By PAUL HUGHES
Author Samuel Johnson called second marriages “the triumph of optimism over experience.”
Placentia is about to find out.
The city is edging closer to letting developer Rick Kreuzer and Tod Properties LLC remake a blighted swath alongside the railroad tracks that run through the North County city.
“Blighted” is the official designation, Mayor Scott Brady said.
The industrial section south of the tracks “is not a very nice area,” he said.
The city hopes to breathe life into some 110 acres in and around its largely Hispanic old town centered along the tracks. Plans call for a train station, as many as 1,800 homes and about 600,000 square feet of stores, restaurants, offices and city space.
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Clementine townhomes by KB Homes: part of area’s early redevelopment |
In a largely built-out city,officials estimate there are two dozen acres of undeveloped land in the former bedroom community,this will be the last big project for decades here.
“What’s the heartbeat of a community?” Brady asked. “Placentia doesn’t really have one. We have a lot of history in old town, but not necessarily a lot of historically significant buildings. This will create a community and reintegrate south Placentia with the entire city.”
Most recent development in Placentia, a city of 50,000 people next to Fullerton, Brea and Yorba Linda, has been housing on its edges next to its bigger neighbors.
The city has been down the redevelopment track before. Some residents have reservations about the latest plan.
The project is an attempt to craft urban coziness. Placentia, literally founded as a suburb, today lacks the tax base and hip atmosphere of its larger neighbors.
Four years ago, Lake Forest-based Tod Properties tried to start a similar redevelopment, only to have the planning collapse amid charges of corruption and indictments of former city officials.
In the fallout, the city’s OnTrac program to create rail underpasses imploded, leaving Placentia with a $16 million bill, said Greg Sowards, a founder of Citizens for a Better Placentia who is running for City Council.
The current proposals need more work, Sowards said.
“The Specific Plan is non-specific,” he said.
Finance Issue
The issue for the city is money, said Mayor Pro Tem Constance Underhill, a 10-year council veteran with two years left on her term.
“A lot is going to be contingent on city finances,” she said. “We’re not in a position to share expenses with any developer.”
Redevelopment will come, according to Underhill.
“We need to have some revitalization,” she said. “But we still need input and a close look at what the plan is.”
As for the Nov. 7 election, in which two council members opted not to seek re-election, she said, “There will definitely be some changes this year.”
Things already have changed.
Gone is the top-down, “my-way-or-the-highway” approach of the earlier failed redevelopment bid.
“Rather than having the developer come in and say, ‘This is what we want,’ we were much more careful this time,” Mayor Brady said.
Placentia held a “charette” to consider how to proceed.
A charette is a brainstorming process used by city planners, officials, residents and developers to come up with plans in a limited time, usually a week.
(The term evolved from a 19th century practice in Paris, where architecture students quickly developed design options and then carried their drawings to the school in a cart, the charette.)
The Vision
Officials want a project that’s friendly to people on foot, with stores, restaurants and lofts where people can work and live.
“You look at the market, look at what the needs are, and build around that,” Brady said. “There’s not enough reason now to go to the old town area. We want a destination point for Placentia and the surrounding areas.”
Now, he said, the city is moving forward on a plan for the area, taking public comments prior to a vote expected in spring.
Kreuzer is setting up the deals to make the first phase happen. Tod earlier led the Clementine condominium project developed by Los Angeles-based KB Homes in old town.
The vision, according to Kreuzer: 1,500 to 1,800 homes, 200,000 square feet of stores and other commercial space and 400,000 square feet of office space.
“We’re trying to create a town center, with neighborhood retailers and quite a bit of open space,” he said.
Kreuzer controls 80% of the 18 acres in the first phase of the project.
Land Prices
He said he’s signing contracts valuing land at $1.5 million to $3 million an acre.
But nothing’s closed recently. Escrow for a parcel now housing pipe maker Excalibur Extrusions was to close last month, but didn’t.
“We didn’t have our equity lined up,” Kreuzer candidly said.
Kreuzer and Excalibur now are working on a new deal. Excalibur owner, Glenn Baldwin, also the president of the local chamber of commerce, expects the sale to go through.
“I’m concerned,” he said. “But the developer is working on it. We’re OK.”
Tod also has put up $1 million as part of its exclusive negotiating pact with Placentia.
“Right now it’s ‘risk money,'” Kreuzer said. “We could come in with a plan in June and the council could hate it.”
When Kreuzer first approached investors, he said they wanted the property controlled before they would invest.
Now that Kreuzer controls the land, the housing market is softening and investors have been wary of a first phase currently planning more than 600 homes.
Kreuzer said he’d been talking to two or three institutional investors to come in and fund the project.
Then, in mid-October, he said he secured a commitment from an investor for the first phase of the project.
He declined to name the investor until the deal is final. The agreement is for the roughly $50 million first phase, he said.
“We (had) to find the right investment group, one that understands Tod,” Kreuzer said.
“Tod” stands for “transit oriented development”,how Tod Properties got its name,because the project is based around a proposed Metrolink stop in the city.
Train Stop
Fullerton currently has the stop furthest east on the Metrolink line. Placentia wants one.
Economic development director Leigh DeSantis said Placentia is following the lead of major metro areas and staying true to its history by proposing a railroad stop.
“It’s going on elsewhere in California and elsewhere in the country,” she said. “The history of the West is it opened up as the railroad came. Now it’s light rail transit and commuter rail, so we’re rediscovering the influence that can have on communities.”
There are several possible locations for a stop,one of the things that must be worked out prior to voting on a final plan. Everyone involved agrees something is essential.
“The transit station is critical to the success of the project,” Kreuzer said. “It’s a transit-oriented development,it needs transit.”
The Metrolink station will cost millions.
“The city has to partner with us on this,” he said.
Given Placentia’s fi-nances, this would seem a tough request.
“Our obligation is to those businesses we currently have,” Mayor Pro Tem Underhill said. “We can’t commit all the income to a new thing, when we have streets to repair.”
Craig Green, a founder of Citizens for a Better Placentia, said the charette process worked well, and likes the development so far. But money is an issue.
“It has to be developer funded,” he said.
Kreuzer said there are ways to make this work.
“We can’t go and ask them for $10 million, but the city does have resources,” he said. “We can’t go to the general fund. But we can use the tools we have. We need the city’s power.”
These could include a community facilities district, Mello Roos or a tax increment bond that would repay indebtedness as land is re-assessed, he said.
“Once we can explain more about how redevelopment has to work,” a project can move forward, he said.
No Eminent Domain
Apart from the Metrolink stop, Kreuzer said he follows two principles for the development: no eminent domain and the project paying for itself.
If the details can be worked out, the city is just as optimistic.
“Our market study has shown us there is much greater demand than we can currently meet,” DeSantis said.
She said the city has looked at the demographics, what people will buy, how much income they have and how far they’d go to spend it.
Old town now provides little of the city’s tax income,a main reason to plan a project in the first place.
The industrial and retail businesses in the plan area generate 8.6% of the city’s sales taxes, about $450,000, according to DeSantis.
This would change markedly, with new housing and more businesses and stores.
DeSantis envisions the makings of a 24-hour area, drawing many from within Placentia who now go elsewhere to eat and buy.
The city might also put in a public market, say a smaller version of Pike’s Place Market in Seattle, with housing for added support.
“We’ll preserve the 1910 town area, put in new shopping and pleasant public spaces, and people will come,” she said. “Not on a grand scale, but they will come.”
The developers now await the inevitable grinding process of city politics and planning.
The plan needs finalizing. The Metrolink location needs to be chosen. There’s a pedestrian bridge in the initial stages of the first phase. And the public is to have its say on all of it in the next six to eight months.
Mayor Brady believes it will unite two halves of the city. Even those voicing concerns, such as council candidate and Placentia booster Sowards, say the redevelopment is coming.
Kreuzer simply says it will work this time around, and that’s a good thing.
“I believe in the project and I think at the end of the day, it’s got to be the right thing for us and the city,” he said.
