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Monday, May 20, 2024

Tennis Sites Serve Up Development Opportunities

As Orange County real estate investors eye infill redevelopment projects as a means to offset land scarcity, one product type continues to serve up interest.

Tennis clubs, both underutilized spots and locations with active user bases, continue to be targeted for conversion projects throughout the county, with several tapped in recent years for alternative uses.

The most recent set of hard courts to come into play is the former Vic Braden Tennis College in Coto de Caza, a 3.9-acre site that’s been largely vacant over the past few decades.

Newport Beach-based California Grand Villages is proposing a 101-unit active senior living development project at the site, although its approval appears uncertain. The plan has been delayed as a result of significant community pushback.

The proposal joins other notable tennis club redevelopments both proposed and completed over the past few years across the county, including a similar project currently in the works in Tustin.

101 Senior Units

California Grand’s proposed project, dubbed Legacy at Coto, is still in the approval process and recently received an environmental impact report.

The renowned tennis instructor Vic Braden built his namesake tennis college in Coto de Caza in 1974 before construction began on the community’s first homes.

The tennis college taught tens of thousands of players up until the 1990s. Braden died in 2014, at age 85.

Now, the club is largely underused, with only seven tennis courts remaining. It’s also used as a community center for year-round events.

California Grand Villages plans to replace these facilities with a two-story building for residential uses and an array of amenities like a bistro, restaurant, lounge and fitness center to accompany an existing swimming pool.

Units would be between 441 and 1,567 square feet.

California Grand said its goal “is to provide housing for independent active adults (aged 62 or older) who wish to live within a resort-style setting.”

It has a similar project in the works in Azusa. It says its preferred location for developments are not tennis facilities, but rather golf courses due to the love of golf by active adults, and because golf club operators are “struggling financially and could use the added income from sale of a portion of their property to offset current cost challenges.”

Resident Pushback

Like other tennis club redevelopment proposals in the county, Legacy at Coto faces opposition from nearby residents.

A petition organized by the Coto de Caza Community Association, which represents 456 homeowners near the project, has garnered more than 1,200 signatures with residents arguing the project’s density is not feasible for the single-family community with its narrow roads and just two exits.

“The developer isn’t being required to get a zone change for the site, which was originally zoned for recreational commercial use. It isn’t set up to hold a 24-hour commercial operation with staff coming and going at all times,” said David Bryden, a nearby resident and volunteer with community group SaveCoto.com.

Residents have also voiced concerns regarding traffic and safety, specifically during disaster evacuations, as well as a general compatibility issue for the planned structure, which Bryden notes is significantly larger than the current tennis club.

An Environmental Impact Report is currently underway at the site; developers hope to break ground by this spring. 

Tustin Hills

It’s not the only tennis club redevelopment proposal facing opposition in the county, with plans for the Tustin Hills Racquet Club also receiving community pushback.

The nearly 6-acre site in North Tustin, with about a dozen courts on its grounds, sold last year to Newport Beach-based Ranch Hill Partners for a reported $6.3 million.

The new owners have proposed a zone change to replace the existing private recreational club, first established in 1958, with residential uses.

The planned 37-unit project would include 34 single-family townhome units and three single-family detached units across 17 buildings.

Residents in Irvine successfully fought off a development proposal a few years ago, at the 9.2-acre Racquet Club of Irvine, which held 28 courts and a swimming pool just off Culver Drive.

KB Home of Los Angeles had filed initial plans to get the site entitled for a 123-unit project, but pulled the plans in 2019.

Newport, Anaheim

Residential developers have nabbed several tennis clubs over the past decade to serve as a land source for new home projects.

Irvine-based New Home Co.’s Meridian luxury development of condominiums, next to Fashion Island, opened in 2015 on a roughly 4-acre site of a former tennis club operated by the Newport Beach Marriott Hotel & Spa.

New Home paid $5.6 million per acre in 2013 and made its investment back fast, selling out the 79 mostly ocean-view units within a year of opening with prices ranging from $1.5 million to $4 million.

In 2016, the former Anaheim Hills Racquet Club was sold to homebuilder D.R. Horton to make way for a single-family home project on the nearly 4.5-acre site.

San Clemente

Not all tennis clubs that are redeveloped are becoming housing projects.

Among the most notable commercial tennis club redevelopment projects wrapped last year with Life Time Inc.’s opening of a new 45,000-square-foot fitness facility, at the city’s former Rancho San Clemente Tennis & Fitness Club.

The company closed on the 10.4-acre site in the San Clemente hills in 2015, then home to the shuttered tennis club.

Life Time demolished the original clubhouse building and built a new high-end gym in its place.

It turned space previously used as tennis courts into a new swimming pool, restaurant, spa and classroom facilities for yoga, Pilates, cycling and group fitness. It also refurbished a portion of the tennis court space.

It’s one of several new gyms—which run much larger than typical fitness centers—that Chanhassen, Minn.-based Life Time planned to open in the area, pre-pandemic.

It has also made plans to put in spots in the Brea Mall and at undeveloped land at the Great Park Neighborhoods.

Newport Beach Happenings

Two notable tennis clubs in Newport Beach have seen real estate drama in recent years, but appear set to operate under their current use for the time being.

The land underneath the Newport Beach Tennis Club was bought in 2017 by a prominent area retail developer.

An LLC headed by Diamond Development Group, the San Gabriel-based owner of Irvine’s Diamond Jamboree shopping center, bought the roughly 7.6-acre site of the tennis club on Eastbluff Drive near Corona del Mar High School.

ATH LLC paid about $12.4 million, property records show. That’s a little more than $1.6 million per acre.

Newport Beach-based Irvine Co.’s Eastbluff Village Center is next door to the tennis club.

There are no plans for a second retail project in the vicinity. The new owners bought the site as an investment, not a development play, brokers that worked on the deal said at the time the sale was completed.

Palisades Tennis Club, the 16-court club next to the Hyatt Regency Newport Beach along Jamboree Road, has a portion of the club’s land subject to a ground lease held by Newport Beach developer Russ Fluter.

After a testy set of negotiations played out in public early last year, a lease extension at market rates was made, allowing the club to remain and to continue use of its clubhouse and Breakers Stadium, where the World Team Tennis’s local team plays.

Another portion of the club’s facilities are also subject to a separate ground lease.

The club’s owner is Laguna Beach’s Eric Davidson, who is chairman of Carlsbad’s World Team Tennis, and is also owner of that league’s Orange County Breakers tennis team.

Davidson knows his real estate; he was co-founder of former Newport Beach senior homecare operator Vintage Senior Living.

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