Walt Disney Co.’s staunch opposition to homebuilding near its Anaheim theme parks may prove to be the least of Irvine-based SunCal Cos. problems in the city.
City officials and the current owner of the land seem to be turning on SunCal’s controversial plan to build 1,500 condominiums near the Disneyland Resort.
At the same time, the tough housing market has prompted other developers to postpone or walk away from condo projects in Anaheim and Irvine.
The dwindling city support, a weak sales outlook and speculation about another bidder for the land ultimately could scuttle SunCal’s plan well before a Disney-backed ballot initiative makes its way to voters next June, according to observers.
SunCal officials said last week they aren’t abandoning their Platinum Pointe project, despite the speculation. But their chances of actually building it appear to have taken a hit.
The company is in a dispute over its attempt to buy the 26 acres that would hold its condo project. The site, at Katella Avenue and Haster Street, now holds two mobile home parks.
In late October, SunCal filed a $60 million lawsuit against the current owner of the land, Dudley Frank and his family partnership, charging breach of contract.
SunCal said it’s spent $5 million on zoning efforts for the project so far and has deposited another $5 million with the Franks as a prelude to closing the land buy.
Along with damages, SunCal wants the initial contract,which would see SunCal pay about $46 million for the land,to be enforced.
Frank’s lawyers contend SunCal walked away from the project after it failed in October to pay another $500,000 that was due in order to extend the close of escrow for a few more months.
Other Suiters?
SunCal’s lawsuit asserts that the Franks are deep in talks with another developer to buy the land out from under SunCal.
The sellers “have dealt with third parties whose agenda is to block SunCal from acquiring the property and preclude any and all residential development, for their own self-serving reasons,” according to the lawsuit filed in Orange County Superior Court.
The lawsuit doesn’t name names. Speculation is that a hotel or timeshare developer, which wouldn’t draw the wrath of Disney, is the most likely prospective buyer. A deal could be announced shortly, according to sources.
The Franks have said Disney isn’t the potential buyer.
Disney, backed by other Anaheim tourism businesses, has sued the city, opposing plans to allow homes near its theme parks. Homes don’t fit well with the area’s hotels, shops and other tourist venues and could impact the tax base for the area, opponents argue.
Housing development also could impact Disney’s plan for a third theme park, though the company doesn’t appear to be moving on that anytime soon.
Late last month, SunCal sent a letter to city officials saying it no longer plans to fund Anaheim’s legal fight against Disney. City officials took the Oct. 30 letter to mean SunCal was backing away from the project.
Councilwoman Lucille Kring now says she plans to change her deciding vote and rescind a residential zoning change for the site.
After hearings last week, a decision on whether to rescind the referendum is expected later this month.
A change in direction from Kring is welcome news to the Disney-backed Save Our Anaheim Resort coalition, which opposes the SunCal plan.
A separate initiative sponsored by the group would give voters the right to approve any future changes to the original Anaheim Resort District plan. It still is slated to go to the ballot in June, regardless of changes to SunCal’s development, said Annette McCluskey, spokeswoman for the coalition.
“We still want to protect the long-term vision of the district,” McCluskey said.
On top of the lawsuits and politics is the reality of the rough housing market that’s slowing down projects elsewhere in Anaheim and keeping other high-end condo projects in the county from breaking ground.
Most notably, the city’s Platinum Triangle development area near Angel Stadium of Anaheim is seeing slow sales at existing projects and slower timelines for construction at other projects, which in total would bring about 9,000 homes to the area.
A handful of Platinum Triangle projects once slated to be condos are now being re-worked as apartments.
