Plans for an ambitious mixed-use project at the Tustin Legacy development have been scaled back, with the city now planning to oversee reuse of one of the base’s two iconic blimp hangars rather than a private developer.
Last week the city of Tustin signed off on an amended negotiating agreement between it and the local affiliate of Calgary-based developer Brookfield Residential regarding development of what was originally promoted as an “urban village” in the center of the former Marine Corps Air Station.
The plan, in the works since late 2015, initially involved nearly 123 acres at Tustin Legacy.
At the time the project was announced, the developers—then under a different ownership structure—had the stated goal of building a “community core” featuring a pedestrian-friendly area likely to include large elements of commercial, entertainment and residential uses.
The project’s size and scope has been scaled back substantially, the acreage cut by nearly two-thirds, the city said last week.
“During the course of preparing a master plan for the area it was determined by city staff and the developer that the development objectives would best be met within an approximately 39-acre footprint,” city documents said.
The reduced acreage “was established to best achieve both the development objectives” of the city and the developer, and should help construction move at a faster pace, Tustin representatives told the Business Journal last week.
Plans now call for the Brookfield affiliate to oversee development of about 450 for-sale homes in a mix of single-family units, townhomes and flats, plus about 600 apartments, and 60,000 to 80,000 square feet of retail integrated within the apartment communities, according to the city.
Beyond the newly designated 39-acre area, the developer is also exploring incorporating another 6.75-acre parcel into its plans, according to city filings.
Hangar Switch
It was initially proposed that one of the two historic, 17-story-high blimp hangars at the former base just off Tustin Ranch Road, would be rehabilitated and incorporated into Brookfield’s project and leased from the city.
That’s not the case anymore, the city said.
All property outside of the 39 acres “is to be retained by the city, including the South Hangar,” last week’s filings said.
The city said it now plans to head rehabilitation of the hangar, which was built in the early 1940s and in recent years has been used for a variety of one-off activities, such as filming and a marathon.
The city “plans to continue these uses in the near term while design is completed on a $15 million maintenance and upgrade project,” Tustin officials said last week in a statement. “This project will allow the hangar to accommodate larger events beyond the current uses.”
Tustin said it also plans to build a five-acre park west of the hangar, which should mesh well with Brookfield’s forthcoming project.
Developer Changes
The Tustin project has been in the works since 2015, when the city chose San Diego-based mixed-use developer OliverMcMillan LLC as its preferred master developer for the site.
A three-year planning process was initially expected before construction commenced; as of last year the city still tentatively listed 2018 as when groundbreaking could take place.
At one time some of the land was eyed for a new baseball stadium for the Angels.
One city official last week expressed displeasure at the pace of movement at the project, which comes as other parts of Tustin Legacy, such as Lincoln Property’s Flight office development, are moving ahead much faster.
“It’s a little disappointing to see how little progress we’ve made on this project,” Mayor Pro Tem Rebecca Gomez said at last week’s city council hearing.
Gomez later provided the following statement to the Business Journal: “The Community Core is a critical neighborhood at Tustin Legacy, and I remain very anxious to see it come to fruition. Although the planning process is lengthy, we are committed to the new milestones agreed to. With the caliber and experience of developer we are working with, I believe this project will be successful. City staff and [the developer] have developed a plan that meets the development objectives of both parties and initiates the development of the Community Core neighborhood.”
The exclusive negotiating agreement between the city and the developer expires in November. The city said last week that it still believes the project will be brought before its planning commission and city council by the end of the year.
OliverMcMillan previously cited similar types of large-scale, mixed-use projects it’s been working on in Atlanta, Houston and Hawaii, including former military base sites, as potential models for the Tustin project.
Last year a venture was formed between OliverMcMillan and Brookfield Residential to develop the Tustin project. Brookfield also built part of Tustin Legacy’s Greenwood housing project down the street from the proposed mixed-use site.
In February, Brookfield, which has regional offices in Costa Mesa, acquired OliverMcMillan for $39.5 million.
Financial terms of Brookfield’s deal with the city for the 39 acres haven’t been disclosed yet.
The developer and its predecessors have been in closed-door negotiations with the city over how much it would pay.
Other commercially developable land at Tustin Legacy has sold for between $900,000 and $1.8 million an acre in the past few years, according to city documents.
