A rendering of The Beat, an expansive development by LAB Holdings in North Long Beach. Rendering courtesy of LAB Holdings.

A long-planned redevelopment of the Atlantic Avenue corridor in North Long Beach is not moving forward after the firm that pitched a slew of restaurants, shops and entertainment spaces for the area has decided to return the land to the city, according to city officials.

The Orange County-based LAB Holding LLC had accumulated nearly 50 properties in the area of Atlantic Avenue and South Street that it sought to develop into a village with housing, retail and an artist colony, but Bo Martinez, Long Beach’s director of economic development, said that the COVID-19 pandemic and other factors led to LAB Holding abandoning much of the project.

“Post-COVID they just weren’t able to develop any momentum,” Martinez said.

An 84-unit townhome development known as RTHM is in pre-construction across the Atlantic from the Michelle Obama Library, but Martinez said the remaining 23 parcels that were tapped for development by LAB Holding will be returned to the city.

A rendering of townhomes from developers Brandywine Homes proposed to be built on a vacant lot in front of the Michelle Obama Library in North Long Beach. Rendering courtesy Brandywine Homes.

That means The Beat, the project that was supposed to revitalize the area by redeveloping existing vacant storefronts and building up empty plots of land, will not happen. The Beat included gardens and music programming focusing on jazz history as well as an “artist colony” and adaptive reuses of existing buildings.

The ambitious plans took years to put together, but now the city will have to pursue other developers who want to enter the North Long Beach market.

“It’s very disappointing, it’s a huge letdown but we have to continue forward,” said Councilmember Al Austin, who represents the southern part of the area where The Beat was supposed to be developed.

Austin said the city needs to find people who want to invest in Long Beach and be part of the vision for the future of the area, but he added that he’s optimistic about the future of the corridor.

“The area, once there is a thriving business district, it will be a walkable community for people who live there. It’s just a matter of getting investors and a responsible developer,” Austin said.

Councilmember Joni Ricks-Oddie, who represents the 9th District, which includes part of the proposed project that is north of South Street, did not respond to a request for comment.

Vacant buildings on Atlantic Avenue just before South Street, some of which were proposed to be part of The Beat project that has now fallen through. Photo by Jason Ruiz

LAB Holding has built numerous retail centers across the region, notably the Anti-Mall in Costa Mesa and the Packing House in Anaheim. Shaheen Sadeghi, LAB Holding’s CEO, did not return a request for comment.

The nearly $7 million sale that the City Council approved in 2016 allowed LAB Holding to take on the land at a discount, but the payment was contingent on developers securing entitlements for projects. If no projects were built, the land must be returned, according to the deal struck between LAB Holding and the city.

It’s unclear how much money Long Beach was paid when the site of the RTHM housing development was sold.

Martinez said while the news is disappointing it could benefit the city. With the area now having a large housing development under construction—instead of a massive vacant space—combined with the climate of the real estate market, the city could end up selling the 23 returned parcels for more than they agreed to in 2016.

“I would say yes that the property is more valuable,” Martinez said.

The city is already in negotiations with Long Beach City College to purchase the three parcels north of the Michelle Obama Library where the college hopes to build a 36-bed affordable housing project for students that would include educational spaces, a food pantry and other student services.

“Our intention to develop student housing in the North Long Beach area has not changed,” Chip West, LBCC’s vice president of business services said in a statement. “There is still a need for more student housing and LBCC is still committed to better support the North Long Beach community.”

As for the rest of the properties, which include multiple parcels on Atlantic north and south of South Street as well as a handful along Lime Avenue, Martinez said they will go back on the market and the city will be looking for developers with proposals that are consistent with the city’s housing and business-growth policies.

That could mean more mixed-use residential projects, retail and other projects that can add people and activity to the corridor.

Jason Ruiz covers City Hall and politics for the Long Beach Post. Reach him at jason@lbpost.com or @JasonRuiz_LB on Twitter.