By Mark Mueller & Sherri Cruz
Orange County Business Journal Staff
A new owner could be in the works for one of Orange County’s most troubled shopping centers, Costa Mesa’s Triangle Square.
Newport Beach-based real estate investor and developer Greenlaw Partners is said to be close to buying the mall, according to sources.
Greenlaw could look to overhaul Triangle Square by adding homes and cutting the number of shops.
The company is said to be in escrow to buy the center from Pasadena-based Triangle Square Investment LLC, which bought it in 1998 for an estimated $47 million.
Representatives for Greenlaw and Triangle Square’s management company declined to comment on a possible sale.
According to sources, the prospective buyer is proposing a major redevelopment for Triangle Square, which, despite its enviable spot at the end of the Costa Mesa (55) Freeway, has had a hard time keeping tenants.
A proposal in the works would cut retail space at the 191,000-square-foot mall and add condominiums.
Early plans have been presented to Costa Mesa’s planning department. It likely would be several months before the city signs off on a redevelopment plan.
Irvine-based consultant Starpointe Ventures, which has worked on a number of mixed-use projects around the John Wayne Airport area, has been hired as an “entitlement consultant” for the Triangle Square proposal.
Gauging City Interest
Work is being done to see if Costa Mesa is open to adding homes alongside the shops and restaurants at Triangle Square, said Patrick Strader, a Starpointe vice president.
Strader declined to say who is buying the mall.
If the mall were rezoned for housing, it could boost Triangle Square’s value.
Brokers had a tough time estimating the likely sales price for the mall, given its high vacancy rate, current lease terms and the prospect of rezoning for homes.
Typically, a local mall bought for $47 million in 1998 easily could have doubled in value by now. But Triangle Square is far from typical, brokers said.
A Triangle Square sale would add a new page to the history of the mall, which opened in 1992 at a cost of $62 million. It originally was envisioned as an entertainment center and downtown for Costa Mesa.
‘Bermuda Triangle’
Some have dubbed the three-story mall the Bermuda Triangle for the number of businesses and leasing agents that have come and then vanished.
Triangle Square has been successful as a nightspot with Sutra Lounge and Yard House. Other tenants include Executive Tans and The Closet, which by all accounts are doing well.
But the mall has plenty of space on its hands after losing big tenants Niketown, Virgin Megastore and Barnes & Noble in the past year.
Leasing agencies have come and gone. The latest to leave is Colliers International Inc. Other brokerages that have taken a stab at leasing up space include Grubb & Ellis Co. and Shapco Realty.
Current owner Triangle Square Investment is looking for a new leasing agent, according to a spokesperson for Charles Dunn Real Estate Services Inc., the mall’s management company.
Parking at Triangle Square has been an issue for shoppers and leasing agents. Some have complained that the mall’s underground parking is too awkward. A lack of parking has kept out a gym, bowling alley and other entertainment tenants.
A number of companies have looked at buying the mall from Triangle Square Investment during the years. But the owners never appeared interested in selling.
Greenlaw owns some 15 properties, most of them office buildings, according to the company’s Web site.
Most of the buildings are in OC, including the 122,000-square-foot Stadium Centre office building in Anaheim.
