Nearly five years after the first housing project in Anaheim’s Platinum Triangle broke ground, the formerly commercial area has become the epicenter of apartment development in North County.
In the past few years, nearly 2,000 apartments have opened in the Platinum Triangle, an 840-acre swath of land around Angel Stadium of Anaheim.
“More people have moved into the area than ever before,” Anaheim Mayor Curt Pringle said.
The Platinum Triangle’s latest project, Los Angeles-based KB Home’s 250-unit Anavia development, opened last week, according to leasing agents at the State College Boulevard project.
Another 400 or so similar looking apartments—primarily podium-styled projects in the three- to four-story range—are nearing completion.
Apartments weren’t the original plan.
Platinum Triangle was envisioned as a hub of high-rise condominiums, hotels, offices, restaurants and shops in place of the worn industrial buildings that used to surround the stadium.
The largest developments planned for the area have been put on hold or scrapped altogether amid the downturn. A few projects are said to be in financial distress or have gone back to lenders.
Many of the apartment complexes now trying to lease up—including the KB Home development—were first planned as condos but changed course as the housing market soured. A few could revert to condos if the market turns.
“These were built to condo standards,” said Pringle, who spearheaded plans for Platinum Triangle. “Some of them will be used as apartments (for the time being), and some will be kept as apartments.”
City officials said they’re working with developers to readjust timelines for when projects can start moving again. About 9,000 condos and apartments have been planned for the area in total.
“We understand the current real estate situation,” Pringle said.
Development “will happen” Pringle said.
“Hopefully it will be sooner rather than later. But figuring out the definition of ‘sooner’ right now is a challenge,” he said.
The next big project to move forward in the area is likely to be a mixed-use project called the Anaheim Regional Transportation Intermodal Center. Plans call for a train station and hubs for other mass-transit services, along with some shops.
The first phase of construction work, planned northeast of the Orange (57) Freeway, between Honda Center and Angel Stadium, could begin by early 2011, according to city officials. About $180 million already has been budgeted for the government-led project.
Real estate brokers who helped developers buy much of the land in Platinum Triangle say it could be years before any homes for sale or commercial projects open.
“These are A products in A locations, but right now there’s no market for the product,” said Louis Tomaselli, executive vice president with the Orange office of Voit Real Estate Services.
The area looks like a work in progress.
The apartments have replaced numerous warehouses and older low-rise offices that long made up the bulk of the area’s buildings. Other lots remain empty or fenced in.
Miami-based Lennar Corp. put the area’s largest and most ambitious project, the A-Town development, on hiatus more than a year ago, with little work done besides demolition.
The builder and its venture partners have invested about $270 million assembling land and doing early work for A-Town. Lennar’s been quiet on when it hopes to resume or if the project will be scaled down.
Lennar initially envisioned some 3,500 condos, including several high-rises, and nearly 230,000 square feet of retail development.
The second-largest project considered for the Triangle, a 53-acre development on city-owned land next to Angel Stadium, is off the books altogether.
A 2007 agreement between the city and developers Archstone-Smith Trust and Hines Interest LP to build more than 1,000 apartments, one or two hotels, offices and a shopping plaza on city land was quietly canceled when the market soured.
The developers were supposed to pay the city $150 million in return for the land.
A few other proposed projects in the area are said to be financially distressed. At least one unfinished project has gone back to the lender, which could test where land prices in the area stand.
A 3.8-acre plot of land on Orangewood Avenue, next to land owned by Lennar, is being marketed for sale at $11 million or $2.9 million per acre by its owner, Los Angeles-based Cathay Bank.
Cathay Bank took the land back from developer West Millennium Homes about a year ago, according to Jerry Giglio, vice president for the Anaheim office of Grubb & Ellis Co., who is marketing the project for the lender.
There’s been interest in the site, which is entitled for 341 apartments or townhomes, but not necessarily at the price the bank is asking, Giglio said.
The nearly $3 million an acre price is on par with what developers paid for Triangle land during the boom a few years ago.
Other Anaheim land parcels outside the Triangle have traded hands for about $1 million to $1.5 million per acre, he said.
Sales of land in the Triangle largely have been at a standstill for more than a year, which makes figuring out the value of that land difficult these days.
When the first housing project in the Triangle—La Jolla-based Windstar Communities LLC’s Stadium Lofts—broke ground near the end of 2004, land in the area traded hands in the $50 to $60 per square foot range.
At the peak of the market, land was being snapped up closer to $150 per square foot, according to Voit’s Tomaselli.
Now, Tomaselli estimates land would trade hands in the $20 to $30 per square foot range.
Condo developers likely won’t be celebrating the impending five-year anniversary of Stadium Lofts breaking ground. The development is the only project selling homes in the Triangle.
Of the project’s 390 homes, the company’s down to selling its final 40.
Sales prices for Stadium Lofts condos are down about $200,000 from their initial prices, and now they sell for $340,000 to $475,000, according to company marketing materials.
