Highlands Plaza Is Holding Downtown Palisades Until Downtown Comes Back

Cafe Vida spent more than two decades in the Business Block at Swarthmore and Sunset after opening there in 2002. The fire destroyed the restaurant. Its next address is 548 Palisades Drive, in the north-end Highlands Plaza space that K Bakery used to occupy. On October 26 the Palisadian-Post reported that co-owner Luis Castaneda was waiting on final inspections, aimed for the first week of November, and said "the place is ready to go."

Cafe Vida's old block looks very different. Topa owns the Business Block site, and in early September the Palisadian-Post's commercial real estate column reported no announced plans and no construction there. The column described the Highlands center at Palisades Drive and Sunset as a place that "seems to be thriving."

So a strip center that once mostly handled Highlands errands is now doing a bigger job. Businesses that used to be spread across downtown, Marquez and Alma Real are coming back to the same parking lot.

Three burned corridors, one address range

The tenants returning to Highlands Plaza mostly come from somewhere else. Here is where several of them worked before January 2025 and where they are now:

Taken together, the table covers downtown retail, the Marquez Knolls neighborhood district and the office building at 881 Alma Real. The Palisadian-Post's September column, written by T.C. Macker, a Palisades native and commercial broker at Westmac Commercial Brokerage, put each of those places at a different stage of recovery. Three of the four Marquez property owners had announced plans to rebuild, but because those owners have different insurers and finances, he expected the process to be slower. 881 Alma Real, which he called the largest office building in the community before the fire, had not started construction, and its owner was still working on plans. He described the Highlands as "much further along."

A business owner whose old block is still a vacant lot can't wait for it, and Palisades Drive is where the available storefronts are.

What it took to sign a lease uphill

Gerry Blanck's return shows how the move worked. He had taught in the Palisades for 43 years. After the fire he spent about a year teaching three days a week at MuDo Integrated Martial Art on Lincoln Boulevard in Santa Monica, which let him keep a core group of students. He came back with help from Build Back Pali, a teen-led nonprofit started by three Palisades kids that raised more than $500,000 for local business recovery. The group gave Blanck $50,000 on the condition that he sign a lease in the Palisades, and the money went straight to his new landlord.

According to the Palisadian-Post, Blanck signed a three-year lease for about 1,200 square feet. The grant covered his deposit and his first few months of rent, and the studio held its grand opening on June 1. Students are starting to come back. Nine students from St. Matthew's Parish School attend his classes every Thursday. The same article reported that the Yogurt Shoppe also received Build Back Pali funding as it planned its move to the plaza. It described the group of returning businesses as "the kind of critical mass that can start to shift the momentum of a recovery."

Cafe Vida's owners made a similar long-term bet. The new space has less room inside, with only a few tables, but more seating overall than the old location. Most of that seating is on a year-round patio with a pergola and heaters. Castaneda described the decision to the Palisadian-Post this way:

"We got a long-term lease. We're confident that the Palisades will be back. We do know that it's been challenging and still a lot of development needs to happen. So it'll be a slow build but we are confident in that long term."

Long leases like these mean the plaza is likely to remain a gathering spot even after downtown is rebuilt.

Walking the storefronts, south to north

The center runs along Palisades Drive near Sunset. Here is what each address held as of the most recent reporting:

• Moku Sushi, 524 Palisades Drive. This Japanese and Thai spot reopened on April 1, 2025, and the September column listed it among the plaza's operating businesses. Its online ordering page currently shows daily hours from noon to 8:15 p.m.
• Sanctuary Spa, 530 Palisades Drive. Racquel and Jeffrey Jacobs opened the spa in December 2024, and the fire closed it a month later. The Palisadian-Post reported an October 29 reopening after a seven-month buildout designed by local architect Michael Kovac. The spa's website lists daily hours from 9:30 a.m. to 7 p.m.
• Spruzzo, 538 Palisades Drive. The restaurant reopened with its full menu on May 1, 2025. It is one of the businesses the plaza kept through the fire.
• Gerry Blanck's Martial Arts Center, 542 Palisades Drive. Classes for kids and adults, in a space that opened in June.
• Palisades General Store, 542 1/2 Palisades Drive. Amy Russo soft-opened in mid-August and held a grand opening on September 19. The store carries home goods, jewelry, kitchenware, clothing, specialty teas and candles made in West Hollywood, and a frozen yogurt machine is planned as a permanent feature. It is open daily from 10 a.m. to 6 p.m.
• Cafe Vida, 548 Palisades Drive. Breakfast and lunch first, with dinner, beer and wine to come once the restaurant is settled.

The plaza also has a Starbucks, which reopened in July 2025.

The tenants also show up for each other. At the General Store's grand opening, Russo served food catered by Cafe Vida and by Spruzzo, which is a few doors down.

Farther up Palisades Drive, the Highlands Circle building at 1515 Palisades Drive survived the fire. The Palisadian-Post called it one of the few commercial buildings in the Palisades left standing. Heather Oscarson, who grew up in the Palisades and lives in the Highlands, has run Hair by Heather Joy there since 2021 and reopened in March 2025. The building's best-known tenant, Casa Nostra, closed on December 31, 2024, a week before the fire, and did not come back.

The services the plaza is taking on

Some of these openings fill gaps left by businesses lost elsewhere in town. Sanctuary Spa planned to open Nails by Sanctuary Spa in the next suite, connected through the lobby, about a week after the spa reopened. Jeffrey Jacobs told the Palisadian-Post that the nail salon previously in that suite chose not to return, "on top of the fact that most of the other nail salons in town in the Palisades had burned down. So we felt the community needed it." One example is Lemon Nails on Antioch Street. Its parcels have since been sold, and the column reported talk of a larger mixed-use project there.

Cafe Vida plays the same role for sit-down breakfast and lunch. Its patio is designed to be used all year, and Castaneda said he hopes it will be "the best patio atmosphere in the whole Palisades."

The nearest major grocery store is Vons at Sunset and Pacific Coast Highway, which survived the fire and was the first major Palisades grocer to reopen. Erewhon is scheduled to open at Palisades Village in January 2027, which will give the Palisades two major grocers. As of early September, there was no significant construction on the former Gelson's site at Sunset and Via de la Paz, and the Ralphs across from Alma Real had not started construction.

That means a Highlands weekday this fall can include a sushi lunch, a martial arts class, a facial and a stop at the General Store without leaving Palisades Drive. A full grocery run still means a trip down to Vons.

What to watch on Palisades Drive next

Two openings will show how far the plaza's role grows. The first is Cafe Vida's first-week-of-November opening and, after that, the dinner service its owners have said will follow. The second is the Yogurt Shoppe, which announced in May that it would move to the plaza. Downtown is moving too. In early September, the Rodeo Realty building at 839 Via de la Paz was nearing completion, and 843 Via de la Paz, formerly home to Flour Pizzeria, was almost finished as well. As those buildings fill in, the businesses with long leases on Palisades Drive will be the ones that kept the Palisades supplied while downtown was rebuilt.

If you live in the Highlands and want to talk about how the plaza's return and the progress downtown are affecting your street, Kyle Leibovitch is a neighbor who follows these storefronts closely. Schedule a consultation, and we can meet at the Highlands Plaza coffee spot of your choice.