The city of Tustin plans to market for sale chunks of Tustin Legacy to developers this summer in an attempt to revitalize interest at the long-delayed project.
More than 110 acres of the 820-acre former Marine helicopter base could be sold in four or more pieces in the next year or so.
If all goes as planned, construction of apartments, single-family homes and a small amount of office and retail space would break ground in the next two to three years.
Development would piggyback on the completion of nearly $40 million worth of roadwork, primarily an extension of Tustin Ranch Road.
Work on the road—which would extend it through the heart of the project parallel to Jamboree Road and Red Hill Avenue—is going out to bid in the next month. The extension is slated to be finished by early 2013.
The road work and a selection of various parcels to sell to developers is expected to jumpstart work at Tustin Legacy, said Christine Shingleton, assistant city manager.
“We’re trying to get something in the ground (soon), to prove momentum” at the project, Shingleton said. “You should see sticks in the ground by late 2013, or early 2014.”
The project, home to the city’s iconic blimp hangars, is slated to hold about 2,100 homes and close to 6.7 million square feet of commercial space when completed.
Tustin’s City Council last week approved the new strategy for the site, ending a year of administrative limbo.
Beyond Shea
• THE NEWS:
Tustin decides to act as master developer of former Marine base
• BACKGROUND:
Construction at 820-acre project went dormant during downturn, city ended pact with Aliso Viejo-based Shea Properties last year
• WHAT’S AHEAD:
City plans to extend Tustin Ranch Road through site, market land in four or more pieces this summer
The city last year ended a master development agreement with its onetime partner, a venture led by Aliso Viejo’s Shea Properties. That came after the developer balked on moving ahead with infrastructure work in the midst of the down real estate market.
City officials will play a more limited role than what Shea would have.
The aim is to minimize risks for the city, both financially and in terms of additional delays, while providing a steady source of revenue from development fees, officials said.
$90M So Far
Prior sales of land elsewhere on the former base—to homebuilders and to Phoenix-based Vestar Development Co., developer of The District at Tustin Legacy, a 900,000-square-foot shopping center along Jamboree Road—has brought in more than $90 million for the city.
“Tustin Legacy is an asset, and should be managed as such,” Shingleton said.
“There’s risk, but there’s risk on the other side, too,” said Councilman John Nielsen, who supported the new plan.
Deborah Gavello was the lone councilmember opposing the plan at last week’s hearing.
“We need to focus on what we do best,” said Gavello, who recommended the city select a new master developer.
The city is expected to move fast to take advantage of early development opportunities, primarily apartments, as well as some retail and office space near the Columbus Square housing development on former base land along Edinger Avenue.
City documents show plans for a mix of close to 450 apartments and houses as well as about 130,000 square feet of commercial space and 190,000 square feet of office space that could see work started in a little more than two years.
Most of that work would be built alongside the extension of Tustin Ranch Road.
Selection Timeline
The city would like to select developers for those initial projects by the end of this year, with land sales completed by next summer. It’s collecting an interest list on the Tustin Legacy website.
“We’re not shutting the door on anyone,” Shingleton said. “Anyone who is interested can contact us.”
Developer interest thus far has been largely coming from smaller builders rather than large-scale developers, she said.
The three parcels most likely to see construction in the next few years total about 70 acres. Combined, they’d require about $47 million in infrastructure work, according to city documents.
Another 40 or so acres of land between Tustin Ranch Road and Barranca Parkway also are slated to be marketed for sale this summer, although a timeline for construction there is likely to be a bit further out.
That 40-acre site could hold more than 500 apartments, 700,000 square feet of offices and a 250-room hotel, according to city documents. That land would require another $36 million in infrastructure work.
The remainder of the 820-acre site would be put up for sale in six or more phases over the next three years or so under the city’s preliminary plans.
Detailed plans for much of the project remain a work in progress.
Consultants to the city, including Irvine’s John Burns Consulting, have recommended emphasizing more apartment development at Tustin Legacy than initially planned in order to take advantage of demand for that sector by investors and developers of late.
Consultants also suggest adding a lake to one or more of the planned residential neighborhoods, which could boost home prices.
Park Centerpiece
A two-mile long park remains a centerpiece of the project’s plan; a smaller, 9-acre park is expected to be eliminated from the final plan. The city likely doesn’t have the money to maintain the smaller park, according to the consultants’ findings.
The more dilapidated of the base’s two blimp hangars still is slated to be demolished.
The demolition of the hangar situated parallel to Warner Avenue “could be creatively offered for a fee to motion picture entities,” according to the city’s latest plan for the base.
