Three Perspectives on Pine Avenue Vacancies - Part 2: The Councilmember


Vice Mayor Suja Lowenthal announcing a new parking mobile app earlier this year.
 
11:00am | Vice-Mayor Suja Lowenthal is also known as 2nd District Councilmember Suja Lowenthal, and so southern Pine Avenue is both her boon and bane. As such, she seemed like an obvious person to speak with to find out what's up, what's down, and what's to look for.

What you won't see, Lowenthal says, is the City taking all comers so as to fill the vacancies for the sake of filling them. Rather, the City will continue to be selective about what types of business it lets set up shop on such a prominent facet of Long Beach.

"If you approach it with [an attitude of], 'We'll just take anything,' there won't be a vacancy rate necessarily," she says. "On a critical street such as Pine Avenue … you do have to be selective where you can."

As a specific example, Lowenthal shares that years ago a Hustler company (as in Larry Flynt) desired to open a retail store on Pine, but that both the property owner and the City felt it was not a good fit. But sometimes the lack of fit is more mundane.

"You'll have commercial brokers who represent retail that will bring any available tenant to a private-property owner, and that property owner may decide that tenant's not a good fit for their building," she says. "Or, in conjunction with whatever modifications have to happen to that particular site that requires any approval, the City might look at it and say, 'You know, that's probably not the right fit, given all the tenants that are there right now.' … I know some property owners are upset with us, because there are Hustler-type corporations where they can probably get more than market value. But is that really what's best for the residents who we are encouraging to come live there? Because we're creating a neighborhood, too. It isn't, 'The highest bidder matters'; it's, 'What's right for that neighborhood?'"

A similar consideration is whether a tenant will contribute to the vibrancy of downtown — and retail businesses that close at 5 p.m. really don't, particularly if located at a prominent spot like a corner.

"That particular property owner may meet his or her need — they can lease that space, get market value," she says. "Because it pays the same whether the tenant is open seven hours a day or 24 hours a day. But for that neighborhood or that street it doesn't pay the same. That's a complication."

Another complication is the sheer multifariousness of Pine Avenue players. "[That] there are so many [property] owners involved, with different mindsets and expectations and lease rates and brokers … presents a challenge," she says.

Lowenthal also points to a challenge Pine Avenue is facing from a nearby strip of real estate: the Promenade, which she labels "the hottest space in downtown right now. …  I think Pine Avenue is a tougher spot right now than the Promenade. … The Promenade may be in a position of first right of refusal. … Pine may be getting the second look right now, given how the Promenade is serving as a destination. And certainly new customers who are coming to Pine are kind of leaning toward the Promenade because of what's already there. You know, it's new, it's fresh."

But back to Pine, what can the City do?

"The City can focus on public infrastructure and the plan-approval process," she says. "And with the development of residential units, we can make the downtown denser and more attractive to owners and brokers. I know that residents themselves feel that the City has a greater role in retail recruitment [than it actually does]. … We do participate on all levels, but public infrastructure, streamlining plan-approval process, and fostering population density is what we can really do."

And what grade does she give the City on that doing? B to B-, she says, though she's quick to qualify it with the notion that the macro - and microeconomic problems affecting Long Beach have limited what the City can bring to bear on the vacancy problem.

"We don't have all of what we need," she says. "Resources have been decimated. … We don't have an Economic Development Department anymore; there are people who have had to incorporate that into their jobs. … When Robert Swayze [viz., the former director of Economic Development] left, that position was closed."

But Lowenthal points out that the City has done plenty. "Many of those property owners [on Pine Avenue] have had many, many rounds of assistance, public assistance," she says. "The public has gone in to help with subsidies. In the 20-plus-year history of that street, a good chunk of the units' buildings have had public assistance. "

As an example she points to Z Gallerie, to which the City gave a 10-year, interest-free loan. "And then right after the 10 years was up, surprise surprise: they had no obligation to stay, and they didn't."

In the end, Lowenthal says, we live in a free market, and to some degree the market must sort itself out. "You can't have a free-market society and then say the City has to come in and subsidize everything," she says. "People say the City should do something. But there's a cost to that. … When you say, 'The city should…,' you've got to have an equal sign with a dollar amount after it. … You know, we kind of want to be careful with how much we want the City to get involved, because really, the real involvement that a lot of business owners are requesting is a subsidy, assistance in actual dollars. And these are not dollars we have right now."

On the upside, Lowenthal is very enthusiastic about the prospect of having the Port Administration building — and its 400 employees — on this side of town. "That one singular decision will have a positive impact on downtown," she says.

So, too, will the recently-completed "land swap" deal that allows for a greater variety of businesses (read: retail) at the Pike.

"There have been vacancies [at the Pike] not because people weren't willing to lease the space, [but because] it had conditions on it regarding what types of use can be allowed," she explains, referring to the State Lands Commission's tidelands restrictions that were in place prior to the swap.

Lowenthal points out that the land swap was the product of several years' work by the City — the kind of thing that's less visible at street level than the empty storefronts. "Those are the things that are ongoing that are hard to see or recognize the value of, because it's not immediate," she says. "But I think [the land swap] will almost immediately start reducing the vacancy rate at the Pike."

As will, she believes, the path the City is following in its efforts to foster Pine Avenue's health and maturation.

Helping to chart that path is the Downtown Long Beach Associates. Read what they have to say tomorrow.

Click here for part one: Three Perspectives on Pine Avenue Vacancies — Part 1: The Brokers
 
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