Airport Boom Taking Off : Developers See Gold in Area Around Long Beach Municipal
On a clear day, the new office tower under construction in the Kilroy Airport Center offers a breathtaking view.
To the south and west, cars cruise along the San Diego Freeway. They are framed against the soft round curves of Signal Hill and the hint of blue Pacific horizon.
To the north and east, the flat plain of suburbia reaches for miles to the San Gabriel Mountains. A few hundred yards from the foot of the tower, airliners gently swoop onto the concrete main runway of Long Beach Municipal Airport.
The airport area has become a developer’s dream. Utilizing some of the last large tracts of vacant land in the city, two business parks--Kilroy Airport Center and Long Beach Airport Business Park--thrive and continue to grow.
To some, the airport area holds the promise of becoming an uptown to match the city’s revitalized downtown.
“The people in the business of building things salivate at the chance of building out there,” Planning Commissioner Tony Tortorice said. “If there is enough land . . . it could be like Century City or Irvine.”
From Kilroy’s 8-story steel skeleton, there is no better place to view the burgeoning area’s development. Glimmering office buildings sprout from the fertile soil that used to support only lush turf. Granite-faced edifices teem with more than 5,000 office workers on the sites where jack rabbits once scampered.
More Projects Planned
The two business parks--each about 50 acres--compose the core of the new wave of growth in the airport area. But they are only the start. New office or light industrial projects are either being planned or are completed on the airport’s south side--along Willow Street, between Lakewood Boulevard and Temple Avenue. Also, McDonnell Douglas Corp. is building offices on the airport’s northeast corner.
“I think (the airport area) will become a very significant sector to our business economy,” Chamber of Commerce President Brent Hunter said. “The response for office space up there has been phenomenal. . . . They have been very successful and will continue to be.”
All of the buildings completed thus far in the two parks are virtually leased. The parks have been so successful that the developers are building 8-story office towers and are aggressively trying to find tenants to fill them.
At the Airport Business Park, the Long Beach Airport Marriott hotel has been equally successful. The 311-room hotel has an 80% occupancy rate, one of the highest among first-class hotels in the city.
Close to Freeway
What makes the area so hot? Developers and city officials, borrowing from the old real estate credo, credit the success to three factors: location, location and location.
The airport area is virtually an off-ramp’s distance from the San Diego Freeway. About 225,000 motorists whiz by every weekday. Besides being easy to reach, the airport area is highly visible.
Perhaps more important, developers and city officials say, the airport area has an ideal regional location. The two business parks are about midway between major business centers in Los Angeles and Newport Beach and can provide a central location for companies that want to conduct business in both counties from a single office. And their location is 15 minutes closer by automobile than offices in downtown Long Beach.
Then there is the city-owned airport. The two airport office centers are only minutes from the boarding gates.
The airport now offers 26 daily commercial flights. But last week, a federal judge struck down the city’s airport noise ordinance, which airlines had opposed because it put restrictions on the number of flights.
The ruling, which could lead to more flights, was a boost to airport-area developers. They say that more flights would make airport-area offices more convenient for businesses with employees who must travel.
City Reaps Rents
From a financial standpoint, the development of the airport parks has already benefitted the city. Community Development Director Roger Anderman said the city receives a total of about $3 million a year in rent from the two parks. The city also reaps additional income from sales taxes, the so-called “bed tax” on hotel rooms and a possessory interest tax that is like a property tax on leaseholders.
“The airport (area) has sort of been overlooked for many, many years,” said George Economides, publisher of the Long Beach Business Journal. “The airport is definitely going to develop further.”
Economides has so much confidence in the airport area that he started his newspaper there a year ago as the Airport Business Journal and only recently revised the name as the publication sought to broaden its appeal.
Without a doubt, much of the airport area’s success is directly due to the good fortune of St. Louis-based McDonnell Douglas Corp. The aerospace giant builds some of the world’s best-known jetliners on the fringes of the Long Beach Municipal Airport. And business is booming.
Its divisions have leased the majority of space in both the Kilroy development and Airport Business Park, part of about 1 million square feet of office space leased by the corporation in the vicinity of the airport, corporate spokesman Dave Eastman said.
By Far the Largest
The Douglas Aircraft Co. division employs more than 25,000 workers, nearly five times more than the city’s next largest employer, the Long Beach Naval Shipyard. The aircraft company has piled up a record number of orders for its new-generation commercial jetliners--the MD-80 and MD-11. McDonnell Douglas also plans to assemble the Air Force’s huge new C-17 transport in Long Beach.
McDonnell Douglas is building in the area as well as leasing. The corporation’s real estate affiliate is constructing Douglas Center at Carson Street and Lakewood Boulevard. The office and retail complex will consist of an 8-story tower and two smaller buildings.
Despite the promising predictions, there are some built-in limitations that could hold down future development in the airport area. The biggest limiting factor is the dwindling city-owned acreage available for development. The two airport business parks have devoured a combined 100 acres of city-owned land, a majority of the amount that city officials say can be spared for business park development.
Because of the lack of land, Anderman and Planning Commission Chairman Manuel Perez said there is not enough space for mixed-use development--the addition of retail stores, theaters and more consumer-oriented amenities. So the area remains best suited for business parks, they said.
Heights Are Limited
Faced with land limitations, developers normally would turn to the obvious: If you can’t build out, then build up. But because of the proximity of the airport, building heights are limited. The Kilroy center, for instance, has buildings graduated in height according to the glide slope, with the lowest scale nearest the runway and the tallest farthest way, as required by federal regulation.
Then, there is the question of automobile traffic. So far, development has taken place at sites that generally do not directly affect the quiet residential neighborhoods east of the airport. More buildings, however, would mean more cars. The city is conducting a study aimed at determining how much traffic the area can bear.
Mayor Ernie Kell, who represented the area around the airport as a councilman from 1975 until becoming the city’s full-time mayor this year, said residents are concerned about existing and potential traffic from the developments.
Because of traffic, noise and other effects on the neighborhoods, Kell said he foresees a limit on the amount of commercial development in the airport area. He said that he puts a higher priority on rehabilitating downtown Long Beach than creating a new city center around the airport.
Airport developers, however, are undaunted. They wax enthusiastically about their projects.
First-Class Buildings
The Kilroy Airport Center will be a $280-million first-class alternative to what is available in downtown Los Angeles or Orange County, company Vice President John G. Carlson said.
“The quality of the buildings we are putting up there will be equal to any downtown office buildings. The granite, the marble--everything is going to be of the highest quality,” he said.
When finished, the 9-building complex will include fountains, a fitness center, restaurants and even a parking area for private aircraft.
Despite the new complex’s location and amenities, Carlson said a lot of people were unaware of it when the $44-million initial phase opened in July, 1987. “Most people didn’t even know it was out here,” he said.
So the company threw a big party.
The $100,000 bash adopted a nautical theme, and the atrium of an office building was decked out to look like a luxury ocean liner. About 750 champagne-sipping guests strolled among different stations that offered samplings of cuisine from six different countries. A French section featured a 34-foot-tall model of the Eiffel Tower. Singer Helen Reddy performed with the Long Beach Civic Light Opera in the revue “Anything Goes.”
‘A Pioneering Area’
On the other side of the runway, the Long Beach Airport Business Park is enjoying strong growth despite early skepticism when it began in 1980.
“Everyone said, ‘That’s kind of a pioneering area,’ ” recalled Chip Harris, president of the development firm of Carlton Browne & Co. of Costa Mesa.
Now the park is a proven success. The ninth and tallest of its buildings--also an 8-story office tower--is under construction. With those completed, plans call for two more buildings before the center reaches capacity.
Harris said he knew all along that the project had “all the ingredients for success.”
Besides the Airport Business Park and Kilroy, other new buildings are rising in the area. An 11-story office building with 700 parking spaces is planned on the present site of the domed Elks Club on Willow Street. Next door, the Residence Inn by Marriott--a residential-style hotel--has expanded from 136 to 216 suites.
