Downtown Los Angeles wants creative tenants. The market has an office vacancy rate of 19%, and creative tenants—many believe—are the key to bringing that number down to the city average or 14%. The new Warner Music lease is expected to catalyze creative activity, encouraging more tech and creative companies to come downtown—but there may be a group of creative tenants already Downtown that need space: fashion tenants. A joint venture between Urban Offerings and ESI Ventures is building a creative office property in the fashion district to cater to these tenants.

“There is a good robust demand for retail and creative office in the fashion district. It is unique because it is in the heart of the fashion district, and there are a lot of fashion tenants that still do the design, marketing and sales in Downtown L.A.—but the manufacturing has moved out,” Shlomi Ronen, a managing principal at Dekel Capital and one of the brokers to secure equity and bridge financing for the project, tells GLobeSt.com. “In this particular submarket of Downtown Los Angeles, there is demand from the creative class of the fashion industry that wants to be near the wholesale mart and centrally located near the city.”

In this particular part of Downtown Los Angeles, there is little competing product, with a few redeveloped properties and no new buildings. “There is little to no new product in this area, but there is some existing. As you walk along Los Angeles Street, you see some of the storefronts at the bottom that are being converted from the old discount brokers and shoe sales to higher-end showroom-type of retailers,” says Ronen. “Above those shops, those buildings have really extensive and nicely built-out creative space that caters to the fashion industry.”