Staff Reporter

When Redondo Beach resident Marcy Rodriguez headed to the beach along Rosecrans Avenue last summer, she hardly noticed the once sleepy industrial district in El Segundo known as Continental Park.

Now, she's there almost every weekend.

"I usually go (to the theaters) on Friday or Saturday nights I love the stadium seating," said Rodriguez. "I didn't even know it was there until a friend from work told me about it."

Rodriguez is one of many South Bay locals who have discovered a new and bustling Rosecrans corridor.

"It's great, the parking's pretty accessible and it's close to home," said Rodriguez, 32.

On one side of Rosecrans Avenue is the upscale suburb of Manhattan Beach, on the other, the industrial city of El Segundo. The area for many years was known more for its aerospace occupants than as a retail destination.

But a 2-year-old marketing campaign from the city of El Segundo intended to lure business, combined with an aggressive effort to recruit retailers by the corridor's biggest landowner, is changing all that.

What was once an industrial park has been transformed into a crowded corridor where stores like Starbucks, Super Crown books and Noah's Bagels have been sprouting up in recent months.

And it's not just hopping on weekdays, when retailers get traffic from surrounding businesses. The corridor is drawing weekend shoppers and diners from throughout the South Bay. People without reservations can often expect to wait an hour-and-a-half at Rosecrans restaurants.

At the Manhattan Beach Marketplace, the Houston's restaurant recently had the best sales year in its seven-year history.

"In 1997, we've picked up about 25 to 30 percent," said Robert Davis, West Coast regional manager and vice president for Houston's. "Even with the added competition, we've just gained."

It wasn't always this way. In the early '90s, the crash of the aerospace industry cost the city of El Segundo about 45,000 jobs. Continental Development Co., which leases 2.5 million square feet of office and retail space in and around the Rosecrans Corridor the section of Rosecrans Avenue between the San Diego (405) Freeway and Sepulveda Boulevard lost more than 700,000 square feet of aerospace tenants.

But starting around 1995, things turned around. That year, the city of El Segundo launched a billboard campaign to lure new businesses. Meanwhile, Continental Development shifted gears and aggressively pursued retailers to fill vacancies left by aerospace companies, which had made up two-thirds of its tenant base. Most importantly, the economy improved.

Today, the former industrial park is 98 percent leased and only a third of its office space is leased to aerospace companies. In just a little more than two years, Continental has expanded its tenant roster to include a 16-screen cinema complex (one of the biggest movie houses to open in the South Bay), upscale eateries and a thriving retail district.

One of the new tenants is the restaurant McCormick & Schmick's. Adjacent to the theaters and propped up against a tiered office building that is home to Andersen Consulting, the restaurant already is shoulder-to-shoulder during happy hour.

"It's just packed," said Jennifer Carpenter, a college recruiter at Andersen.

More than 30 businesses have relocated along the Rosecrans Corridor, including Andersen Consulting and Unocal Corp.'s world headquarters. Even TRW Inc., which left during the recession, came back to its former home.

Sales tax revenues are up 95 percent since 1995, said James Hansen, director of El Segundo's economic development department from $2.9 million in fiscal 1995 to a projected $5.7 million in 1997.

While businesses on the north side of Rosecrans Avenue are part of El Segundo, those on the south side are in Manhattan Beach and that area is thriving too, said Geoff Dolan, Manhattan Beach's city manager.

Dolan admits that El Segundo played the lead role in reviving the corridor.

"The Manhattan Beach side was not as active as it is now," said Dolan. "El Segundo has brought in great restaurants and really has reinvigorated this whole area it's just incredible."

Unlike many competing retail areas that wrestle for each others' customers, the retailers along this stretch of Rosecrans are thrilled with the arrival of each new retail tenant because they continue to draw more shoppers to the area.

"There's a real synergy between the activity on both sides of the street," said Dolan. "We have a very large employment base, we now have theaters, a couple of real nice restaurants the street has just become a very vibrant area."

Fueling the retail growth, according to Bob Inch, vice president of marketing for Continental Development, is a different tenant base than existed when the area was dominated by aerospace companies.

"I think the popularity is caused by a new generation of office tenants that are probably more of a high-end retail-using type," said Inch. "A good portion of the former aerospace and engineering tenants were brown-baggers."

Yet to come is the new Manhattan Beach Studios, a planned 22.5-acre complex with 14 sound stages that will open this summer. The studios will be built directly behind the Manhattan Beach Marketplace at the intersection of Rosecrans and Redondo Avenue.

For Alice Neuhauser, one of the project's developers, the corridor's nearby freeway access and retail district played a key role in selecting the site for the $80 million complex, she said.

"We liked the way the area has a nice transition between the industrial to the retail," said Neuhauser, who along with partner Ron Flesch is developing the project for Shamrock Entertainment Investors II Inc., a unit of Burbank-based Shamrock Holdings Inc.

For merchants along the avenue, the upcoming studios are like icing on the cake. "It's pretty exciting to see what will happen when the studios come up," said Renaldo Guidone, owner of Lido in Manhattan Beach.

Meanwhile, Davis can hardly wait. "When you think of feeding all those people that's such a windfall for everybody here," he said.

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