“Businesses Thrive Amidst Concerns Over The Westside’s Future” by Long Beach Business Journal, June 19, 2017

By Brandon Richardson, Senior Writer- June 19, 2017

Hundreds of businesses make up Westside Long Beach – between the Magnolia Industrial Group area to the east of the Los Angeles River to the countless industrial and commercial buildings to the west. And while businesses continue to thrive, some owners have concerns about the future of the area.

“There’s kind of a dark cloud hanging over our head right here on the Westside because of the expansion of the rail yard for the Port of Long Beach,” Stan Janocha, chief operating officer of Superior Electrical Advertising Inc., said. “With that hanging over our heads, businesses are relocating and looking to go elsewhere.”

Superior Electric Advertising Inc. has been a part of Long Beach’s Westside industrial area for nearly 50 years, employs more than 125 people and has well-known clients such as McDonald’s, Denny’s and Starbuck’s. Stan Janocha, chief operating officer of Superior Electrical, said there is a dark cloud hanging over the Westside, with several issues making the area’s future uncertain, including whether his company can remain in Long Beach. Pictured top, from left, are: Janocha; Patti Skoglund, president; Jim Sterk, CEO; and Doug Tokeshi, senior vice president and CFO. (Photograph by the Business Journal’s Larry Duncan)

Superior Electrical has about 130 employees and produces signage for companies such as McDonald’s, Starbucks, CVS and Denny’s. With the economy’s improvement and large companies remodeling or building new stores, Janocha said his business is doing well. However, he explained that if the port’s rail yard is approved, he would have no choice but to relocate – most likely outside of Long Beach due to the low vacancy rate for industrial real estate.

Janocha’s business has occupied the 100,000-square-foot building at 1700 W. Anaheim St., a former Coca-Cola bottling plant, since 1971.

Workers at Superior Electrical Advertising (Photographs by the Business Journal’s Larry Duncan)

“We’re staying busy, and we owe a lot of that to our great employee base. We just hope that things continue this way,” Janocha said. “The Westside is a great place to work – we love this place. But if the rail yard goes through, we probably won’t be here. It would just be too close to us. It just wouldn’t be feasible for us to stay here anymore.”

Despite some uncertainty in the area, business owners are still glad to be located on the Westside. Ed Spotsky, owner of Spot Lighting Supplies, said that his business is on fire with homeowners and businesses converting to LED lighting. He explained that his online sales are the fastest growing aspect of the business.

During the recession, Spotsky noted a decline in general contractor purchases for building and remodeling residential and commercial properties, with many companies being forced to lay off employees. However, with a recovering economy, he said these sales are back up, with will-call pickups occurring continuously every day.

Ed Spotsky, owner of Spot Lighting Supplies, said despite future uncertainties for the area, he is glad he opted to locate his business on the Westside rather than a location he had previously considered near Joe Jost’s. (Photograph by the Business Journal’s Larry Duncan)

“I love where we’re at right now,” Spotsky said. “I drive by a building I thought of buying way over by Joe Jost’s, and all I think about all the time is how glad I am that I bought exactly where I bought . . . just one exit off the freeway.”

SnugTop, a manufacturer of truck caps and camper shells, has been operating on the Westside since 1959. Hartmut Schroeder became president and CEO of SnugTop in 1980. In August, the company was acquired by a larger national company, which kept Schroeder on to continue running operations.

Prior to the acquisition, Schroeder said SnugTop focused primarily on the Western United States and international markets. However, he said the company now has a reach beyond its traditional market area, with 2017 sales ahead of last year at the same time.

“We’ve been very, very happy here. We occupy a whole city block,” Schroeder said. “We always felt that we are well positioned here. Especially in the past, a big portion of our business has been international, so we were doing a lot of exporting. So the proximity to the port has always been a big advantage to us.”

Recently, Schroeder explained that the strong U.S. dollar has decreased their exports substantially. However, with increased business across the U.S. and developing specialty products for national fleets such as telecommunication and pest control businesses, Schroeder said any international business that was lost was picked up on the commercial side.

Santa Fe Importers, located at 1401 Santa Fe Ave., has operated on the Westside since 1947. The company has more than 50 employs operating a deli and meat product manufacturing plant, which was recently contracted to provide all sausages for Angel Stadium. Pictured from left: President Vincent Passanisi; Vice President of Sales Marisa Passanisi; Store Manager Michael Medina; and General Manager Jorge Endura. (Photograph by the Business Journal’s Larry Duncan)

Schroeder said he understands the concerns of Westside business owners, especially when it comes to the port’s proposed rail yard, but that the company has been happy at its location for a long time. Many of the company’s roughly 200 employees are local to Long Beach and the surrounding areas, according to Schroeder, and SnugTop uses local suppliers, such as Phillips Steel (also on the Westside), as often as possible.

“We’ve been here for a long time, and I’m certainly going to plead with our new owners that we stay where we are,” Schroeder said. “I still believe it’s a good place to do business. I’ve always enjoyed doing business in the City of Long Beach. That has not changed.”

Since 1947, Santa Fe Importers has operated on the Westside. Today, the company has more than 50 employees and operates a deli that offers lunch and dinner, catering and groceries, as well as wholesale products through Marisa Foods, which produces products such as meatballs and sausages for restaurants and other businesses nationwide.

Santa Fe Importers President Vincent Passanisi said business has been very steady because, despite any outside factors, people need to eat. He explained that the first quarter was a little slow but that was typical of the entire industry, not just his business. However, business has picked up, and Passanisi said big things are happening.

“In fact, we are now making all the sausage for Angel Stadium,” Passanisi said. “That’s been a really exciting opportunity, and there are lots of those opportunities coming down the pipe, so it’s been very exciting.”

Matthew Shook, left, and Joe Pearson own and operate Hi-Standard Manufacturing on the Westside. Shook said he loves the unique area for its small neighborhood vibe. (Photograph by the Business Journal’s Larry Duncan)

As far as being located on the Westside, Passanisi said things are changing. Aside from the uncertainty of the rail yard, he pointed to the incoming medical marijuana businesses. With the passing of Measure MM in November, which allows businesses to grow, manufacture, distribute and sell medical marijuana products in the city, the Westside has become prime real estate. The measure places a minimum distance of medical marijuana businesses from parks, schools, beaches, libraries and other such amenities, making the Westside an ideal location.

“So that’s sort of changing the climate over here,” Passanisi said. “Property values are going through the roof as people are looking for properties to put in these businesses.”

Passanisi explained that the Westside’s proximity to the ports and freeways are an appealing amenity for businesses. However, the uncertain future of the Westside, coupled with new regulations such as health care, minimum wage and tax increases and the ever-present threat of frivolous lawsuits, is casting a shadow over his normally optimistic attitude.

“I’m usually a very optimistic person, but I get a little pessimistic when I start having to deal with these challenges on a daily basis,” Passanisi said. “But there is always opportunity if you look for it, so I’m always excited for what is ahead. I think as long as there’s a climate that promotes entrepreneurs to do new things, there will always be opportunities.”

Gil Ficke, owner of Long Beach Travel Center, a Shell gas station and a Carl’s Jr. that cater to the many truckers coming in and out of the ports, said his business experienced a soft spell during the fall and winter months but that volume has bounced back. Like Passanisi, Ficke noted increased operating costs due to new regulations have offset his 1%-2% margin increase.

Many trucks traveling through Long Beach to and from the Port of Long Beach utilize the Long Beach Travel Center located at 1670 W. Pacific Coast Hwy. at Santa Fe Avenue. The station features several Shell fuel islands to reduce wait times for truckers. (Photograph by the Business Journal’s Larry Duncan)

Though he is aware of some Westside business owner concerns, Ficke admitted to being out of the loop with most of the Westside issues. However, he noted the prospective closure of the 9th Street bridge due to the port rail yard and the disruptive effect that would have on the area’s traffic flow.

“I’m just trying to stay on top of things. The city is also increasing the sales tax. I’m concerned about that, where just over the city limit their operating costs are not on par with mine and I have to compete,” Ficke said. “I’m just trying to do a good job and be a good neighbor and make some money.”

Matthew Shook, co-owner of Hi-Standard Manufacturing, said much of his business was tied to the oil industry in years past. However, when oil prices plummeted, he was forced to think outside the box to create new products to bring revenues back up. Apart from manufacturing parts for the oil industry, the company produces parts for aerospace, defense and other commercial businesses.

Hi-Standard has been located at 1510 W. Cowles St. for more than 30 years and originally opened in 1967 around the corner on Caspian Avenue. Shook and his partner, Joe Pearson, took over the company from their fathers who partnered to form the business.

“I don’t necessarily share some of the concerns that I hear from these other guys with the rail stuff and the development,” Shook said. “I really like [the Westside] – the trucks and the traffic are unique. I like it. It feels like home. We’ve been here so long. It’s just a small, neighborhoody industrial park. It’s got character.”