The L.A. County Board of Supervisors passed a motion on Tuesday that will set aside $12 million from the American Rescue Plan Act to establish an Anti-Displacement Commercial Property Acquisition Program (Program) to prevent the displacement of small businesses located in areas at high risk of gentrification.
The motion—which passed unanimously—was introduced by Supervisor Holly J. Mitchell.
“Businesses are the anchor of local communities. They create local jobs and wealth-building opportunities for diverse residents,” said Mitchell, who noted that 60% of L.A. County’s 1.3 million small businesses were owned and operated by people of color.
“Rising rents and real estate speculation are causing displacement for many vulnerable small businesses, especially those in gentrifying communities of color,” Mitchell continued. “This motion directs the Department of Economic Opportunity to establish a new countywide strategy to stabilize small businesses led by people of color and other marginalized populations.”
While the program is intended to preserve commercial corridors in communities of color, $2 million is specifically targeted to the program’s launch in Mitchell’s home community of Leimert Park, where rising rents have pushed out small Black-owned businesses over the years and efforts by business owners to purchase property on its main drag—Degnan Boulevard —have fallen through.
“Through this pilot acquisition, we are preventing the property from being gentrified by a commercial real estate speculator,” Mitchell explained. “I believe in the strong community benefits of this deal and the ability of the key partners to implement it.”
The Leimert Park pilot is led by the nonprofit black owned and operated community land trust put together by Sole Folks owner Akil West and business developer Prophet Walker, and underwritten by the community development finance institution, Genesis L.A, which was established in 1998 out of the office of former Los Angeles Mayor Richard Riordan.
West and Walker had been working to secure a deal to purchase an 11,000+ square foot building located at 4317-4331 Degnan Boulevard that houses six businesses—including Sole Folks, the Hot and Cool Café and EsoWon Books for over $6 million. Plans included transforming the property into a complex with ground-floor retail space, 35 apartments and a rooftop restaurant. Their biggest challenge had been securing all of the funding.
The county program—and the money it guarantees—will ensure that the group secures the already partially funded property that was in escrow at $6.5 million and is now expected to close in the coming days.
Added Mitchell, “Any future redevelopment of the property in Leimert Park acquired and owned by the community land trust is not only required to provide below market commercial rent, but it also requires affordable housing at a robust community engagement process before and if any redevelopment of the land can occur.”
The efforts of Walker and West to preserve the cultural enclave that is presently enjoying a resurgence—thanks in part to the opening of a Metro station and the refurbishing and ultimate reopening of the Vision Theatre —will serve as a model to scale in other not yet identified areas of highest need across the county.
“The whole point”, Mitchell concluded, “is to support Black small businesses who get priced out of the market— to help stabilize their businesses by guaranteeing ownership of the buildings and a part of the contingencies is to make sure they are protected at a rent rate they can afford.
“The time is so critical because the city has invested millions of dollars in the refurbishing and ultimate reopening of the Vision Theatre and public dollars for the opening of a Leimert Park Metro station. We talk a lot in our community about gentrification in the context of home ownership, but it’s about black businesses too, and to join those others in providing ownership for this building in the hands of a black entity who have committed to maintain affordable rents for those black small businesses was our goal and we’ve accomplished it.”