A $2 billion plan to transform an industrial swath of downtown Los Angeles into one of the region’s largest housing developments is nearing a pivotal moment.
The Fourth & Central project plans 1,521 residential units, offices and green space to transform a 7.6-acre site at the nexus of Little Tokyo, Skid Row and the Arts District in a city grappling with a housing affordability crisis. The project is set to go before the Los Angeles City Planning Commission on Oct. 9.
If approved, it could become the largest apartment development underway in the city.
“This is where the rubber hits the road,” Larry Rauch, one of the site’s longtime owners, told CoStar News. “We’ve spent years preparing for this moment, and now it’s time to see if the city agrees with our vision.”
The project represents how cities like Los Angeles are reimagining aging warehouse zones to meet housing demand without displacing residents.
But the path to groundbreaking is lined with hurdles. Economic headwinds, shifting market conditions and the complexity of assembling financing for a multiphase, multiuse project mean the developers must convince not just city officials but also investors and lenders that the vision is viable.
A legacy project
The development team, led by Rauch, has operated a cold storage facility on the site for over five decades through his company Los Angeles Cold Storage. Now, the group says the best use of the land is no longer refrigeration — but revitalization.
“This isn’t just about economics,” Rauch said. “It’s about creating something lasting for the community. We want our grandchildren to look at this and say, ‘They built something meaningful.’”
The project has already earned support from California Gov. Gavin Newsom and LA City Council President Marqueece Harris-Dawson, who praised the proposal's union labor agreements, green building standards and transit-oriented design.
The developers say they’ve conducted hundreds of outreach meetings over the years, engaging stakeholders from Skid Row to Little Tokyo. They have made changes in response to community feedback, including reducing building heights, removing a hotel component and improving pedestrian connectivity to nearby neighborhoods.
If approved, the project could catalyze further development across the Southeast Gateway, with studies suggesting that up to 200,000 new residential units could follow in adjacent industrial zones.
Promise meets pain points
While Downtown Los Angeles is seeing signs of revitalization, it remains a district in flux. Office vacancy rates hover around 21%, well above the national average, and some of the city’s tallest towers — including the Aon Center and 777 Figueroa — have faced foreclosure or loan defaults in recent years.
The city’s effort to overhaul the Los Angeles Convention Center ahead of the 2028 Olympics is emblematic of both ambition and risk. The $2.6 billion modernization project is designed to showcase LA on the global stage but faces financing hurdles and a tight construction timeline that must pause during the Games.
Federal and state mandates are driving government workers back to downtown offices, although the federal shutdown could hamper that growth.
Among green shoots: Multifamily occupancy rates are consistently north of 90%, according to the DTLA Alliance, a group composed of 2,000 property owners that oversees the 65-block downtown business improvement district.
Downtown is one of the most active locations for apartment construction in greater Los Angeles, according to CoStar data, as developers look to increase residential inventory to ease cost concerns.
A recent University of Southern California report found that LA County has completed fewer than 100,000 housing units since 2021— far short of the 700,000 units required by 2029, including nearly 300,000 affordable homes.
From initial permit application through construction, multifamily projects in LA take roughly three years on average, triple the national pace, and the number of apartment units under construction has dropped 21% in the past year. Vacancy rates are among the lowest in the country, and average rents are 32% above the national average.
Downtown proposals
The Fourth & Central project, with its 1,521 residential units and emphasis on affordability, aims to help close that gap. Developers say it could become the largest affordable housing development in the city.
But the project’s success hinges on overcoming the same obstacles that have slowed other developments: lengthy entitlement processes, financing complexity and community opposition.
Plans call for 10 buildings ranging from two to 44 stories, with a mix of rental and for-sale housing, office space and retail. The tallest tower, designed by Sir David Adjaye, would rise 44 stories and anchor the northern edge of the site.
The project would have an internal network of paseos and pocket parks to connect Central Avenue to Alameda Street, and integrate with the city’s expanding transit infrastructure, including a future rail line running along Alameda.
The City Planning Commission last year gave the green light to Vella Group's long-planned 670 Mesquit project, a $1.4 billion effort to turn another former cold storage facility into a complex with housing, offices and stores.
It also approved key permit changes needed for a 53-story, 466-unit residential tower to rise at The Bloc, a mixed-use complex at 700 S. Flower St. The approvals clear the way for the projects to go before the City Council for a final vote.
