The question of how best to develop the SeaPort Marina Hotel property, located at one of the city’s busiest intersections and also at the center of the one of its biggest real estate controversies, was put to teams of rival students studying real estate at UCLA and USC.
The UCLA vs. USC Real Estate Challenge is an annual competition between teams of students representing the UCLA Ziman Center for Real Estate and USC Lusk Center for Real Estate. Each year, the competing teams are required to examine a Southern California location and prepare development proposals that attempt to identify the most lucrative opportunities for a given piece of land. The proposals must also include cost estimates, financing strategies and how to win approval from politicians and bureaucrats.
The competitors presented their dueling proposals to a panel of judges representing real estate, banking and architecture firms this week on the USC campus.
“It’s a grueling six week process. We really talked to 300 people,” said Stephen K. Anderson, a USC Lusk Center student who worked for Los Angeles World Airports and the Community Redevelopment Agency of Los Angeles before beginning graduate-level study at USC.
Anderson and his four teammates won the 2013 competition, and claimed the Silver Shovel trophy for the annual event. The Southern California chapter of the National Association of industrial and Office Parks hosted the event.
On the surface, the SeaPort Marina Hotel site appears to be the great irony of Long Beach real estate: the hotel is at the city’s busiest intersection — Pacific Coast Highway and Second Street — but the hotel has lost its former prominence and the property has languished over the past several years.
The hotel’s seemingly prime location near the coast has proved to also be a drawback. Despite the high levels of consumer demand in the area — upscale grocery store Gelsons opened recently across the street — the property is subjected to coastal development restrictions, including a rule that no buildings be taller than 35 feet.
Those limits, along with worries over traffic and the effects of new construction on the Los Cerritos Wetlands, helped spell doom for a $320-million proposal dubbed the Second+PCH Project. The City Council killed the proposal in 2011.
The recent history and political difficulties of developing the SeaPort Marina Hotel site heavily influenced the teams’ proposals. USC’s plan, called Belmont Yards, was built upon the idea of initially replacing the hotel with new retail, a permanent farmer’s market and a pedestrian bridge from the development to the nearby marina. The USC concept also included the use of recycled shipping containers as a nod to the importance of the shipping industry to Long Beach’s economy.
All that could be done under current development restrictions, students said. The USC plan further contemplated a second phase of construction that could include a new hotel and 300 multifamily housing units. The students estimated the costs of their plan at $197 million.
The student plans assumed that revisions to Long Beach’s coastal development rules would be amenable to taller buildings than are presently allowed. The UCLA concept also revolved around a proposal to attract investors and officials’ goodwill with a retail phase that would be allowed under current law and a second phase of hotel and residential construction that may become possible if development restrictions are eased.
Property owner Raymond Lin and company have submitted a plan for the hotel, how in the midst of environmental review, to raze the building and replace it with 252,000-square-foot retail development.
Lin, who noted that he is a USC alumnus, said at the event that his current plans do not include a second phase of hotel and residential construction, but also said he may be open to some modification down the road.
“Both are very bold projects,” he said of the students’ work.