When Jeff Fullerton took on the Long Beach Civic Center project as a unique public-private partnership deal, a guy named John Keisler was hoping for a nice office in the new City Hall building. Keisler knew he was going to be the city’s economic development director, and couldn’t wait.
Fullerton and Pat West worked together to complete what is believed to be the largest municipal infrastructure public-private partnership on the West Coast – the Long Beach Civic Center. Fullerton was project director for Plenary-Edgemoor (the private partner) and West was the Long Beach city manager from 2007 to his retirement in 2019.
Fullerton was the project director for Plenary-Edgemoor during the Long Beach Civic Center project from 2014 to its opening in July 2019. The project cost $520 million, including construction of a new City Hall, a new Main Library, a new Lincoln Park and HVAC infrastructure for the entire complex. A complementary port headquarters building was constructed at the same time, but is in addition to the $520 million price tag because the Port of Long Beach purchased the building when it was complete.
Fullerton has been part of $6 billion worth of public-private partnerships and now is principal of his own consulting company, Fullerton Partners LLC. West also has a consulting business – Pat West LLC.
Earlier this year, Fullerton and Sunstone CEO John Keisler formed P3 Partners LLC. A separate consulting company, it maintains a relationship with Sunstone Cities. Keisler left his position at Long Beach City Hall – leaving that fancy office – in 2022 to become Sunstone’s leader.
“Our challenge was the city asked us to find a cost-neutral equation,” Fullerton said. “They wanted to find a way to build a new City Hall for no more than what they were paying to maintain the old city hall.”
Long Beach’s budget was already strained, West said. But the City Hall and the main library had been deemed hazardous if a major earthquake hit, and needed to be replaced.
“Our elected officials had no taste for a bond issue (at that time),” West told the audience. “We had to find a way to build without raising taxes or going to the ballot.”
Fullerton said Plenary-Edgemoor found a way to raise private money for the construction, partially by taking the property where the old city hall sat in exchange, and partially by agreeing to a 40-year commitment to maintain the new buildings.
“It was essentially a DBFOM (Design-Build-Finance-Operate-Maintain) deal,” West said. “That made it possible, and transferred a lot of the risk from the city.”
Fullerton explained that there is a “risk continuum” for public-private projects that allows a public entity certainty while providing private investors with a fair return. In the Long Beach Civic Center case, Plenary Edgemoor agreed to maintain the buildings and return them to the city in at least 85% of new condition after the 40-year lease agreement was completed.
Other facets of the agreement included allowing the city to move only once – the new buildings were completed before the old buildings closed – and contingencies in case there was significant damage.
The Civic Center is seven years old now, and both sides remain satisfied with the agreement, officials say. It could not have happened without the P3 concept, West and Fullerton agreed.
As Fullerton and Keisler continue to work together, the P3 infrastructure concept continues to evolve. The approach has been used for water treatment plants, library rebuilds and is currently under consideration to rebuild the cities devastated by the January 2025 wildfires.
It makes sense that P3 strategies will work when it is time to plan for recovery – physical, economic, and governmental recovery. Recent experience has shown again that P3s can combine clear governance structures, sustained financing, community engagement, and commitment to equity with the private sector’s speed, innovation, and specialized capabilities.
Take the time to talk with an expert about the process Keisler will be here in Napa during the City Managers Annual Conference, and his partner in Public Private Partners LLC, Jeff Fullerton, will be here as well. They are ready and willing to meet.
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About Sunstone Cities
Sunstone Cities is an economic development consulting firm that helps local government leaders unlock economic development, new business formation, and job growth. We partner with municipalities to identify and capitalize on opportunities for revenue growth and investment. Our team of experienced local government professionals leverage data-driven insights, industry expertise, and public-private partnerships to help cities revitalize their economies, attract new businesses, and better monetize their community assets.