A long-vacant, 30-acre site on the western side of Anaheim will soon see an ambitious, and recently reworked, mixed-use development featuring retail uses and for-sale homes break ground.
The Anaheim City Council recently approved a development agreement to turn land it owns at the intersection of Beach Boulevard and Lincoln Avenue into a project called 39 Commons.
The development is expected to hold up to 65 townhomes on 3 acres of the site, as well as a 35,000-square-foot grocery store, and 38,100 square feet of shops and restaurants. A hotel is also a potential for the site, among other commercial uses.
Los Angeles-based Zelman Development Co., which has been in negotiations with the city for years over the size and scope of the project, remains involved.
New to the development team is Irvine’s Greenlaw Partners, a commercial real estate investor and developer with other large projects in the works or underway in the city.
Lower Cost
Zelman and Greenlaw are buying 12 acres at the site for $5.6 million, or roughly $470,000 per acre.
Other developable land in and around the city has traded at prices closer to $3 million an acre in recent years.
The discounted price “reflects higher construction costs that are expected at the site,” according to the city, which noted the property’s former use as a landfill (see story, this page).
The joint venture will lease the remaining 18 acres at the site for $66,000 per year for the first five years, then $132,000 for the next five years followed by additional increases.
A 2010 appraisal for the site valued the 30-acre property at around $21 million, according to prior news reports.
The project’s scope and focus has been significantly reworked; a few years ago a big-box anchored shopping center was envisioned for the land.
New Vision
Initial work on the site is slated to begin early next year, according to the city.
“Development of this corner has been a long time coming, and this marks a big step forward,” said City spokesman Mike Lyster. “39 Commons is a key piece of our vision to remake Beach Boulevard, as Anaheim has done before with its downtown, stadium area and the resort.”
The city said it will invest $14 million of its own funds to revamp 3.6 acres of land just south of the 39 Commons site that currently holds an outdated motel, car wash, and gas station.
Development of homes or apartments on that site is likely.
Last December, the city approved a new development plan for the immediate area to revitalize it.
The zoning increases residential development limits in the region from 3,651 to 5,128 new homes, and commercial space from 907,000 square feet to 2.1 million square feet.
It’s a similar game plan to what was adopted in the revitalized downtown Anaheim area, as well as in the Platinum Triangle, where about $1.5 billion investment is underway or close to breaking ground.
“While Beach [Boulevard] has had its challenges over the years, it represents the next opportunity in Anaheim,” Lyster said. “We expect 39 Commons and the investments we as a city have made to usher in more investment and redevelopment.”
Hotel Nearby
Greenlaw Partners has other projects elsewhere in Anaheim, closer to Disneyland.
Construction is underway on a 12-story, 326-room Radisson Blu hotel, a four-star project headed by an affiliate of Portland, Ore.-based hotel developer BPM Real Estate Group and Greenlaw.
The development site is next to the Santa Ana (5) Freeway, but on the opposite side from Disneyland, and about a mile from the entrance to the theme park. It will be the largest hotel in Anaheim east of the (5) Freeway when complete.
The development team paid about $3.6 million for the former city-owned land, a long-vacant site on South Anaheim Boulevard near Disney Way.
The estimated full project cost of the hotel is nearly $170 million.
Greenlaw is also looking to turn an older business park next to the hotel site into a residential development.
Zelman has another retail project in the works elsewhere in OC; its Yorba Linda Town Center development is expected to feature a luxury movie theater, restaurants, and other retailers.
