A new age A plan for the future A conflict of interest? A changing landscape A rebirth

Seeds of Change

Big changes are coming to the century- old Southern California Flower Market
by Jaqueline McCool, Joyeeta Biswas, Justin Sedgwick, Meijun Li, Mara Pometti

A new age

Jeff Saito begins his day at midnight at the Southern California Flower Market, unloading fresh flowers and preparing to arrange them. He and his family have been in the trade for three generations, growing flowers on their farm and selling them in this century-old mart.

But not for long.

Downtown Los Angeles has transformed dramatically in recent years, entering what some have described as a "renaissance."

Saito and his family are planning to retire from the flower market and this business in the next few years. They're not the only ones. Saito points to surrounding stalls, and describes the plans many other vendors have made to leave their businesses behind.

The flower business is not as lucrative as it once was, he says. "It's a little bit harder to be profitable now, as profitable as it was before."

As older vendors prepare to leave, the flower mart is poised for big changes. An upcoming redevelopment project aims to transform the market and revolutionize the way it does business.

Like many vendors at the mart, Saito has seen the market and the area change in recent years. He has watched as retiring customers and the popularity of imported flowers have led to a drop in revenue in the wholesale market.

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Agricultural imports, which include floral imports, saw a sharp jump in growth within the last eight years. For California growers, this has made their profession more expensive, and caused many to consider a transition to growing markets, like the avocado industry.

There is also the rapidly changing landscape of Downtown Los Angeles, which has transformed dramatically in recent years, entering what some have described as a "renaissance." This has altered the customer base of the markets.

Some, however, are fighting hard to keep up with the changing market and shifting downtown landscape.

A plan for the future

Five years ago, Scott Yamabe, executive vice-president and general manager of the Southern California Flower Market, began to seriously consider a complete redesign of the structure. He felt that it was necessary to protect the longevity of the mart. This project is currently on track to break ground in the next two years, and will be modeled after other popular downtown institutions.

Yamabe has had his role at the market for almost 20 years, and says he came in at a time when the market needed an economic revival. According to Yamabe, the market had a growing vacancy problem, but the mart now has a wait list of vendors hoping to get spots.

Yamabe says he was chosen for the role of general manager because the board of directors felt his background in real estate could rejuvenate the market.

After a unanimous motion was passed by city council, plans for a 15-story building to take the place of the current Southern California Flower Market began to unfold.

The motion states the reason for the project as, "In an effort to help revitalize the area, the Flower Market would like to redevelop its property into a mixed-use project resulting in new jobs, tax revenue generation for the city, all while retaining the Flower Market operations at the ground level."

The document cites the "functional obsolescence" of the building, an idea Yamabe and vendors at the market echoed, speaking about the lack of efficient space available.

The wholesale space will be cut by 35% of what it is now, according to Yamabe. However, he does not foresee this decrease in available space as negatively affecting vendors.

"We think by the time we renovate the flower market portion, there's going to be a few tenants that just retire," says Yamabe. "We kind of understand our tenant space pretty well, and so we know that some of the older ones, like we have about six or seven growers and they come from Carpinteria, and they're all in their 60s and 70s, and so we know that they're probably going to retire."

Jeff Saito and his brother are two of these growers. Saito says just the drive to the market takes him around two hours, a journey he makes three times a week.

Although Saito has decided to close his business and not take part in the newly renovated market, he believes the new design will benefit those who decide to stay.

"The vendors who are planning to stay here are looking forward to it," says Saito. "It's going to be a new facility, it's going to be a lot more energy-efficient, and space-wise it will be a lot more efficient too."

Efficiency is an integral part in what Yamabe says will make the renovation so helpful. Thi will save each vendor space for flowers by making the wholesale area into one large cooler, eliminating the storage space each vendor needs to keep his or her flowers fresh.

"This business has been done like this for 100 years, and so with the technology out there now, we think we can make this operation a lot more efficient," says Yamabe. "Although we'll shrink the size a little bit it will still be the same, but just smaller."

Scott talked with USC journalists about changes happening at the Flower Market and plans for a new development project. If video does not display click here

Yamabe has taken inspiration for the renovation from restaurant halls in Tokyo, as well as another downtown institution, Grand Central Market. He describes his vision for the new mart as "kind of an upper scale Grand Central Market."

The market, like the Southern California Flower Market, has been around for more than 100 years, and has traditionally been a place where immigrants sold their native home-cooked foods.

In recent years the market has changed, garnering criticism as well as praise. As older vendors have left, stalls have been rented by now popular institutions, like Wexler's Deli and Eggslut.

These fashionable food stalls have transformed the once family-owned businesses into upscale Instagram-worthy destinations. While some are happy with this change, others see the shift as another by-product of the gentrification of downtown.

If the new flower market undergoes a similar rise in popularity, Yamabe is not sure how he will keep stall prices down for all of the original vendors. However, he hopes the small rental space will be enough to alleviate a renting burden from sellers who would not be able to afford an entire storefront.

Yamabe also believes he will be able to keep rent low by maintaining control of the project, something he is doing by working as the developer and general manager during the renovation period, utilizing his background in real estate.

Customers at the Flower Market.
Area around the Flower Market

A conflict of interest?

A similar project has been planned for the San Francisco Flower Mart, where the space that is predominantly owned by the San Francisco Flower Growers Association, has been partially sold by the Grower's Board to Kilroy Realty.

A 2014 New Yorker article detailed how the plans of the San Francisco mart to be renovated sparked protests and uproar among the vendors.

The San Francisco Flower Mart, like the Southern California Flower Market, can be renovated, but is required to stay a wholesale flower space in some respect. Also similar to downtown Los Angeles, San Francisco has seen an influx in real estate following the tech boom.

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The growing tech market in Los Angeles is a group Yamabe is hoping to cater to as well. He feels this group will need somewhere to live, and his new mixed-use building may be just the place.

Yamabe says this project will avoid backlash similar to what happened at the San Francisco Mart, by continuing to oversee the project, ensuring he does not lose touch with the vendors.

Bill Cooper and Katie Galley, members for the Society of the Preservation of Downtown Los Angeles, a group that monitors new building in downtown L.A.'s historic core, both felt having Yamabe as the developer and manager would be best for preserving the history of the market.

The two say they often witness developers taking on projects downtown that the developers feel no attachment to. Cooper and Galley believed this led to large structures that didn't match the surrounding historic building and ultimately had a negative impact on the surrounding area.

But not everyone agrees.

Dennis Kobata, a board of directors member at the Southern California Flower Market for the last year and a half, believes Yamabe's involvement in the project creates a conflict of interest.

Although he believes the project is a good idea for the modernization of the market, Kobata feels Yamabe's involvement as general manager and developer may create potential problems.

"When he does something as GM of the flower mart, is that in his interest also as the head of the development team who is doing the development project?" said Kobata, "And is it in the best interest of the flower market, or is it in the best interest of the development team, who will be compensated if the project goes smoothly?"

Kobata's great-grandfather was one of the original founders of the market, but the proposed renovations are why Kobata became involved with the market once again.

"What has happened is the board and the shareholders, recognizing that there is a conflict, have gone forward with it," says Kobata.

Yamabe says he has the best interest of the market in mind, and ultimately that is what will make the project successful.

"The majority of the board feel that although technically speaking there may be a conflict of interest, but legally there's not a conflict," says Yamabe.

Yamabe says this could be seen as a conflict of interest, but insisted all final decisions are made by the board, who felt it was best for the mart's redevelopment to be handled by someone who has a history with the market.

John Kono, who has been a board member for over three decades, a seller and grower at the market, and a close friend of Yamabe's, feels Kobata's perspective on the redesign is negative because Kobata is new to the board and has not observed Yamabe's history with the market.

Kono says Kobata does not fully understand all of the ground work and planning that has gone into the project, and that while Kobata may disagree, the other eight board members feel having Yamabe in charge of development is best.

"Everyone, including the attorney says it is without a doubt a conflict of interest," says Kobata.

While Kobata says most on the board acknowledge this is a conflict of interest, he was "a minority of one" who voted against the redevelopment.

The Southern California Flower Market bustles with life and energy in the early morning hours.click here

A changing landscape

When Yamabe walks through the market, almost every vendor waves at him. He makes small talk and refers to most vendors by name. Over the past two decades Yamabe has been able to foster relationships with most of the sellers, and he takes credit for bringing in some of the market's oldest residents.

Saturday at the market feels like a different world in comparison to an early morning any other day of the week. Wall Street, where the two original markets are situated, is blocked off by cones and caution tape. This allows for vendors of all types to sell their goods.

Drive down 8th Street, and there are bustling sidewalks, crowded with patrons of the neighboring fashion district, a visible sign of a growing economy. Pupusa trucks line the street and customers walk with bundles of flowers in their arms, and although this sight may not have been seen five years ago, it bears a similar resemblance to other parts of Los Angeles during a transitional phase.

In 1999, Los Angeles' Adaptive Reuse Ordinance came into effect, legislation that created a boost in redevelopment projects helping to bring the downtown area into its late renaissance.

The Beacon Economics Report also found "a number of older and historic buildings have undergone a modernization to attract new businesses, residents, and visitors to the Downtown area."

After taking the San Pedro exit on the I-10 freeway, just before Maple Avenue, the street that funnels into the fashion and flower districts, a sea of cranes can be seen- a visual representation of what it means to be an emerging epicenter.

As the downtown area has increased in popularity, additional vendors have rented space surrounding the two original markets.

The new building will be mixed-use, a growing trend in redevelopment happening downtown.

When they are busy, the fashion and flower districts are unrecognizable, like a cousin of the arts district, on its way to becoming a tourism hub.

The flower district itself is situated less than two streets away from Skid Row, which, according to an LA Chamber of Commerce report, homes 3% of the county's homeless population in .0001% of the county's total land area.

As the homeless population has increased over the last decade, the area surrounding Skid Row has expanded to home a larger amount of the homeless population. According to data collected by the Los Angeles Homeless Services Authority, more than 2,500 homeless people can be found within the 0.4 square miles of the area.

Jim Mellano, owner of the Original Los Angeles Flower Market, believes customer interaction with the district's homeless population is a business deterrent, and negatively impacts individual's experiences at the marts.

"The homeless population is a major issue for us," says Mellano. "We have to keep three full-time security guards rolling the entire block that we own for security purposes."

As building continues, less space will be allocated for the homeless population. Signs advertising weekly sidewalk power washing can be seen surrounding areas of the mart, and when driving through the area at 12 a.m., employees can be seen washing stretches of sidewalk near neighboring homeless encampments.

Herbert Smith, president and CEO of Los Angeles Mission, located on East 5th Street of downtown, says building in this area has had effects on those without housing. He believes that not only has this renaissance made the cost of living downtown more expensive, it has also decreased the space those who are homeless can occupy.

Smith says the renovation of the Southern California Market will have an effect on the homeless population living in the area. "I can only speculate that it will push homeless further towards the river or other areas," says Smith.

Although the homeless population in Los Angeles is growing, the space the population is able to inhabit is shrinking, as new sections of Los Angeles join the renaissance.

Yamabe says of the market's relationship to the homeless population, "By doing this project, we're certainly going to clean up this block at least. I think we're going to help in the sense that we're going to activate the area, and just make it more enticing for the general population of LA..."

As the downtown renaissance continues, Yamabe is trying to change his business to fit the shifting landscape. Yamabe often refers to the renovations as being a place where people can "live, work and play". Ultimately he hopes to create a space people flock to, a new tourist destination in L.A.

A rebirth

Times have changed too. The flower industry is not as clear cut as it once was. The direct grower/wholesaler-to-customer chain of supply and demand no longer exclusively exists. Increased popularity has brought the non-market vendors who slash prices. And then there are the supermarkets that offer flowers to the everyday consumer and online flower shops that deliver straight to the recipient's door.

21st century innovation has helped and hurt the flower industry, and now the Southern California market is attempting to keep up. As the market is set to begin construction in two years, Saito says many older vendors are three years into their five-year plan to retire. The familial lineage of their stalls and businesses is officially coming to an end.

Yamabe says, "Everything changes, especially in this area."

©2017 by Jaqueline McCool, Joyeeta Biswas, Justin Sedgwick, Meijun Li, Mara Pometti