Forever 21 opens new headquarters in Lincoln Heights*

Forever21Front.jpgMayor Villaraigosa's office is trumpeting the new facility, which will house the company's distribution, logistics, e-commerce, merchandising and warehouse operations. The property had been used previously as a Macy's showroom. Forever 21 is in many ways a classic entrepreneurial success story: Founded in 1984 by Korean immigrants Don Chang and Jin Sook Chang, the retailer now has 500 stores in 15 countries. Forbes estimates the couple's net worth at $4.5 billion, and its L.A. location provides a nice economic boost for the area. From the Mayor's office:

The Mayor's Office of Economic and Business Policy (OEBP) helped guide Forever 21's relocation from its inception. In July 2011, OEBP held an "all hands on deck" meeting to streamline the project's development. In August 2011, the Case Management Unit, developed by OEBP, cut red tape by breaking down silos between City departments and solved issues from sidewalk repairs to parcel acquisitions. By November 2011 the site and structural plans were accepted and building permits were finalized. Throughout the building process, OEBP was on hand to help resolve any issues that arose.

Since the privately held company does not report financial results and since the Changs rarely give interviews, it's hard to get a good reading of how the place is run. Much of what's revealed isn't flattering, including several allegations that connect Forever 21 to sweatshop operations. From the LAT:

The Labor Department said an investigation into the Los Angeles retailer uncovered evidence of "significant" violations of federal laws on minimum wage, overtime and record-keeping by vendors supplying the company. Now, the agency is trying to get their hands on data documenting wages, hours and employment practices at Forever 21's contractors and manufacturers. The Labor Department is trying to compel Forever 21 to comply with a subpoena handed down in August after the company refused to cooperate.

*Reader notes that for years the location was the main distribution center for Broadway Department Stores. Eventually, Federated took over and it became a Macy's location.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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