A major American city is tackling the housing crisis with creative housing projects, including on top of a Costco.
Real estate developer Thrive Living thinks it has found a solution for affordable housing with its plans to build 800 apartments on top of a Costco in Los Angeles.
The complex will begin construction early this year on top of a Costco in Baldwin Village, South Los Angeles.
The complex will include a rooftop pool and fitness center, according to plans for the building reported in the Wall Street Journal.
The $425 million project will also include 184 apartments for low-income households.
Once the property is completed, sometime in 2027, Thrive plans to partner with the local Housing Authority to provide rental vouchers to low-income tenants in at least 100 of the units.
Costco, built into the ground floor of the building, will pay Thrive rent, making the development less dependent on government subsidies to provide affordable housing, Thrive said.
“I want to build thousands and thousands of apartments every year, not hundreds,” Thrive founder Ben Shaoul told the Journal.
A real estate developer plans to build 800 apartments on top of a Costco in Los Angeles
Thrive's hope is that Costco will benefit by gaining access to a densely populated urban area with a direct customer base on its doorstep.
Costco makes billions each year from its annual membership fee and could generate as many as 1,600 new sign-ups from residents of the LA complex alone.
This is unlike most Costco locations, which are usually located in suburbs and can only be reached by car.
The department store chain has made a concerted effort over the past year to move further into cities with smaller stores.
Costco also tends to own, rather than rent, the real estate of its stores, unlike plans for the Baldwin Village location.
Shaoul said the plans came about after Costco approached him about leasing the space that he initially planned to be an exclusively commercial building.
Baldwin Village is a lower-income neighborhood in the upscale Baldwin Hills area of Los Angeles.
Baldwin Village has a poverty rate that is more than double the national average, according to the Journal.
Thrive's founder Ben Shaoul has plans to introduce the concept to more cities in the US
The site has received support from notable community figures, including the city's mayor, Karen Bass, who formerly lived in the area.
According to Freddie Mac estimates, Los Angeles is at the sharp end of a national housing shortage of about 3.7 million homes.
The city is also seeing the destruction of thousands of homes as wildfires continue to rage through the city.
