Damian McKinney spent decades chasing office and industrial deals across Southern California. But these days he’s just as likely to be pitching to investors a hospital campus or a converted apartment tower along the Long Beach waterfront.
“When markets shift, you’ve got to pivot,” McKinney, a principal and managing director at Avison Young near Los Angeles, told CoStar News. “Office isn’t coming back with a vengeance, but assets that solve long-term needs — healthcare, housing, hospitality — are still getting attention.”
That shift is playing out across his listings that represent properties other than office buildings — from a historic downtown office tower turned apartments to a legacy medical campus that could be reimagined — as downtown Long Beach office vacancy hovers around 19% with no new construction and modest rent growth, according to CoStar data.
McKinney has built a career on reading those inflection points, founding McKinney Advisory Group in 2010 and selling it to Avison Young in 2020. The through line is simple: Properties that can evolve with the market are the ones attracting capital.
His own career has evolved alongside Long Beach’s shift from an aviation hub into a modern "Space Beach” economy, as aerospace and defense tenants fill properties left vacant by distributors and manufacturers such as airplane maker Gulfstream and Procter & Gamble.
Market evolution story
When McKinney began working in Long Beach in the late 1980s, aerospace meant airplanes, runways and defense contracts, with companies like McDonnell Douglas and Boeing defining the city as a manufacturing and engineering hub.
Over time, he watched the industry move from building aircraft to supporting defense technology and commercial space ambitions, with the same workforce adapting to more specialized, tech-driven roles.
“The labor was always here,” McKinney said.
Long before “Space Beach,” Long Beach was known as “Iowa by the Sea,” a reflection of Midwestern families and blue‑collar values that shaped the city's manufacturing and aviation workforce. McKinney said that culture never disappeared — it evolved as aerospace shifted from airplanes to space technology, with the same labor base adapting to new roles rather than being replaced.
In one example of that evolution, Anduril, a maker of drones and other U.S. military technology, and Try Anomaly, a spacecraft manufacturer, are taking over Douglas Park, the former Douglas Aircraft Co. manufacturing plant later operated by Boeing and where more than 15,000 airplanes were built before aerospace operations ceased in the 2000s. Similar tenants growing in Long Beach include Rocket Lab and Voyager Technologies.
McKinney said the transformation mirrors broader real estate cycles, where industries change faster than the communities that support them and demand shifts from industrial space to offices, research facilities and tech-oriented campuses.
Repositioning real estate
McKinney is focusing on adaptive reuse in Long Beach, advising owners to reposition older office and institutional properties toward housing and healthcare demand, including marketing a converted 1929 office building with 80 apartments and an 8.7‑acre medical campus aimed at uses ranging from wellness and behavioral health to temporary housing.
The shift comes as Long Beach leaders are courting investment and smoothing the path for redevelopment. McKinney points to more than $1 billion in infrastructure spending, a new waterfront amphitheater and upcoming Olympic events as catalysts reshaping demand and drawing new capital from family offices and institutional investors.
For brokers, the conversation has shifted from leasing velocity to repositioning strategy, particularly for older office buildings with coastal views and smaller floor plates.
Those properties are increasingly viewed as candidates for residential or hospitality conversions rather than traditional office repositioning. McKinney sees that firsthand in downtown, where tenant move-outs and a flight to quality have left older inventory struggling.
Instead of waiting for an office recovery, he’s advising clients to align with housing shortages and healthcare demand, positioning legacy properties for their next use in a changing market.