The sale of 30 parcels of land near Atlantic Avenue and South Street to LAB Holding, LLC was approved by the Long Beach City Council Tuesday night for nearly $7 million. Google Maps screenshot.
Citing the capital intensive nature of the project, the Long Beach City Council voted Tuesday night to reduce the upfront cost to the Orange County developer that acquired several blocks of land along the Atlantic Avenue corridor in North Long Beach last year.
LAB Holding LLC was granted final approval for the land acquisitions in August 2016, land that came with a price tag of about $6.9 million. Originally, the deal called for The Lab to pay the city a $500,000 down payment, however, with Tuesday’s vote that figure was dropped to $50,000.
The group will still be responsible for paying the balance of the $6.9 million despite the reduction in upfront costs.
Eighth District Councilman Al Austin reached back into 1940s film history to quote Michael Curtiz’s Casablanca, stating that he thought this project was “the beginning of a beautiful friendship” between the city and LAB, adding that residents and businesses would be the ones to benefit from this deal.
“Many of the storefronts in the North Village have been vacant for several years since the redevelopment agency was dismantled,” Austin said. “The residents in North Long Beach have been waiting for this project for many years and they have watched Bixby Knolls and other corridors and other areas of the city make great strides.”
In August, the council had also agreed to reduce costs of the land acquisition by about $1.1 million as the group had indicated it could not proceed without a reduction in price. Then Economic Development Manager Mike Conway explained that the city’s reduction in price did not amount to a city subsidy, but a “calculation of the land’s value required to achieve project economics.”
The group has secured dozens of properties in the city’s Eighth and Ninth Districts which make up the northernmost reaches of Long Beach. The intent of the project is to develop it into a North Village retail center similar to those LAB holds in Costa Mesa and Anaheim.
Long Beach will receive about 21 percent of the proceeds from the $6.9 million sale costs with 75 percent of that being allocated to the North Redevelopment Project Area and the remainder being spread citywide. However, under the updated terms of the agreement, a portion of the 75 percent will be allocated to reimburse LAB for tenant improvements and exterior building renovations. That amount is not to exceed $350,000, or roughly 30 percent of the fund.
Mayor Robert Garcia called the project a home run that was one of the best things to happen to Long Beach in a “very very long time.”
Chris Bennett, a representative from LAB, was on hand and made a brief comment about the groups anticipation to get the project started and to get to work with the city.
“We are focused on local independent jobs and local independent businesses to create something that is very unique and Long Beach specific,” Bennett said. “That’s what we try to do with every community we work with and we’re very excited to work in Long Beach.”
Vice Mayor Rex Richardson, who was absent from the meeting due to the birth of his daughter, said LAB and the other two developments North Long Beach has wooed over the past year represent the first real opportunity to create a Main Street in the city's north.
The projects, which will primarily sit in Richardson's district, comes after dogged behind the scenes efforts by the vice mayor and other officials to bring the development from the downtown sector to the north and continue the Uptown Renaissance that Richardson has pushed since becoming part of the council in 2014.
"LAB Holding rounds out the development team that we've put together over the course of the last year that will work together to create a Main Street that stretches from Jordan High School to the Michelle Obama Library," Richardson said .
[Editors note: the story has been updated to include comments from Vice Mayor Rex Richardson.]