Space Beach Shows P3 as Economic Development Strategy

Case Study #4

Public-private partnerships do not need to be limited to single projects. The concept can be central to an entire economic development approach, such as the Long Beach cluster development of Space Beach.

That was the topic of a panel at the recent 88 Cities Fall Summit in Long Beach. The Los Angeles County Economic Development Corporation organized the summit.

The "Scaling Public-Private Partnerships" panel was moderated by Studio One Eleven partner Michael Bohn and included Sunstone Cities CEO John Keisler, City of Long Beach Economic Development Director Bo Martinez, Long Beach Economic Partnership Board Chair Weston LaBar and Advocacy Chiefs LLC CEO Benjamin Cadranel.

The panel's subtitle was "From funding resilience to industry cluster development," and the panelists agreed that the transition from the end of commercial airplane manufacturing to a large and successful group of outer space-oriented companies is a shining example of that approach.

Historic Ending

Long Beach had been building airplanes for 74 years when Boeing delivered its last C-17 in November 2025. The aerospace legacy stretched back to before World War II when Douglas Aircraft settled in the city next to the municipal airport.

Manufacturing of commercial jets had stopped several years before the U.S. government announced it would not order any more of the giant cargo planes known as C-17s. When Boeing shut the line down, approximately 1,410 jobs were lost directly and regional losses were estimated at 5,191 jobs. For perspective, Douglas Aircraft employed 50,000 people during World War II.

The giant C-17 construction plant was only part of the Boeing manufacturing property that now was surplus. An earlier master plan called Douglas Park transformed former Boeing facilities into an area of retail, open space and headquarters for Virgin Galactic.

Virgin Galactic and its Launcher One arrived as Boeing was closing its C-17 hangar doors in 2015. By 2018 Virgin, later called Virgin Orbit, employed about 450 people. The venture eventually folded, but it was the pioneer that started Space Beach.

Government Support

With Boeing's early warning in 2013 that it would close the C-17 plant in 2015, Long Beach officials went to work. In September 2015, the U.S. Department of Defense's Office of Economic Adjustment awarded Long Beach a $3,995,609 grant as part of a $4.4 million comprehensive economic transition program tied to the end of the C-17 program.

It was the first big piece of public participation in the P3 project of Space Beach.

Keisler was the director of the city's Economic Development Department at the time. As he recalled during the panel discussion, the city used the grant for economic development, land use and infrastructure planning, along with assistance to impacted defense suppliers.

Building on the Douglas Park Planned Development, the city created a Globemaster Corridor Specific Plan that provided a comprehensive framework for developing 437 acres in the north-central portion of Long Beach. The development districts did not include any residential component, focusing instead on industrial, commercial and airport-related development.

That plan was approved by the City Council in 2021, but it had been in the works since 2014, after Boeing announced its manufacturing closure. Planning was key, but the business-friendly approach of Long Beach's government representatives to attracting companies and making their move to Space Beach as easy as possible also was important.

More Public Partners

While available land and both financial and bureaucratic assistance were critical to the space companies looking to join Space Beach, a key factor was, and is, a qualified workforce. While the legacy of aviation provided a base, cutting-edge approaches require cutting-edge training and education.

As Boeing manufacturing wound down, the Pacific Gateway Workforce Innovation Network stepped in. They connected displaced Boeing workers with new opportunities, found and supported training programs, and provided high-quality career services.

Many of the new jobs created by these space companies involved aerospace engineering. California State University, Long Beach, ranked #4 nationally among public universities for aerospace engineering, has built one of the largest aerospace programs in the state. CSULB recently received a $15 million federal grant to upgrade its engineering facilities.

Continued workforce development will be key for the cutting-edge companies of Space Beach to continue growing. The partnership is synergistic: students find valuable internships at these companies, some of which also support the school financially for things like the Beach Rocket Lab.

P3 Works

The success of this public-private-education partnership can be seen in the roster of major companies calling Long Beach home.

• Relativity Space is leasing the entire 1-million-square-foot former Boeing C-17 facility for its headquarters and launch vehicle manufacturing center.
• SpinLaunch moved its headquarters from Sunnyvale to Long Beach.
• Rocket Lab came to Long Beach to consolidate its corporate headquarters, production complex and mission control center.
• Vast Space moved into the northern portion of the Globemaster Corridor and has plans to launch Haven-1 in mid-2026.
• SpaceX has a booster recovery facility at the Port of Long Beach.

Economic Development

Numerous smaller companies focusing on specific segments of the space and aviation industry have joined Space Beach to be part of the ecosystem. Other advanced technology firms are part of the Space Beach area around the Long Beach Airport, including Mercedes Benz, Nikon Advanced Manufacturing Technology Center and Ford's Electric Vehicle Development Center.

In every case, the P3 approach had a hand in companies locating in and near Space Beach. In many cases, an argument could be made that the additional jobs would not have come to Long Beach without P3.

And jobs have come. It is estimated that 6,000 workers are directly employed by aerospace today, up from 2,800 aerospace jobs in 2018. That's economic development.