HomeMy WebLinkAbout12 - PH-1 - An Ordinance for an Extension to the Pac - 6/1/20211
CITY COUNCIL AGENDA REPORT
MEETING DATE: JUNE 1, 2021 ITEM NUMBER: PH-1
SUBJECT: AN ORDINANCE FOR AN EXTENSION TO THE PACIFIC ARTS PLAZA
DEVELOPMENT AGREEMENT 00-04 (19-02), GENERALLY LOCATED
AT 3200 BRISTOL STREET
DATE: MAY 13, 2021
FROM: DEVELOPMENT SERVICES DEPARTMENT/ PLANNING DIVISION
PRESENTATION BY: MINOO ASHABI, PRINCIPAL PLANNER
FOR FURTHER INFORMATION
CONTACT:
MINOO ASHABI 714.754.5610
minoo.ashabi@costamesaca.gov
RECOMMENDATION:
Staff recommends that the City Council:
1. Find the project is categorically exempt from the provisions of the California
Environmental Quality Act (CEQA) per CEQA Guidelines Section 15061 (b) (3)
(general rule) of the CEQA Guidelines because the amendment is merely a time
extension for an existing development agreement and does not change the
underlying project. In addition, the environmental analysis for the Project
described in Environmental Impact Report No. 1047 (SCH No. 2000041100) and
the subsequent Mitigated Negative Declaration described herein are applicable;
and,
2. Give first reading to Ordinance No. 21-xx to approve Development Agreement
19-02 amending the Pacific Arts Plaza Development Agreement DA-00-04 for a
24-month time extension up to August 15, 2023. The City Council may also
consider a 36-month time extension per the applicant’s updated request.
APPLICANT OR AUTHORIZED AGENT:
The applicant and authorized agent is Jeffrey Davis, representing the property owner,
Irvine Company, Office Properties.
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PROJECT DESCRIPTION:
Proposed Amendment to Development Agreement DA-00-04 (DA-19-02)
The applicant is proposing an amendment to the original Pacific Arts Plaza Development
Agreement (DA-00-04) to allow for a three-year time extension. (The original Agreement
was approved in 2001 and is valid until August 15, 2021). The proposed amendment also
includes an additional public benefit payment of $25,000 to the City.
The proposed amendment (DA-19-02) is provided as Exhibit A to the Ordinance
(Attachment 1) and reflects a two-year time extension with the expiration date of August
16, 2023. The two-year extension is consistent with the applicant’s original request dated
May 1, 2019 and consistent with the recommendation of the Planning Commission. Due
to delays associated with the COVID-19 pandemic and its effects, the applicant has
revised their letter to request a three-year time extension. If City Council approves the
three-year time extension, the term of the agreement will be modified to August 15, 2024.
BACKGROUND:
Planning Commission Action
On December 9, 2019, the Planning Commission adopted Resolution PC-19-51
recommending approval of the two-year time extension on a 6-0 vote. The applicant’s
original letter request dated May 1, 2019 is provided as Attachment 2. The staff report,
minutes and video of the Planning Commission meeting are available at these links. No
public comments were submitted.
Staff Report:
http://ftp.costamesaca.gov/costamesaca/planningcommission/agenda/2019/2019-12-
09/PH-2.pdf
Meeting Minutes:
https://www.costamesaca.gov/home/showpublisheddocument/42159/6372368207235000
00
Video:
https://costamesa.granicus.com/player/clip/3484?view_id=10&redirect=true
Original Development Agreement DA-00-04
On July 16, 2001, the Costa Mesa City Council approved DA-00-04 between the City
and Two Town Center/Fifth Street Properties. DA-00-04 is the original Agreement for the
project site referred to as the Two Town Center and Downey Savings Property (later
referred to as Pacific Arts Plaza). The Agreement was effective for 20 years, expiring on
August 16, 2021. In December 2010, the property was acquired by The Irvine Company
from Maguire Properties.
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Project Site
Pacific Arts Plaza is an 18.9-acre site bounded by Anton Boulevard, the I-405 Freeway,
Bristol Street and Avenue of the Arts. Pacific Arts Plaza is a subarea of a larger 54-acre
area, commonly referred to as South Coast Plaza Town Center (SCPTC), which
contains a variety of commercial, arts and entertainment, and high-rise office uses,
including the Segerstrom Center for the Arts (see Attachment 3 for vicinity maps).
Pacific Arts Plaza itself is currently developed with a variety of office buildings and
restaurants including Mastro’s, Peets Coffee and Specialty’s Cafe and Bakery. The site is
designated Cultural Arts Center (CAC) by the General Plan and has a zoning designation
of Town Center (TC). The property is also located within Area 4 of the North Costa Mesa
Specific Plan.
Approved Development per the Original Agreement
On July 16, 2001, the Costa Mesa City Council approved Development Agreement DA-
00-04 between the City and Two Town Center/Fifth Street Properties (property owner at
the time). The Agreement was effective for 20 years, expiring on August 16, 2021. The
original Agreement described the “envelope” for the “Two Town Center” project and was
associated with approval of General Plan Amendment GP-00-02, the North Costa Mesa
Specific Plan including Specific Plan Amendment SP-00-01, Preliminary Master Plan PA-
00-38 (Resolution No. 01-9 approved on February 5, 2001), and Mitigation Monitoring
Program for Final EIR No. 1047 and dedication agreements (described as the “existing
Development Approvals” in the DA).
The Development Agreement describes the project as: “the demolition of the existing
theatre and some of the existing restaurant and retail uses on the property and the
construction of two (2) new office buildings totaling 400,000 square feet of office uses (in
the aggregate), 20,600 square feet of replacement of restaurant uses, two parking
structures, the reconfiguration and revision of the existing surface parking, circulation
improvements and landscaping.” The Development Agreement allows for development of
the project in approximately three phases as follows:
Table 1 –Phasing Summary for Pacific Arts Plaza
Phase 1 New office building (minimum 85,000 SF and max. 300,000 SF) and
parking facilities
Phase 2 Reconfiguration of existing parking
Phase 3 Second office building including commercial space and new parking
facility (aggregate not to exceed 400,000 SF)
The original Agreement did not include any site plan approvals; the purpose of the
Agreement was to establish the development capacity for the site, subject to future
approvals including a subdivision map, master plan, Planned Sign Program, building
permits and other ancillary permits outlined in Exhibit E of the original Agreement
(Attachment 5).
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The original Development Agreement allows for a maximum Floor Area Ratio (FAR) of
1.55 and a maximum building square footage of 1,227,978 (including existing and
planned development) within Pacific Arts Plaza. The trip budget under the Agreement is
2,133 a.m. peak hour trips and 2,150 p.m. peak hour trips.
Table 2 summarizes the approved development capacity based on the existing
development approvals under the original Development Agreement.
Table 2 – Development Summary for Pacific Arts Plaza
under Original Development Agreement
Total Acres: 18.9 acres
General Plan : Cultural Arts Center
Zoning: Town Center (TC)
Maximum Intensity: 1.55
Maximum SF: 1,227,978 sf
Trip Budget: 2,133 a.m. peak hour trips
2,150 p.m. peak hour trips
Maximum Building Height: Ranges from 60 ft. (4 story) to 175 feet (11 story) –
see Exhibit D of Attachment 5
Actions Subsequent to the Original Agreement
The following is a list of Council actions related to the Pacific Arts Plaza site that occurred
after adoption of the Development Agreement:
A Preliminary Master Plan for Two Town Center (PA-02-33) was approved on
October 21, 2002. The preliminary master plan approvals included an amendment
to South Coast Plaza Town Center Preliminary Master Plan (PA-00-38) which was
referenced in the Development Agreement and a variance from the Bristol Street
setback for the proposed parking structure (20 feet required, 0 feet approved), a
Mitigated Negative Declaration as a follow up to Final Environmental Impact
Report No. 1047. The Preliminary Master Plan (PA-02-33) allowed construction of
an 18-story high-rise (400,000 square feet) and a five-level parking structure (770
new spaces) in conjunction with the demolition of the South Coast Cinema
Building (12,000 square feet.) and two-level parking structure (Resolution No. 02-
78, Attachment 6).
On November 8, 2004, the City Council took action delegating future periodic
reviews of the Development Agreement to the Planning Commission and to allow
formal periodic reviews to be conducted every two years. Intervening annual
reviews were conducted at staff level.
On November 21, 2006, the City Council approved General Plan Amendment
GP-06-02 in conjunction with a program EIR (EIR No. 1052), which allowed
construction of five high-rise residential projects including a 180-unit residential
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structure at the corner of Anton Blvd. and Park Center Drive referred to as 675
Anton Blvd. which is within the Pacific Arts Plaza area (Resolution No. 07-07).
On January 16, 2007, the City Council approved North Costa Mesa Specific Plan
Amendment SP-06-02 which added 180 residential units to the Pacific Arts Plaza
site to be consistent with General Plan Amendment GP-06-02 (Resolution No.
07-12) as follows:
Table 3 – North Costa Mesa Specific Plan (amended 2006)
Map Key Unbuilt
Development
Capacity Under
the DA
Slated for
Demolition
Development
Capacity
Per GP-06-02
approval
Maximum
Building
Height
A 400,000 SF, 18-
story office and
parking structure
Theatre (19,200
SF and parking
structure)
400,000 SF office
and associated
parking
315 ft. (Above
Grade Level)
B None 67,450 SF 180 high-rise
residential units
315 ft. (Above
Grade Level)
On January 16, 2007, the City Council also approved Preliminary Master Plan
PA-05-50 for the Pacific Arts Plaza high-rise residential project. The master plan
established a high-rise development option that complied with the maximum
number of units, and maximum non-residential building square footage approved
for Area 4 of North Costa Mesa Specific Plan (Resolution No. 07-12). This
development option, the General Plan Amendment GP-06-02) and Specific Plan
Amendment SP-06-02 allowing the residential high-rise development was not
reflected in the original Development Agreement and a subsequent amendment
to the Agreement was not requested nor approved. The approval of preliminary
master plan PA-05-05 was valid for 24 months and expired on January 16, 2009.
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The last review of the Development Agreement by the Planning Commission was
in May 2017, which found the applicant in compliance with the terms and
conditions of the Agreement.
Development Agreement Obligations on Part of the Developer
The applicant has not undertaken any development activities on the project site; the site
remains as an office and restaurant use. Therefore, several obligations of the Agreement
as they relate to this parcel have yet to be fulfilled. The developer has completed these
obligations:
1. Provision of Traffic Improvements (completed). Environmental Impact Report
No. 1047 for the South Coast Plaza Town Center required traffic improvements
at Bristol Street/Sunflower Avenue and Fairview Road/South Coast Drive. These
improvements were implemented in 2002. The Bristol Street/Sunflower
improvement involved the conversion of a third northbound through lane to a
shared through/right turn lane. At Fairview/South Coast, a second eastbound
through lane was converted to a shared through/right turn lane. Other traffic
improvements are to be implemented when final building permits for the Town
Center Master Plan Development are issued.
2. Fulfillment of Additional Public Benefits (completed). The Developer has fulfilled
an additional public benefit described in Exhibit “H” of the original Agreement, by
donating land for the Avenue of the Arts Freeway off-ramp. This land was
appraised at more than $1,100,000 at the time and provided significant traffic
mitigation benefits and improved access to Town Center and the surrounding
area.
3. Preservation of Noguchi California Scenario (ongoing). The Developer has
provided for the preservation, maintenance, public accessibility, and validated
parking for visitors of the Noguchi California Scenario. A Land Use Restriction
related to these provisions will be in effect until 2050 (Exhibit F of Attachment 4).
No changes to this provision of the Agreement are proposed.
4. Provision of Excess Parking Capacity in TAD Plan (ongoing). The Developer
has proposed parking provisions in the Theater and Arts District (TAD), which
allow for the equitable use of excess parking capacity in the Pacific Arts Plaza
parking structures during non-business hours for patrons of the performing arts
venues located in the Town Center area. As required by the Agreement, parking
charges to the patrons of performing arts venues shall not exceed prevailing
parking charges for venue event parking at other comparable facilities in Orange
County. The original Agreement (Section 2.1.1) requires a 50% discount on
venue parking charges to Costa Mesa residents. The applicant is committing to
continue providing a 50 percent discount on venue parking charges to Costa
Mesa residents for the extended term of the Agreement.
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The following are pending developer obligations:
1. Creation and Implementation of the TAD Plan (pending). The Theater and Arts
District (TAD) Plan was approved by the City Council in February 2004 and later
amended in 2006 and 2008. The TAD Plan provides consistency of theme and
design for prominent public and outdoor private spaces in the South Coast Plaza
Town Center area. An amendment to the TAD Plan was approved by Council on
May 6, 2008. The amendment reallocated the funds required by the TAD Plan to
be focused on a comprehensive sign program primarily related to development
of the planned office building within the Pacific Arts Plaza area. The signage
program has not been implemented and is required at the time of construction of
the new office building or new hotel building (planned within the larger Town
Center area). The following itemizes the estimated improvement cost for private
improvements per the TAD Plan for both the Pacific Arts Plaza and South Coast
Plaza Town Center projects:
Table 4 – Theatre and Arts District Obligations
Item Estimated Cost Implementation Schedule
1) Area signage program
(directional and corner
monument signs)
$400,000 Before Certificate of Occupancy for
the first hotel or office tower
2) New Courtyard at Park
Center Drive including a
kiosk for California
Scenario
$800,000 Before Certificate of Occupancy for
new office at south end of Park
Center Drive (Pacific Arts Plaza)
3) Public art obligation $200,000 Before Certificate of Occupancy for
new office at south end of Park
Center Drive (Pacific Arts Plaza)
2. Final Master Plan Approval (pending). Approval of the Two Town Center Final
Master Plan occurred in October 2002. The Final Master Plan involved the
development of an 18-story, 400,000 sq. ft. office building, four-level parking
structure, and demolition of the cinema building and existing two-level parking
structure.
Since the Developer has not submitted building plans for construction of the
buildings approved by the master plan, there are no other obligations that need to
be fulfilled at this time. The remaining obligations identified in the Development
Agreement that will be required during project construction include the following:
Provision of Bristol and Paularino Traffic Improvement. On a fair-share
basis, the Developer will provide for the addition of a second northbound
left-turn lane and a second westbound left-turn lane at Bristol and Paularino
Avenue. The need and timing for this traffic improvement will be evaluated
at the time of final building plans submission.
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Provision of Park Center and Sunflower Traffic Improvement. On a fair
share basis, the Developer will provide for the following traffic
improvements: (1) conversion of a northbound through lane to a shared
left/through lane, (2) conversion of a southbound left-turn lane to a shared
left/through lane, (3) conversion of southbound through lane to a right-turn
lane, and (4) implementation of split phasing for north/south direction. The
need and timing for this traffic improvement will be evaluated at the time of
final building plans submission.
Payment of Fire Protection Impact Fee. The Developer will be responsible
for payment of a fire protection impact fees. According to the EIR (page
323 of Volume I), Site 5 (Pacific Arts Plaza High Rise Project) should pay
the $0.28 per square foot of new development and $469.35 per new
residential unit ($84,483.00 for 180 units on Site 5). This fee is due prior to
issuance of a building permit for new development.
3. With the proposed amendment, the applicant is submitting $25,000 to the City as
an additional public benefit payment associated with the amendment for the time
extension.
Development Agreement Obligations on Part of the City
In accordance with Section 2.2 of the Agreement, the City has assured the Developer
rights for 20 years to carry out and complete a project in accordance with the provisions
of the Agreement and subject to existing land use regulations in effect at the time of the
Agreement, existing development approvals, and future development approvals (including
master plan, subdivision map and building permits necessary to complete the project).
ANALYSIS:
Time Extension Request
The applicant originally requested a two-year time extension in 2019. The Planning
Commission reviewed the request at their December 9, 2019 meeting and recommended
approval of the time extension to City Council. The agreement is valid until August 15,
2021. The project site continues to thrive as an office complex with surface parking and a
parking structure. The applicant has modified the request seeking an additional year since
the Planning Commission's action preceded the COVID-19 pandemic by only a few
months. The applicant has indicated that extending the agreement until August 15, 2024,
will allow the applicant to thoroughly study development scenarios responsive to the 21st
century workplace and take into consideration the evolution of office uses in response to
COVID-19 conditions.
If the Agreement term is extended, the developer maintains the right to develop the
400,000 square foot office project described in the original Agreement subject to the
land use regulations and development approvals that were in place prior to the effective
date (August 15, 2001) of the Agreement. In addition, the public benefits of the DA will
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remain in place. The 50 percent parking discount Costa Mesa residents receive when
attending cultural events in the immediate vicinity will remain in effect. In fact, since
taking ownership, The Irvine Company has extended this discount to all parking users,
regardless of residency, as a way to support patronage of the Theater and Arts District
and area amenities. Parking rates are $1.75 per 15 minutes up to a $20 daily rate
maximum during normal office hours and are $1.00 per 15 minutes up to a $10 daily
rate maximum after 5PM and on weekends. The value of this benefit is estimated at
$50,000 per year.
If the Agreement were not extended and expires, the existing General Plan or Specific
Plan (and any future amendments) and other regulations and requirements in place at the
time would apply; however, the City would not derive the benefits of the remaining
developer obligations in the Agreement.
Since adoption of the Agreement, there have been amendments to the General Plan and
North Costa Mesa Specific Plan that allow greater development flexibility for the Pacific
Arts Plaza area. Development capacity includes the additional 400,000 square feet of
office uses included in the Development Agreement, as well as 180 new residential units
(subject to City approval of a master plan and building permits) envisioned at 675 Anton
(please refer to Table 3 above). It should be noted that the potential to develop residential
at the Anton location is not part of the Development Agreement and therefore is not
affected by the proposed amendment or time extension. Any future development not
specifically described in the Development Agreement is subject to City regulations in
place at the time of development, including an inclusionary housing ordinance if adopted.
City staff have reviewed the Agreement and the proposed change to the term and concur
that the Developer is in compliance with the terms of the Agreement and the requested
extension, even at a three year level, can be supported.
Future Development Post-Housing Element Update
The City is required by State law to adopt a compliant Housing Element by October 2021.
This update will cover the housing planning period between 2021 and 2029, often
referred to as the 6th Cycle, and will identify specific housing programs and actions that
will be implemented during the planning period to achieve the City’s housing goals.
Legislative actions necessary to implement the adopted Housing Element such as
General Plan Amendments and subsequent zoning actions would need to occur within
three years of the adoption of the Housing Element, by October 2024. If the Agreement
expires, future development will be subject to any new amendments that would be
effective due to the Housing Element update and any subsequent actions. The original
Agreement specifically pertains to office uses and does not include housing. The
Applicant has met with City staff and is participating in discussions regarding the Housing
Element update.
JUSTIFICATIONS FOR APPROVAL:
The applicant is not proposing additional project changes as part of the time extension
request.
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State Law requires that amendments to Development Agreements be adopted by
Ordinance. The draft City Council Ordinance for approval of the Development Agreement
amendment is included as Attachment 1.
The following are justifications for approval of the proposed project:
Proposal does not modify the previous approvals, other than the time extension.
Other than extending the term of the Development Agreement, the applicant is not
proposing additional project changes as part of the time extension request. The
extended term will allow the City the opportunity to benefit from the remaining
Developer obligations, should the project be developed within the next two to three
years. The applicant is committed to continue to offer the discounted parking rate
to Costa Mesa residents and has included an additional $25,000 Public Benefit
payment, associated with the time extension request.
Proposal is in compliance with the broader goals of the General Plan.
The proposal is in conformance with the applicable General Plan and land use
designation.
ENVIRONMENTAL DETERMINATION:
The project has been reviewed for compliance with the California Environmental Quality
Act (CEQA), the CEQA Guidelines, and the City environmental procedures. The
proposed time extension was found to be categorically exempt from the provisions of
the California Environmental Quality Act (CEQA) per CEQA Guidelines Section 15061
(b) (3) (general rule) of the CEQA Guidelines because the amendment is merely a time
extension for an existing development agreement and does not change the underlying
project. In addition, the environmental analysis for the Project described in
Environmental Impact Report No. 1047 (SCH No. 2000041100) and the subsequent
Mitigated Negative Declaration described herein are applicable.
PUBLIC NOTICE:
Pursuant to Title 13, Section 13-29(d), of the Costa Mesa Municipal Code, three types
of public notification have been completed no less than 10 days prior to the date of the
public hearing:
1. Mailed notice. A public notice was mailed to all property owners and occupants
within a 500-foot radius of the project site. The required notice radius is
measured from the external boundaries of the property.
2. On-site posting. A public notice was posted on each street frontage of the
project site.
3. Newspaper publication. A public notice was published once in the Daily Pilot
newspaper.
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As of the date of this report, no written public comments have been received. Any public
comments received prior to the June 1, 2021 City Council meeting will be provided
separately.
FISCAL REVIEW:
Financial impact is not known at this time. The requested time extension is accompanied
by an additional $25,000 Public Benefit payment.
LEGAL REVIEW:
The ordinance for adoption of the amendment to the Agreement and the amendment to
the Agreement have been approved as to form by the City Attorney’s Office.
ALTERNATIVES CONSIDERED:
The City Council has the following alternatives:
1. Adopt ordinance as drafted. The City Council may approve a two-year extension as
currently drafted. The City Council may also consider the applicant’s request for a
three-year extension of the Agreement.
2. Adopt Ordinance with any modifications. The City Council may request specific
changes to the ordinance that are necessary to alleviate concerns
3. Recommend denial of the Request. If the City Council believes that there are
insufficient facts to support the request, City Council must not adopt the ordinance and
provide facts in support of denial.
CITY COUNCIL GOALS & PRIORITIES:
Not applicable.
CONCLUSION:
Planning Commission recommended approval of the extension and determined that given
the size and complexity of the approved master plan, it is reasonable to approve the
proposed amendment to extend the term of the Development Agreement for two years.
Staff believes that the additional one-year extension requested due to the COVID-19
pandemic is reasonable and the added time will allow the applicant to further study and
develop the project concept and continue providing the public benefits associated with the
Agreement in terms of a reduced parking rate for the patrons of the north Costa Mesa
area.
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________________________________ _________________________________
MINOO ASHABI, AIA JENNIFER LE
Principal Planner Director of Economic and
Development Services
_________________________ ____________________________
CAROL MOLINA KIMBERLY HALL BARLOW
Finance Director City Attorney
Attachments: 1. City Council Ordinance 21-XX adopting DA-19-02
Exhibit A: Draft Development Agreement (DA-19-02)
2. Applicant Letters
3. Vicinity Maps and Zoning Map
4. December 9, 2019 Planning Commission Final Resolution (without
attachments)
5. Original Development Agreement DA-00-04
6. Resolution 01-9 (PA-00-38)
7. Resolution 02-78 (PA-02-33)
Applicant: Harpal Sadhal
Irvine Company
111 Innovation Drive
Irvine, CA 92617
EXTENSION TO
THE PACIFIC ARTS
PLAZA
DEVELOPMENT
AGREEMENT 00-04
June 1, 2021
City Council Meeting
v v
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BACKGROUND
•DA-00-04 is the original Agreement approved on July
16, 2001 between the City and Two Town
Center/Fifth Street Properties.
•The Agreement was effective for 20 years, expiring
on August 16, 2021.
•In December 2010, the property was acquired by The
Irvine Company from Maguire Properties.
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PROJECT SITE
•Pacific Arts Plaza is
an 18.9-acre site
bounded by Anton
Blvd., the I-405
Freeway, Bristol
Street and Avenue of
the Arts.
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4
AREA MAP
•Pacific Arts Plaza is
a subarea of a larger
54-acre area,
referred to as South
Coast Plaza Town
Center, which
includes commercial,
arts, entertainment,
and high-rise office
uses
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PROJECT DEFINED PER DA
•Demolition of the existing theatre and some existing
restaurant and retail uses
•Construction of two (2) new office buildings totaling
400,000 square feet of office uses (in the aggregate),
20,600 square feet of replacement of restaurant uses,
and two parking structures
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PROJECT DEFINED PER DA
Table 1 –Phasing Summary for Pacific Arts Plaza
Phase 1 New office building (minimum 85,000 SF and max. 300,000 SF)and parking facilities
Phase 2 Reconfiguration of existing parking
Phase 3 Second office building including commercial space and newparking facility (aggregate not to exceed 400,000 SF)
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DEVELOPMENT SUMMARY PER DA
Table 2 – Development Summary for Pacific Arts Plaza
under Original Development Agreement
Total Acres:18.9 acres
General Plan :Cultural Arts Center
Zoning:Town Center (TC)
Maximum Intensity:1.55
Maximum SF:1,227,978 sf
Trip Budget:2,133 a.m. peak hour trips
2,150 p.m. peak hour trips
Maximum Building Height:Ranges from 60 ft. (4 story) to 175 feet (11 story) – see Exhibit D of
Attachment 5
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NORTH COSTA MESA SPECIFIC PLAN AMENDMENT
Table 3 – North Costa Mesa Specific Plan (amended 2006)
Map
Key
Unbuilt
Developmen
t Capacity
Prior to GP-
06-02
Slated for
Demolition
Development
Capacity
Per GP-06-02
approval
Maximum
Building
Height
A 400,000 SF,
18- story
office and
parking
structure
South Coast
Cinema
theatre
(19,200 SF
and parking
structure)
400,000 SF
office and
associated
parking
315 ft.
(Above
Grade
Level)
B None 67,450 SF 180 high-rise
residential
units
315 ft.
(Above
Grade
Level)
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DA OBLIGATIONS
•Traffic Improvements completed and pending
•Freeway off-ramp dedication and funding
•Preservation of Noguchi California Scenario
•Discounted parking
•Theatre and Arts District (TAD) Plan (sign plan and
installation)
•Payment of Fire Protection Impact Fees
•$25,000 additional payment with the extension request
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TIME EXTENSION REQUEST
•In accordance with Section 2.2, the Agreement
assures Developer rights to carry out the project until
August 15, 2021.
•On December 9, 2019, the Planning Commission
adopted Resolution PC-19-51 recommending approval
of the two-year time extension on a 6-0 vote.
•Applicant has modified the request seeking a 3-year
extension until 2024
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RECOMMENDATION
•Find the project is categorically exempt from CEQA
per CEQA Guidelines Section 15061 (b) (3) (general
rule); and
•Give first reading to Ordinance No. 21-xx approving
a 24-month time extension up to August 15, 2023.
The City Council may also consider a 36-month time
extension per the applicant’s updated request.
EXTENSION TO
THE PACIFIC ARTS
PLAZA
DEVELOPMENT
AGREEMENT 00-04
June 1, 2021
City Council Meeting
ORDINANCE NO. 21-xx
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
COSTA MESA, CALIFORNIA, AMENDING ORDINANCE NO. 01-
06 AND APPROVING THE FIRST AMENDMENT TO THE
DEVELOPMENT AGREEMENT DA-00-04 BETWEEN THE CITY
OF COSTA MESA AND IRVINE COMPANY LLC AS
SUCCESSOR IN INTEREST TO FSP TWO TOWN CENTER AND
FIFTH STREET PROPERTIES-DS, LLC
THE CITY COUNCIL OF THE CITY OF COSTA MESA DOES HEREBY FIND AND
DECLARE AS FOLLOWS:
WHEREAS, Pursuant to Ordinance No. 01-06, the City of Costa Mesa, FSP Two
Town Center, LLC, and Fifth Street Properties-DS, LLC, entered in to that certain
Development Agreement for Two Town Center and Downey Savings Development
Properties dated as of July 27, 2001 (hereinafter, the “Development Agreement”), which
provides for construction of the Two Town Center and Downey Savings Project
(hereinafter, the “Project”), as defined in the Development Agreement;
WHEREAS, the Project is now known as Pacific Arts Plaza, and the Irvine Company,
LLC (hereinafter, the “Irvine Company” or “Developer”) purchased the property on which
the Project was constructed in December 2010 and the Development Agreement was
thereafter assigned to the Irvine Company; and
WHEREAS, the Developer has requested that the City extend the term and
otherwise amend the provisions of the Development Agreement; and
WHEREAS, a public hearing was held before the Planning Commission on
December 9, 2019 pursuant to the Procedures and Requirements for Consideration of
Development Agreements set forth in City Council Resolution No. 88-53, regarding the
proposed First Amendment to the Development Agreement (hereinafter, the “Amendment”)
at which time the Planning Commission considered testimony presented by the public and
the Irvine Company and thereafter made recommendations of approval to the City Council
on a 6-0 vote; and
WHEREAS, a public hearing was subsequently held on June 1, 2021 before the City
Council pursuant to the requirements of Resolution No. 88-53, at which time the City
Council considered testimony presented by the public and the Irvine Company and the
recommendations of the Planning Commission regarding the proposed Amendment; and
WHEREAS, the Amendment is:
(a) Consistent with the objectives, policies, general land uses and
programs specified in the General Plan and with the General Plan as
a whole and the North Costa Mesa Specific Plan;
Attachment 1
(b) Compatible with the uses authorized in, and the existing land use
regulations prescribed for, the zoning district in which the real property
is and will be located;
(c) Is in conformity with and will promote public convenience, general
welfare, and good land use practice; and
WHEREAS, the Amendment will not:
(a) Be detrimental to the health, safety and general welfare;
(b) Adversely affect the orderly development of property or the
preservation of property values; and
WHEREAS, the Amendment will promote and encourage the development of the
proposed project and will ensure the public benefits promised in the Development
Agreement and the Amendment, by providing stability and certainty to Developer; and
WHEREAS, the City, pursuant to the provisions of the California Environmental
Quality Act (“CEQA”) (California Public Resources Code Sections 21000 et seq.) and State
CEQA guidelines (Sections 15000 et seq.), the initial project was evaluated under
Environmental Impact Report No. 1047 (SCH No. 2000041100) certified in February 2001
and Mitigated Negative Declaration for the high-rise building (approved in October 2002).
In addition, the City has determined that the ordinance is not a "project" and further, that it
is exempt from the provisions of CEQA pursuant to CEQA Guidelines Section 15061(b)(3)
(because it can be seen with certainty that the adoption of this Ordinance will not have an
effect on the environment) such that no environmental review under CEQA is required; and
WHEREAS, all legal prerequisites prior to the adoption of this Ordinance have
occurred.
NOW, THEREFORE, THE COSTA MESA CITY COUNCIL DOES HEREBY
ORDAIN AS FOLLOWS:
Section 1. Findings and Declarations. The above stated findings and declarations
are true and correct.
Section 2. Approval. The City Council hereby approves, adopts and enters into
the Amendment in the form attached hereto as Exhibit A and incorporates the Amendment
herein by this reference.
Section 3. Recordation. Upon execution of the Amendment by all parties, the
City Clerk is directed to record the Amendment pursuant to Resolution No. 88-53.
Section 4. Environmental Compliance. Pursuant to the provisions of the
CEQA and State CEQA Guidelines the initial project was evaluated under Environmental
Impact Report No. 1047 (SCH No. 2000041100) certified in February 2001 and Mitigated
Negative Declaration for the high-rise building (approved in October 2002). In addition, the
City has determined that the ordinance is not a "project" and further, that it is exempt from
the provisions of CEQA pursuant to CEQA Guidelines Section 15061(b)(3) (because it can
be seen with certainty that the adoption of this Ordinance will not have an effect on the
environment) such that no environmental review under CEQA is required
Section 5. Inconsistencies. Any provision of Ordinance No. 01-06 that is
inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and
no further, are repealed or modified to that extent necessary to affect the provisions of this
Ordinance.
Section 6. Severability. If any chapter, article, section, subsection, subdivision,
sentence, clause, phrase, word, or portion of this Ordinance, or the application thereof to
any person, is for any reason held to be invalid or unconstitutional by the decision of any
court of competent jurisdiction, such decision shall not affect the validity of the remaining
portion of this Ordinance or its application to other persons. The City Council hereby
declares that it would have adopted this Ordinance and each chapter, article, section,
subsection, subdivision, sentence, clause, phrase, word, or portion thereof, irrespective of
the fact that any one or more subsections, subdivisions, sentences, clauses, phrases, or
portions of the application thereof to any person, be declared invalid or unconstitutional.
No portion of this Ordinance shall supersede any local, State, or Federal law, regulation,
or codes dealing with life safety factors.
Section 7. Effective Date. This Ordinance shall become effective thirty (30) days
from its adoption.
Section 8. Certification. The City Clerk shall certify the passage and adoption of
this Ordinance and shall cause the same to be posted or published in the manner as
required by law
PASSED AND ADOPTED this _____ day of ______________, 2021.
________________________________
John Stephens, Mayor
ATTEST: APPROVED AS TO FORM:
______________________________ ________________________________
Brenda Green, City Clerk Kimberly Hall Barlow, City Attorney
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
CITY OF COSTA MESA )
I, Brenda Green, City Clerk of the City Council of the City of Costa Mesa, hereby
certify that the above and foregoing Ordinance No. _________ was introduced and
considered section by section at a regular meeting of said City Council held on the
_____ day of _____________, 2021, and thereafter passed and adopted as a whole at
the regular meeting of said City Council held on the _____ day of ______________,
2019, by the following roll call vote:
AYES:
NOES:
ABSENT:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Seal of
the City of Costa Mesa this ______ day of _____________, 2021.
___________________________
Brenda Green, City Clerk
Exhibit A of Attachment 1
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
CITY OF COSTA MESA
77 Fair Drive
Costa Mesa, CA 92626
Attn: CITY CLERK
(Space Above This Line Is for Recorder’s Use Only)
This Amendment is recorded at the request and for
the benefit of the City of Costa Mesa and is exempt
from the payment of a recording fee pursuant to
Government Code §§ 6103 and 27383.
FIRST AMENDMENT TO DEVELOPMENT AGREEMENT
between
THE CITY OF COSTA MESA
and
IRVINE COMPANY LLC
CONCERNING TWO TOWN CENTER AND DOWNEY
SAVINGS DEVELOPMENT PROPERTIES
2
FIRST AMENDMENT TO THE
DEVELOPMENT AGREEMENT FOR TWO TOWN CENTER AND DOWNEY
SAVINGS DEVELOPMENT PROPERTIES
THIS FIRST AMENDMENT TO DEVELOPMENT AGREEMENT (“Amendment”) is
executed this ___ day of ______, 2019, by and between: (1) the City of Costa Mesa, a
Municipal Corporation of the State of California (“City”), and The Irvine Company LLC, a
California Limited Liability Company, (“Irvine Company” or “Owner”). The City and Irvine
Company shall individually be referred to as “Party” and shall collectively be referred to as the
“Parties.”
RECITALS
1. City, FSP Two Town Center, LLC, and Fifth Street Properties-DS, LLC, entered in to
that certain Development Agreement for Two Town Center and Downey Savings
Development Properties dated as of July 27, 2001 (“Development Agreement”). The
Development Agreement provides for construction of the Two Town Center and Downey
Savings Project (“Project”), as defined in the Development Agreement. The Project is
now known as Pacific Arts Plaza.
2. Irvine Company purchased the property on which the Project was constructed
(“Property”) in December 2010 and the Development Agreement was assigned to Irvine
Company. The Property is described in Exhibit A to the Development Agreement and is
depicted in Exhibit B to the Development Agreement.
3. Unless otherwise amended, the Development Agreement will expire on August 15, 2021.
4. Since 2001, a portion of the Property has been developed. However, portions of the
Property are developed to an extent that is less than permitted by the Property’s
entitlements. The Parties wish to ensure that certain development regulations contained
in the Development Agreement that are in effect through August 15, 2021, continue to
govern on the Property. Therefore, the parties wish to extend the term of the
Development Agreement by an additional two (2) years beyond the current date of
expiration to August 15, 2023.
5. Section 2.1.1 to the Development Agreement sets forth certain public benefits to be
provided by Irvine Company, and the City and Irvine Company desire to memorialize
that many of the public benefits have been provided. The Parties desire to ensure the
continuation of certain of these public benefits and to add certain additional requirements.
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6. This Amendment is intended to be an amendment pursuant to California Government
Code Section 65868. This Amendment has been considered and approved in the same
manner as the Development Agreement with public hearings pursuant to California
Government Code Section 65867.
7. The City Council has evaluated the potential environmental impacts of this Amendment
and has determined that any potential impacts have been analyzed pursuant to the Final
Program Environmental Impact Report No. 1047, prepared for City and certified by the
City Council on February 5, 2001, in accordance with the California Environmental
Quality Act (“CEQA”). There are no circumstances present that would require a new,
subsequent or supplemental environmental impact report for this Amendment, under the
provisions of CEQA.
8. On December 9, 2019, City’s Planning Commission held a public hearing on this
Amendment, made findings and determinations with respect to this Amendment, and
recommended to the City Council that the City Council approve this Amendment.
9. On [date], 2019, the City Council held a public hearing on this Amendment and
considered the Planning Commission’s recommendations and the testimony and
information submitted by City staff, Irvine Company, and members of the public. On
[date], 2019, pursuant to Government Code section 65864 et seq. and the procedures set
forth in City Council Resolution No. 88-53, the City adopted Ordinance No.
____________ finding this Amendment to be consistent with the City of Costa Mesa
General Plan and the North Costa Mesa Specific Plan, and approving this Amendment.
AGREEMENT
NOW, THEREFORE, City and Irvine Company agree as follows:
1. Effective Date. This Amendment shall not become effective and no Party shall have any
rights or obligations hereunder until the “Effective Date,” which for purposes of this
Amendment shall mean the thirty-first (31st) day following the adoption of Ordinance
No.___ by the City Council and signature by the City.
2. Duration of Agreement. The Development Agreement is hereby extended to be operative
and continue until August 15, 2023.
3. Continuation of Parking Benefit. City and Owner agree that certain public benefit
obligations set forth in Section 2.1.1 and Exhibit H to the Development Agreement have
been satisfied in full. City and Owner further agree that Owner shall continue to provide
the public benefit described in enumerated paragraph (3) to Section 2.1.1 to the
Development Agreement, pursuant to which Owner is required to provide a fifty percent
4
(50%) discount on parking on the Property to residents of the City of Costa Mesa
patronizing performing arts venues on the Property after regular business hours, until
expiration of the Development Agreement, as amended herein.
4. Additional Consideration. In addition to those public benefits enumerated in Section
2.1.1 and Exhibit H to the Development Agreement, Irvine Company shall, upon the
Effective Date of this Amendment, provide to City a $25,000 Public Benefit Payment, to
be dispensed at the discretion of the City Council.
5. Building Fees. City and Owner agree that should Owner choose to construct additional
development on the Property prior to the expiration of the Development Agreement, as
amended herein, such development shall be subject to City development fees at those
rates in existence and normally applicable to building or construction applications or
permits at the time that such applications or permits are processed by the City.
6. Original Agreement Amended and Conflicts. In the event of any conflict between the
terms of this Amendment and the remainder of the Development Agreement, this
Amendment shall control. Except as otherwise set forth herein to the contrary, all terms
and provisions of the Development Agreement shall remain un-amended and continue in
full force and effect. The term “Owner” as defined in the Agreement shall mean the
Irvine Company LLC. This Amendment with the remainder of the Development
Agreement shall be construed together and shall constitute one agreement.
7. Notice of Intention to Amend. In enacting this Amendment, the City has provided for
public notice and hearing in the manner provided by California Government Code
Section 65867.
8. Compliance with Government Code Section 65867.5. Government Code Section
65867.5 provides that a development agreement is a legislative act that shall be approved
by ordinance and subject to referendum. A development agreement shall not be approved
unless the City Council finds that the provisions of the agreement are consistent with the
general plan and any applicable specific plan. These requirements of Section 65867.5
have been satisfied by the City’s finding that this Amendment is consistent with the City
General Plan and the North Costa Mesa Specific Plan, and the City’s approval of this
Amendment by Ordinance No. ______.
9. Section Headings. All section headings are inserted for convenience only and shall not
affect construction or interpretation of this Agreement.
10. Authority to Execute. The persons executing this Amendment warrant and represent that
they have the authority to execute this Amendment on behalf of the party for which they
are executing this Amendment. They further warrant and represent that they have the
5
authority to bind their respective party to the performance of its obligations under this
Amendment. The City Manager or his/her designee has the authority to implement the
terms of this Amendment and execute any documents in furtherance of the terms of this
Amendment and the Development Agreement so long as they have been reviewed and
approved as to form by the City Attorney.
11. Counterparts. This Amendment may be executed in two (2) or more counterparts, each
of which shall be deemed an original, but all of which shall be deemed to constitute one
instrument. It shall not be necessary that all signatories execute the same counterpart(s)
of this Amendment for this Amendment to become effective.
[SIGNATURE PAGES FOLLOW]
6
SIGNATURE PAGE TO
FIRST AMENDMENT TO DEVELOPMENT AGREEMENT
Irvine Company
IRVINE COMPANY LLC
By:
Its:
By:
Its:
7
“CITY”
CITY OF COSTA MESA
By:
John Stephens
Mayor
ATTEST:
Brenda Green
City Clerk
APPROVED AS TO FORM:
Kimberly Barlow
City Attorney
8
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss
COUNTY OF ____________ )
On ___________, 2019 before me, , a Notary
Public, personally appeared [insert names of Irvine Company signatories only], who proved to
me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
_____________________________
SIGNATURE OF NOTARY PUBLIC
Attachment 2
Attachment 3
Vicinity Map
Pacific Arts Plaza
Zoning Map
Pacific Arts Plaza
Attachment 4
Attachment 5
Attachment 6
Attachment 7