DOWNTOWN NEWS
By: Eddie Rivera
Could Spring Street Become a Virtual Economic Center? Many people look at the intersection and sniff that the area is well past its prime. But the Historic Core, with Sixth and Spring streets as ground zero, could in fact could lead a healthy slice of L.A's multimedia and Internet-based industry into the 21st century. Amazingly, the aging community could be at the center of future technology. Through the efforts of the Community Redevelopment Agency (CRA), the Historic Core Business Improvement District (BID) and some forward-thinking building owners, Spring Street is quietly feeling a groundswell of activity from young multimedia companies and Internet-related enterprises. The businesses are eager to take advantage of the area's unique architecture, central location and soon-to-be-completed fiber optic street wiring. While it is still early in the virtual game, many of the physical and some of the economic components are in place to create a new Downtown dynamic. Call it the digital village. As Bunker Hill became Downtown's site of choice for new buildings, the former financial district- once called "Wall Street of the West"-was nearly abandoned. Approximately 10 Spring Street buildings between Fourth and Seventh streets are either empty or occupied only on the top floor. But while the area languished, L.A's multimedia industry began booming. Cherryl Wilson, property manager at 548 Spring Street, a 166,000-square-foot, 12-story historic building, smelled opportunity. With the establishment of the Historic Core BID, Wilson began courting new tenants who would appreciate the building's uniqueness and, perhaps more important, rental rates as low as 75 cents per square foot. The multimedia industry was a natural. "This was all very serendipitous," said Wilson. Referring to a successful model dubbed Silicone Alley, she added, "I was aware that this was being done in old, decaying New York City neighborhoods far worse than this one. People were reclaiming these old buildings for new uses."
Electronic Bridges
In the spring of 1998, Wilson contracted with Fast Serve, an Internet service
provider, who leased 13,000 square feet of the top floor and then set about
wiring the entire building with a high-speed, switched-port Internet
connection. "This is the key. This is the infrastructure," said Ken Levine,
owner of Fast Serve. If one considered the digital village in real-world
terms, the roads, bridges and highways were now in place. Data-including
video and text-can be routed from the 548 connection, an asset few home or
small business modems could provide in the past. Suddenly 548 could offer
tenants the advantage of rapid Internet connections along with a service
provider that was literally upstairs from them. Now, as Wilson increases her
construction crew to build out more offices,word has spread. "We've seen a
400 percent increase in the number of inquiries here," said Wilson recently.
"I used to get a phone call a month and now I get a call a day." Adding to
the attractiveness of the area is its location in a federal Empowerment Zone.
This allows businesses to qualify for hiring credits and tax reductions. Says
Levine, "The response to my company has been more than I ever expected,
but as this thing grows, there has to be room and opportunity for larger
companies to be a part of it."
Back at the CRA
Of course one building does not a village make, and the CRA had been
grappling with the Spring Street dilemma. As Deputy Administrator Don
Spivack described, "We had long been looking for ways to rehabilitate and
renovate these buildings and had thought of a variety of actions, most of
them related to live/work projects." But one of Wilson's tenants had a better
idea. In the spring of 1997, non-profit Global Incubation Inc. (GBI) set up
shop at 548. Created in conjunction with Loyola Marymount University,
GBI aims to support and nurture new multimedia, film post-production and
graphic designers. Working as an "incubator" for these newborn businesses,
GBI would prepare business plans, handle employee benefits planning and
introduce them to banks. GBI has applied for a community development
block grant and hopes to be fully funded later this year. "We are futurists,"
said Tonia McDonald, a GBI partner. "We want to see Downtown Los
Angeles happen. I see Downtown being revitalized and I am telling people
to get down here now." "This is the perfect use for this type of building,"
said Spivack, who added that the potential for other so-called digital villages
exists in the area around USC, as well as in Hollywood and North
Hollywood. Spivack envisions an area which would incorporate new
ground-floor retail outlets such as coffee shops and bookstores. To help,
CRA is spearheading a number of sidewalk and street lighting improvement
projects in the Spring Street area.
New Network
As the digital synchronicity continues, the City of Los Angeles has sent out
a request for proposals for funding partners to help complete a fiber optic
cable network. The route, which currently links Downtown to San Pedro,
would ultimately connect to West L.A. and Van Nuys. In addition, both
Sprint and Pacific Bell have laid down fiber optic lines on Spring Street,
creating a more convenient connectivity corridor. While these lengthy, high-
tech ties are far from completed, they could help set the electronic stage for
even more economic revival. Although the 548 building is the only Spring
Street structure yet working this wired world, the City would provide the
right-of-way, the existing physical infrastructure and a streamlined permit
process for companies who can market the use of the fiber optic lines to
other businesses. This could offset the cost of the line's construction. Like
others involved in the digital village project, Spivack is highly optimistic.
"Yes, we can create a digital village," he said. "You have to start
someplace."