Downtown Continues Seeing Housing Growth, Which Breaks Expectations

Long Beach has not lightened up on its commitment to developing the downtown. While housing projects are taking off in other parts of town, the downtown still leads the city’s housing market.

According to a Downtown Construction Report, 78.6% of all new apartments built in Long Beach since 2020 are located downtown – up from 66.2% in the previous decade. That 12-point increase ranks Long Beach among the top U.S. cities for downtown-focused housing. That comes from RentCafe, a nationwide apartment search website and a part of Yardi Systems, a leading global provider of property management software headquartered in Santa Barbara, Calif.

Long Beach added 2,386 downtown apartments between 2020 and 2024. Converted buildings made up 7.8% of new downtown apartments, according to the report.

As of November 2023, properties built since 2000 were already 93% full. The highest rental rates have been in the $1,001 to $1,500 per month and $1,5001 to $2,000 per month, according to Apartments.com based on data collected by CoStar Group researchers.

“Long Beach is one of the most downtown-oriented cities in California this decade when it comes to apartment construction. In fact, its growth pattern is more comparable to that of San Francisco and Oakland – though smaller in scale – due to its concentrated pace of development. Nearly four out of five new apartments have been built in the downtown area, surpassing all other cities in the state except San Jose,” says Alexandra Both, real estate writer and research analyst who authored the Downtown Construction Report.

“This trend is driven by a combination of factors, including revitalization policies like the 2012 Downtown Plan, which enabled greater residential density, as well as land availability and strong demand for urban living. Choosing to live in Long Beach’s urban core offers waterfront access, walkability and proximity to major employment centers such as Los Angeles and Orange County,” Both says.

What’s Happening Downtown

A year ago, Dallas-based firm JPI acquired a portion of the Mosaic DTLB property which goes from Long Beach Boulevard, 4th Street, The Promenade North, to 5th Street. As part of a larger redevelopment application, the 1.58-acre site has been approved for the construction of 272 rental apartments. JPI last month began clearing for this mixed-use complex in downtown.

JPI intends to brand the new development as Jefferson Long Beach. In addition to housing, it will be the location for 16 affordable units and 19,000 square feet of ground-floor commercial space. The remainder of the property is slated for the construction of 628 residential units in a series of eight-story structures designed by MVE + Partners, according to a published report.

The former Union Bank building on Ocean Blvd. in downtown will be converted into a residential tower that will be a part of a 275-unit development that’s been approved by the city’s Planning Commission as of last September.

The approved plan would allow for a 15-story building converted into a mix of studio, one-bedroom and two-bedroom apartments. Located at 400 Oceangate, the building has been the headquarters for law firms and other businesses over the years.

Construction projects slowed down after COVID-19, but the city and its hotels and event centers have been witnessing gradual growth and visitor traffic.

LB More Downtown Focused Than Other Cities

The new report says that Long Beach is one of the most downtown-focused cities in California this decade, which is showing renewed urban core investment. The city is experiencing a decline in reuse activity, which may suggest there’s been a shift toward new construction or challenges in adopting older buildings.

Long Beach is 33rd overall in downtown apartment development and conversions among the cities included in the study.

Since 2020, Long Beach has seen 2,386 downtown units. For the building projects in the city, 78.6% have been in the downtown – up from 66.2% over the previous decade. Reuse made up 7.8% of downtown units in the new report, down from 13.1% in the previous decade report covering the 2010s.

Restoration of historic buildings continues in Long Beach, though there’s more interest in living in new buildings by these renters, the study says. Experiencing a decline in reuse activity may suggest a shift toward new construction or challenges in adapting older buildings, according to the RentCafe report.

The Breakers Hotel in Long Beach, now known as the Fairmont Breakers Long Beach, has recently undergone a significant restoration and reopened in November 2024. It’s an example of how these historic buildings can be beautifully restored. The thriving hotel has new tenants and a renewed focus on luxury and hospitality.

Jon LeSage is a resident of Long Beach and a veteran business media reporter and editor. You can reach him at jtlesage1@yahoo.com.