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Multimillion-dollar hotel project nixed by Long Beach council

December 21, 2011 |  7:01 am

A four-year stalemate over land use in southeast Long Beach came to an end when the City Council rejected a $320-million development that included a boutique hotel, science center, shops and condominiums.

In a 3-to-5 vote, the City Council declined to change zoning and permit requirements on the 2nd Street and Pacific Coast Highway parcel, which would have allowed the construction of a 12-story condominium complex.

A long-standing moratorium limits the size of buildings to three stories in the southeast area.

The council also did not uphold the Planning Commission's certification of the environmental impact report, which had been approved last month but appealed by environmental and community groups.

It also unanimously agreed to direct city staff to return to the council with a report on revising a 34-year-old land-use requirement.

It was the second attempt to develop the southeast parcel. Developers first had partnered with Lennar Corp., a national home-builder, which funded and designed a project. But the giant company pulled out four years ago because of city opposition.

Since then, developers say they have spent millions in an attempt to bring their new project to life.

The Seaside Village or 2nd+PCH project would have replaced the old SeaPort Marina Hotel with 20,000 square feet of restaurant space, 275 residential units, 155,000 square feet of retail space, 50,000 square feet of hotel space, plus an underground garage for 1,440 cars.

The 12-story tower building would have had 126,000 square feet of condominium space topped by a helipad.

Supporters had argued the project would have created hundreds of new jobs and millions in revenue.

Long Beach already benefits from hundreds of businesses, such as Boeing, Long Beach Airport, tourism, a large oil field and the nation's second-busiest port, which produces thousands of jobs and generates $16 billion in annual trade-related wages statewide, according to city officials.

Still, the city has an unemployment rate of 12.7% as of last month, compared with the county average of 11.5%.

Opponents of the project argued it would have increased traffic congestion at already backed-up intersections and harmed nearby wetlands. What's more, they said, changing the city's Local Coastal Program and the Southeast Area Development Improvement Plan to accommodate the project would have set a precedent for other high-rises along PCH.

Dozens of residents showed up to Tuesday night's council meeting, including another developer who offered to pay a portion in updating the development improvement plan.

Amid the mixed crowd, those in favor of the project wore green T-shirts with the words "Live, work, eat and play in Long Beach" on the back, while opponents wore stickers with "Second and PCH" crossed out.

Councilman Gary DeLong, whose district includes the parcel site, supported the project, as did councilmembers Robert Garcia and Suja Lowenthal.

And while the conversation between councilmembers and lead developer David Malmuth seemed to hint the project would be approved, the council's final decision shocked many.

"I'm pleasantly surprised," said environmental activist Heather Altman, a resident and foe of the project. "I was not anticipating that the vote would go this way."

But for Malmuth and SeaPort Marina hotel owner Raymond Lin, the council's vote was painful and bitterly disappointing.

"I feel horrible," Malmuth said. "We need to process this, but I think the project's dead."

"I now have to try and do what's best for my family," Lin said of the SeaPort Marina hotel. "I've already tried to do what was right for the community."


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