A sea change in Avalon

Eight decades ago, William Wrigley Jr. added amenities to the tiny harbor community of Avalon that transformed Catalina Island into a storied getaway for movie stars and the early power brokers of Los Angeles: steamships, hotels and a landmark “casino” building featuring a theater and a ballroom.

In the 1960s, development slowed as big spenders and tourists gravitated toward newer resorts -- Disneyland, Palm Springs, Lake Arrowhead -- blossoming on the mainland. Now, Avalon is experiencing a steep decline in tourism that has contributed to this year’s city budget deficit of $3 million. Its municipal plumbing is in such bad shape that residents worry about polluting the harbor every time they flush the toilet.

Hoping to again make Avalon a leading Southern California destination, the Santa Catalina Island Co., which the chewing gum magnate bought in 1919, has embarked on a series of projects to turn the city into a “resort without walls,” featuring upgraded restaurants and shops, eco-adventures, hillside condominiums, a deluxe hotel and an 18-hole golf course with ocean views.

Some short-term projects -- a zip line that will whisk customers by cable from a mountain peak to the beach and an underwater “Sea Trek” attraction that will let people walk through kelp forests while wearing helmets attached to air hoses -- are being funded by the company and are expected to open this summer.

The largest projects, such as the hotel and golf course, would be funded by other developers and investors. The island company would provide the land. These ventures, company officials said, would not be launched until some recovery is seen in the hotel and resort industry.

The projects, which company officials said could total $500 million over the next decade, would be among the most expensive planned or underway in Los Angeles County. The aim is to revitalize the 1-square-mile city of Avalon, spurring growth without destroying its nostalgic charm.

“We’re building a brand based on adventure, natural environment, history and exceeded expectations -- and it’s full steam ahead,” said Randy Herrel, president and chief executive of the land trust company. “Over the next 18 months there will be more investment in Avalon than in the previous 18 years combined.”

Gambling is out of the question. “The chances of gambling coming to Catalina are between zero and zero,” Herrel said.

New investments in Avalon, a community of 3,500 residents about 22 miles off the Southern California coast, cannot come soon enough for some business leaders.

“For quite some time, Catalina has been battling a perception that there is nothing to do here, a notion fueled by the fact that we’ve had no new products to offer in decades,” said Wayne Griffin, executive director of the Avalon Chamber of Commerce. “We finally have a lot of new things to talk about.”

The town has a rich history. Zane Grey wrote Western classics in an Avalon pueblo. NBC broadcast big-band performances from the casino ballroom during World War II. Marilyn Monroe lived in Avalon with her first husband, a member of the merchant marine.

Yet a leisurely and quaint routine unfolds each morning. Tourists clad in flip-flops, Hawaiian shirts and shorts lick ice cream cones as they shuffle past T-shirt and trinket shops, pubs and restaurants. Couples sun themselves on the beach. Glass-bottom boats cruise the harbor. Scuba divers explore the shoals. Fishermen lug poles and ice chests to the water’s edge.

The city has been waiting decades for something new to offer visitors from its target market: the coastal communities stretching from Santa Barbara to San Diego.

Earl Schrader, a real estate broker who’s lived in Avalon 21 years, is cautiously optimistic about the company’s development plans.

“While I’m excited about the prospects, I’ll believe it when I see it,” he said. “We’ve been down this road a hundred times.”

Serious talk of moving in new directions was initiated two years ago by Alison Wrigley, the great-granddaughter of William Wrigley Jr., and her husband, Geoffrey Rusack, both of whom sit on the company’s nine-member board of directors. Another Wrigley descendant, Paxson Offield, also is on the board.

“They are the spark plugs behind this proposal,” Griffin said.

About 88% of the 75-square-mile island is owned by the nonprofit Catalina Island Conservancy. The island company owns about 11% of the land mass, and about 1% is owned by private individuals and the city of Avalon.

“We appreciate that a revitalized Avalon will continue to be a gateway to the island’s 42,000-acre nature preserve,” said Ann Muscat, president and chief executive officer of the conservancy. “And we think the revitalization of Avalon and the nature preserve are consistent with the original vision William Wrigley Jr. had: that the island would be a destination for people to enjoy in many different ways.”

The company initially intended to announce its investment plans after a significant uptick in the overall economy. But with financing for new resorts all but nonexistent and cross-channel visits plummeting, Wrigley family members were not willing to wait any longer.

“Alison and Geoffrey said, ‘It’s time,’ ” Herrel said.

“That’s extremely exciting news,” said Avalon Mayor Bob Kennedy, owner of the ScubaLuv dive shop and operator of the new “Sea Trek” concession. “The era of the Santa Catalina Island Co. planning improvements but not pulling the trigger on development for fear of making a mistake is over.”

The company’s long-term goals include a complex starting on the western edge of town at scenic Descanso Beach that would be anchored by a 71-room boutique hotel, an 18-hole championship golf course, luxury homes and condominiums on the surrounding hills.

A partnership of the Koll Co. and Lambert Investments has selected Auberge Resorts of Napa Valley to develop the hotel, homes and condominiums.

Jack Nicklaus Cos. has been selected to develop the golf course, which would replace an existing nine-hole course built just south of town in 1892. Several holes would be developed on nearby mountain ridges overlooking downtown Avalon and the Pacific.

These large projects would require approval from the city of Avalon, Los Angeles County planners and the state Coastal Commission. They would also require city infrastructure improvements to accommodate the growth.

Construction has begun on 17 middle-income houses in a canyon at the south edge of Avalon.

Later this year, the company plans to spend $3.5 million remodeling the downtown 73-room Pavilion Lodge to include what developers described as “quasi-private outdoor living rooms.” Remodeling is also planned for two popular waterfront restaurants -- Antonio’s and Armstrong’s -- as well as a block-long stretch of commercial space dominated by a vintage hotel, a Chinese restaurant, a hardware store and a post office.

Near-term improvements such as the zip line and underwater kelp walk should attract more visitors and provide a financial boon to the island, said Lisa Grobar, professor of economics at Cal State Long Beach.

“It really would broaden the appeal of Catalina a little bit more to families,” Grobar said. “It’s a nice romantic place to go for the weekend, but if you have kids, you wonder what there would be for them to do.”

As for whether a deluxe hotel and golf course would pan out, she said: “Eventually, consumer spending will recover -- and they are not talking about having to fill a Las Vegas-style hotel with a thousand rooms each night.”

“Given that, plus the uniqueness of the island,” she added, “I think they have a shot at it.”

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louis.sahagun@latimes.com

roger.vincent@latimes.com

Sahagun reported from Avalon, Vincent from Los Angeles.