Setting sights closer to home.

Scarcity of land and a sea change in the attitudes of community officials and often, residents, is dramatically affecting the development environment for real estate.

Development is out, redevelopment is in. And after years of seeking sites and projects in the suburbs, all eyes have turned back to the Valley floor.

Many of the most noteworthy projects highlighted in the Business Journal's special report on real estate this year are occurring in urban cores, and they are expected to have a significant effect on those neighborhoods.

Not only does the emphasis on redevelopment in older neighborhoods mean a different set of opportunities, it is also creating a different set of challenges than those developers once faced.

"Ten years ago the word most people used was NIMBY," said Cliff Goldstein, a partner at J.H. Snyder Co., who is building NoHo Commons, a 16-acre mixed-use project in North Hollywood. "Today, the word is BIMBY."

When developers sought to build in suburban communities they faced a hostile neighborhood of homeowners whose battle cry was, "Not in my backyard."

But as land has grown more scarce, and these same developers target redevelopment sites in older neighborhoods, they are more likely to face a community anxious to see empty storefronts and rundown buildings rehabilitated.

Developers say the message they are more likely to hear in these communities is "Build in my backyard."

That newfound receptivity doesn't necessarily make the process any easier, it just makes it different, developers say.

Battling NIMBYs required finding out what they objected to and trying to work around it.

Testing the waters

Developing in BIMBY neighborhoods can often mean getting a wide variety of input, beginning as early as possible into the process to get a sense of what kind of development will be successful.

"What has changed is people are more selective in what they want in their area," said Ira Handelman, a land use, government and community relations specialist who operates Handelman Consulting Inc. "You've got to come in with what makes sense to them."

In the Valley, as in other parts of Los Angeles, neighborhoods can take on a particular personality based on an ethnic group, and developers can often benefit by being sensitive to those tastes and preferences when, for example, planning a retail project, experts said.

"Why are some centers successful?" said Handelman. "You have to have the right mix of stores. The successful centers bring stores that people will go to."

The emergence of neighborhood councils has necessitated another layer of communication for developers but it has also provided an opportunity to get wider input before a project gets too far along.

The shift to infill development has meant other changes in the way developers operate.

"Infill sites are more predominant," said Scott Sheridan, a principal with Sylmar-based Sheridan Ebbert Co. "That has opened a Pandora's box of environmental issues and what solutions are available to allow you to recycle a piece of property."

Sheridan said that 10 years ago it was virtually impossible to get financing for an infill site that had environmental issues, but the industry has grown far more sophisticated, and the methods available now to clean up many of these sites has loosened the purse strings of financiers.

"The good news is, although it is complicated and time-consuming, your marketing risks are less," Sheridan said.

Infill development

Development on a property far from the center of the city can be risky if companies are reluctant to move outside the radius of their employees' homes. But a redevelopment on an infill site gives employers the opportunity of moving into a new, updated facility without the risk of losing their employee base.

Redevelopment involving the residential sector may not come with the traditional environmental problems, but it does generate its own set of issues related to the environment, namely traffic.

Developers say that concern over increased traffic has been the single most dominant issue they have faced as they fly to move their projects through the pipeline.

The other one is zoning.

Turning a commercial property into a residential development or simply building a residential project on commercially zoned land requires navigating a time consuming bureaucracy, as DT Ventures learned when it filed a change of use permit to transform the former Adolf's meat tenderizer factory into artists lofts.

The developers of the fast mixed-use project on Ventura Boulevard fought for two-and a-half years to get the zoning changes and permits they needed to construct an apartment complex with retail shops in Encino.

But developers say that despite the time involved, city officials have become far more receptive to these kinds of projects because of the housing crisis.

And if the red tape is delaying developers, it isn't stopping them.

NoHo action

And North Hollywood has become a center of redevelopment, with more than four different projects and hundreds of thousands of square feet underway in both commercial and residential projects.

Retail tenants, who once shunned many of these areas, are also showing renewed interest, an encouraging sign to developers who have to bear the financial risk of betting that tenants will be willing to come to some of these neighborhoods.

But more and more, retailers are realizing there is considerable buying power in these urban areas because the density of population compensates for the differences in per capita income, developers say.

"Anybody that gives these areas something other than a cursory look will quickly find out that billion dollar buying power is sitting right there," Goldstein said. "These people are driving many miles outside their communities to be served."