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These small business owners are having their rent increased by more than 250%

These small business owners are having their rent increased by more than 250%

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LOS ANGELES (Circa) -- Ruben Flores was shocked when his landlord came in last week to notify them that he would be raising his rent for his typewriter repair shop by 330%.

"Right now, my rent is $1,600, and it would go up to $5,300 in 60 days," said Flores.

Flores' family has owned U.S. Machine Co, a typewriter repair shop, in the Highland Park neighborhood of Los Angeles for 35 years. The same landlord is hiking the rent by 250% for a flower ship, a vintage furniture store and a barber shop on the same block.

"We've always been good tenants. We've always paid rent, so we're really shocked," Flores said.

Screen Shot 2018-04-13 at 11.15.51 AM.png
Ruben Flores inherited this typewriter repair shop from his dad.

"That's kind of ridiculous," said Rey Kender, a customer of five years at Hair-Zone Barber Shop next door. "A lot of businesses will be moving because of that."

Felix Navarro, owner of The Juicy Leaf, a plant store, down the street from Flores' typewriter repair shop, said he moved his business from Venice because he was being sked to pay almost $15,000 a month for rent. He said Highland Park was one of the few affordable areas left in the city. "That's way too high," Navarro said of Flores' new rent.
The landlord did not respond to a request for comment. But if you ask Highland Park resident, what's happening is because of gentrification, or the process of renovating an area so that it conforms to a middle-class state, as defined by Merriam-Webster.

We've always been good tenants. We've always paid rent, so we're really shocked.
Ruben Flores, owner of U.S. Machine Co., a typewriter repair shop

"Everything's being closed. The swap meet used to be close, but they closed it down," said Vanessa Arteaga, a resident of 16 years. Five years ago, Highland Park was gang-infested and largely Latino, according to Arteaga. A Lyft driver I spoke to who also grew up in the neighborhood said he would have to get driven to and from school because of the frequent drive-by shootings. Arteaga says the neighborhood is safer now, but also more and white and expensive. The average price of a home has nearly doubled in the last five years, according to data from Trulia.

Brenda Perez, a PhD candidate who's studying gentrification at the Pacifica Graduate Institute and grew up in Highland Park says she's seen the area change "significantly." "Ruben is an icon of our community who's been here for decades. What's happening is that you have the influx of capitalism displacing lower rent-paying businesses. We're seeing huge displacement, and even an increase in homelessness."

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Screen Shot 2018-04-13 at 11.13.44 AM.png
If they can't make their new lease payment, these businesses will likely have to move to another area of Los Angeles.

What's happening in Highland Park is happening all over the nation. According to one study from the Institute for Local Self-reliance, from 2015 to 2016, retail rents increased by 16% in Oakland and 26% in Charleston. At the root of this increase? A host of factors, according to the study, like a rise in the number of people moving to cities
in seach of walkable urban places and a declining supply of small retail spaces.

I feel like I'm part of that change, and I don't know what to do about it. I don't know
Steve Greist, moved to Higland Park two years ago

This has some newcomers feeling conflicted.

"I feel like I'm part of that change, and I don't know what to do about it. I don't know," Steve Greist, who moved to Highland Park two years ago, said. "I mean, I go to those restaurants, those bars that are opening."

But real estate developers flocking to low-income areas like Highland Park say there's nothing to feel bad about.

"It's transformation, not gentrification," said Courtney Poulos, owner and broker of ACME Real Estate, a brokerage firm in L.A. "Change is inevitable, especially in Los Angeles. "We do have a housing crisis, but we've found that more people are buying and transforming their neighborhoods so they can ultimately have a place they can live, work and play. And that's making the community properties' values all go up at once."

Flores says he likely won't be able to pay the new lease and plans to move his business into a commercial residential lot by his house. The other business owners declined to go on camera because they say the landlord agreed to have a meeting with them in the coming weeks to negotiate a different rate. Flores didn't get one of those meetings.

"I let him know, it’s your property," Flores said. "You have the right to do what you want. But how could you not give us a warning, to any of us in this corner? I understand things change, things get more expensive. Just to come in overnight, not give us at least six months or a year. And that’s the only thing that upsets me."

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