Magnolia Park Business Owners Feel Squeeze as Commercial Rents Jump 25% in Two Years

The vintage neon sign outside Atomic Records has been a Magnolia Park fixture for 18 years, but owner Maria Santos isn’t sure how much longer it will glow on Magnolia Boulevard.

Santos received notice last month that her rent would increase from $4,200 to $5,800 monthly when her lease expires in March — a 38% jump that reflects a troubling trend hitting small businesses throughout Burbank’s beloved vintage shopping district.

“I’ve weathered recessions, the pandemic, streaming killing CD sales, but this might be what finally does me in,” Santos said while sorting through a stack of vinyl records. “The landlord says it’s just market rate now, but market rate is pricing out the businesses that made this neighborhood special.”

Santos isn’t alone. Commercial rents along the Magnolia Park corridor have increased an average of 25% over the past two years, according to data from Burbank commercial real estate firm Henderson & Associates. The spike comes as the district has gained national attention for its mid-century charm and vintage boutiques, drawing weekend crowds from across Los Angeles County.

The irony isn’t lost on longtime business owners: their success in creating a unique shopping destination is now threatening their ability to afford staying there.

The Numbers Tell the Story

Tom Henderson, whose firm tracks Magnolia Park commercial properties, said the rent increases reflect broader real estate trends but are particularly acute in Burbank’s most desirable retail corridor.

“We’re seeing properties that rented for $2.50 per square foot three years ago now commanding $3.50 or even $4 per square foot,” Henderson explained. “Property owners are realizing they can get these higher rents, especially from chain retailers or restaurants willing to pay premium prices for the foot traffic.”

The district stretches roughly from Hollywood Way to Buena Vista Street, encompassing about 60 storefronts. At least eight businesses have closed or relocated within Magnolia Park in the past 18 months, according to the Magnolia Park Merchants Association.

“We’re losing the mom-and-pop character that people come here for,” said Janet Kim, who owns Retro Rerun vintage clothing shop and chairs the merchants association. “If we’re not careful, we’ll end up like every other strip mall with chain stores that could be anywhere.”

Adaptation Strategies

Some business owners are finding creative ways to survive the rent crunch. Dave Morrison, who runs Cosmic Comics, negotiated a revenue-sharing arrangement with his landlord after receiving a 30% rent increase notice.

“Instead of a flat rate, I pay a base rent plus a percentage of sales above a certain threshold,” Morrison explained. “It means I pay more during good months, but I won’t get priced out during slow periods. My landlord was willing to work with me because he knows good tenants are valuable too.”

Others are downsizing within the district. Melody Martinez, who owns Magnolia Moon antiques, moved from a 2,000-square-foot space to a 1,200-square-foot shop three blocks away.

“My new rent is actually $400 more than my old rent was two years ago, but it’s still $1,000 less than what my old space would cost now,” Martinez said. “I had to get rid of the furniture section, but I’m still here.”

The Landlord Perspective

Property owner Robert Chen, who owns three buildings along Magnolia Boulevard, said he sympathizes with longtime tenants but faces his own financial pressures.

“My property taxes have gone up 40% in three years, insurance costs are through the roof, and maintenance expenses keep climbing,” Chen said. “I try to work with good tenants, but I also can’t subsidize their businesses. When other properties are getting much higher rents, my investors expect market rates.”

Chen said he’s tried to balance profitability with preserving the district’s character by prioritizing existing tenants for renewals when possible and screening potential new tenants carefully.

“I turned down a national chain pharmacy that would have paid 20% more than my current tenant because it wouldn’t fit the neighborhood,” he said. “But I can only do that so many times.”

City Response

Burbank Economic Development Director Lisa Rodriguez acknowledges the challenge but says the city’s options are limited in addressing private commercial rent increases.

“We can’t control what property owners charge, but we’re looking at ways to support small businesses through this transition,” Rodriguez said. “We’re exploring a small business loan program and considering zoning changes that might create more affordable commercial space in other parts of the city.”

The Burbank City Council will discuss a proposed small business assistance program at its December meeting, potentially offering low-interest loans or grants to help established businesses manage rent increases or relocation costs.

Looking Ahead

Back at Atomic Records, Santos is considering her options. She’s looked at spaces in nearby neighborhoods but worries about losing the customer base she’s built over nearly two decades.

“My customers know to find me here,” she said. “If I move to some strip mall in North Hollywood, will they follow? I built something special here, and I hate the idea of walking away from it.”

Santos has started a crowdfunding campaign to help cover moving costs if she relocates, and she’s exploring a partnership with a neighboring business to share retail space.

“Magnolia Park will survive this, but it might look different,” she said. “The question is whether it’ll still be the unique, quirky place that people fell in love with, or just another expensive shopping district.”

The merchants association plans to meet with city officials next month to discuss potential solutions, including the possibility of creating a small business preservation district with incentives for property owners to maintain affordable rents for longtime tenants.

For now, Santos keeps the neon sign lit and hopes for the best. “This neighborhood has been good to me for 18 years,” she said. “I’m not giving up without a fight.”