Call it the $1M lesson.
That’s the money the City of Irvine will forfeit by backing out of a deal to buy (at an inflated price) a pair of buildings along Armstrong Avenue in the IBC for nearly $20M, with the expectation of opening the city’s first homeless shelter.
A surprise inclusion in an Oct. 22 City Council hearing, the deal was initially approved by a 4-1 vote, despite little outreach to nearby businesses and residents.
Once news of the deal, covered here in the Oct. 27 Business Journal, got out, there was a heavy amount of local backlash, backed in part by the MDL Irvine townhome development down the street from the Armstrong buildings, due to the lack of transparency in the proposal.
A hastily called second meeting on Nov. 5 saw the council reverse course and opt to kill the deal, by a 3-2 vote.
The loss of $1M “is a lesson” to the city to keep its residents more informed on deals of this type, said one speaker.
Irvine’s Great Park Neighborhoods was expected to see about 5,000 homes built at the time the former El Toro Marine base was sold in 2005 to private developers.
That figure was raised to a little more than 10,500 units about a dozen years ago, after locally-based Five Point Holdings (NYSE: FPH) stepped in to ramp up work at the adjacent, city-owned Great Park after Irvine officials blew through more than $200M in initial funding for the nearly 1,300-acre project – a much more expensive lesson that apparently wasn’t learned – with little to show for it.
Over 8,300 homesites at FivePoint’s development have been sold since 2013, with builder sales of about 6,500 homes during that time.
Expect more housing at Great Park Neighborhoods going forward, given state requirements for more housing across OC and current market trends.
FivePoint CEO Dan Hedigan last month told analysts his firm is “looking at opportunities to repurpose certain commercial sites [in Irvine] for residential use, given the depth of demand and values being driven by residential uses.”
The developer has entitlements for 4.9M SF of commercial developments at Great Park Neighborhoods. Less than half of that space has been built out.
Time magazine’s list of the 200 best inventions of 2024 includes products by two famous Orange County entrepreneurs.
Regenesis, the San Clemente company founded by Gavin Herbert, won for SourceStop, its approach to eliminating the risk of per and polyfluoroalkyl substances – also known as forever chemicals – in soil and groundwaters. Time said the product acts as a soil filter, reducing concentrations of the pollutants by up to 99%.
Irvine-based Masimo’s W1 Medical Watch gives “medical-grade accuracy a cut above most fitness trackers,” the magazine said. For more on Masimo founder Joe Kiani and his former company’s lawsuit against Apple, see Yuika Yoshida’s article on page 1.
