SpaceX helping city shape a new image
The rise of Elon Musk’s SpaceX, more-affordable rents and the lure of Inglewood’s future pro football stadium are combining to transform Hawthorne’s reputation as a nose-down industrial city to something cool.
The scent of beer spills into the brick-walled taproom at Los Angeles Ale Works, a craft brewery that opened this year on a quiet industrial block in Hawthorne, Calif.
Behind the brewery, a boutique letterpress company prints cards, wedding invitations and other stationery, while a woodworking shop a few feet away makes custom furniture. Nearby, a used Falcon 9 first-stage booster rocket towers over the headquarters of SpaceX and nearby warehouses that are increasingly filled with an eclectic mix of products, restaurants and artists.
The rise of Elon Musk’s SpaceX, more-affordable rents and the lure of Inglewood’s future pro football stadium are combining to transform Hawthorne’s reputation as a nose-down industrial city to something cool.
Organic coffee and tea chain Urth Caffe is moving its headquarters from downtown L.A. to Hawthorne. Its new facility — a 1960s-era warehouse formerly used for aerospace industry services — is set to open next year. Another brewery, Common Space, will open soon. And highend motorcycle manufacturer Arch Motorcycle Co., co-owned by actor Keanu Reeves, has also set down roots.
“Businesses like to say they’re located in Hawthorne,” said Hoonie Kang, partner at Kearny Real Estate, which helped revitalize the Hawthorne Municipal Airport and managed the nearby business park where SpaceX is located.
The South Bay area has ridden the booms and busts of the aerospace industry for years, from the increase in defense spending during the Reagan administration to the cuts in the early 1990s. Industry consolidations and, eventually, the move of companies’ headquarters from the Los Angeles area to the East Coast took a toll on the region, said Robert Kleinhenz, an economist with Beacon Economics and the Center for Economic Forecasting and Development at the University of California, Riverside.
In 2005, Levi Stockton saw a much different scene. Stockton came to Hawthorne to work for a group that had obtained the master lease for the Hawthorne Municipal Airport. Most of the hangars had leaky roofs and no doors.
That same year, Kearny Real Estate purchased the business park that would become synonymous with SpaceX. Once a Northrop Corp. facility, the 86-acre property was being used to manufacture fuselages for Boeing’s 747 aircraft.
The real estate firm got to redeveloping about half of the site — modernizing existing buildings, demolishing other parts and emerging with a 21-building industrial park. Kearny sold its first building in the park in 2007.
That same year, the 300-person space startup owned by Musk, an internet entrepreneur and co-founder of Tesla, moved in. Since then, Kang estimates, SpaceX has occupied more than half the buildings in the industrial park.
Kearny “took what was dirt and old manufacturing, and turned it into something where people could imagine, ‘Hawthorne could be cool,’ ” said Andrew Dilfer, vice president at JLL, which specializes in commercial real estate services and investment management.
Real estate experts and the city’s mayor credit Hawthorne’s redevelopment partly to the halo effect of SpaceX, and Tesla Design Studio just behind the rocket factory.
SpaceX is now reshaping the launch business. It has amassed a robust launch manifest of commercial, NASA and national security missions. The company’s longterm goal is to colonize Mars.
SpaceX’s growth has attracted subcontractors and vendors to the city and other nearby businesses have also benefited from the company’s young workforce, Dilfer said. SpaceX now employs more than 5,000 people across several sites in the U.S., including Texas, Florida and Washington state. Its workforce is largely composed of engineers and technical workers.
Restaurants, bars and other businesses have cropped up to serve those workers.
Danny Meyer, manager of Hawthorne Arts Complex, said there’s been so much demand for artist space in the city that almost 50 percent of his newly built studios have already been rented. He said the city’s many warehouses are seen as a plus, as businesses look to transform those into new opportunities.