Despite dozens of public meetings, and promises of jobs and millions in revenue, a bid to turn an aging pink hotel into a ritzy $320-million coastal development in Long Beach is over.

“This had the potential of being huge and it’s dead in the water,” Councilwoman Rae Gabelich said Wednesday.

After six hours of sometimes heated discussion at a packed City Council meeting Tuesday night, the proposed complex at 2nd Street and Pacific Coast Highway was rejected on a 5-3 vote.

“Quite frankly, I’m disappointed with my colleagues,” Gabelich said. “Conditions could have been set. Why, I ask, would you kill something that has been in the process for eight years?”


Lead developer David Malmuth’s reaction was more to the point.

“I feel horrible,” he said of the vote, which rejected proposed amendments to the area’s zoning regulations.

The proposal, which included high-end retail, hotel and residential units, had faced intense opposition because of concerns over traffic congestion and the potential effect on the nearby Los Cerritos Wetlands. But it was the city’s decades-old zoning plan, which imposes a height restriction of three stories on any new development, that doomed the project.

“This is backwards,” said Councilwoman Gerrie Schipske, who voted against the project. “What I’m most concerned about is that we need to have a plan that’s predictable for anyone who wants to do development here.”


Introduced at the meeting was a letter from the California Coastal Commission dated Monday recommending that the city revise the Southeast Area Development and Improvement Plan, known as SEADIP.

Melvin Nutter, former commission chairman and now attorney for the Los Cerritos Wetlands Land Trust, warned council members before the vote that the project probably would be sent back if they approved it.

“I cannot recall a single instance in which the Coastal Commission approved a major amendment without first requiring significant changes,” Nutter told the council.

Opponents of the project said the developers had ignored both the area’s Local Coastal Program, which exists as part of the California Coastal Act, and SEADIP.


“The biggest factor I was taking into consideration was the Coastal Commission and that they wanted to see a comprehensive master plan for that area,” said Councilman Steven Neal, who also voted no. “Personally, I’m not comfortable that we as a body are sending stuff to the Coastal Commission only for it to be rejected.”

The Seaside Village, or 2nd+PCH project, would have replaced the SeaPort Marina Hotel with 20,000 square feet of restaurant space, 275 residential units, 155,000 square feet of retail space and 50,000 square feet of hotel space, plus an underground garage for 1,440 cars. The complex also would have included a 12-story tower with 126,000 square feet of condominium space.

“It’s unfortunate that we turned down what I think would have been a spectacular development, and revenue too,” Councilman Robert Garcia said. “Not a lot of people are developing.”

Since the late 1970s, SEADIP has dictated what can be built at several parcels in the area, including the site for the proposed Second+PCH project. In addition to going well above the three-story restriction, opponents said the development would have had a detrimental effect on the wetlands and the traffic-clogged intersection.


But for Malmuth and SeaPort Marina Hotel owner Raymond Lin, the council’s vote was painful and bitterly disappointing.

“I now have to try and do what’s best for my family,” Lin said. “I’ve already tried to do what was right for the community.”

After the vote, the Facebook fan page for the project was updated.

“We did not receive what we asked for tonight at the City Council,” it said. “It was a long process and perhaps Long Beach is not ready for our dream, but don’t stop dreaming.”


Moments later, Kimberly Lopez left a comment.

“I guess people love looking at run-down motels,” she wrote. “Too bad.”

ruben.vives@latimes.com