Retail visionary Shaheen Sadeghi sees resi in his future

Shaheen Sadeghi, chief executive officer of LAB Holding LLC, is a retail guy and then some. He’s best known for being one of the granddaddies of the lifestyle mall, a reputation that goes back to 1993, when he developed The Lab/Anti-Mall in Costa Mesa, which was considered a thumb-in-the-eye to mall conformity and won a place with a new generation of shoppers just down the road from South Coast Plaza, a stalwart of upscale American retail.

After 30-years of receiving national acclaim for building an alternative to the once-dominant regional mall, the fashion designer-turned retail developer has given TED Talks and received various honors for his brand of specialty centers and food halls, a concept he branched into with panache and savvy at the Anaheim Packing District.

Now he’s set to break out again––this time with his first housing project.

Construction is scheduled to start sometime this summer on a half acre of land in what will become RTHM Long Beach, a development of 84 townhouses on the corner of Atlantic Avenue and South Street in the seaside city. An abbreviation for the word rhythm, the development’s name was inspired by music and the arts.

Sadeghi said this isn’t a case of a veteran developer simply wanting to change lanes.

“The new product is a multi-use place,” he said. “The next generation of products in the industry will not be classified by division of residential, retail, office and industrial.”

He has been interested in working in residential for a few years. He pitched ideas of building a mixed-use community in Costa Mesa in 2016. The project got a green light from the city’s planning commission but didn’t pass muster with the city council.

In 2016, Sadeghi got a call from a broker working with the City of Long Beach. The broker asked Sadeghi if he’d like to try his hand at helping to turn around the neighborhood of North Long Beach, which is best known as a neighborhood where rapper Snoop Dogg grew up.

It was a risk––the Atlantic Avenue Corridor of North Long Beach was considered a blighted area and city officials figured it needed some retail to bring some business to the area. In December 2017, LAB Holding acquired land for $6.9 million from the city. Sadeghi wanted to build residential in a mixed-use development. The city of Long Beach embraced the idea, but he spent the next few years getting conditional use permits from the city. He got a final green light in September 2021.

RTHM Long Beach will include a 567-square-foot community space and a 2,294-square-foot commercial space that will probably be used for a restaurant. A block away, on South Street, Sadeghi will develop retail for a section called The Beat. With about 43,000-square-feet of space, The Beat is scheduled to include cafes, restaurants, art installations and is considering a jazz museum. Plans for The Beat also call for a residential component, which is currently planned to be 14-cottage-style units.

For RTHM Long Beach, he is working with a partner, Irvine, Calif.-headquartered Brandywine Homes. Brandywine will lead construction and home sales, handling finance as well. Since 1994, the developer has specialized in building housing in infill areas in established urban areas. In 2017, the home builder wrapped up development and sold 131 townhouses in a community called Riverdale that is a five minute drive from the RTHM Long Beach site. Home prices started in the low $600,000s.

RTHM Long Beach’s floor plans will range from 1,264-square-feet to 1,770-square-feet. Floor plans will include a two-bed, two-bath townhouses as well as three-bed, two-bath and four-bed, three-bath options. The townhouses will be three stories and LEED certified, with two-car garages equipped with EV charging capabilities. Pricing also will start in the low $600,000s, along the line of the Riverdale development, according to Leslie Pennington, Brandywine’s vice president of sales & marketing. The development’s models will be open by April 2023. There will be no units set aside as affordable.

While North Long Beach is known for landmarks such as the Michelle Obama Neighborhood Library in 2016, area business people said that there’s a big need for Sadeghi’s project.

“He’ll bring semblance of safe and secure retail,” said Yanki Greenspan, who serves on the board for Uptown Business Improvement District, which serves North Long Beach.

“It’s kind of a desert for it now,” added Greenspan, who also works as president of Westland Real Estate Group. “Also, any production of new housing will be good for North Long Beach. I wish they were doing more.”

While there’s a demand for new housing and retail in economically challenged neighborhoods, success is not guaranteed, said Kacy Keys, chief executive officer for Praxis Development Group, which has developed mixed-use projects in the Crenshaw Corridor neighborhood of Los Angeles.

“Depending on the area and the street, it can be hard to build ground floor retail,” she said. “While a potential asset to both a project and a neighborhood, retail can be a challenge.”

Keys said she’s not familiar with RTHM Long Beach or The Beat, but she noted that 84 townhouses would provide some built-in support for nearby retail.

Sadeghi takes a broader view.

“We’ve been very consistent in developing small businesses in communities and neighborhoods for 30 years,” he said. “We’re a hardware company. We build things. We’re also a software company, where we operate each project and program, and also create an ongoing local connection with the community. When we can’t get what we want, we build by ourselves. We built our own coffee shop in the past. We built our own barber shop. We built our own cheese shop. That’s a different model than the typical developer.”

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