Hollywood is known for comebacks. Now the neighborhood is working on its own

Hours before “Hamilton” was set to open at the Pantages Theatre last year, performances of the Broadway hit were canceled as edicts to prevent the spread of a highly contagious new coronavirus set off a cascade of woes for the Hollywood neighborhood.

A restaurant near the Pantages known for its hearty American food was stocked up with its signature dessert soufflés and other dinner fare cooks had ready to serve crowds of “Hamilton” fans. Suddenly, theaters, restaurants and other businesses were ordered to close.

A lot of food was about to spoil, said Richard Falzone, owner of Off Vine, a 31-year-old restaurant in a historic Craftsman-style cottage near Sunset and Vine.

“I told staff to take everything they could,” he said, “or throw it away.” Falzone remembers the date well. “March 16, 2020. I’ll have that in my mind forever.”

More than a year later, Falzone faces different challenges as customers return and he looks forward to “Hamilton” finally opening next month. He’s shorthanded because only three of the 12 servers he laid off during the downtimes have returned. Cooks and dishwashers are also hard to find.

“I need to hire eight people, and if I don’t then I am going to lose a lot of money because I am not going to pack my restaurant with only one server,” he said. “That’s a nightmare we have in the industry.”

Boom, bust and hope for another boom tell the story of Hollywood today as the neighborhood labors to spring back from the pandemic and its economic fallout.

About 70% of street-level businesses in Hollywood responded to instances of vandalism and theft that coincided with last summer’s overwhelmingly peaceful racial justice protests by hunkering down behind sheets of plywood, said Kris Larson, president of the Hollywood Partnership business improvement district.

Some stores remain boarded up because they have gone out of business or have yet to relaunch after closing for the pandemic. Larsen estimates that 10% are gone for good, but the number could go higher when government restrictions on evictions for nonpayment of rent are lifted.

High-profile COVID-era casualties include upmarket Paley restaurant in Columbia Square on Sunset Boulevard and ArcLight Hollywood, the cinema complex that included the landmark Cinerama Dome theater.

Many others have hung on, Larson said. “Somewhat miraculously, a lot of the mom-and-pop shops survived.”

Bigger stores and restaurants with deeper financial resources have better weathered the economic downturn. Katsuya, a sushi restaurant at Hollywood and Vine known to draw celebrities, is set to open by the fall after being closed since March 2020. Boards covering its windows were removed last week.

Katsuya opened in Hollywood in 2007 and served 8,000 customers a month before the shutdown, said Jerry Garbus, senior director of operations for its parent company SBE, an international hospitality company.

Being in Hollywood is important in part because of what it represents to people outside the region, he said.

“The dynamic energy and the glamour of Hollywood has really become synonymous with Los Angeles as a whole, and the perceptions people have about L.A., and what emotions are evoked when people think about Los Angeles.”

Though Hollywood is well-known for its tourism and nightlife, it’s also one of the most substantial office markets in the region, with about 5.9 million square feet to rent, according to real estate brokerage CBRE. The absence of workers who moved their jobs home during the pandemic has been a drag on the recovery, Larson said.

“We need to get them back,” he said. “And that’s true for every city in the country.”

When — or if — workers will return to the office is a matter of uncertainty for many employees and their companies. Some businesses have started to ease back into the workplace, while others are offering flexible work-at-home policies that are expected to evolve in the months ahead as people adjust to a new post-pandemic work style.

Hollywood’s biggest office tenant is Netflix, which is expected to bring its employees in after Labor Day. The end-of-summer holiday is a marker for many companies to return to the office, although some other entertainment businesses such as ViacomCBS and Walt Disney Co. have said they may begin to come back after the Fourth of July.

One of Netflix’s landlords is Kilroy Realty Corp., which has three office complexes in Hollywood, including the recently completed $450-million On Vine office, apartment and retail center south of the former ArcLight theaters and Cinerama Dome.

Netflix leased all the office space at On Vine and is preparing its new digs for occupancy. The streaming giant is emblematic of the joining of technology and entertainment, which has been especially good for neighborhoods such as Hollywood, Culver City and Burbank that have long been home to showbiz-type businesses, said Rob Paratte, head of leasing and business development for Kilroy.

“We have been, and are, very bullish on Hollywood,” he said. “You are going to continue to see dramatic change.”

Kilroy is looking for other sites in the area to build on, he said, because people in entertainment often need to work side by side.

“It’s pretty hard to make a film from home,” he said.

At the same time, the optimistic proclamations of Hollywood boosters are sounding alongside the humanitarian crisis gripping Los Angeles as thousands of people find themselves living on city streets.

Hollywood did its own homelessness count after the official countywide count was canceled this year, and volunteers organized by the Hollywood 4WRD coalition tallied 1,513 people without homes in Hollywood and East Hollywood compared with 1,714 people in the official Los Angeles Homeless Services Authority 2020 homeless count for the area, a 12% decline.

But life had gotten even more difficult for people without housing, the coalition of businesses, churches and nonprofit groups determined. With businesses and libraries closed, people had less access to food, restrooms and places to wash.

Off Vine owner Falzone said that people living on the streets “challenges the way we understand our city’s value system. We are supposed to be better than this. We shouldn’t allow people to die on our sidewalks and waste away in this environment.”

The business community is among those focused on improving the homeless crisis, Larson said. Hollywood Partnership last year added to its efforts by establishing a street outreach team trained to build relationships with homeless people and help them get services and assistance.

“Homelessness is by far the No. 1 issue affecting Hollywood,” he said. “Never does a day go by that the topic does not get introduced into our work” at the business improvement district. “It is top of mind and in the line of sight for everyone.”

The pending return of office workers is a related concern, he said. “There are people with options who are not going to want to walk down streets of Los Angeles and have to navigate those types of conditions. People are making decisions” about where they want to work.

More than 23% of Hollywood office space is unleased, CBRE said, which is high for the region.

Doubts about whether white-collar workers will come back even if their bosses want them to makes the vitality of the office market “the biggest question mark” affecting Hollywood’s revival, Larson said.

Star-studded movie premieres have returned to the reopened El Capitan and TCL Chinese theaters, and visitors are booking hotel rooms again. Recently built hotels Thompson Hollywood and Godfrey Hotel Hollywood are taking reservations for next month.

Attractions such as Hollywood Wax Museum, Madame Tussauds Hollywood and Ripley’s Believe It or Not are up and running. A $100-million makeover of the Hollywood & Highland shopping and entertainment center is underway.

Challenges faced by restaurants and stores are more likely to be centered on finding enough workers than government regulation or lack of consumer confidence, as they were during the pandemic, Larson said.

Patrons include a lot of people who are taking trips to Hollywood as they emerge from lockdown, research by Hollywood Partnership suggests.

Pedestrian activity on Hollywood Boulevard is back to about 80% of what it was before the pandemic, and about 60% of the people strolling the Walk of Fame are from more than 250 miles away, according to cellphone data tracked by the business improvement district that reveals owners’ ZIP Codes.

“We are seeing tourism rebound faster than anticipated,” Larson said. “Generally speaking, people in Hollywood are preparing for a big summer.”

Looking ahead is entrepreneur Thaddeus Smith, who is renovating the landmark Earl Carroll Theatre on Sunset Boulevard for a January reopening. The Streamline Moderne-style showplace that opened in 1938 was one of Hollywood’s most boisterous supper clubs and was known more recently as a soundstage for Nickelodeon Studios.

The update, which could cost as much as $4 million, will turn the Earl Carroll into a concert and event venue for as many as 1,800 people, Smith said, with new bars and kitchens.

Success depends on restoring its over-the-top historic glamour, he said, a notion he wishes other local businesses would embrace.

“This isn’t Orange County. This is Hollywood,” Smith said. “You damn better be ready to make it Hollywood. L.A. really needs it.”

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