
Needleman scored three years ago when MJW Corp.'s Mark Weinstein bought nine buildings that formerly housed apparel manufacturing operations and transformed them into a collection of condominiums and lofts known as Santee Court. The project attracted hundreds of new residents to the area and many new apparel-related businesses then moved into Needleman's buildings.
As for new development, the San Pedro Fashion Mall at the corner of 12th and San Pedro streets has more than 400 wholesalers selling their apparel to retail outlets around the world. Now, businesses within the district generate $8 billion annually from sales and services, according to the area's business improvement district.
Still, the Fashion District suffers from an exodus of apparel manufacturing, which is either going overseas or to more modern facilities in north Orange County, Vernon and City of Industry.
Ideal space today is single story, with high ceilings, large floor plates and driveways that are easy for trucks to navigate something often unavailable in the district.
"The buildings in our district just don't lend themselves to (modern requirements,)" said Kent Smith, executive director of the BID. Some of the space, though, is being absorbed by designers, studio operators and wholesalers.
The second-largest property owner in the area is not even apparel related. A real estate investment trust called City Market of Los Angeles owns the six-acre produce market that has been in operation since 1906 on San Pedro Street.
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