Additional Documents Additional Documents

ADDITIONAL DOCUMENTS ADDITIONAL DOCUMENTS

ADDITIONAL DOCUMENTS

the VILLAGES of SOUTH COAST 1683 SUNFLOWER AVENUE SOUTH COAST METRO DISTRICT COSTA MESA CA

HOME RANCH

LA TIMES BUILDING

VANS

PREPARED BY ROSE EQUITIES SEPTEMBER 8, 2015

1 SANTA ANA RIVER TRAIL ROSE EQUITIES

September 8, 2015

The Honorable Stephen Mensinger City of Costa Mesa 77 Fair Drive Costa Mesa, California 92626

Mayor Mensinger,

As you know, the ownership of the LA Times site, located at 1375 Sunflower Avenue, has requested to be included in the current general plan update process. Similarly, for over two years, we have been exploring the various opportunities to appropriately reposition the Robinson Pharma site (1683 Sunflower Avenue) located next to SOCO, one of the most authentic and thriving retail centers in all of Orange County. In fact, the western portion of South Coast Metro is made up of several sites that offer up great opportunity and potential for the City of Costa Mesa to maintain the quality of life it currently affords its citizens and to insure it will also do so for future Costa Mesa generations.

We recognize the City is in the middle of its general plan update process and the potential inclusion of projects such as the LA Times and ours could cause delays and additional cost for same. As such, assuming the LA Times is allowed to enter the process, we also ask for similar inclusion. With this letter, we respectfully request that this process consider the redesignation of the Robinson Pharma site for a live-work-play village comprised of a variety of uses. We acknowledge, if the LA Times request is denied, we will respectfully withdraw ours as well.

With this in mind, please consider the following thoughts as it relates to the repositioning of the Robinson Pharma site, which we are calling ‘the Villages of South Coast,’ as part of the revitalization and repositioning of the western portion of South Coast Metro.

We have been closely monitoring the general plan update and subsequent planning designations for many of the properties north of the I-405. Including the LA Times site, the following properties have been discussed for development or repositioning:

1. VANS – Vans recently purchased the property located at 3333 Hyland Avenue, which will include several hundred employees and potentially redevelopment of the parking lot bordering Hyland. This property is also immediately adjacent to SOCO, opposite the Robinson Pharma site. 2. Emulex – 65,435 square feet of office have already been approved at the corner of Sunflower and Susan. This site is currently for sale and as a part of the sales procedure, the repositioning of the property, including the build out of the vacant land, has been encouraged. 3. The corner of Sunflower and Harbor – Designated as the ‘Business Park Overlay’ in the general plan update draft recommended land uses, there is a suggestion for this intersection to be up-zoned from 0.25-0.75 FAR to 1.0 FAR.

8383 Wilshire Boulevard Suite 632 • Beverly Hills, California 90211 • 323.782.4300 2 4. Home Ranch – Currently approved for 759,165 square feet of commercial; there is a recommendation to increase this site to 1,200,000 square feet. 5. LA Times – Proposal for 1.0 FAR of ‘Urban Center Commercial’ use, or approximately 914,760 square feet of development.

These properties are an integral part of the west side of South Coast Metro. With the future development of these sites, in addition to the projects already in place, this area of the South Coast Metro District possesses great potential to become a vibrant, mixed-use, walkable and bikeable district, unlike any other economic node in all of Orange County. A global question is what can and should be done from a planning perspective to insure the long-term success of the current and future planned developments?

Some of the most memorable and desirable land use districts (for office, retail and residents alike) around the world are those that appropriately mix jobs, retail and residential in a walkable/bike friendly plan. In today’s hyper-competitive world of Orange County, the idea of a well-executed live- work-play environment puts both private and public institutions which participate in these settings in an extremely viable position to excel. Our goal for our site is to build on the strengths of the uses already in place and planned. This includes its unique location next to the Santa Ana River Trail, which is 4 miles to the beach, 1.5 miles to Fairview Park and 6 miles to Anaheim Stadium via bike. To this end, we are embracing the emerging bike culture of Costa Mesa (and Orange County) like no other area to date. The result is the creation of a functionally and visibility-stimulating area along the I-405 freeway, an environment that will be on display for the entire county to marvel and recognize as the gateway to the City of Costa Mesa.

If these properties north of the I-405 are to be developed and draw from the vibrant companies in today’s 21stcentury economy, one of the first questions these corporate leaders will ask is “whether these sites offer up to their employees an environment which affords a high quality of life relative to how they live-work-play?” Large users of space, for instance in a campus setting, will no longer accept sites which are deficient in any one of the elements of live, work or play.

We all know the development pattern of the 20th Century, in particular within Orange County, lead to areas of extensive suburban sprawl, where people have to travel the freeway to get to their jobs. Similarly, there are many employment centers where there is a glaring lack of housing options. The answer for both the future corporate leaders of Costa Mesa and the City includes solutions which keep people off the freeway by embracing the definitions of an appropriate job-housing balance in a mixed- use district where employees and the people of the City can live, work and play in a quality environment.

From this perspective, it makes for common sense for the City to take a hard look at the above mentioned sites and other properties north of the I-405 appropriate for repositioning. Costa Mesa is known for both its alternative and eclectic residential neighborhoods and retail (SOCO, the CAMP, the LAB) in addition to the economic firepower of the South Coast Metro District. By taking a comprehensive look to these properties north of the I-405, the City can appropriately plan for its

8383 Wilshire Boulevard Suite 632 • Beverly Hills, California 90211 • 323.782.4300

3 4 5 6 the Villages of South Coast

Prepared remarks, to be submitted at September 8, 2015 Joint Study Session

Honorable Mayor Mensinger, council, and planning commission, my name is Leonard Glickman, managing partner of Rose Equities. I am here to speak on behalf of the site located at 1683 Sunflower Avenue, referenced in the agenda as the Robinson Pharma site.

As you know, this site is located next to SOCO, one of the most authentic and thriving retail centers in all of Orange County.

It is also adjacent to the Santa Ana River Trail, a key component to the emerging bike culture of the city and a variety of other employment generating uses. It is area known as the western portion of the South Coast Metro District.

These three building blocks, located in a little pocket of northwest Costa Mesa, carry with it the framework to create a dynamic and vibrant mixed-use district…..the type that is the envy for private and public citizens alike as we move deeper into the 21st Century.

For this reason, we think there are significant advantages to taking a comprehensive look at this area, which includes sites like the aforementioned LA Times, VANS, Emulex and others.

And of course, the Robinson Pharma site is right in the middle of it.

We believe by looking at this area comprehensively, the result would be the creation of a functionally and visibility-stimulating area along the I-405 freeway…..an environment that will be on display for the entire county to marvel and recognize as the gateway to the City of Costa Mesa.

Imagine driving south on the I-405, crossing over the bikers riding along the Santa Ana River, and coming to three shining beacons of Costa Mesa’s Gateway as one looks to their left…

ROSE EQUITIES September 8, 2015 7 the Villages of South Coast

First, you would come upon the live-work-play, walkable, bikeable village we imagine for our site, one we are calling the Villages of South Coast…

Second, you see the eclectic retail star that is SOCO.

And third, you would come to the headquarters of VANS, the corporate embodiment of Costa Mesa’s own alternative economic heartbeat.

Now imagine looking right and seeing the edge of one of Costa Mesa’s cherished neighborhoods, Mesa Verde. Imagine living in this neighborhood, riding your bike up through the Santa Ana River Trail and enjoying your purchases from the SOCO farmers market while sitting in the new park we aim to include in our village.

This is the best part…by looking at the opportunity offered by western portion of the South Coast Metro District to provide a strong and sustainable economic foundation for the City’s future….

It does so by maintaining the integrity of traditional Westside and Eastside Costa Mesa neighborhoods that are so cherished by the City’s citizens.

As it relates to the LA Times, we understand ownership has asked for inclusion in the general plan process and associated EIR.

To this note, we recognize the City is in the middle of this process and understand the potential inclusion of projects such as the LA Times and ours, could cause delays and added cost to same.

Assuming the LA Times is granted inclusion to this general plan process, we also ask for similar inclusion and respectfully request that the City, council and planning commission consider the redesignation of the Robinson Pharma site for a live-work-play village comprised of a variety of uses. We are aware of the costs this would add to the general plan process and are prepared to fund same.

However, I want to be clear, if the LA Times request to be included in the general plan update process is denied, we will respectfully withdraw our request to be included in same. In the end, we want more than anything to look to the leadership of the City of Costa Mesa for the best way to move forward.

ROSE EQUITIES September 8, 2015 8 the Villages of South Coast

Lastly, I want to bring a little attention to who we are and the value we bring to the community of Costa Mesa. To best enhance the current and potential future attributes of the western portion of South Coast Metro, the repositioning of the Robinson Pharma site requires execution by an entity that has a long-term perspective.

This creates, by definition, a symbiotic relationship between property owner and the strength of the community (benefiting all). We are a family-business with 65 years of experience that always seeks the benefits of long-term ownership.

Unlike most other ‘developers’, we utilize only our family’s economic resources and do not to sell a project once completed for quick profit. With this outlook, our success more than anything else, is predicated upon a thriving community and its surrounding area. Our financial investment is not only to our benefit but also by definition, to our neighbors and the community at large.

To that note, we are prepared to commit our extensive developmental skills and financial resources for the planning and development effort of not only our site but the necessary infrastructure and social services required to the city, such as:

1. improved traffic enhancements 2. fire-life safety inclusion 3. bike infrastructure and 4. the before mentioned recreational park land and facilities we aim to include in and around our site.

I have included a couple conceptual initial images of just a part of our thinking on the screen.

The first one is access to the bike trail and the second is a potential ball field located adjacent to the Santa Ana River Trail.

Thank you again Honorable Mayor, council and planning commission for your time. I look forward to your thoughts on the opportunity the western portion of South Coast Metro provides for the City’s future, in addition to the continued progress toward the repositioning of the Robinson Pharma site.

Questions…

ROSE EQUITIES September 8, 2015 9 SANTA ANA RIVER TRAIL

the VILLAGES of SOUTH COAST SOUTH COAST COLLECTION

10 the VILLAGES of SOUTH COAST

LAGUNA BEACH IRVINE CORONA DEL MAR FASHION ISLAND #2 OC MALL JOHN WAYNE INTERNATIONAL AIRPORT NEWPORT BEACH

IFOR CAL NIA

IFORN 55 CAL IA 73

SOUTH COAST PLAZA #1 OC MALL HOMEHOME RANCHR INTERSTATE 405 LA TIMES BUILDING COSTA MESA

VANS

SOUTH COAST COLLECTION

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La S ORANGE COUNTY ie Los Angeles Co. r r a North 710 A v e Orange County . Norwalk 91 5 Submarket 71 Yorba Linda 91 Fullerton Placentia 91 19 Riverside Co. Cerritos Long Beach 605 Buena Park Cajalco Airport Villa Central Rd. Park Orange County RIVERSIDE COUNTY ORANGE COUNTY 39 Submarket 241 Anaheim 57 Orange

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Seal Beach The VILLAGES of SOUTH COAST 5 55 Irvine MacArthur Blvd 133 Huntington Beach Costa Greater Lake Mesa Orange County 405 Airport Area Elsinore

John Wayne 241 Airport Submarket Newport South Beach 73 Orange County 133 1 d Submarket El Toro R Pacific Ocean

5 73 Laguna Beach Laguna Niguel

74 San Juan Capistrano

10 Miles 5 Miles 12 SUPPORTING MATERIALS

In addition to our prepared statement, we have enclosed a series of articles and supporting materials, on a variety of issues, which should be part of the continuing dialog for the City of Costa Mesa as part of its ongoing review for the western portion of South Coast Metro.

ROSE EQUITIES September 8, 2015 13 4/24/2015 What Attracts Tech Pros to OC? - Daily News Article - GlobeSt.com

You are here: Home > Daily News > What Attracts Tech Pros to OC?

Last Updated: April 24, 2015

EXCLUSIVE What Attracts Tech Pros to OC? By Carrie Rossenfeld | Orange County New Event! Expand your SoCal network at RealShare San Diego on May 28.

ORANGE COUNTY, CA—In short, a better lifestyle is driving young, highly educated, motivated, balanced and successful tech talent to the Orange County market, Alex Hayden, EVP who leads CBRE’s tech and media practice in Orange County, tells GlobeSt.com. We spoke with Hayden exclusively after the release of his firm’s national report on tech talent, which revealed that Orange County had a 31% growth in tech talent since 2012, making it one of the top-10 “momentum markets” for tech-driven office leasing demand.

GlobeSt.com: What is unique about the type of tech talent that is attracted to Orange County?

Hayden: “Companies looking for Hayden: A lot has to do with the type of culture the tech companies are trying to create. OC fits the prototype talent are making a larger of highly educated, motivated, balanced and successful employees. The location can be the ultimate draw for commitment to Orange County.” companies: “Come work for my fast-growing, exciting tech company. We are located in a perfect area where you can surf and ski, enjoy shopping and nightlife and live in a great community.” Easy sell!

GlobeSt.com: What is being done to bring in and retain this type of talent in the region?

Hayden: Higher-paying jobs and nearby affordable rental housing.

GlobeSt.com: How do you see this sector growing in Orange County in the future?

Hayden: We see continued desire from the employers to be in this locale due to the lifestyle that matches the desires of the Millennial employee. The biggest issue is the cost and availability of affordable housing; yet, many of the new multifamily developments are going up to offset this, much of which is being built by the Irvine Co.

GlobeSt.com: What else should our readers in know about tech talent in Orange county?

Hayden: When compared to other cities that the report identifies as top tech-talent markets both around the country and here on the West Coast, the Orange County lifestyle has advantages. Housing is less expensive than in markets like the Bay Area and New York, commute patterns are shorter, office space is less expensive and lifestyle activities such as surfing, skiing and L.A./San Diego nightlife are all within an hour’s drive. Companies looking for talent are recognizing these things and are making a larger commitment to Orange County.

Stay ahead with GlobeSt.com's National AM Alert for original coverage of the latest transactions and trends shaping the commercial real estate industry. Sign Up Today!

About Our Columnist

Carrie Rossenfeld is a reporter for the West Coast region of GlobeSt.com and Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.

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About ALM | Customer Support Copyright © 2015 ALM Media Properties, LLC. All rights reserved. http://www.globest.com/news/12_1096/orangecounty/technology/What-Attracts-Tec14h-Pros-to-OC-357312-1.html?zkPrintable=true 1/1 - Streetsblog.net - http://www.streetsblog.net -

How Sprawl Worsens California’s Terrible Drought Posted By Angie Schmitt On April 10, 2015 @ 11:18 am In Network Roundup | 6 Comments

California is in the throes of a drought that Governor Jerry Brown called [1] “unprecedented in recorded history.”

There are many factors behind the severity of the state’s drought, and one of them is land use. In a prescient post from last year, Jon Mendelson at Network blog Stockton City Limits [3] warned that California’s water crisis was likely to get worse, adding that cities like Stockton aren’t doing themselves any favors by continuing to build the most water- intensive kind of development: sprawl. He [2] says Stockton could be a poster child for Sprawling development strains California’s fragile the kind of development that strains water resources. Photo: Stockton City Limits natural resources in California:

Recent reports from Smart Growth America (“Paving Our Way to Water Shortages: How Sprawl Aggravates the Effects of Drought [4]”) and Western Resource Advocates (“A Comparative Study of Urban Water Use Across the Southwest [5]”) argue that the type of growth that’s been a hallmark of the Central Valley the past few decades leads to cities that consume far more water than is sustainable.

The studies found that urban growth patterns with a relatively low density of units per acre — especially those featuring primarily single-family houses — use more water than higher- density, mixed-use plans. They also indicate that the more pavement used for a development, such as for parking lots at a sprawling strip mall, the less rain recharges groundwater stores. These impervious surfaces carry stormwater to drains and ultimately into waterways where it can’t be used for consumption, instead of allowing water to soak back into the ground to be extracted by wells.

The findings, while directly related to other regions, are applicable to Stockton. Climate models for the coming century generally predict dwindling snowpack in the Sierra Nevada Mountains, the primary source of drinking and agricultural water for Stockton and California 15 as a whole. That means the current worst-in-a-century drought could become common. Cities such as Stockton, which is predicted by the general plan to grow significantly from its current size of 300,000 during the next 20 years, will have to do with less.

Don’t be mistaken — the sprawling development patterns of Stockton and cities up and down the state aren’t wholly to blame for this year’s drought. The lion’s share of California’s drought should be attributed to record low rainfall in 2014 and an antiquated water rights system.

(It’s also true that agriculture consumes more water than urban users, so some might argue San Joaquin County would become more water efficient the more local farmland is turned to houses. It’s a noxious viewpoint considering our immediate region relies economically on ag production and doesn’t have to import its farm water like the Central Valley’s west side, but it’s an argument nonetheless.)

But the point remains that with a growing population and a water supply that will at best stay the same, planners and developers would be Coke-bottle-glasses shortsighted to not take every chance to make cities more efficient when it comes to water.

Elsewhere on the Network today: Plan Charlotte [6] shares public health expert Richard Jackson’s research linking the obesity epidemic to the unwalkable environments we’ve constructed. And Seattle Transit Blog [7] says one secret to affordable housing is to build more transit.

Article printed from Streetsblog.net: http://www.streetsblog.net

URL to article: http://www.streetsblog.net/2015/04/10/how-sprawl-worsens- californias-terrible-drought/

URLs in this post:

[1] Governor Jerry Brown called: http://www.usatoday.com/story/news/2015/04/09/drought-california- brown/25544867/ [2] Image: http://streetsblog.net/wp-content/uploads/sites/6/2015/04/scl- sprawl-overhead.jpg [3] Stockton City Limits: http://stocktoncitylimits.com/2014/03/19/is-stocktons- sprawl-making-the-drought-worse/ [4] Paving Our Way to Water Shortages: How Sprawl Aggravates the Effects of Drought: http://www.smartgrowthamerica.org/documents/DroughtSprawlReport09.pdf [5] A Comparative Study of Urban Water Use Across the Southwest: http://www.westernresourceadvocates.org/media/pdf/SWChapter4.pdf [6] Plan Charlotte: http://plancharlotte.org/story/richard-jackson-built-environment- and-transit-charlotte 16 SOUTHERN CALIFORNIA REGIONAL PROGRESS REPORT 2014

a report produced by the Metropolitan Futures Initiative (MFI) EXECUTIVE in the school of social ecology at the university of california, irvine SUMMARY June 11, 2014

Executive Committee

John R. Hipp Jae Hong Kim Victoria Basolo

17 2 2014 EXECUTIVE SUMMARY REPORT California region –Imperial, Los Angeles, nomic changeswithinthe six-countySouthern terns inlanddevelopment alongsidesocioeco of oureverchangingregion. We analyzepat attempt toreveal thecomplexityanddynamics In thissecondSouthernCaliforniaRPR,we ty oflife. planning forgrowth, development,andquali of thesetransformationpatternsisthusvitalin Understanding thenature andconsequences hoods andthehealthofentire region. will determinethevitalityofourneighbor The wayinwhichthistransformationunfolds agencies withspecificgoalsinmind. from actionstakenbyindividuals,groups, and in arandomfashion.Rather, ithasresulted this regional transformationhasnotoccurred Southern Californiancities. Although complex, the highestjobstohousingratioamonglarge has grown intoathrivingeconomichubwith and inabilitytoattractnewinvestment,Irvine gion havestruggled withshrinkingtaxbases Consider Irvine.Whileothercitiesinthere- consequential. markets, thisissueoftheRPRistimelyand growth and the ongoingtumultinhousing Given thesheermagnitudeofthiscontinued by themselvesaccountforthistransformation. development patternssuchassprawlcannot and exurbanexpansioncontinue,traditional employment decentralizationandsuburban Although trends suchaspopulationand transformed drasticallyduringthistime. port (RPR),theregion’s urbanlandscapehas highlighted inourfirstRegionalProgress Re- second largest metropolitan area intheU.S. As the SouthernCaliforniaregion isnowthe Following acenturyofuninterrupted growth, - 18 - - - key findings. Presented beloware asummaryofsomeour the region. inform publicdiscussionaboutthefuture of makers andthepublicalike,thushelp able knowledgeandinformationforpolicy and qualityoflifetrends, willprovide valu- demographic, social,environmental, economic, series, wehopethatourmodels,usingdetailed Consistent withthelarger goalsoftheRPR County: theGreat Parkarea. tions aboutakeydevelopmentsiteinOrange insights from theseanalysestomakeprojec- region, thelatterpartofReportutilizes opment inthebroader SouthernCalifornia meaningful insightsintothenature ofdevel Although thesefirsttwofocicanprovide some economic vibrancyofneighborhoods. paying particularattentiontoitsimpactonthe of thislandusechangeforneighborhoods, locations. Second,weassesstheconsequences why developmenthappensasitdoesincertain We followwithstatisticalmodelsthatexplore terns forclustersofcitiesduringthisperiod. First, wedescribethechangesinlandusepat- ra counties–overthelast20years. Orange, Riverside,SanBernardino, andVentu- • • D

evelopment all sixcounties, thenetgrowth rates varied While single-familyresidential increased in 15.5M to17.6M. growth rate(approximately +14.6%from a pacethatmatchedregional population residential landincreased by15% (inacres), single-family housingunits.Single-family Southern Californiawasthedevelopmentof From 1993to2005,aconsistenttrend in P atterns - 3 2014 EXECUTIVE SUMMARY REPORT - - - - evelopment D se U and L Proximity to amenities had important effects Proximity on which types of development occurred. to business subcenters and Closer proximity the likelihood of sin the beach increased housing, gle-family housing, multi-family industrial, public infrastructure, commercial, and mixed-use, open space & recreation, office space development. the to transit stations increased Proximity - residen likelihood of single and multi-family - industrial, public infrastruc tial, commercial, mixed-use, and office space develop ture, ment. to transit stations also increased Proximity - into com the likelihood of redevelopment public facilities, and office space. mercial, to freeways On the other hand, proximity the likelihood of single-family units, reduced the perspective of from which is preferable to noxious fumes on high- exposure reducing likely more were ways; instead such parcels or transportation, to experience commercial Orange County saw a large expansion of expansion a large saw County Orange de substantial but a residential multi-family - grew in single-fam County rapidly Riverside are facilities, which and public ily residential population increase. associated with substantial gains County saw San Bernardino services, industrial, & in land for commercial communication & utili- and transportation, ties. a modest ex- County experienced Ventura falling between territory, pansion of its urban River Angeles and rapidly expanding Los cline in industrial land and military uses. land and cline in industrial side and San Bernardino.

xplaining

• • • • 3. 4. 5. 6. E 19 - - - The full report is available at: http://socialecology.uci.edu/mfi The full report Los Angeles County was outpaced by Los in Orange, Riverside, and San Bernardino of various types of new development. acres Imperial County extensively developed farmland areas. side added 1,600 acres. side added 1,600 acres. Non-residential urban land uses also ex- Non-residential region. panded substantially within the “Mixed Development” uses In particular, be than 50% (in acres) by more increased Los Angeles County lagged behind all other Angeles Los land counties in multi-family residential parcels development in both numbers of Angeles only added 900 acres, Los and area. and River while Orange added 3,000 acres industrial tween 1993 and 2005. However, industrial, uses (i.e. light industrial, heavy Ange- Los and extraction) actually shrank in les and Orange counties, though it increased overall. in the region The growth in multi-family residential residential in multi-family The growth the rate of single-fam- land was about half although the scale of ily units (about 8%), to have appears projects these multi-family in over this period. This increase increased Ange- in Los scale seems most pronounced les County and Orange County. cultural lots. In other words, the transition words, cultural lots. In other as other type of other urban uses, such from to & recreation, and open space residential was not substantial. single-family housing Nearly 95% of all new single-family housing housing single-family new all of 95% Nearly or converted agri on vacant was developed substantially, from Los Angeles County’s County’s Angeles Los from substantially, 45% Riverside’s to acres in 5% increase in acres. increase

Each county had distinct patterns of land use conversion: 2. 1. • • • • 4 2014 EXECUTIVE SUMMARY REPORT • C • • • • •

onsequences appeared toinducemore rapid increases higher population densityandwalkability) New urbanismstylesof development (e.g., development. public facilities,mixed-use,andofficespace to experiencesingle-family, industrial, density (intheinitialyear)were more likely Neighborhoods withahigherpopulation facilities. into commercial, industrial,andpublic more likelytoexperienceredevelopment velopment. And suchneighborhoods were commercial, mixed-use,and officespacede ly toexperiencesingle-family, multi-family, without ahighschooldegree were lesslike hoods withahigherpercentage ofresidents peared toimpactdevelopment. Neighbor The educationleveloftheresidents ap- had noeffecton redevelopment. decade; furthermore, racial heterogeneity this effectdisappeared in themost recent mixed-use, andofficespacedevelopment, single-family, multi-family, commercial, ity inneighborhoods appeared toreduce Although racialandethnicheterogene- infrastructure, andofficedevelopment. commercial, industrial,public ence singleandmulti-family, were more likelytoexperi with amixture ofland-uses development. Neighborhoods appeared importantforsome Diversity inneighborhoods into multi-familyhousing. also increased redevelopment commercial andindustrial,it of landbeingredeveloped into ways increased thelikelihood Whereas proximity tofree- development. communications, andutilities

land

use

development - 20 - - - • • •

residents withhigherincomes overtime. amounts. Theyalsoexperiencedincoming in neighborhood housingpricesandloan greater increases inhomesales pricesand park forhomesinaneighborhood ledto for neighborhoods. Closerproximity toa Nearby parkshavepositive consequences employment rates. for incomingresidents andincreasing un- over time,aswellloweraverageincome home salespricesandloanamounts distance experiencedlowerappreciation in borhoods withlongeraveragecommuting preference forshortercommutesasneigh- developments, there appearstobeastrong Consistent withthepushformore dense time. the largest increases inunemploymentover the neighborhood andnearbyexperienced neighborhoods withlowlevelsofretail in enced thelowestappreciation rates. And but notintheneighborhood itself,experi trast, aneighborhood thathasretail nearby, amounts ofretail innearby areas. Incon- had highamountsofretail, butalsohigh was higheriftheneighborhood notonly unemployment: homeloanappreciation appeared toincrease salespricesandreduce The mixoflanduseinaneighborhood also - 5 2014 EXECUTIVE SUMMARY REPORT rime C and , arks , P se U But big parks will tend to have more crime But big parks will tend to have more by vacant lots or surrounded if they are industrial land use. White-collar jobs appear to spur job growth, job growth, White-collar jobs appear to spur number of with a large as neighborhoods showed white-collar jobs in nearby areas a jobs; furthermore, in retail growth greater in the number of white-collar increase large jobs in retail increased jobs in nearby areas the following year. the neighborhood crime blocks with parks have more Whereas block, they typically have than a residential area, less crime than a block in a commercial or a school. industrial area, Big parks in our study have less crime than do smaller parks. Big parks will tend to have less crime if they government buildings, by surrounded are use. recreation retail, or office buildings, - financial health had important con city’s A with a higher revenue sequences, as cities in increases ratio had greater to expenditure and home loan amounts, home sales prices in the income of increases as well as greater incoming residents. or in the number of retail An increase led to blue-collar jobs in a neighborhood jobs the next year. white-collar more borhoods experienced smaller increases in increases smaller experienced borhoods loan amounts home and sales prices home - in cities with high if they were over time income level of crime rates. The er violent in into neighborhoods moving residents lower also were crime cities high violent with higher violent crime over time. Cities in white-collar, decreases rates experienced jobs over time. and retail blue-collar, and

• • L • • • • • 21 - - - - The full report is available at: http://socialecology.uci.edu/mfi The full report The level of violent crime had important consequences for the economic health of over time: neigh the city’s neighborhoods Neighborhoods that suffered from a higher from that suffered Neighborhoods vacancy rate of housing units experienced fewer white-collar and blue-collar jobs over time. Another measure of neighborhood disad of neighborhood Another measure hood over time. Neighborhoods with higher hood over time. Neighborhoods in- unemployment experienced smaller home sales prices and home loan in creases amounts over time. Such neighborhoods jobs and blue-collar also saw losses in retail over time. vantage—the poverty rate—had a negative over time. effect on white-collar job growth The presence of unemployed residents had of unemployed residents The presence neighbor additional negative effects on a The presence of highly educated persons of highly educated The presence neighbor has notable positive effects for hoods over time. Neighborhoods with more with more hoods over time. Neighborhoods (at least a bach- highly educated residents elor’s increases experienced larger degree) over in home sales prices and loan amounts also experienced time. Such neighborhoods residents influx of higher income a greater rates, and over time, falling unemployment in white-collar jobs. increase a larger It was also the case that the size of the park the size of the park the case that It was also parks showed positive as larger mattered, Home sales prices and home effects as well. if the strongly more loan amounts increase is a small than if it nearby park is larger also parks near large park. Neighborhoods in white-collar growth experience a stronger jobs over time. home loan amounts. Such neighborhoods Such neighborhoods loan amounts. home retail in increases greater experienced also unemployment time, and lower jobs over rates.

• • • • • • The New Economy and Jobs/Housing Balance in Southern California

Southern California Association of Governments 818 West 7th Street, 12th Floor Los Angeles, California 90017 April 2001

22 V. DYNAMICS OF JOBS/HOUSING BALANCE

The creation of geographic imbalances between employment and housing availability is largely a natural economic and sociologic phenomenon with a tendency to be self-correcting over time. Before World War II, job formation in Southern California concentrated around a few major job centers such as downtown Los Angeles, due to the “agglomeration” economies that accrue to companies being in close proximity to one another. Housing developed chiefly in suburban areas with relatively inexpensive land. Housing was connected to job centers by publicly funded highways. With increasing highway congestion over the last fifty years and the depletion of developable land for new industrial sites in urban core areas, jobs have tended to migrate to suburban locations to take advantage of lower land and labor costs and shorter commute times. For example, thirty years ago Orange County cities largely served as “bedroom” communities for Los Angeles companies, but Orange County now is a jobs-rich subregion, with many of its workers living in the Inland Empire.

This phenomenon largely explains why the Southern California region is one of multiple employment centers spread over a vast area, and why average home-to-work travel times have changed little over the last thirty years. In 1990, 68% of commuters surveyed in the region indicated that their drive between home and work was easy, and that the majority of the population lived less than 20 miles from their workplace (Southern California Association of Governments 1990). That same year, being “close to my work” was only ranked eleventh in importance out of sixteen factors considered in choosing a place to live.

However, the booming economy of Southern California over the last decade has markedly increased traffic congestion and, according to recent surveys, has increased commuter drive times. In addition, there are several major development trends that have emerged over the last decade that run counter to achieving a greater job/housing balance throughout the region. The first is the economic ascendancy of the “New Economy” of high-tech, information-based industries. The second is the “fiscalization” of land use brought about by several voter initiatives that have significantly reduced the incentive for local government to support residential development. Fortunately, there are encouraging signs that the expansion of traditional “old economy” industries into currently job poor/housing rich areas of the region could help offset these trends towards increased jobs/housing imbalance. There are also indications that some of the “New Economy” companies are beginning to locate in these areas.

A. The New Economy

It has been argued that the advent of the information-based New Economy of high-tech/dot.com companies should reinforce the natural tendency of business to migrate to areas of high housing availability. This is because these types of enterprises are much less anchored to natural resources and transportation facilities in their siting decisions and are consequently much more “footloose” than traditional industries. Also, the increasingly widespread use of new telecommunications technology has diminished the need for employees to travel to centralized work centers since they can work at home or at satellite work sites just as efficiently.

The New Economy and Jobs/Housing Balance in Southern California 39 23 Compared to other regions of the country where the New Economy predominates, the clustering of high-tech industries is less pronounced and relatively more dispersed in the SCAG Region. This could be due to a number of factors, including the greater geographic expanse and economic diversity of the region, the embryonic nature and lack of maturity of many high-tech companies and conversely, the inability of some older, established companies to attract venture capital investments. Also, the fact that many of the information technology companies in the region have closer relationships to the companies that they serve than to other high-tech firms in that sector has likely inhibited the formation of intensely collaborative clusters.

High-tech companies have established themselves primarily in West Los Angeles, Santa Monica, the San Fernando Valley, Culver City, the South Bay cities (particularly Torrance and El Segundo), and in Irvine, Costa Mesa, and Brea in Orange County (see Table 20). Being close to the ocean and beaches, world-class research universities (particularly University of California- Los Angeles, University of California-Irvine, and the University of Southern California) and the only major international airport in Southern California (LAX) are important factors that explain the location of high-tech firms in these areas.

Table 20 Top 10 Cities for Venture Capital Investment, SCAG Region, 4th Quarter 1998 Investment (In % of SCAG City Millions $) Region Los Angeles $1,125 22% Santa Monica $719 14% Irvine $614 12% Culver City $299 6% Pasadena $257 5% Torrance $223 4% West Lake Village $179 3% El Segundo $149 3% Costa Mesa $144 3% Brea $131 3%

Source: PriceWaterhouseCoopers Money Tree Survey and Ventureeconomics.com

These areas are all jobs-rich, and the continued clustering of firms at these high-tech nodes will continue to exacerbate problems associated with job/housing imbalances, especially related to long commute distances. Santa Monica is establishing itself as a major player in the high-tech field. With the surge of new high-tech jobs there, traffic is now worse on I-10 travelling west from downtown Los Angeles than to downtown from Santa Monica. This is a reversal from historic traffic patterns, and signifies the diminished economic dominance of the central business district of Los Angeles in relation to Santa Monica and West Los Angeles (Shuit 2000).

Venture capital investments in the region closely correspond to the location of high-tech clusters in the information technology and biomedical technology sectors. As shown in Map 14, venture capital firms have recently made the majority of their investments in companies in Los Angeles,

The New Economy and Jobs/Housing Balance in Southern California 52 24 Limitations

Determining a balanced jobs/housing ratio presents problems. Each region of the country is different, so it is not easy to develop a standardized figure. The mean for the SCAG region in 1997 was 1.25. The projected mean for 2025 is 1.43. The 2025 mean is not in the “balanced” quintile using the 1997 standards, but is in the “Gain Jobs” quintile. This is because projections for 2025 show higher jobs/housing ratios for Orange County and the Inland Empire RSAs than the ratios in 1997. Orange County is expected to become even more jobs-rich while the Inland Empire is projected to alleviate its jobs/housing imbalance with an influx of jobs. Both of these factors are driving the average jobs/housing ratio higher.

To control for the higher ratios that are skewing the mean to a number (1.43) outside of the “balanced” range, the analysis considers the median for these two years. The projected median for 2025 is 1.31, which falls just outside of the balanced category. Still, this is up from the 1997 median of 1.12. Robust projected employment figures are sending the ratios higher as Orange County becomes more jobs-rich and as the Inland Empire begins to have its own jobs-rich RSAs.

This analysis did not examine other regions of the country to determine a statewide or nationwide balanced ratio. The analysis was concerned solely with how the different RSAs related to each other within the region.

Household Growth and Jobs/Household Growth Footprint

Methodology

Household Growth Footprint

• The number of new households is determined by subtracting the total households projected in 1997 from those projected for 2025 (new households) • The amount of acreage needed to accommodate the number of new households between 1997-2025 is calculated by dividing the number of new households above by the average density (number of household units per acre). Three scenarios regarding average density are used: (1) the 1996 density for each county; (2) a 25% increase in density; and (3) a 50% increase in density. • Total acreage required to accommodate housing is derived by adding acreage needed for public amenities (roads, schools etc.) to the acreage projected for housing on a 1:1 basis. • The percentage of "developable land" needed for dividing the total acreage in c above (for each of the scenarios) derives housing (including amenities) by the "potentially developable land (excluding wetlands, prime and unique farmlands, Q3 flood zones and areas most suitable to large numbers of endangered species). In addition to this definition of potentially developable land, this analysis also used the same formula to determine the percent of land needed if developable land is defined as “developable and accessible” or “all developable land.” • Developable land = all land excluding the following: land that is already developed, land under public ownership (such as federal and state-owned lands, public parklands, military

The New Economy and Jobs/Housing Balance in Southern California 101 25 4/1/2015 Orange County housing shortage could drive out workers, hurt economy - LA Times Orange County housing shortage could drive out workers, hurt economy

By T IM LOGAN

MARCH 31, 2015, 9:00 AM

f nothing changes, Orange County’s shortage of housing will drive out workers and drag down the region’s robust economy, a local business group I warns.

In a report out Tuesday, the Orange County Business Council projects that the county’s housing shortfall will deepen sharply unless communities there build more apartments and houses at a greater density.

Without more places for workers to live, said Wallace Walrod, the council’s chief economic advisor, more twenty- and thirtysomethings will leave and businesses will struggle to recruit high-quality employees.

“We already lose more than we should,” he said. “This has long-term consequences for our economic competitiveness.”

The report -- a scorecard the council has released three times since 2008 -- measures the number of housing units and the number of jobs in Orange County.

At 1.5 jobs per housing unit, the county already has 50,000 to 62,000 too few homes to support its workforce, the report estimates. And if state projections for job growth and housing development hold, Orange County will fall another 100,000 units short of its housing needs over the next 25 years, Walrod projects.

“We know that the economy is going to continue to grow jobs,” he said. “We’re going to need to put people somewhere.”

Traditionally, that “somewhere” has been on newly developed land somewhere in Orange County, or in less-expensive locales in Riverside or San Bernardino Counties. But developable land is growing sparse along the coast, and, in a place where 40% of workers already spend an hour or more commuting each day, pushing east becomes less appealing all the time, Walrod said.

The answer, he said, lies in building up, not just spreading out.

“The era of big master-planned communities is not quite over, but it’s ending,” he said. “The kind of development that’s going on in Orange County is fundamentally changing. It’s going to be more infill, mixed-use, high-density development.”

Walrod pointed to Irvine -- the only city whose housing growth has kept pace with job growth in recent years -- and Anaheim as cities that are trying to plan for more housing at higher density.

In other parts of the county, planning commissions and neighborhood groups are pushing back. The study also pointed to high development fees -- from $40,000 to $80,000 per unit -- and regulatory hurdles as factors that slow homebuilding in Orange County and elsewhere in coastal Southern California.

A report earlier this month from the state Legislative Analyst's Office detailed similar supply challenges drive up the cost of housing in many coastal markets up and down California.

Keep an eye on housing and real estate in Southern California. Follow me on Twitter at @bytimlogan

http://www.latimes.com/business/la-fi-orange-county-housing-shortage-20150330-story.html26 1/2 3/19/2015 Print Article: To keep up with demand, O.C. needs 7,000 new homes per year, state says

To keep up with demand, O.C. needs 7,000 new homes per year, state says By JEFF COLLINS 2015-03-18 16:55:17

Orange County needs to build 7,000 more homes a year than it is currently building to make housing more affordable, the state Legislative Analyst’s Office reported this week.

Statewide, the pace of new homebuilding needs to be increased by 100,000, the agency said in the new report.

The Legislative Analyst’s office, which provides non-partisan policy and fiscal reviews, says runaway housing costs threaten household finances and the state’s economy as a whole.

The report says that the typical California home price is double the national average, while median rents are 50 percent higher.

“We think this issue is one of the biggest issues facing the state and the state’s economy right now,” said Brian Uhler, a state analyst who helped write the report.

Californians spend an average of 27 percent of their income on housing, compared to a national average of 23 percent, the report said. People who work in coastal communities like Orange County face commutes that are 10 percent longer than the national average, because high housing prices force them to move further away from their jobs.

Californians also are four times more likely to live in crowded conditions.

Even California’s least expensive housing markets are more expensive than average, with higher housing costs contributing to poverty, the report said.

“The state’s high housing costs make California a less attractive place to call home, making it more difficult for companies to hire and retain qualified employees, likely preventing the state’s economy from meeting its full potential,” the report said.

Obstacles to more construction include land constraints, homebuilding costs that average $50,000 to $75,000 more per house than in the rest of the nation, and local resistance to building higher density housing.

The state’s tax system also encourages communities to prefer commercial development over housing – and in particular multi-family housing like apartments and condos.

Solutions, Uhler said, could involve reforming laws affecting environmental and governmental reviews or redistribution of the state’s sales and property tax revenue to encourage homebuilding over retail development.

For example, a higher proportion of sales tax dollars could go to municipalities based on their population rather then the volume of business transacted within its boundaries. This might encourage local governments to approve more housing development.

“If we really want to make serious progress on the housing cost front, we really have to make changes in many or all of those areas,” Uhler said. http://www.ocregister.com/common/printer/view.php?db=ocregister&id=65470827 1/2

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