Developer Mike Harrah is pushing ahead with plans for a major redevelopment of the Santa Ana land and buildings previously owned by the former parent company of the Orange County Register after the media company departed the property this year.
Harrah’s Caribou Industries, one of Santa Ana’s largest property owners and developers, has begun to unveil ambitious plans for the 20-acre former newspaper site near the intersection of the Santa Ana (5) Freeway and Grand Avenue.
The 625IVE project would give the property a major overhaul into a mixed-use community featuring high-rise residences, midrise creative-office buildings totaling nearly one million square feet, plus a retail project on Grand Avenue tentatively called The Crush.
Harrah has commissioned architecture firm Gensler for the project; he said he’s already invested more than $1 million in the cutting-edge plans, which under a proposed timeline would take about 10 years to build.
The design costs are on top of the estimated $60 million that Harrah paid in 2014 to buy the existing 625 Grand Ave. building from Freedom Communications Inc., the former owner of the Register, plus excess land and facilities next to the building last year.
The Register—now owned by Digital First Media following a bankruptcy sale last year—moved its operations a few months ago to a smaller office in Anaheim near Angel Stadium.
Harrah thinks he got a bargain on the deal for the building and land, despite losing the office building’s largest tenant.
“It’s the most valuable property in Orange County” due to its central setting and location in the core of OC’s most urban city, Harrah said last week.
Location
The architecture plans aren’t the only expensive thing about 625IVE. Caribou’s financial projections put the development cost close to $1 billion, and the company is seeking an equity partner to cover $400 million in costs, including retiring debt that Caribou took on to buy the property.
In addition to financing, a few other key issues need to be resolved before the project can move ahead, foremost an anchor tenant for the office portion.
Harrah envisions a large corporate user talking up the bulk of the space; ideally the tenant—likely a large tech firm—would also lease space at his One Broadway tower a little more than a mile away.
The 37-story One Broadway project and 625IVE would be linked by a light-rail system that’s about to be built in the city. The residential portion of the mixed-use project on Grand Avenue would likely be home to many employees at both sites, he said.
Foundation Work
While 625IVE is still in the early stages of design and isn’t expected to break ground in the near term, Harrah continues to proceed with work at One Broadway, whose construction site sits next to Caribou’s office.
One Broadway Plaza, which is more than a decade in the making, will be Orange County’s tallest building. It’s slated to approach nearly 500 feet.
Irvine’s 21-story 200 Spectrum Center tower is currently OC’s tallest office, standing 323 feet high.
A heavy amount of groundwork has taken place at the One Broadway site over the past six months to prepare the structure’s base at a cost of about $11 million, according to Harrah.
The next phase of foundation work will take place in about 60 days, he said, leading to steel starting to rise over the next year.
The project “is well funded,” and Caribou is exploring bringing in foreign investors as partners in the development, he said.
Harrah previously estimated the nearly 600,000-square-foot tower’s total cost at $380 million. He said lenders backing his project have removed requirements that the building be at least 50% preleased before kicking off construction, a concession that prompted the beginning of work.
