TO:
Honorable Mayor and Members of the City Council
THROUGH:
Talyn Mirzakhanian, City Manager
FROM:
Masa Alkire, Community Development Director
Adam Finestone, Planning Manager
Tari Kuvhenguhwa, Associate Planner
SUBJECT:Title
Project Pulse Status Update and Discussion Related to Redevelopment Options for City-Owned Properties Located at 400 Manhattan Beach Boulevard (Former US Bank Building) and 1155 Morningside Drive (Parking Lot 3) (No Immediate Budget Impact) (Community Development Director Alkire).
(Estimated Time: 1.5 Hours)
DISCUSS AND PROVIDE DIRECTION
Body
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RECOMMENDATION:
Staff recommends that the City Council receive this Project Pulse status update, discuss and provide additional direction regarding the redevelopment of City-owned properties located at 400 Manhattan Beach Boulevard and 1155 Morningside Drive.
EXECUTIVE SUMMARY:
In the spring of 2025, after the purchase of the property located at 400 Manhattan Beach Boulevard, the City established “Project Pulse” as a coordinated approach for the redevelopment of that property and the City-owned Parking Lot 3 property at 1155 Morningside Drive. The name Project Pulse represents a commitment on behalf of the City to keep its collective finger on the community’s pulse regarding the future development of downtown Manhattan Beach.
Since that time, City staff has conducted a robust public engagement program and provided periodic status updates to the City Council. At those updates, starting in August 2025, the City Council provided direction to staff in response to initial input obtained from the community that spring. In response to that direction, staff has conducted associated work related to the redevelopment of both properties to help inform decisions on future uses.
Recent public engagement activities have involved a team of design professionals who translated the public’s input into preliminary design concepts within the parameters established though prior City Council direction. As part of this agenda item, staff will be presenting the preliminary design concepts for feedback from the City Council. Additionally, staff will be seeking direction on associated work efforts so that the City can move forward with the next steps in the redevelopment process.
FISCAL IMPLICATIONS:
The City has allocated $2.3 million in the current 5-year Capital Improvement Program budget for design work related to future projects at both Project Pulse properties. Funding for the construction of projects at either site has not yet been allocated. Initial fiscal considerations related to both properties are provided in the Discussion section of this report. Based on the direction received from the City Council, staff could conduct additional fiscal analysis to identify implications and report back at a future meeting.
Staff, and the City’s Municipal Advisors at KNN Public Finance, revisited debt financing costs based on current market rates for the outstanding tax-exempt Certificates of Participation issued for the acquisition of 400 Manhattan Beach Boulevard. Refinancing this debt is anticipated before the maturity date on July 1, 2028, and before the construction phase. If the site use is privatized for office, retail and/or mixed-use development, then refinancing with taxable bonds at a higher interest rate is required. Currently, the interest rate difference is approximately 1.3%, which adds about $128,000 in annual debt service costs (totaling about $3.8 million over 30 years) that would need to be paid for from tenant lease revenues.
BACKGROUND:
In 2024, during a routine inspection of the former three-story, 145-space parking structure at Parking Lot 3, located at 1155 Morningside Drive, the Public Works Department identified structural concerns that resulted in the immediate closure of the top level of the structure and, ultimately, the entire structure. In November 2024, the parking structure was demolished, and an interim surface parking lot was constructed at the site, which opened in June 2025.
In April 2025, the City Council authorized the purchase of the former US Bank property located at 400 Manhattan Beach Boulevard. The purchase represented a forward-thinking investment that aligns with the City’s vision for economic resilience and community enhancement. The decision to acquire the property was driven by its strategic location, potential community benefits, and the ability to preserve community character, as well as revenue-generation opportunities and long-term value through equity growth.
Shortly thereafter, the City established Project Pulse as a coordinated approach for the redevelopment of the two City-owned properties identified above. Due to the proximity of the two properties and their similar characteristics (such as lot size and zoning), the City has been considering the redevelopment concepts for both sites concurrently to help ensure compatible and complementary outcomes for these important sites in the City’s downtown.
In May 2025, City staff held a community outreach kick-off meeting for the Project Pulse work effort. The goals of this community meeting were threefold:
1. Provide an open forum for City staff to meet with the community and collect initial ideas and input to report back to City Council;
2. Summarize the initial potential Parking Lot 3 redevelopment options that City Council discussed at the December 9, 2024, City Council meeting; and
3. Provide an opportunity to discuss options with the community that had not yet been presented to City Council for consideration.
In August 2025, the City Council conducted a study session on Project Pulse to discuss and provide initial direction on the redevelopment of both properties, and establish a robust public engagement program, identifying the community outreach and engagement methods and activities that staff would use to identify the community’s vision for the properties. The public engagement program is summarized in Attachment 2. Additional City Council study sessions were held in January and April 2026, during which the City Council received reports and provided additional direction to staff. A summary of the direction received from the City Council at these study sessions and the information provided in response to that direction is included as Attachment 3 to this report, and the staff reports from the study sessions are included as Attachments 4, 5, and 6.
DISCUSSION:
Public Engagement Program Update (Spring/Summer 2026)
Since the April 21, 2026, status update, staff has continued implementing the public engagement program to collect input on the community’s vision for the properties and incorporate elements into preliminary design concepts. Outreach and engagement activities conducted during this period are described below.
FlashVote Survey
FlashVote is a tool used over the past year to acquire statistically significant data from community members on a variety of City initiatives. In April 2026, the City conducted a FlashVote survey to obtain additional feedback from City residents on the then-current list of potential redevelopment options. The questions asked about community preferences for topics such as the desired uses downtown and the potential for concentrated public parking. Respondents could also provide an open-ended comment on the survey. This additional input received was used to help inform the planning of the design charettes with respect to the types of uses and activities to include for community consideration. The main takeaways from the FlashVote survey were that the community believes additional parking and open space are needed downtown, and that at least some amount of parking should be provided at both Project Pulse properties. A copy of the complete FlashVote survey results is included with this report as Attachment 7.
Older Adults Program Presentation
On April 28, 2026, City staff attended an Older Adults Program (OAP) “lunch bunch”, which was advertised in advance in the March OAP newsletter. Staff provided a brief overview and timeline for Project Pulse, described the redevelopment options still being considered at that time, and answered initial questions. The attendees provided comments related to the need for more parking, additional space for senior programming, and concerns with the scope of commercial components. Additionally, the attendees expressed support for the City’s acquisition of 400 Manhattan Beach Boulevard and appreciated the myriad of outreach and engagement efforts being conducted.
Design Charettes (Workshop #1)
A central goal of the Project Pulse visioning process was to identify potential design options based on input received from the community and the City Council related to the uses desired for each site. To that end, the City solicited proposals and hired an architectural and community engagement consultant (Gensler) to continue collecting public input and refine that vision into schematic designs for both properties. The first step in that process involved obtaining additional community input on more specific land use and site design considerations. For this reason, the City hosted design charrettes on May 30 and 31, 2026, at Joslyn Center aimed at collecting feedback on the preferred mix of commercial and open space uses, preferred layouts for the sites and their buildings, and how community members wanted to experience both. The workshop was hosted over two weekend days to provide an opportunity for broader community participation, resulting in more than 70 community members attending on one or both days. Detailed information on the format of the design charrettes can be found in Attachment 8 to this report.
Upon reviewing and synthesizing the input received at the charrettes, the primary findings were as follows:
• The community’s vision centers on open, social, and outdoor-driven experiences
• Strong emphasis on gathering spaces and food-oriented commercial uses
• Parking Lot 3: Envisioned as a multi-level structure anchored by green space, community uses and potentially limited commercial activation, with views to the ocean
• 400 Manhattan Beach Boulevard: Preferred as a flexible, largely open site with green space and surface parking, supporting adaptable community and commercial uses
More detailed findings from the input received at the design charrettes are included in Attachment 8, and more specific feedback received for each property is also discussed later in this report.
Conceptual Design Preview: Open House (Workshop #2)
On July 15, 2026, the City hosted a conceptual design preview open house at the Joslyn Center. At this event, the City presented preliminary design concepts for each site, which were influenced by community input provided throughout the public engagement process (including the design charrettes) and based on direction received from the City Council throughout the Project Pulse visioning process. Over 100 community members attended the two-hour event and provided input on the design concepts. A detailed summary of the information presented at the open house and the feedback received is included as Attachment 9 to this report and discussed in more detail for each property below.
Parking Lot 3
Design Charettes - Summary of Community Feedback
Through the various activity stations at the design charrettes, community members communicated their preferences for the desired mix of uses and the overall site layout.
Mix of Uses
At the design charrettes, attendees were able to conceptualize their vision for the property, guided by the narrowed-down list of potential land uses established during previous City Council meetings earlier in the Project Pulse visioning process. The proposed community designs for this site consistently prioritized a people-oriented destination with parking, open/green space, social uses, and community-oriented programming. To summarize:
• Open/green space is a consistent feature across most designs, highlighting its importance to the overall vision
• Outdoor dining and small-scale food uses were widely included, suggesting food plays a key role in activating the site
• About half of the designs include above-ground parking, reflecting mixed preferences within the community
• Community halls appear in 43% of designs, indicating steady interest in dedicated gathering space
Site Layout
Most community designs favored two- to three-story buildings, some with stepped terraces to capture ocean views, and others with a more courtyard-oriented layout, similar to Metlox. Because the site layout exercises predominantly address what is above grade, there was not significant focus on the subterranean aspects of a project at the site; however, the general understanding was that whatever would be built at the site would be above three stories of underground parking.
As noted above, more detailed information on the design charettes can be found in Attachment 8.
Open House - Preliminary Design Concepts
At the April 21, 2026, City Council meeting, the City Council directed staff to explore two design concepts for Parking Lot 3 as part of the continued public engagement program, as follows:
Concept A - Parking, Mixed-Use Commercial and Community Space
This design prioritized creating a vibrant mixed-use destination with retail and dining uses and a rooftop community hub, while providing 129 parking spaces underground. To summarize:
Underground: Three levels of parking
First floor: Retail or food and beverage (up to three tenant spaces)
Second Floor: Restaurant (up to two tenants, one with a larger dining patio)
Third Floor: Enclosed community space and rooftop community patio
Concept B - Parking and Community Space
This alternative design focused on maximizing parking capacity through a combination of above-ground and underground parking, providing a total of 202 parking spaces, while incorporating the same rooftop community hub. To summarize:
Underground: Three levels of parking
First Floor: Parking structure
Second Floor: Parking structure
Third Floor: Enclosed community space and rooftop community patio
Community Feedback
Community opinions were very evenly split between the two concepts. 37% of comments received supported Concept A, viewing it as a more complete community investment that combines parking, retail, dining, revenue generation, and public activity, while 35% of comments supported Concept B, noting that Downtown Manhattan Beach's foremost need is more parking.
In addition to preferences for one concept over the other, 14% of comments preferred to see a hybrid of the two concepts, such as more parking with ground floor retail, or commercial uses on the rooftop patio to activate it. Lastly, 14% of comments suggested other uses, such as a hotel, housing, or additional park space. (These uses had been eliminated from further consideration based on direction provided at the January 2025 City Council study session.)
General Comments for Consideration:
Community members also provided comments with more general questions or concerns, most of which related to rooftop community space design, operations, and activation; a preference for smaller-scale commercial spaces; and financial feasibility.
A more detailed overview of the open house and the feedback, including photographs and visual illustrations, is included with this report as Attachment 9.
Underground Metlox Connection: Feasibility Report
Alongside this conceptual design process, staff have also been exploring the feasibility and potential cost of an underground tunnel connection between Metlox’s existing underground parking structure and future underground parking at this site. At the January 2026 City Council meeting, City staff were directed to contract with an engineering firm to explore the feasibility of underground parking (two levels) with an underground connection to Metlox and provide cost estimates. In June 2026, the City contracted with IDS Group (IDS), an engineering firm that has previously completed work for the City, including for Parking Lot 3.
At the April 2026 City Council meeting, City staff received updated direction to explore a project concept with up to three levels of underground parking. For this reason, the concepts explored for engineering feasibility and cost estimates compare the difference between two levels and three levels of underground parking.
Engineering Feasibility and Rough Order of Magnitude (ROM) Cost Estimate
IDS’s analysis concluded that creating an underground tunnel to connect the existing Metlox structure (as it was designed and constructed) is feasible from an engineering perspective. The report explores one type of parking structure design (two levels and three levels), which both propose using the public right-of-way underneath 12th Street for part of the underground parking structure, and both alternatives will necessitate the relocation of existing underground utilities.
A ROM is a high-level, early-stage cost estimate used to approximate a project's potential total cost, timeline, and resource needs before more detailed planning begins. The estimate analyzed the potential cost, to the best of IDS’s ability with the information available at this stage in the City’s process. The total estimated costs are:
• Option 1 (Two Levels with Tunnel):
o Parking Structure Construction Cost: $36,100,000
§ Tunnel Cost: $15,000,000
o Parking Stalls Provided: 93
o Cost/Stall with tunnel: $387,962
§ Cost/Stall without tunnel: $226,672
• Option 2 (Three Levels with Tunnel)
o Parking Structure Construction Cost: $42,500,000
§ Tunnel Cost: $15,000,000
o Parking Stalls Provided: 136
o Cost/Stall with tunnel: $311,904
§ Cost/Stall without tunnel: $201,610
A copy of the complete feasibility report and more detailed ROM cost estimate are included with this report as Attachment 10.
The estimated cost for the tunnel connection between the two sites is approximately 15 million dollars. In conclusion, while an underground connection to Metlox is feasible, it would be more costly than a standalone parking structure with its own ramps for entering and exiting and would likely not result in significantly more parking spaces than a standalone structure would provide. Due to the estimated $15 million dollar cost of the tunnel feature as well as the construction complexity that the feature adds, the potential disruptions to the immediate area due to construction occurring in Morningside Drive, and the minimal benefit with respect to number of parking spaces achievable, it is staff’s recommendation that an underground tunnel connecting Metlox to Lot 3 underground parking not be pursued as part of a future project.
Considerations & Next Steps
At the August 25, 2025, City Council meeting, where the first Project Pulse study session was conducted, the timeline for the bond financing for the 400 Manhattan Beach Boulevard acquisition was discussed. The one-year public engagement program’s schedule was informed by that timeline. Now that the public engagement program has concluded and the community’s vision for the properties has begun to take shape, it could be appropriate to separate discussions about the two sites moving forward. Given that Parking Lot 3 is currently developed with a surface parking lot that is generating revenue and has no debt attached to it, there is less urgency to act swiftly on the redevelopment of the site. As such, staff believes it is appropriate to bifurcate decision-making regarding the two sites and prioritize making decisions regarding the next steps for 400 Manhattan Beach Boulevard site. Consideration of Parking Lot 3’s redevelopment options could occur after decisions have been made regarding the redevelopment of 400 Manhattan Beach Boulevard.
If directed to do so, City staff can return at a future date for the City Council to consider the specific community feedback received at the open house for Parking Lot 3 and make a decision on the preferred combination of uses for that site.
400 Manhattan Beach Boulevard
Design Charettes: Summary of Community Feedback
Through the various activity stations at the design charrettes, community members communicated their preferences for the desired mix of uses and the overall site layout.
Mix of Uses
At the design charrettes, attendees were able to conceptualize their vision for the property, guided by the narrowed-down list of potential land uses established during previous City Council meetings earlier in the Project Pulse visioning process. The proposed community designs for this site tended to favor a more open and flexible site, rather than a built-up one, with strong alignment around open/green space, parking, and informal outdoor uses. To summarize:
• Open/green space is almost universally included in the designs
• Surface parking is a core component in two-thirds of the designs
• Outdoor seating and kiosks are widely incorporated, reinforcing a preference for informal gathering spaces
• Smaller-scale and more diverse retail and food uses are favored over larger formats, aligning with the fine-grained, walkable character of downtown
Site Layout
Nearly all community designs emphasized the importance of preserving some portion of the site as open space, with the area closest to Manhattan Beach Boulevard most prioritized for development. Some designs preferred low-intensity development that would allow flexibility if nearby sites become available.
As noted above, more detailed information on the design charettes can be found in Attachment 8.
Open House - Preliminary Design Concept
In Fall 2025, City staff conducted the first phase of the public engagement program. The Council received a report outlining the results of that first phase at its January 20, 2026, meeting. At that meeting, the City Council narrowed down the list of potential redevelopment options to continue exploring and directed staff to continue with the public engagement program and to return with more information.
Mixed-Use Commercial with Limited Parking & Flexible Pedestrian Plaza
The design concept for this site considered the input received from the community over the course of the Project Pulse public engagement program, particularly from the design charrettes, along with direction from the City Council that the property include revenue-generating uses. As such, the design envisions a mixed-use commercial development that builds on the existing small-scale character of Manhattan Beach Boulevard, with ground-floor uses that complement the surrounding Downtown area. Outdoor seating areas are integrated with a flexible, pedestrian-focused plaza within and along Morningside Drive, which can be activated with the use of retractable bollards. The second floor is conceptualized as a creative office space, supplemented by an outdoor patio that provides an additional amenity for the tenants.
First Floor: Retail or food and beverage (up to three tenant spaces)
Second Floor: Creative office (with an outdoor patio)
Parking: Surface parking lot (16 spaces)
Open Space: Flexible pedestrian plaza within and along Morningside Drive
Community Feedback
The community response received at the open house related to the proposed design concept was mixed. To summarize the comments received:
• 37% strongly supported the design, citing the new public spaces, strong community orientation, and potential for the City to generate revenue
• 37% opposed the design, primarily due to concerns about impacts on nearby residents, increased traffic and circulation challenges, and a preference for alternative uses such as parking, arts uses and park spaces
• 26% supported the design if specific concerns were addressed, such as public access to the 2nd level patio, confirmation related to the feasibility of the creative office space, prioritizing the commercial spaces for local businesses, and resolving traffic circulation
Other comments provided related to perceived unequal treatment of existing restaurants that do not have the opportunity for outdoor dining, a desire for additional public access and community benefit (primarily related to the second-floor patio), the desire to see smaller-scale commercial spaces, and concerns regarding the viability of the second-floor office space. A more detailed overview of the open house and the feedback, including photographs and visual illustrations, is included with this report as Attachment 9.
Overview of Refined Conceptual Design
The preliminary design concept intentionally took into consideration community preferences to consider potential noise, a smaller scale project (the proposed two-stories, rather than three), and spillover parking effects. This was done by conceptualizing a future building with a significantly greater setback from the nearest residential use compared to what would otherwise be permitted in the CD zone. The design proposes placing a surface parking lot in that gap between a future building and the existing residential use behind the site.
The building is proposed to accommodate up to four commercial tenants, with the retail or food and beverage spaces limited to the first floor and oriented towards Manhattan Beach Boulevard and the northwest frontage along Morningside Drive. On the second level, a creative office with an outdoor patio for that tenant is proposed (with the outdoor area oriented similarly towards Manhattan Beach Boulevard and a portion of Morningside Drive). While there was community interest in a public rooftop deck and food and beverage uses on the second story, City staff’s recommendation is that a use that does not intensively use outdoor space in the evening hours be placed on the second story (such as a creative office for a business). This decision was informed by preferences and concerns communicated to City staff through the Fall 2025 resident focus group and other engagement activities that included nearby residents among the overall participants.
The proposed limited on-site parking is in line with the Council’s direction from January 2026, but it does not propose an underground or ground-level parking structure due to the inefficiencies that result from the shape of the lot, as a significant amount of space would be used for ramps, and the actual number of spaces provided would be severely limited. While the conceptual building design is taller than the existing two-story building, it roughly matches the height of Metlox (i.e., a taller structure, but designed with only two stories).
This design also envisions that the on-site parking be provided for employees and visitors to the site (rather than generally available public parking). Providing some on-site parking would reduce parking demand by building users on surrounding street parking and nearby City parking facilities. This intentional decision in the design was developed in response to community preferences, which did not favor permanent public parking at the site. The surface parking area also provides a buffer between the proposed structure and the existing adjacent residential building.
Limited On-Site Parking
Based on the community input received and the professional opinion of the City Traffic Engineer, staff recommends that the site provide limited on-site parking for users and visitors to the site rather than a paid public parking lot. In previous City Council meetings, staff have discussed that while this site and Parking Lot 3 are comparable in size, they significantly differ in lot shape. Parking Lot 3, a regular rectangular shape and location surrounded by commercial development, is better suited to accommodate a public parking lot or parking structure. In contrast, the 400 Manhattan Beach Boulevard site is irregularly shaped, which limits the site’s potential for an efficient parking lot layout, and has residential uses directly adjacent to the site. These residential uses are a more sensitive use to impacts from a busy public parking lot. The small surface parking lot included in the proposed design is on-site parking for employees and visitors of the site, similar to the previous use of the site.
Constructing underground parking or a parking structure on the site would require a significantly larger building development, in order to accommodate both the parking and desired uses on the site. An underground and/or above-ground parking structure would require ramps to enter and exit. In addition, such a structure would not be space-efficient due to the irregular lot shape. However, if the City Council prefers that the site include an underground parking facility for the employees and visitors, direction can be provided to explore that option.
Flexible & Community-Oriented Pedestrian Plaza (Manhattan Beach Boulevard and Morningside Drive)
As City staff have been engaging with community members through the Project Pulse activities and surveys, some existing concerns and potential concerns have been communicated. Certain questions and/or concerns shared with staff, including by residents in the immediate block(s) to the west and south of 400 Manhattan Beach Boulevard, prompted staff to consider potential opportunities to address some existing concerns and/or requests while also exploring future uses for that site. Those comments were:
• Resident Focus Group (Fall 2025)
o Traffic-control is a must-consider factor
o Traffic patterns/habits and circulation on Morningside Drive for nearby residents
o Commercial loading is a problem: they block alleys/streets
• Downtown Business and Professional Association & Resident Focus Groups (Fall 2025)
o Consideration of projects that support/allow gathering
• FlashVote Survey (Spring 2026)
o Downtown should be designated as a walkable area/prioritizing pedestrian spaces and uses
o Further pedestrianizing downtown, including some pedestrian only-areas and by narrowing traffic lanes
o Outdoor dining
o Monthly art walk, Etsy-like pop-ups for small business owners to sell their items
o More beautification of public spaces
One of the overall findings from the design charettes was for 400 Manhattan Beach Boulevard to be a flexible, largely open site with green space and surface parking, that can also support adaptable community and commercial uses. Taking into consideration community preferences, City Council direction on the narrowed-down list of uses to incorporate into a design concept, and some degree of revenue generation, this pedestrian plaza could address several of the preferences identified in the community outreach process.
Incorporating the pedestrian plaza into the plan allows for the revenue-generating uses to be built on the site, in a smaller-scale building that only uses a portion of the property. The plaza can also serve as an additional pedestrian safety and traffic control tool, while still providing a flexible, outdoor space that can host community-oriented activities and events.
Additional Outreach to Adjacent Stakeholders - Survey & Focus Group
In response to certain feedback received during the May and July community workshops, City staff collected community input from the residential and commercial stakeholders in the immediate block around the potential plaza. This included residences along 11th Place, 11th Street, 10th Place, and the north side of 10th Street, in addition to commercial properties and businesses on Manhattan Beach Boulevard and 11th Place (between Morningside Drive and Highland Avenue). City staff distributed an online survey via mail and by-hand to property owners and occupants at these properties. In mid-late August, stakeholders were contacted through a letter, requesting their participation in an online survey. The survey aimed to gauge interest, disinterest, or uncertainty about a pedestrian plaza concept at this location. Responses from 19 community members were received and the results were as follows:
• Interested/Supportive: 5 respondents
• Not Interested/Not Supportive: 13 respondents
• Not sure, Need More Information: 1 respondent
In addition to the online survey, City staff offered respondents the opportunity to meet and discuss their comments and/or questions in more detail. On August 25, 2026, and August 31, 2026, City staff met with 6 of the 19 respondents. For the respondents that expressed concern or hesitation, they shared more of the reasoning behind their potential concerns regarding the plaza:
• Concern that plaza would be used by more visitors/non-residents than residents
• Existing concerns over traffic conditions at that corner
• Existing issues with delivery truck loading and rideshare vehicles waiting in alleys blocking residential garages (10th & 11th Place); want to see solutions to resolve these issues
• Preference for more open space to be located on the site, rather than in the plaza
• Want reassurances that resident preferences are at least balanced with commercial ones
• Desire for more green space
The feedback received from those interested in this concept or elements of it are summarized below:
• Likes the idea of the frequency being coupled with special events and a lower-intensity project on-site (rather than building out the full site)
• Likes the idea of the retractable bollards: preference is for plaza to be open most of the time, especially during summer
• Supports outdoor dining
• Understands that revenue generation is a consideration: wants that balanced with low-scale development
A copy of the complete survey results is included with the report as Attachment 11.
Preliminary Traffic Data Collected
In response to traffic concerns raised by design charettes and open house participants, City staff conducted traffic counts in the immediate vicinity of the potential pedestrian plaza location. The traffic counts occurred between August 27, 2026, and August 30, 2026 (Thursday through Sunday). Some of the most notable data collected (counted by machine and through in-person observation) was:
• No significant difference in traffic volumes between weekdays and weekends
• Traffic volume is fairly consistent throughout the day
• Highest volumes of traffic activity occur between 7:00 a.m. - 7:00 p.m. daily
• Traffic volume through pedestrian plaza area: approximately 1,200 cars per day. This is higher than typical for a residential street, but not unusual for a mixed-use area with residential and commercial uses
• Traffic volume on Morningside Drive is approximately 100 cars per hour and 1,000 - 1,200 per day
• 25-40% of this traffic through the pedestrian plaza area uses the 11th Place alley (generated from residents and commercial businesses adjacent to 11th Place)
A breakdown of the data collected, including graphics, is included with the report as Attachment 12.
If the City Council directs staff to move forward with this pedestrian plaza concept, a more detailed analysis of potential traffic flows in the vicinity of the project site could be completed during the Planning entitlement process. The magnitude of any circulation impact would depend on the number of hours and on which days a pedestrian plaza is active. For example, a street closure during a low volume time would cause less traffic diversion than a closure during peak travel periods. Such an analysis would also identify potential solutions for concerns raised by nearby residential and commercial stakeholders.
City Outreach to Vons
Over the past year, City staff has been exploring potential opportunities to partner with the owner of the Vons property, directly east of 400 Manhattan Beach Boulevard, as part of a larger redevelopment effort. While this outreach was conducted in response to direction received from the City Council in August 2025, it is also something City staff has heard from the public throughout the Project Pulse work effort. In April 2026, as part of the Project Pulse status update, staff provided an update on the outreach efforts conducted thus far, noting that City staff and their economic development consultant, the Kosmont Companies, have met with the owners of Vons several times and were told that Vons would consider their options and provide a response later in the Spring.
Since that time, City staff and their consultant have continued to engage with the Vons ownership group. The City has also determined that Vons only owns the southeast corner of the parking lot and is a long-term lessee on the remainder of the site, including the footprint of the grocery store building. The City’s consultant contacted the underlying property owner and enquired as to their potential interest in partnering with the City on a future development project involving their property and 400 Manhattan Beach Boulevard.
Staff is continuing to work with their consultant to determine if a public-private development partnership is viable and if there is mutual interest in the type of development that could occur on a combined development site. While there appears to be some interest in a public-private development partnership from the ownership group, significant delays will soon impact the timely redevelopment of the 400 Manhattan Beach Boulevard site. Staff and the City consultant can continue their outreach efforts on this issue, though establishing a deadline by which the property ownership must formally indicate interest in a mutually agreeable project is recommended.
LCP Height Amendment - Current Status
During this course of the one-year public engagement program, City Council has directed staff to conduct additional research and/or related tasks alongside the community outreach to narrow down the list of future uses that affect both sites.
At the August 2025 City Council meeting, staff introduced the idea of amending development regulations to allow a minor increase in the height limit for one or both of the Project Pulse properties. The City Council directed staff to explore potential amendments to increase the allowable building height from 26 to 30 feet, provided that a subterranean or at-grade parking structure is provided. The City Council requested that staff identify potential impacts and obtain input from the California Coastal Commission before returning to the City Council for further direction. (A copy of that staff report is included as Attachment 2.)
At the April 2026 City Council meeting, staff provided an update on the Project Pulse work effort and received additional direction, including to proceed with initiating a code amendment to increase the maximum allowable building height, as well as to allow additional height for site elements. (A copy of that staff report is included as Attachment 4.)
On August 12, 2026, the Planning Commission conducted a study session to discuss and provide feedback on increases to the allowable heights for buildings and for limited site elements at both properties. Later this fall, City staff will return to the Planning Commission to conduct a public hearing. After that, City staff will return to City Council for a public hearing to consider a draft amendment to the LCP.
Alternative Interim Uses - Paid Public Parking & Relocation of Overflow Commercial Permitholders
At the May 6, 2025, City Council meeting, the City Council approved temporary uses for 400 Manhattan Beach Boulevard until a permanent use is identified. At that time, the approved temporary uses included the use of the existing parking lot as overflow parking for the City’s commercial parking permit program. As a result, 26 parking spaces have been striped in the lot for commercial parking permit holders.
At the April 21, 2026, City Council meeting, the City Council directed staff to explore options for implementing paid public parking at this site as an interim use, while maintaining downtown employee parking for commercial parking permit holders. City staff was also directed to identify where those employees would park if paid public parking were to move forward, as those permit holders would need to be relocated.
There are two options for providing public parking at this site:
• Option 1 - Existing Parking Lot
o Number of spaces: 26
o Work required: Maintain the newly-striped parking spaces and install one or two payment kiosks
o Estimated costs (two options):
§ As part of the City’s larger Capital Improvement Program (CIP) project related to kiosks: No additional cost
§ If not completed as part of the parking kiosk CIP: $5,750
o Estimated revenue: $243,061/year - $275,470/year (meters and citations)
• Option 2 - New Parking Lot
o Number of spaces: 41
o Work required: Demolish existing building and construct a new surface parking lot (41 parking spaces) with payment kiosks (similar to Parking Lot 3)
o Estimated costs:
§ Demolition: $216,000 (already budgeted)
§ Construction: Unknown
• For reference: Parking Lot 3 design services and construction: $2,000,000 for 69 parking spaces
o Estimated revenue: $383,289/year - $434,395/year (meters and citations)
Given the bond financing timeline for this site, staff does not recommend Option 2 (i.e., a new parking lot). If the City Council’s preference is to be ready to start construction on a future project by or around Fall 2028, that would be a relatively short utilization period for a new parking lot, due to the time and expense of:
• Demolishing the existing site
• Securing a demolition contractor
• Preparing construction drawings
• Securing Planning entitlements and building permits
• Securing a contractor
• Constructing a surface lot
A new surface parking lot will need to be demolished prior to the construction of a future project at this site. For these reasons, if the City Council wishes to move forward with public parking as an alternative interim use, staff’s recommendation is to proceed with Option 1 (i.e., using the existing parking lot).
Allowing for paid public parking will also require two planning entitlements: a Use Permit and a Coastal Development Permit. Paid public parking is considered a “commercial parking facility” under the City’s certified Local Coastal Program, which requires a Use Permit and a public hearing with the Planning Commission.
Given the bond financing timelines and that construction activity for the future use would likely not begin until after the Summer 2028 Olympics, the ability to generate revenue from the site in the interim is a consideration. Transitioning the parking spaces from commercial parking permit overflow would mean adding twenty-six spaces back into the public parking supply, which was diminished when the Parking Lot 3 structure was demolished in Fall 2024. When combining the 69 spaces in the interim surface lot at Parking Lot 3, the 56 new spaces created in the downtown area in response to that demolition, and these spaces, this would result in 151 spaces. That means that all 145 spaces from Lot 3 (plus an additional five spaces) would be provided until 400 Manhattan Beach Boulevard is redeveloped.
If the City Council directs staff to proceed with this updated interim use, City staff will begin the planning entitlement process and coordinate with merchant parking permit holders that Lot 7 will be utilized for overflow parking (rather than this site).
Development Process
Based on input received from the City Council regarding 400 Manhattan Beach Boulevard, the City will need to determine how a project at the site would be built. The City could act as the developer and construct a project on the site as a capital improvement project. Alternatively, the City could partner with a private developer to construct the project. While either option is possible, the construction, maintenance, and operation of a commercial project is not a typical function of a municipal government. Rather, cities tend to partner with private developers to achieve commercial projects on city-owned land, similar to what Manhattan Beach did with the Metlox property more than two decades ago.
In order to further explore a joint venture with a private development partner, additional work would need to be conducted to determine what that would look like. The City could consider either a long-term ground lease or an actual sale of the property. In both cases, any agreement could spell out the parameters that the developer must abide by. While the conceptual design provided with this report can serve as a basis for the parameters to include in the agreement, it is likely that the project will not be identical to what is presented. (The only way for the City to exercise complete control over the development would be to construct it ourselves.) To determine what type of agreement the City would enter into (ground lease or purchase/sale agreement), additional due diligence would be necessary. This would include a detailed market analysis, cost estimates, and other real estate considerations. If directed to do so, City staff could work with its economic development consultant and report back on what to include in a request for qualifications (RFQ) for potential developers.
Considerations & Next Steps
For this site, next steps include the City Council providing direction on the future use(s) to determine whether to construct a project ourselves or determine the best option to obtain a development partner, what additional action should be taken related to the Vons site (if any), whether to pursue an interim use of the property and what that use would be, and whether to pursue the adjacent pedestrian plaza concept. Additional information is provided in the Conclusion section below.
Additional Public Comments Received
Since the April 21, 2026, City Council meeting, the City has received several additional public comments through email or in-person at the community events, in addition to the public engagement activities outlined above. Those public comments are included with this report as Attachment 16.
CONCLUSION:
At this time, staff recommends that efforts be focused on the redevelopment of 400 Manhattan Beach Boulevard because of the time-sensitive nature and fiscal considerations involved. Should the City Council concur, staff will circle back to Parking Lot 3 to determine the redevelopment options there at a later date.
With regard to 400 Manhattan Beach Boulevard, staff is seeking City Council direction on the following items:
1. Time-limited continued discussion with Vons
• Staff recommends establishing a 90-day limit to continue discussions on potential partnership opportunities with the Vons site owners
• Staff will report back to provide an update prior to expiration of that time limit
2. The combination of uses for a future mixed-use development
• First floor: Retail and/or Food & Beverage
• Second floor: Creative office with outdoor patio
• Surface parking lot
3. Whether to continue exploring a flexible, community-oriented pedestrian plaza concept on Morningside Drive (between Manhattan Beach Boulevard and 11th Place)
4. City as sole-developer or public-private partnership
• Staff seeks direction on whether the City will serve as the developer and property manager for a project, or if the City should partner with a developer to realize a project.
• If direction is provided to pursue a development partner, staff requests authorization to conduct the due diligence and market analysis to determine how best to execute such a project.
• This action can occur concurrently with the continued discussions with the Vons site ownership.
5. Alternative interim use as paid public parking until the site is redeveloped
• Initiate planning entitlement process to allow interim use of “Commercial Parking Facility” and installation of parking kiosks after (using existing parking spaces)
• Confirmation of Lot 7 (along Valley Drive) as alternative parking location for overflow commercial parking permit holders
Additionally, while staff recommends that attention be turned toward 400 Manhattan Beach Boulevard, staff is also seeking direction on the following item related to Parking Lot 3:
1. Underground parking connection to Metlox Underground tunnel connection between Metlox and Parking Lot 3 site.
• Staff recommends that the City not pursue the underground tunnel connection based on the cost, complexity, and limited benefit.
PUBLIC OUTREACH:
A significant amount of public outreach has been conducted for Project Pulse over the last year. Information on that outreach is included in Attachment 3.
Additionally, a variety of communications methods were used ahead of this City Council meeting. This includes courtesy notices published in the Beach Reporter and Easy Reader, email blasts to interested parties (including the Chamber of Commerce and the DBPA), an announcement at the September DBPA monthly meeting, postings on the City’s social media platforms, and mailings to property owners and residents ahead of this City Council meeting. An announcement was also published in the Older Adults Program’s September newsletter. As of the writing of this staff report, staff has not received any public comments.
ENVIRONMENTAL REVIEW:
Discussing the matter and receiving direction from City Council is not a “Project” as defined under Section 15378 of the California Environmental Quality Act (CEQA) Guidelines; therefore, the activity is not subject to CEQA pursuant to Section 15060(c)(3). While the goal of this discussion is to make progress towards developing concepts for both properties, future redevelopment project(s) that the City Council identifies for each property will be subject to applicable provisions of CEQA and will be analyzed at that time.
LEGAL REVIEW:
The City Attorney has reviewed this report and determined that no additional legal analysis is necessary.
ATTACHMENTS:
1. Location Map
2. Public Engagement Program (August 2025)
3. History of Public Outreach & City Council Actions
4. August 26, 2025 - City Council Staff Report (Web-Link Provided)
5. January 20, 2026 - City Council Staff Report (Web-Link Provided)
6. April 21, 2026 - City Council Staff Report (Web-Link Provided)
7. FlashVote Survey Results
8. Design Charette Summary (Workshop #1
9. Open House Summary (Workshop #2)
10. IDS Group Feasibility Report - Underground Parking Connection to Metlox
11. Pedestrian Plaza Survey Results
12. Preliminary Traffic Data - Pedestrian Plaza Area
13. 400 Manhattan Beach Boulevard - Schematic Design Package
14. Public Parking Lots Map - Lot 7
15. August 12, 2026 - Planning Commission Staff Report (Web-Link Provided)
16. Additional Public Comments Received
17. PowerPoint Presentation