$50,000 for one person

1 bedroom/1 bathroom = $2,300/month

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37187567)

80k is the lower bound of middle class

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37188881)

are you saying the middle class doesn't exist anymore?

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37188960)

how about not buying a new car worth 30k

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37189009)

My car has 230K miles on it currently and it is a 2009 Taurus and I bought it in 2011 for about $17K. I'll replace it at 300K. That's about 12 times around the earth's equator.

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37189577)

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37189573)

http://www.pewresearch.org/fact-tank/2018/09/06/are-you-in-the-american-middle-class/

"Middle-income households – those with an income that is two-thirds to double the U.S. median household income – had incomes ranging from about $45,200 to $135,600 in 2016."

This definition is absurd, because $136,000 would put your household in better shape than 85% of households.

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37194451)

wapo had an article about this last week, almost every apartment complex approved in DC/VA in the last five years has had "luxury" in the marketing materials

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37188967)

The "community manager" strung me along for about six months and then, all of a sudden, the investors who bought the building sold it to another group of investors. That group of investors claims that we need to give them an opportunity to fix the problem and Florida law doesn't really give me any other choice but to move out.

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37191271)

EVERYTHING built in LA is defined by parking, whether we like it or not. More specifically, everything is defined by our parking code. Los Angeles, unlike, say, New York, has extremely strict parking code for all residential occupancies. For all buildings in an R4 zone (AKA condos and rental units with more than 3 units) each unit is required to have 1 full size dedicated parking space. Compact spaces are not allowed, nor tandem spaces. In making our assessments as to required space for parking, the typical calculation is that each full parking stall will require 375sf of space (after considering not just the space itself but also the required drive aisle, egress, out of the structure, etc. So that 800sf apartment is actually 1175 sf to build.

But wait, there’s more! That parking space for each unit either has to be at ground level (which is the most valuable real estate on the whole project), or it has to be above or below ground. Going underground is astronomically expensive, primarily due to removing all that dirt, and the fact that earthquake zones such as LA have expensive requirements for structure below grade. Even going up above grade is problematic, given that the required dead load of vechile parking makes for expensive structure. So not only is 32% of your apartment just for your car and otherwise useless, but its also by far the most expensive part of that apartment to build.

Now we have to consider the required open space. Unlike most major urban cities such as New York or Chicago, Los Angeles has a requirement for each unit to have at minimum 100sf of planted open space on site. At least 50% of that open space must be “common open space”. What that means in real terms is that you are required, by code, to have a rooftop or podium garden on your building. As a developer you want as many balconies as possible, since you can charge more for a balcony and typically not so much for a nice communal garden / roofdeck. But even if you give every single unit a balcony, you STILL are required to have that stupid garden to a size of 50sf per unit. At least 25% of that garden must be planted with heavy plants / planter boxes that jack up your dead load and thus jack up the cost of the building’s structure.

So now that 800sf apartment you are building is actually a 1275sf apartment, with a garden and a large parking space.

Can we take at 800sf and divide it into smaller rooms? So a low income family could live there?

No we can’t. The required parking and open space are defined by the “number of habitable rooms” in the unit. Take that 1 bed room unit and make it a 3 bed room unit and now you have a requirement of 1.25 parking spaces (which rounds up) and 175sf of open space instead of just 100sf.

What if my apartment is right next to the metro? Do I still need all that parking?

In January 2013, LA enacted its first major parking reduction, essentially giving developers the option of replacing up to 15% of their required residential parking with bike parking if they are within 1500ft of a major light rail or metro station. However, these bike spaces must be “long term” spaces, which require locked cages, a dedicated bike servicing area. Also, each removed parking stall requires 4 bike spaces and all spaces must be at ground level, the most valuable real estate on the project. All this means that the trade is barely less costly than the parking spaces it replaces.

Another thing to consider with building near the metro is something called “street dedication”. A street dedication is the area between the existing street and the area on a building site that you are allowed to build on. Essentially its space the city is reserving for future expanding of the streets (for wider sidewalks, more lanes, etc. Because the city expects more traffic near these new metro stations, they have altered their plans to have much larger street dedications near the metro stations, squeezing the neighboring lots and raising the cost per square foot of each of these lots. Understandable, but it does not help the issue at hand.

OK, fine. So how affordable can I make my new rentals / condos??

All developers consider this as a cost per square foot (CSF). While all the parking and open space requirements make the CSF grow, lets just assume that its all the same. A modest, relatively affordable development might be $130 per sellable square foot to build and sold at $165 (these numbers are VERY oversimplified). If we built our tower in New York code, our cost to build would be $15,600,000. The same tower in Los Angeles would be $24,862,500 after the premium for shakeproofing and higher dead loading. Now we price both buildings at $165 per square foot, and sell all units. We get 19,800,000. That New York building makes us 4.2million. The Los Angeles building? You LOSE over 5 million dollars.

This is why you will never again see a new skyscraper in Los Angeles with condos selling for the lower middle class. They literally can’t build a legal building to code and charge acceptably without destroying their own business.

Just to break even, our developer for this project would need to charge $207 per square foot. Now consider the cost of land (all time high), cost of tower capable contractors in Los Angeles (at an all time high due to demand), as well as marketing, and paying your employees, architects, surveyors, required consultants over the course of multiple years. $300 per foot would be little more than break even. What if something goes wrong? A delay? What do you pay yourself and your investors?

TLDR: Los Angeles, right now, is simply incapable of building affordable rental and condo towers. The only way to make a new highrise building cost effective is to make luxury units, because what would be luxury amenities in New York or Chicago are required in Los Angeles by the building code, not optional. That was OK back when LA had cheap land and cheap construction, but our land and labor costs have caught up to other cities.

edit: adding this from something I wrote in the comments because I completely forgot to mention:

Traditionally, contracting was the best paying "blue collar" job out there, and to a certain extent it still is. If you were smart, hardworking, but didn't go to college, you started hauling bricks on a construction site and then worked your way up to general contractor over the course of years. Lots of the best GCs out there did this. But, as less and less of super capable kids DON'T go to college, there are less super capable 18 yearolds hauling bricks and 10 years later, less super capable GCs.

All that was manageable to an extent before the crash of 2008. Architecture (my job) was hit VERY hard, but it was the construction industry that was hit the hardest. A massive portion of the best (older and experienced) contractors left job sites, either to retire or go into consulting. Now that development has exploded and we need as many GCs as possible, we architects have to deal with less and less experienced contractors, who charge more and more.

While there are LOTs of guys and gals out there who can swing a hammer and go a good job on site, being the GC of a major project we are talking about is one of the hardest, most underappreciated jobs out there.

Its like conducting an orchestra where, for every missed note, thousands and sometimes millions of dollars are lost. Everything is timed down to the day, sometimes the hour. Hundreds of people, from suppliers to subs are involved. Any mistake will gouge you. Safety must be watched like a hawk or OSHA will eat you. Its a rare breed of construction worker who can handle this job, and they've never been in higher demand or shorter supply in Los Angeles. In 10 years this problem won't exist (we may have a surplus of good GCs actually), but right now its a dog fight getting the good ones to work with you. They have all the power and charge accordingly.

https://www.reddit.com/r/LosAngeles/comments/6lvwh4/im_an_architect_in_la_specializing_in_multifamily/

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37189031)

Who really needs a Pet Concierge. Or a theater in their apartment building?

(http://www.autoadmit.com/thread.php?thread_id=4127321&forum_id=2#37190580)