When A Deal Is Not A Deal
Posted by: Jubal | 09/04/2007 1:56 PM
This August 31 Los Angeles Times article is reminder of the elasticity of the phrase "a deal is a deal" in contemporary Anaheim politics.
Case in point is the City of Anaheim's plan to develop the 53-acre site next to Anaheim Stadium (Archstone-Smith and Hines was granted exclusive development rights by the city). Anaheim Councilman Harry Sidhu has been the chief cheerleader of this undertaking. The Archstone plan is for mix of offices, retail, entertainment, hotels and residential (including 1,100 apartments).
Angel's agreement with the city requires that the team -- in other words, Arte Moreno -- has to sign off on any residential development on that site. Moreno doesn't want to sign off.
Which doesn't deter Councilman Sidhu:
"The city wanted to open up the dialogue and get Mr. Moreno's blessing to put residential on the land," said Councilman Harry Sidhu. "But since he did not want to open up the door, we are proceeding further without any negotiation."
Odd. When Councilman Harry Sidhu speaks about the Resort District and SunCal's residential zoning overlay (which Sidhu supported before he opposed it), then "a deal is a deal" and the Resort District cannot be altered one iota because that would mean going back on the city's "deal" with Disney.
But that's on the other side of the freeway, in the land of Zoning Permafrost. On the Angel Stadium side, a "deal is not a deal" -- at least not in Councilman Sidhu's estimation.
[Full disclosure: I'm a member of the consulting team for SunCal's proposed Platinum Pointe project in Anaheim]
UPDATE (9/5/07, 2:47 p.m.): Sarah Tully has a follow-up article on the OCR website.
you can see the documentary I made about him at recallingrocco "dot" com....
What about Moorlach's vendetta against the Deputy Sherriff's? I guess that means a deal is not a deal too...
Hey Jubal - Harry is a true champion for Anaheim and its taxpayers on this property. Remember when that land was about to go to greedy NFL owners for $50 million and now the city and taxpayers will be fetching more than $150 million?
The way that I read that L.A. Times quote from last week's paper is that negotiations on residential went nowhere with Arte and the second part of quote doesn't necessarily mean that he's saying that they're proceeding with residential. That's how I read it. Let's not jump to any conclusions.
On a deal that shouldn't have been passed up, I'm sure you remember that commercial/residential compromise deal that Harry and Curt Pringle suggested to SunCal.
After the referendum is voted on as part of the June 3, 2008 ballot, that's one deal that I bet SunCal will wish they had seriously considered.
DEAL OR NO DEAL - SEEMS TO ME THAT SUNCAL MISSED THE BOAT ON A COMPROMISE DEAL WORTH CONSIDERING.
Fascinating that the "housing" for this area is now proposed to be 1,100 apartments. So many of the condominium projects under construction currently in the Platinum Triangle have gone from condos to apartments in the last 90 days. The latest is the "2100 at Platinum Triangle" complex just to the northeast of the stadium on Katella. 2100 was originally going to be condominiums, and they even had a website inviting you to join the purchase interest list early this summer. Now 2100 has been changed to apartments just as structural steel for the site rises from the ground.
That other big condo development south of the Platinum Triangle on Chapman switched from homes to apartments even after it opened and sat trying to scrounge up buyers for a couple of months. I went on the home tour when it was condos, and now it has a big banner that says "NOW LEASING" while hardly any lights are on in the entire development after sundown. It's been open for months, but no one lives there. And that one switched sides last spring, months before the subprime market imploded over the last 60 days. A few other Triangle area developments have changed their stripes from condos to apartments too even as they are being built, as the housing market collapses and the ability to get cheap and dirty subprime mortgages disolved into thin air.
I really have to wonder if there is truly a market for literally thousands and thousands of expensive mid-rise apartments in the middle of Anaheim. Something tells me the emergency brake is being pulled as I type on any Platinum Triangle housing development that doesn't already have steel going up right now. That would leave Lennar in the worst shape with their sprawling Triangle development, but I can't imagine any sane developer going forward with any type of condo or luxury apartment complex in central Anaheim for at least several years. And if the national economy heads into recession before 2010, then the Triangle and Stadium plans would gather dust likely until the middle of the next decade.
I honestly can't see any developer heading into that over-saturated apartment market anytime soon. So the Moreno issue would be a moot point in my opinion.
Jubal-
Your criticism of Harry Sidhu is misplaced.
The developer who has an Exclusive Negotiating Agreement with the city on the north stadium site, Archstone-Smith, joined representatives from the city in meeting with Angels representatives, including Arte Moreno, regarding this potential project.
The city has been consistent in negotiating with potential buyers of this site, be it the NFL or Archstone, or any other developer, that they would have to live and operate within the Angels lease terms.
Archstone would like to include residential in their plan, but they know that they would need Angels approval for that to occur. They were discussing with the Angels their plan in hopes of gaining a start in this negotiating process.
But wherever they end with the Angels, they know that the city wants them to present a plan totally consistent with the lease excluding residential, unless an agreement is reached with the Angels.
Councilmember Sidhu's comments reflect that the city and Archstone will contine with our negotiating with a non-residential option and that is in sync with the lease.
Sidhu is very consistent that a deal is a deal.
Curt Pringle
"I honestly can't see any developer heading into that over-saturated apartment market anytime soon. So the Moreno issue would be a moot point in my opinion."
WRONG!!!
Hey Westsider...the Aprtment Industry flurishes in a for-sale downturn. Why do you think the Irvine Company keeps on building them? It seems to me that IAC is a business model that works. Apartments are the one portion of the housing market that will tick up in '08.
The demand for housing remains high, wheather people chosse to rent or simply can't afford to buy, the bottom line is they need a place to live. Rental market vs. For-sale market is a teeter-totter pushed by basic economics.
With all due respect to Da Mayor (a great mayor, BTW)), that's not what Sidhu said. Sidhu said the city's movin' ahead on the project, residential included, without further negotiation with Moreno.
I see your point "Everyone" when it comes to the national markets. But Lennar and SunCal and all of these other developers aren't in the business of building apartments, and that's who is here with bulldozers in central Anaheim. The business model and planning vision of the Platinum Triangle was not built upon thousands of rented apartments, it was built upon thousands of purchased homes.
The land for 2100 at Platinum Triangle was bought and developed by D.R. Horton, and their purchase interest list and trendy web preview page was on a Horton website as recently as May of this year. With structural steel being completed, 2100 is now being owned and operated by an outfit called "AvalonBay Communities" that specializes in apartments in the "high barrier-to-entry markets" of the country. Buh-bye D.R. Horton, Anaheim hardly knew ya.
Lennar builds homes for purchase. So does SunCal. Neither of those companies have apartment developments in SoCal, and their plans and proposals for the Triangle area all called for thousands upon thousands of condominiums and purchased townhomes.
Certainly there is a market for quality, upscale, expensive apartments in aging central OC. But the two new expensive complexes off of Chapman that have been empty for months with "NOW LEASING" banners flapping desperately in the wind tell me that niche market isn't as deep or as wide as some folks may believe.
And I just don't see how the upscale apartment market can bear an infusion of 3,000+ additional rental units all in the Triangle area over the next few years. That wasn't the vision that the Triangle was supposed to bring to Anaheim, and that's not why the big home builders like Lennar are still digging new sewer lines, carving out new streets and parks, and laying fiber optic cable around the Triangle district.
Lennar didn't agree to pay for all that infrastructure so it could hand over the property to an upscale apartment manager. And SunCal didn't shell out hundreds of thousands of dollars for a political campaign to build shoebox apartments for Disneyland ride operators to bunk up 3 to a room. These big home builders were in Anaheim to build PURCHASED HOMES, not rental units.
The Platinum Triangle can only take so many last-second upscale apartment conversions on hundreds of units at a time before future construction stops. And I feel the Platinum Triangle area just hit those brakes in the last 30 to 45 days.