The future of the largest office building in South Orange County is still in flux. Â
About a year after once again being considered for sale by the federal government, discussions are moving forward on long-term plans for the Chet Holifield Federal Building in Laguna Niguel.
The 1 million-square-foot building, commonly referred to as the Ziggurat Building, was built in 1971 by William Pereira, and initially was intended to be a manufacturing facility for North American Rockwell.
Its future has been the source of speculation over the past decade as the government, which acquired the building in 1974, is now considering new uses for the 92-acre site.
An early-stage development proposal indicates the government is leaning towards the sale of the six-story building following the relocation of the existing tenants elsewhere in Orange County, which could pave the way for a larger redevelopment of the site. The city in April indicated it is on board with this plan, for the time being.
An expected price hasn’t been estimated, though the land could well be worth $300 million or more if housing and other highest and best uses are ultimately allowed at the site, real estate sources have told the Business Journal. The land isn’t entitled for those uses now.
Brokerage Savills has reportedly been selected to market the property for sale, if such a plan is finalized.
DownsizingÂ
One government contractor that’s reported to occupy space at the building appears to be downsizing well ahead of the building’s proposed changes.
A recent state filing indicates Forfeiture Support Associates, or FSA, is eliminating hundreds of positions in the city.
FSA provides administrative, legal, and investigative services to the U.S. federal law enforcement and homeland security communities; the contractor in based in Ashburn, Va., and had been operating as a subcontractor for another government-focused firm, Sciolex Corp., state filings indicate.
A WARN filing with the state’s employment development department indicates FSA laid off about 440 employees in the city this summer.
The United States General Services Administration (GSA) manages the Chet Holified building; the property’s largest tenant is the United States Citizenship and Immigration Services.
AlternativesÂ
The potential redevelopment of the Chet Holifield building comes after an early 2020 letter in which the government’s Public Buildings Reform Board recommended selling a handful of underutilized federal properties across the country that could bring in up to $750 million.
According to the GSA, “as a result of the age and current condition of the building, the working space for their tenants does not meet applicable building code, accessibility, and security standards.”
The government’s preferred plan at this time involves the relocation of all the building’s tenants to leased space within Orange County, at which point the government property would “be reported as excess in accordance with federal policy and disposed.”
Other options being considered for the Laguna Niguel site include the construction of a new federal office building next to the existing Chet Holifield property. The government would then relocate the tenants into lease space primarily within Orange County, and the remaining property would be sold.
A third option, dubbed the “No Action” alternative, would keep the building and tenants, with minor repairs as needed.Â
