The Aquarium of the Pacific, the Queen Mary and the Long Beach Convention Center are going to have to be enough for Long Beach’s waterfront development dreams, at least for now.
Citing the financial difficulties that have plagued the theater circuit industry, Developers Diversified Realty Corp. wants to significantly scale back its plans for Queensway Bay, an 18-acre entertainment complex that was to be a key component in the efforts of Long Beach officials to turn the waterfront into a major destination.
The developer now wants to go forward with the project in phases without a theater anchor.
The development as now envisioned would be a smaller, four-acre development on the waterfront side of Shoreline Drive, with restaurants as primary tenants.
The previous 18-acre project had been designed to have a combination of dining, retail and entertainment uses, including a parking structure financed with city bonds and a stadium-seating theater complex with an IMAX screen.
Ultimate build-out plans have changed little, and DDR would go forward with the rest of its project once the theater circuit industry has settled down, a company spokesman said.
DDR is in talks with tenants that had previously signed leases to determine which will fit into the smaller project and hopes to break ground by the end of the year, with the first restaurants opening next summer.
“The whole thing has to be re-thought, and it has to be done quickly,” said Calvin Hollis, managing principal at Keyser Marston Associates Inc., which is advising the city on the project. That may not be that difficult to do, since the project is no longer as complex.
The downsizing comes as little surprise. After Edwards Theaters Circuit Inc. filed for bankruptcy protection and pulled out, the project was delayed until DDR brought on L.A.-based Resort Theaters of America to replace Edwards. But the week that the much-publicized Queensway Bay shopping center in Long Beach was set to break ground, word came that Resort’s parent company had declared bankruptcy too.
Since then, DDR officials have pored over Resort’s finances, looking for signs that it could move forward comfortably. They didn’t find any such signs.
Even with retailers such as Cost Plus, Barnes & Noble and California Pizza Kitchen, the project couldn’t pull in the necessary foot traffic without a theater.
“Essentially, we have a great project and a great location, it’s leased up sufficiently to get financing, it does have financing approval, it has entitlements, it has construction drawings on the board,” said Bob Paternoster, the city official in charge of the project. But no theater.
The decision not to go with Resort came as hard news to city officials.
“They looked pretty good to us,” Paternoster said. “They were a small, growing firm.”
Airport buildings
Real estate investment trust AMB Property Corp. has bought three air cargo buildings at LAX.
The three cargo-handling facilities total 114,685 square feet and are tenanted by DHL Airways and Mexicana Airlines.
One of the buildings is the landmark Hangar 1, site of the original LAX operations tower.
The acquisition is part of a larger, $100 million transaction in which Virginia-based Aviation Facilities Co. sold close to 900,000 square feet of facilities at eight airports to AMB. Aviation Facilities will continue to lease and manage the facilities.
Retail moves
Niche developer Primestor Properties has opened its Sherwood Village shopping center in Van Nuys, the latest in a line of projects that the 8-year-old firm has undertaken in L.A.-area Latino neighborhoods.
The 23,000-square-foot Sherwood Village project was done in partnership with Goldman Retail Associates.
The latest project fits right into Primestor’s strategy of mixing mom-and-pop and national retail tenants, said Arturo Sneider, owner of the company.
The project has a Kragen Auto Parts, Blockbuster Video, K.F.C. and McDonald’s mixed in with businesses such as a Laundromat and a family-owned Chinese restaurant, Fortune Express.
That’s not the only project the company has in the works.
In Lynwood, Primestor has an agreement with the city to develop a 100,000-square-foot project on a 6.5-acre site at Long Beach Boulevard and the 105 Freeway, set to open in 15 months.
The project, called Lynwood Springs, is designed to have a number of water elements, Sneider said.
“Like all of our projects, it will be a very, very attractive, Hispanic-oriented retail center,” he said.
The company is also assembling property for a five-acre retail project in Walnut Park and is developing a 17,000-square-foot project at the northwest corner of Atlantic Boulevard and Florence Avenue in Bell.
“Atlantic and Florence is like Main and Main for the Hispanic market,” Sneider said.
Recent projects done by the West Hollywood-based firm include a $3 million center in Lincoln Heights and a $5 million, 100,000-square-foot center in Huntington Park.
Primestor was founded in 1992 to develop and manage shopping centers in Latino neighborhoods.
Sneider said the company picks prime locations in mostly under-served communities and develops high-quality projects.
“Just because it’s in those markets, does that mean we can build C-quality with no architecture and no landscaping?” Sneider said. “Those days are over in the fastest-growing population in California.”
Business Park Expanding
L.A.-based Investment Development Services is moving forward with a $13 million third phase of its Vista Business Park in Valencia.
Encouraged by absorption rates for industrial spaces larger than 100,000 square feet, company officials plan to build a 206,000-square-foot building set for completion in early 2001. The building was designed by Hill-Pinckert Architects and built by Kendrick Construction.
Jim Linn and Nigel Stout of the San Fernando Valley office of Grubb & Ellis Co. are handling the leasing.
Roughly 740,000 square feet at Vista Business Park is leased to Pharmative.
Staff reporter Milo Peinemann can be reached at mpeinemann@labusinessjournal.
com.
