Breweries vs Gentrification
The word running through the mind of every LA resident on the search for their next home is gentrification. With rents consistently rising double of inflation each year, it’s becoming harder and harder to keep up. Whether a prospective homeowner or a renter, being priced out of a desired neighborhood is an all-too-familiar story.
Another industry that has undergone a huge transformation over the past few years is the beer industry. Growing from 18 independent craft breweries in 2014 to 74 in 2017 (a number currently at 84 and that will be closing in on 100 by the end of 2018), LA county has gained a reputation for being very welcoming to microbrews. Figures from two-thirds of the members of the Los Angeles Brewers Guild shows the knock-on effect of that: the LA beer industry contributed $96m to the economy. That’s big business.
The LA Brewers Guild Executive Director, Frances Lopez has overseen the majority of the growth, working on business plans and licensing legislation for any new brewery that wishes to join the group, and is sensitive to the issue.
“I use the term ‘Mildly Gentrified’ when it comes to the introduction of breweries,” she explains. “You see the real estate prices go up and new small businesses come in. Highland Park is a great example. You see a bunch of local bars and restaurants and it’s not that the business owners have been there for decades - they’re new people.”
Real estate prices are going through the roof and it’s not nice to see people displaced but it’s also a very positive thing for that community,” Lopez continues. “Some people welcome that change into their areas. It’s a double-edged sword.”
A region of Los Angeles currently undergoing significant property price rises, acquiring an even heftier slab of cultural cachet, and is also a historic hub for craft breweries is the South Bay. Incorporating cities in the southwestern corner of LA from the Beach Cities (El Segundo, Torrance), the Palos Verdes Peninsula, Long Beach and San Pedro, and inland cities such as Inglewood and Hawthorne.
With no fewer than four new breweries opening in the past 18 months, Hawthorne and Gardena have seen something of a brewery boom of late. Common Space, Los Angeles Ale Works, Ximix, and State Brewing have followed the introduction of SpaceX and the promise of the Rams’ brand new world-class stadium into the region.
Of course, you can say that the gentrification of Hawthorne, in particular, started over a decade ago, as the aerospace industry looked to regroup, renovate and move forward, but 2018 is when we’re seeing the tangible evidence both in terms of storefronts and rent rises.
Zumper suggests that a 1-bedroom apartment in Hawthorne was valued at $1,000 in August 2015 (https://www.zumper.com/blog/2015/08/california-rent-report-august-2015), rising at 5.5%. Cut to May 2018 and you’re looking at $1,350. As one of the most affordable regions of LA, that is a hefty rise and the 13% year-on-year rise reported in August 2017 - attributable to SpaceX increasing production by providing 1,000s of extra jobs in the city - (https://www.zumper.com/blog/2017/08/los-angeles-metro-report-august-2017/), is only eclipsed by Alhambra (13.5%) and West Covina (15.3%).
“Hawthorne has been through some less than ideal times but it’s exciting to be here now,” says Brent Knapp, CEO of Common Space Brewery, which opened in March 2018.
“There are seven breweries between Hawthorne, Gardena, El Segundo, and Inglewood,” he continues. “We’re kind of like the LAX Corridor. Torrance has a great scene and the Arts District has a great scene, so we’re hoping the LAX Corridor can be a great scene.”
Tourism is indeed an important factor in improving the local economy. LA Beer Hop’s Hal Mooney runs a fleet of buses that take groups of beer enthusiasts on regional brewery tours the length and breadth of LA. Starting six years ago with two tours - one in eastern/central LA and one in the South Bay - they have now expanded their destination offerings to Hawthorne.
“We’ve considered making a specific Aerospace Corridor Tour because Hawthorne and Gardena is becoming a bit of a destination,” Mooney says. “It’s freeway adjacent and they’re all very different breweries even though they all have space-oriented branding.”
On the other side of El Segundo Blvd is Los Angeles Ale Works, which opened a year earlier in February 2017 and boasts beers with aerospace-oriented titles such as Martian Occupation and Space XPA. Brewer/owner Kip Barnes has many thoughts on the idea of gentrifying Hawthorne.
“I’d say that we are the number one business that real estate agents bring their clients to, to show how the area is growing and when a new business moves into an area, it’s often seen as gentrifying but we don’t wanna look at ourselves that way,” Barnes says, taking a pause from brewing a new IPA called Midnight Frisbee.
“It’s not who we are - we’re not crazy-wealthy people opening a business. If your whole goal is to focus on bringing tons of people from outside of your city, that’s when you hit that gentrification angle really hard. We want to be of service to the neighborhood.”
Looking around the neighborhood, you see other elements of business improvement. 2018 will see super-hip organic eatery Urth Caffe move their central headquarters to Hawthorne, as well as new car dealerships (Porsche and Subaru) and new hotels. This appears to be more a reflection of a city prospering through solid organization.
Common Space certainly benefited from Hawthorne’s easiness to work with.
“They were super business-friendly,” explains Common Space owner Brent Knapp. “They basically told us to get our plan together and that they would not get in our way.”
Speaking to the City of Hawthorne’s Urban Planner Maria Majcherek, the reasons behind the city’s recent rise became clear.
“We have a bunch of large companies newly established in Hawthorne and the employees need somewhere to go,” Majcherek says. “The industrial areas of Hawthorne are not the dirty manufacturing that it used to be. Now they’re much cleaner, R&D-type uses and the breweries fit right in.”
Majcherek goes on to explain how Hawthorne relaxed the terms of the Conditional Use Permit. Where there used to be strictly-enforced rules about being within 300ft of a sensitive use (a church, park, or, in this case, a school), common sense is being used.
“These two breweries are very professional and very responsible and they went ahead and spoke to the school district to assure them that they are well-managed businesses,” she explains. “The things that the city did was to encourage that kind of use, rather than a bunch of bars and liquor stores.”
When asked about the prospect of more breweries coming to Hawthorne, Majcherek was not closed to the idea.
“I wouldn’t be surprised if we get a few more. It creates a synergy when there’s more than one.”
Not every city has a SpaceX tentpole business to grow from, but emerging cities might want to pay attention to the methods the City of Hawthorne used to cultivate growth.
As residents are slowly priced out of the historically more desirable and well-known districts of the city, they move farther from the center, and that is where the growth is anticipated. Just as the Eastside trifecta of Los Feliz, Silver Lake and Echo Park have thrived over the past decade, that growth - the mild gentrification - can now be seen in Eagle Rock and Highland Park. It’s worth keeping an eye on cities even farther afield.
“I’m seeing a lot of growth in the eastern side of the county because there are communities there that are thirsty for that kind of business,” says Frances Lopez. “We don’t have a brewery in every single neighborhood and the areas that have a higher concentration of breweries, have a lot of people there. You’ll be seeing things in Glendora, Monrovia, Arcadia, Whittier, Downey.”
Hal Mooney agrees with that train of thought: “I believe that there could be a neighborhood brewery in every enclave of Los Angeles. They’re not all big, scalable breweries. They’re more mom ‘n’ pop shops where the brewmaster is the owner and also runs the taproom. Just like every neighborhood has a restaurant or two, maybe every neighborhood should have a brewery. It doesn’t sound like the worst world.”
While it’s clear that the emergence of craft breweries in a neighborhood is not a sinister harbinger of gentrification per se, their presence is certainly an indicator that the municipality is pushing for development. It means that local property prices may have already been on the rise, so if you’re looking for your new place and spot a local brewery, it might already be too late to grab that bargain.