Editor's note: This dip in rents may be seasonal; demand for apartments is always higher at the beginning of the school year in the fall and may decline as the academic year progresses. The only way to tell about the general rise or fall of rates is to compare one month with the year before.

For more on rentals in Palms, jump to our Renters page.

By Roger Vincent, Los Angeles Times Staff Writer
March 10, 2007

Sizzling demand for offices, warehouses and retail space is hitting Southern California and other major urban centers. That is resulting in smaller cubicles and longer commutes for workers, higher prices for consumers and closure of businesses unable to meet landlords' demands for higher rent.

Office rents have climbed more than 25% on average in the last three years in much of Los Angeles County. . . .

Rents on hot retail strips such as Melrose Avenue, Rodeo Drive and Robertson Boulevard have more than doubled in the last two years. . . .

Higher rents also are the result of economic redevelopment that is transforming some neighborhoods into more upscale shopping and entertainment venues. The waves of change that swept through Santa Monica and Old Pasadena years ago are now being felt in other older districts such as Hollywood, Culver City, Alhambra and downtown Los Angeles.

Shopkeepers in many of these changing retail districts are feeling pinched.

Even though the family-style Italian fare at Jay Handal's San Gennaro Cafe made it one of the most popular restaurants in Culver City, Handal [shown here in a photo by Ken Hively in front of Handal's shuttered restaurant] shut down the eatery a few months ago when his landlord nearly tripled the rent as his lease expired.

"I couldn't afford it," he said.

Moving into San Gennaro's space will be a more upscale, all-organic restaurant run by celebrity caterer Akasha Richmond.

"There is going to be an attrition factor," said Handal, who also operates a restaurant in Brentwood. "Small business today is being squeezed out of the market. You're not going to have many family-friendly community restaurants — only big guys with deep pockets." . . .

Neighborhood activists will rally next week in Larchmont Village to try to prevent the loss of a popular restaurant and other local businesses threatened by rising rents.

In Culver City, the city spent more than $60 million over the last decade on public improvements largely intended to attract new restaurants and businesses, said Kellee Fritzal, economic development administrator.

The plan appears to have worked. Demand among merchants is high enough that average store rents have jumped from $1.85 per square foot per month to $4.50 in the last three years. . . .