The one-time homes of churches, dietary supplement manufacturers, clean-energy companies, and a host of other office tenants in Irvine are on the fast track to being turned into apartment sites in the latest burst of development activity at the Irvine Business Complex.
Nearly 3,700 apartments are in the planning stages across the IBC, the 2,800-acre, largely commercial area near John Wayne Airport, according to Irvine city planning documents.
That’s the most new multifamily development proposed for the IBC in years and does not factor in another 1,200 or so apartment units that are already under construction in that part of the city.
$5,000 Combined
Taken together, the nearly 5,000 apartments in the works make IBC the biggest source of new apartment construction in Orange County, other than Irvine Company’s work under way at several sites in and around the Irvine Spectrum.
That compares with only about 2,000 new apartments that opened in all Orange County last year, according to the latest annual apartment report by Marcus & Millichap Real Estate Investment Services.
The brokerage’s report projects about 4,000 apartments will open in OC this year, a figure believed to include at least one IBC project.
Construction won’t immediately start for all of the planned projects after the city signs off on plans. Developers in the IBC have six years to move ahead once they get permits.
But at least a few will begin in earnest this year, according to Tim Strader Jr., a principal at Irvine-based development consultant Starpointe Ventures.
“It’s a busy time right now,” he said.
Prominent projects under way include Mill Creek Properties’ 187-unit complex going up near Jamboree Road at 2852 Kelvin Ave., and Irvine Co.’s 987-unit Park Place complex on Michelson Drive.
The Irvine Co. project—one of two apartment complexes on the books for Park Place—will be the largest new rental community to open in OC this year.
There’s a limit to the IBC’s growth, Strader said.
The city enacted a 15,000-unit cap on residential development there in 2010. The IBC will be near its capacity once the final batch of proposed development is done.
New Uses
The bullishness on the area’s apartment market is forcing some longtime area tenants to make alternative plans, and in some cases, is leading to other office sales.
Irvine Canaan Christian Community Church, for example, has recently bought and sold in the IBC.
Officials tied to the church sold a nearly 3.6-acre site on McGaw Avenue late last year to Atlanta-based developer 360 Fusion. The site, across the street from a post office, had long housed the church’s congregation but is now slated for a 280-unit apartment complex.
$16.2M Loan
Terms of that sale were not disclosed, but property records show the buyer taking out a $16.2 million loan to fund it.
Irvine Canaan closed on a purchase of its own this month, paying $12.7 million for 16812 Armstrong Ave., a 102,910-square-foot office building about a mile from its old location.
It will use the two-story Armstrong Avenue office for all of its church’s activities and administrative offices, said Scott Seal, principal for the Orange office of brokerage Lee & Associates Commercial Real Estate Services who worked on the sale with CBRE Group Inc.’s Ross Bourne.
Viva Life Science, a Costa Mesa-based maker of vitamins and other nutritional products that’s led by an elder at the church, isn’t expected to make the move to the Irvine location, Seal said.
Teardowns Planned
An Irvine industrial building that previously held the operations of another nutritional supplement maker—Irvine-based Scilabs Nutraceuticals Inc.—is among several high-visibility buildings in the IBC likely to be razed in the not-too-distant future if apartment plans proceed.
Sanderson J. Ray Development of Irvine owns Scilabs’ former building at 2772 Main St., along with two adjacent properties just off Jamboree Road. The developer is looking to get the site entitled for a 362-unit apartment complex, according to city records.
That development sits down the block from Metropolis, a 457-unit complex on Main Street that previously held the headquarters of fueling tank supplier Quantum Fuel Systems Technologies Worldwide Inc., which moved to Lake Forest last year.
The largest apartment development on the books in the IBC is San Diego-based apartment owner Garden Communities’ proposed 1,600-unit Campos Verdes project.
The two-block development, which sits on Campus Drive next to Jamboree Road, would require nearly 10 low-rise buildings to be torn down to make way for construction. The first phase of Campos Verdes’ development—between Bardeen and Teller avenues—could begin next year if plans go accordingly, Strader said.
Garden Communities is also heading up the redevelopment of the former Quantum Fuels site on Main Street.
