MARKET STUDY FOR THE LA PALMA GENERAL PLAN UPDATE
MARKET STUDY FOR THE LA PALMA GENERAL PLAN UPDATE
Prepared for: HOGLE-IRELAND, INC.
March 2012
ALFRED GOBAR ASSOCIATES
300 S. Harbor Boulevard, Suite 714, Anaheim, CA 92805-3719 (714) 772-8900 FAX (714) 772-8911
ALFRED GOBAR ASSOCIATES Table of Contents
CHAPTER PAGE
I EXECUTIVE SUMMARY...... I-1 Economic Assessment Overview...... I-1 Retail Market Assessment...... I-1 Lodging Market Assessment ...... I-5 Medical Campus Assessment ...... I-9 Opportunity Area Assessment...... I-12 Opportunity Site Areas 2 and 3...... I-13 Opportunity Site Area 4 Centerpointe Business Park)...... I-13 Opportunity Site Area 5 ...... I-14 Opportunity Site Areas 10 and 11 (Medical Campus) ...... I-14 Opportunity Site Area 16 ...... I-15
II RETAIL MARKET ASSESSMENT ...... II-1 Retail Market Overview...... II-1 City of La Palma Retail Facilities ...... II-2 Competitive Supply Factors...... II-4 Taxable Sales Trends...... II-4 Retail Establishment Representation...... II-7 Retail Sales Per Establishment ...... II-8 Competitive Retail Sales Flows ...... II-9 Competitive Trade Area Setting...... II-11 Competitive Area Retail Facilities ...... II-12 Market Demand Factors ...... II-14 Population of Competitive Trade Area Setting...... II-14 Consumer Characteristics of Trade Area Setting ...... II-17 Retail Expenditure Trends ...... II-22 City of La Palma Retail Market Potential ...... II-24 Retail Anchor Potential ...... II-24 Non-Anchor Retail Potential ...... II-26 Project-Specific Retail Potential...... II-28
III LODGING MARKET ASSESSMENT...... III-1 Lodging Market Overview...... III-1 La Palma Area Lodging Facilities ...... III-3 Market Demand Factors ...... III-4 Population Growth...... III-4 Business Activity...... III-5 Visitor Activity...... III-9 Market Supply Trends...... III-10 Room Supply ...... III-10 Hotel Occupancy...... III-12 Hotel Average Daily Rates...... III-13 Lodging Market Potential...... III-14 Regional Demand Outlook...... III-14 La Palma Area Demand Outlook ...... III-16 Project-Specific Lodging Potential ...... III-18
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CHAPTER PAGE
IV MEDICAL CAMPUS ASSESSMENT...... IV-1 U.S. Healthcare Trends ...... IV-2 California Hospital Trends ...... IV-3 Regional Hospital Trends ...... IV-4 Site Area Hospital Trends...... IV-5 Patient Volume Trends ...... IV-6 Outpatient Trends (Emergency and Non-Emergency) ...... IV-7 Outpatient Emergency Services Trends ...... IV-7 Utilization Rate Trends ...... IV-8 Financial Trends ...... IV-10 Site Area Hospital Emergency Services...... IV-11 Site Area Hospital Non-Emergency Services ...... IV-12 Site Area Hospital Patient Satisfaction Ratings...... IV-13 La Palma Intercommunity Hospital Overview ...... IV-14 Hospital Services...... IV-14 Awards...... IV-15 Patient Volume and Occupancy Trends ...... IV-16 Financial Trends ...... IV-17 Site Area Medical Coverage Assessment ...... IV-18 Emergency Medical Coverage...... IV-18 Non-Emergency Medical Coverage...... IV-22 Impact on Surrounding Area Land Uses...... IV-21
V OPPORTUNITY AREA ASSESSMENT...... V-1 Property Assessment Overview...... V-1 Priority 1 – Opportunity Areas...... V-3 Site 1 – Bettencourt & Rainbow Park Areas ...... V-4 Utilization Assessment...... V-4 Site 2 – Walker Street Industrial Area...... V-4 Utilization Assessment...... V-4 Site 3 – Marin Circle-Fresca Drive Industrial Area...... V-5 Utilization Assessment...... V-5 Site 4 – Centerpointe Business Park Site Area ...... V-5 Utilization Assessment...... V-7 Site 5 – Walker Street-Orangethorpe Avenue Commercial Area (NWC) ...... V-8 Utilization Assessment...... V-9 Site 6 – Walker Street-Orangethorpe Avenue Commercial Area (NEC) ...... V-9 Utilization Assessment...... V-9 Sites 10 & 11 – La Palma Intercommunity Hospital Site Area V-9 Utilization Assessment...... V-11
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CHAPTER PAGE
V OPPORTUNITY AREA ASSESSMENT (Continued) Priority 2 – Opportunity Areas...... V-11 Site 7 – Brookside Apartment Area ...... V-12 Utilization Assessment...... V-12 Site 8 – Nova Casa-La Palma Apartment Homes Area...... V-12 Utilization Assessment...... V-12 Site 9 – La Palma Convenience Center Site Area...... V-12 Utilization Assessment...... V-13 Commercial Opportunity Areas...... V-13 Site 12 – La Palma Avenue-Moody Street Site Area (NEC).. V-13 Site 13 – Family Mart-Super 1 Mart Site Area ...... V-13 Site 14 – La Palma Avenue-Moody Street Site Area (SWC) . V-14 Site 15 – Carl’s Junior Site Area...... V-14 Site 16 – Walker Street-La Palma Avenue Site Area (SWC). V-14 Site 17 – Walker Street-La Palma Avenue Site Area (SEC).. V-15 Site 18 – Walker Street-Crescent Avenue Site Area (NWC) . V-15 Site 19 – Moody Street-Crescent Avenue Site Area (NEC)... V-16 Site 20 – Moody Street-Crescent Avenue Site Area (SEC)... V-16
EXHIBIT
I-1 City of La Palma Opportunity Site Locations ...... I-16
II-1 Retail Performance Comparisons – 2009 Combined 4-City Area and Selected Geographic Regions ...... II-30
II-2 2009 Constant Dollar Per Capita Sales Trends For All Retail Store-Group Activities Excluding Auto Sales-Supplies-Fuel ...... II-31
II-3 Per Capita Sales Comparison – 2009 Combined 4-City Area Versus Southern California ...... II-32
II-4 Retail Establishment Permit Trends For All Retail Store-Group Activities Excluding Auto Sales-Supplies-Fuel ...... II-33
II-5 Retail Establishment Representation – 2009 Permits Per 1,000 Population – Combined 4-City Area Versus Southern California ...... II-34
II-6 2009 Taxable Retail Sales Flows Describing 4-City Area Based on Southern California Expenditure Potential ...... II-35
II-7 Audit of Retail Facilities Within La Palma Area ...... II-36
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EXHIBIT PAGE
II-8 Retail Anchors Surveyed La Palma, California – March 2012 ...... II-37
II-9 Household Retail Spending Behavior by Income Level...... II-40
II-10 Residual Market Potential for Additional Anchor Store Merchandisers 1.5-Mile Trade Area Ring – City of La Palma ...... II-41
II-11 Non-Anchor Retail Storefront Potential – 1.5-Mile Trade Area City of La Palma, California – March 2012 ...... II-42
III-1 Indexed Population-Employment-Visitor and Room-Night Sales Trends Orange County Metropolitan Region ...... III-19
III-2 La Palma Trade Area – Existing Hotel Facilities ...... III-20
IV-1 Site Area Hospitals ...... IV-25
IV-2 Patient Volume Trends – 2008-2010 Site Area Hospitals ...... IV-26
IV-3 Outpatient Emergency Services Visits ...... IV-27
IV-4 Short-Term Hospital Utilization Trends...... IV-28
IV-5 General Acute Care (GAC) Hospital Utilization Trends...... IV-29
IV-6 Hospital Financial Trends (in Millions of Dollars) – 2008-2011 Site Area Hospitals ...... IV-30
IV-7 Site Area Hospital Emergency Services 2010 Statistics...... IV-31
IV-8 Emergency Department Visits by Severity 2010 Statistics...... IV-32
IV-9 Site Area Hospital Non-Emergency Services December 31, 2010 ...... IV-33
IV-10 Patient Satisfaction Ratings – 2011...... IV-34
IV-11 La Palma Intercommunity Hospital Services Trends – 2002-2010...... IV-35
IV-12 La Palma Intercommunity Hospital Disclosure Report Financial Highlights – 2002-2010 ...... IV-36
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EXHIBIT PAGE
V-1 City of La Palma Opportunity Site Locations ...... V-17
V-2 Site 1 – NW/SW Corner of 91 and Canal West of Walker Street ...... V-18
V-3 Site 2 – Walker Street North of Orangethorpe Avenue ...... V-19
V-4 Site 3 – SEC of Walker Street and Fresca Drive...... V-20
V-5 Site 4 – NWC of Orangethorpe Avenue and Valley View Street ...... V-22
V-6 Site 5 – NWC of Orangethorpe Avenue and Walker Street...... V-25
V-7 Site 6 – NEC Of Orangethorpe Avenue and Walker Street...... V-26
V-8 Site 7 – SEC of Orangethorpe Avenue and Walker Street...... V-27
V-9 Site 8 – Valley View Street North of La Palma Avenue ...... V-28
V-10 Site 9 – NWC of La Palma Avenue and Valley View Street ...... V-29
V-11 Site 10 – NEC of La Palma Avenue and Walker Street...... V-31
V-12 Site 11 – NWC of La Palma Avenue and Walker Street...... V-32
V-13 Site 12 – NEC of La Palma Avenue and Moody Street ...... V-34
V-14 Site 13 – NWC of La Palma Avenue and Moody Street ...... V-35
V-15 Site 14 – SWC of La Palma Avenue and Moody Street ...... V-37
V-16 Site 15 – SEC of La Palma Avenue and Moody Street ...... V-38
V-17 Site 16 – SWC of La Palma Avenue and Walker Street...... V-39
V-18 Site 17 – SEC of La Palma Avenue and Walker Street...... V-41
V-19 Site 18 – NWC of Crescent Avenue and Walker Street ...... V-42
V-20 Site 19 – NEC of Crescent Avenue and Moody Street...... V-43
V-21 Site 20 – SEC of Crescent Avenue and Moody Street ...... V-45
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Chapter I Executive Summary
Economic Assessment Overview
Property represents a vital community resource utilized in many forms (e.g., retail, industrial, housing, parks, roads, etc.) so that businesses and residents can realize distinct but interrelated economic objectives (e.g., selling merchandise, providing services, fabricating products, raising a family, and going to work). Despite its near built-out status, the City of La Palma is part of the larger Orange County economy, which is projected to intensify as a business and employment destination within the Southern California region over the next 25 years. The community General Plan provides an opportunity to make effective use of property resources in order to best serve diverse economic and social needs of the community and also to benefit from broader economic growth within the surrounding region.
This General Plan economic assessment evaluates market potential for retail and lodging development, two land use activities thought to be in relatively limited supply but vital to the future economic and fiscal vitality of the community. In addition, this economic assessment evaluates market trends affecting demand for acute care medical services provided by the local community hospital and adjoining office buildings that occupy nearly 17 acres within the heart of the community. Finally this economic assessment reviews location attributes and current utilization describing 20 Opportunity Areas throughout the community.
Retail Market Assessment
Retail is a population-serving form of land use, meaning retail facilities are built to satisfy consumer demand for products and services. Retail shopping largely reflects a home-based trip event, even though all consumers will make some purchases in connection with school or work, or while on vacation. The strong home-based nature of retail shopping is the reason retail potential is largely defined by the resident population being served. An assessment of the retail market has been conducted to determine if potential exist to better serve consumption demand of area residents and
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increase the supply of retail facilities generating fiscal support for public services that must be provided by the City of La Palma.
Retail shops within the City of La Palma do not compete in isolation for sales support from residents that live within the City. Instead, city retail establishments must compete for support against a strong group of retail competitors represented in a 4- City area that includes La Palma, Cypress, Buena Park, and Cerritos. Latest annual data available from the State Board of Equalization (SBOE) indicates the 4-City area captured nearly $1.8 billion in taxable retail sales during 2009, or roughly 47.0 percent more in sales support than expected for the 205,000 residents living in these communities. The net inflow of sales support does not mean local area residents spend substantially more on retail products than most Southern California consumers, but that area retailers include many strong merchandisers with the ability to influence shopping behavior.
The strong competitive influence of area retailers located beyond the City limit is one reason total taxable sales captured by City-based establishments are substantially less than should be expected from the 16,000 residents living in La Palma. Independent estimates for 2009 suggest the City retail sector should have captured roughly $96.0 million in taxable sales support (excluding automobile and gasoline purchases) but only attracted about $35.0 million in taxable sales support. The $61.0 million difference means 64.0 percent of City support potential flows to retail establishments in adjoining cities and beyond. In all fairness, retail representation within the City of La Palma (7.57 retail permits per 1,000 residents) is about 48.0 percent below the level describing the 4-City area and 38.0 percent below the level characterizing Southern California as a whole. There is a serious lack of retail facilities within the City of La Palma to serve consumption demand of the resident population.
The City of La Palma accounts for 8.0 percent of all residents within the 4-City area but only about 2.0 percent of total retail sales. Retail development opportunities are tied to the ability to recapture sales support lost to surrounding area retailers. The distribution of area retailers influences the geographic area in which the City retail sector can expect to recapture significant sales support as shown below:
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Figure I-1 La Palma Retail Sector Trade Area
As a practical matter, it is not realistic to expect neighborhood-serving shops in La Palma to attract substantial support from consumers who live beyond significant concentrations of existing retail activity, such as the Los Cerritos Shopping Center or Buena Park Mall. A 1.5-mile trade area ring with nearly 66,000 residents describes the geographic area where City-based establishments can compete most effectively for consumer sales support.
Although small in size, the 1.5-mile ring represents a very attractive trade area setting. Population density is quite high at more than 9,300 residents per square mile, compared to a density of roughly 4,000 residents per square mile in many suburban market areas. Compared to Orange County, trade area households reflect a strong family orientation (roughly 85.0 percent versus 71.0 percent), high rate of homeownership (roughly 74.0 percent versus 62.0 percent), and large number of relatively affluent households, as illustrated below:
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Figure I-2 La Palma Area Household Income Distribution
24% 24%
20% 20%
16% 16%
12% 12%
8% 8% Share of Hous ehol ds 4% 4%
0% 0% Below $15,000 - $25,000 - $35,000 - $50,000 - $75,000 - $100,000 - $150,000 - $200,000 & $15,000 $24,999 $34,999 $49,999 $74,999 $99,999 $149,999 $199,999 Above Household Income Range 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
The assessment of retail market potential evaluated competitive opportunities to increase the supply of anchor and non-anchor retail facilities. Anchors generally include storefronts with at least 5,000 to 10,000 square feet of contiguous space while non-anchor storefronts generally range in size from 1,200 to 2,400 square feet. Anchors play an important role because they often generate repeat shopper traffic that benefits sales support in adjacent non-anchor storefronts. Market potential for additional anchor retail was assessed by simulating the competitive influence of more than 50 existing stores occupying nearly 2.0 million square feet of space. Market potential for non-anchor retail was assessed by comparing the existing supply of more than 390 storefronts against indicated demand for more than 110 distinct store- type activities used to describe the bulk of businesses found within contemporary retail centers and districts.
Identified market potential for additional anchor retail stores in La Palma is summarized below:
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Figure I-3 City of La Palma - Retail Anchor Potential Store Threshold Size Sales 2012 2015 Anchor Store-Type Activity Sq. Ft. Per Sq. Ft. Potential Potential Drug Store 15,000 400 Strong Strong Food-Grocery Store 30,000 375 Strong Strong Bedding & Housewares 8,000 200 Very Strong Very Strong Auto Parts Store 5,000 400 Very Strong Very Strong Sporting Goods Store 10,000 250 Very Strong Very Strong Book, Music, Media Store 5,000 250 Very Strong Very Strong Office Supply Store 10,000 240 Very Strong Very Strong
Overall Overall Area Sales Performance Overall Retail Potential 83,000 $27,000,000 $325/SF
Taxable Retail Potential 83,000 $15,787,500 $190/SF
Note: Taxable potential assumes only 35% of total drug store and food store sales are taxable.
Source: AGA.
The corresponding assessment of non-anchor retail potential identified good to strong market support for another 32 to 47 storefront operations serving local consumers. Enough market potential was also identified to integrate indicated anchor and non- anchor potential into a project-specific development, as summarized below.
Figure I-4 Project Specific Retail Potential - High Range Estimate Store- Storefront Floor Space Taxable Retail Operation fronts Dist Space Dist Gross Sales Sales Merchandising 21 48% 44,100 29% $8,820,000 $8,820,000 Service-Admin 16 36% 23,200 15% $3,480,000 Negligible
Non-Anchor Retail 37 84% 67,300 45% $12,300,000 $8,820,000
Anchor Retail 7 16% 83,000 55% $27,000,000 $15,800,000
Overall Site Potential 44 100% 150,300 100% $39,300,000 $24,620,000
Source: AGA.
Lodging Market Assessment
Travel and tourism is an important industry for California, Orange County, and La Palma because it generates economic activity related to lodging, dining,
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entertainment, retail purchases, and transportation. In 2010, travel and tourism generated more than $8.2 billion in economic activity within Orange County, including $1.4 billion related to lodging expenditures. Lodging market demand is driven by the need for overnight stays (commonly referred to as room-night demand) associated with growth in resident population, business and employment activity, and travel activity throughout the region. An assessment of lodging market conditions has been conducted to determine the potential for increasing the supply of hotel facilities within the City of La Palma.
The City of La Palma and surrounding La Palma area offer a unique blend of logistics advantages for leisure and business travelers, as summarized below. • Within 25 minutes of LAX, Long Beach, and John Wayne airports • Within 15 minutes of the Anaheim Visitor and Convention Center • Within 10 minutes of the resort districts of Disney and Knott’s Berry Farm • Easy access to major freeways connecting all of Southern California • A central location to more than 4,700 local area businesses • A central location to more than 210,000 local area residents
Future population growth in the La Palma area will be modest over the next 8 to 10 years due to the near built-out status of the City and surrounding communities. By comparison, business employment growth in the La Palma area is projected to increase relatively fast in comparison to Orange County. In addition, Orange County will remain an important destination for leisure and business travelers, as illustrated below:
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Figure I-5 Projected Travel Activity - OC Region
40.0 1.40
35.0 1.30
30.0 1.20
25.0 1.10
20.0 1.00
15.0 0.90
Pe rs on T rips10.0 (M illio 0.80 Index of 2010 Activity L 2010 Activity Index of
5.0 0.70
0.0 0.60 2010 2012 2014 2016 2018 2020 Leisure Travel Business Travel Total Travel Activity Index
Source: California Travel & Tourism Commission; Tourism Economics; AGA
The City of La Palma currently has just one hotel facility (158-room La Quinta Inns & Suites) located in the Centerpointe Business Park. A prospective lodging facility within the City will need to compete most directly with 18 hotels located in the La Palma area for a share of room-night demand throughout the region. Lodging performance trends describing the competitive attraction of La Palma area hotels provides good insight about the potential for increasing the supply of hotel rooms in a new or expanded hotel facility.
La Palma area hotels represent a supply base of nearly 2,840 rooms or 5.3 percent of the total room supply in Orange County. No new hotels have been built within the La Palma area during the past 20 years and the absolute supply of hotels rooms has actually decreased slightly since 2001. By comparison, nearly 5,870 additional rooms were added to the total supply of available rooms in Orange County, representing a 12.0 percent net increase in supply since 2001.
The overall occupancy rate and average daily rate (ADR) for a room stay in all hotels throughout Orange County has fluctuated with economic cycles. Since 2010, a strong rebound in leisure and business travel activity has fueled an increase in hotel occupancy, if not a corresponding jump in ADR charged. During the 11 years since 2001, the overall occupancy level achieved by La Palma area hotels (about 67.0
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percent) has frequently lagged Orange County as a whole by 3.0 percent and by as much as 5.0 percent during periods of economic decline. By comparison, the average daily rate describing La Palma area hotels consistently lagged Orange County by 23.0 percent to 25.0 percent until 2007. Since 2007, however, the average daily rate describing La Palma area hotels has lagged Orange County by 30.0 percent to 33.0 percent. In 2011, the average daily rate describing all of Orange County averaged $113 per night but only $75 per night in the La Palma area. The widening gap that distinguishes average daily rates for Orange County as a whole from the La Palma area lodgings can be attributed to the aging stock of hotel facilities competing for support.
Performance trends indicate existing La Palma area hotels are competing for a diminishing share of overall lodging demand within the region despite logistical advantages that describe the area. The weakening overall competitive position of La Palma area hotels can be attributed to a large base of aging hotel rooms and heavy mix of economy and midscale facilities (accounting for more than one-half the total room supply). Any future increase in existing room supply should focus on providing a more upscale lodging experience (versus economy or luxury experience). Even assuming existing hotels manage to achieve above-average occupancy performance by modernizing and renovating facilities (69.0 percent versus the historic average of 67.0 percent), there is enough market potential to increase local supply by 180 rooms over the next 4 years and 350 rooms over the next 8 years.
Four project-specific scenarios are described below that summarized the overall level of market performance that can be anticipated with hotel operations of varying size: Figure I-6 Project Specific Lodging Potential 2012 Room 8% Hotel Market Project Scope ADR Occupancy Revenue Tax Outlook 120 Room Hotel $113 72% $3,560,000 $284,800 4-Yr 180 Room Hotel $113 72% $5,350,000 $428,000 4-Yr 250 Room Hotel $113 72% $7,420,000 $593,600 8-Yr 350 Room Hotel $113 72% $10,390,000 $831,200 8-Yr
Source: AGA.
Identified ADR performance is the same as the 2011 ADR describing all of Orange County and reflects a conservative interpretation about the competitive pricing that can be commanded by a new hotel offering a lodging experience that is an upgrade
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over the majority of existing hotels in the La Palma area. By comparison, the ADR achieved by hotel facilities within the beach communities of Orange County was $140 per night as of mid-year 2011. A higher overall level of occupancy performance can also be expected for a newly-constructed hotel facility.
Medical Campus Assessment
Traditionally, hospitals have been regarded as a location to receive a level of acute care (emergency treatment, scheduled surgery, intensive care, etc.) that cannot be readily provided from the office of a private medical practice or community health clinic. Over the years, the healthcare industry has undergone significant changes, driven by technological advancements, government programs, political discourse, and the economic challenge of providing medical care, that have affected overall demand for care treatment within hospital facilities. An assessment of hospital trends and local area performance has been prepared to gauge the relative necessity of maintaining an acute care hospital facility and adjoining medical offices within the City of La Palma.
Over the past 50 years, the number of U.S. hospital beds per 1,000 residents has steadily declined from 9.2 beds per 1,000 residents in 1960 to 3.1 beds per 1,000 residents in 2009. Historically, the overall ratio of beds per 1,000 residents has been lower in California and along the West Coast than in other regions of the country. Statewide, there has also been a general decline in number of licensed hospital beds reflective of national trends. Between 1997 and 2007, the total number of licensed beds in California declined by 12.0 percent before rebounding slightly by 1.0 percent between 2007 and 2011. The Orange County and Los Angeles County regions have also witnessed long-term and recent declines in total number of licensed beds. Between 2008 and 2010, total licensed bed capacity in hospitals decreased by 11.5 percent in Los Angeles County with an even larger corresponding decrease of 17.4 percent in Orange County.
Licensed bed capacity once served as a benchmark measure of acute care delivery capabilities but now really serves as a gauge about the direction of industry growth and service delivery trends. In short, technological advances in healthcare have reduced the required number of trips to the hospital and days spent in hospital care.
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Healthcare advances involving non-invasive treatments and preventative measures have lessened industry dependency on an expanding base of licensed bed capacity.
La Palma Intercommunity Hospital is one of 35 licensed acute care hospitals available in the surrounding area to serve emergency and non-emergency medical needs of area residents and workers. Not all hospitals provide the same level of licensed care and generally specialize in one or more areas of treatment. In addition to location, a hospital’s range of specialization and emergency room capabilities are important factors considered by paramedic and ambulance services when transporting a patient to an area hospital. There are 11 hospitals within a 7-mile radius and 23 hospitals with a 10-mile radius licensed to provide “basic” emergency room services (broken leg, laceration, etc.). Of this total, only one hospital in Orange County (UCI Medical Center—9.6 miles) and one in Los Angeles County (Long Beach Memorial Medical Center—8.9 miles) are licensed “trauma centers” authorized to provide Level I or Level II emergency care services to Orange County residents (refer to Exhibit IV-7 in Chapter IV). It is important to note that Long Beach Memorial Medical Center is the only Los Angeles County trauma center recognized by the Orange County Health Care Agency as an approved emergency medical receiving center for Orange County residents. In short, to receive basic forms of emergency medical treatment, La Palma area residents currently have numerous options available within a short drive but must travel nearly 10 miles to receive more complex levels of emergency treatment.
Despite a high degree of regulatory oversight, hospitals are in competition to provide medical services to an area population. This is particularly true for scheduled medical treatment or non-life threatening emergencies and the reason many hospitals seek to specialize in targeted areas of care. Operating performance data (patient days, outpatient visits, utilization rates, net patient revenue, etc.) compiled by the Statewide Office of Health Planning and Development (OSHPD) provide general insight about public demand for individual hospital facilities. Hospital utilization of bed capacity for general acute care treatment provides a good overall indication how developed capacity of a facility is being used to serve medical care demands of the community. The hospital utilization rate for La Palma Intercommunity Hospital is roughly one-half the rate describing Orange County and Los Angeles County hospitals, as illustrated below:
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Figure I-7 General Acute Care (GAC) Hospital Utilization Rates 60.0% 55.0% 50.0% 45.0% 40.0% 35.0% 30.0%
Utilization Rate 25.0% 20.0% 15.0% 2008 2009 2010 La Palma Hospital Los Angeles County Orange County
Several health agencies conduct periodic surveys of patient satisfaction to gauge the quality of treatment services as perceived by patients. The U.S. Department of Health and Human Services included all surrounding area hospitals as part of a 2011 survey of patient satisfaction across 10 categories of service and experience (nurse- doctor communication, staff expediency, pain control, cleanliness, quietness, willingness to recommend, etc.). In general, Orange County hospitals ranked higher than Los Angeles County, but La Palma Intercommunity Hospital only received an above average score in 2 out of 10 patient satisfaction categories (staff expediency, and quietness). Despite a mixed patient satisfaction rating, La Palma Intercommunity Hospital is among 405 “Top Performer” hospitals in the nation as ranked by the Joint Commission on Key Quality Measures for compliance with accepted medical protocol in the treatment of patients.
Since taking over ownership and operation of La Palma Intercommunity Hospital, Prime Healthcare Services has managed to increase average net inpatient revenue from $1,088 per patient day (under Vanguard Health Systems) to $2,257 per patient day and increase net outpatient revenue from $293 per patient day to $461 per patient day.
La Palma Intercommunity Hospital is the centerpiece of an approximately 16.9-acre medical campus located within the heart of the community. Overall site improvements describing the 16.9-acre campus equate to an effective building floor area ratio (FAR) of 0.38:1.00. By comparison, campus building improvements required to support a hospital with a strong network of local medical practitioners
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frequently exceed an FAR of 1.00:1.00. Also, the year-round hospital utilization rate describing La Palma Intercommunity Hospital is less than one-half the level describing other surrounding area hospitals. Equally important, only two-thirds of the 138,500 square feet of medical office space adjoining the hospital is currently occupied and has limited healthcare representation among existing tenants. By comparison, office facilities within a vibrant medical campus regularly achieve overall occupancy in excess of 90.0 percent.
From a business standpoint, the financial operating performance of La Palma Intercommunity Hospital has improved during the last four years since it has been under the ownership and management of Prime Healthcare Services. In terms of effective utilization of a key property resource, the 16.9-acre site area is not being effectively utilized for its intended purpose as a medical campus facility. In addition, there is a relative abundance of licensed acute care hospitals with the capacity and ability to provide similar medical care services within the local area. Long-term community economic growth could be better served if the site was developed with alternate land uses that better serve consumption needs lacking in the community, including retail, housing, and employment land use.
Opportunity Area Assessment
Future growth throughout Orange County will continue to drive the need to make the best use of property resources within the community so that the City of La Palma benefits from active participation in the regional economy. Several opportunity areas throughout the community have been identified that may provide good locations to increase overall economic activity by optimizing land use development. Exhibit I-1 identifies 20 site area locations described according to three distinct levels of priority (Priority 1, Priority 2, and Commercial) that reflect the strategic importance of such site areas as locations to bolster long-term economic growth in the community.
All opportunity areas have been improved with various forms of development, the only exception is a 0.42-acre vacant commercial parcel (Site 20). Each site area has been assessed in terms of site attributes (size, configuration, visibility, exposure, access, existing improvements, etc.) that define current utilization and influence future attraction of the site area as a location for more intensified or alternate forms of
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land use development. With limited exception existing utilization (measured in terms of FAR) is consistent with most contemporary forms of development (rental housing, retail, etc.) that describe the predominant land use within each site area. For a number of smaller “Commercial Priority” site areas, existing development reflects the most feasible level of utilization within the physical limits (shallow depth, adjacent land use, etc.) of the site itself. Opportunity areas with significant potential to support more intensive levels of development activity, including retail, lodging, housing, or mixed-use development are summarized below.
Opportunity Site Areas 2 and 3
These two industrial areas are built out with industrial buildings that are 30 to 35 years old and in fair to good condition. Site Area 2 totals 3.8 acres and Site Area 3 totals 16.8 acres. Both site areas have several hundred feet of frontage along the Artesia Freeway with excellent visibility and exposure to heavy regional traffic flows. Access to the site area from the freeway requires familiarity with the local street system but is otherwise relatively easy. Both site areas are relatively separated from surrounding land uses that could be adversely affected by more intense levels of development. Neither site area describes an optimal location for retail development but both represent excellent locations to host corporate-level employment centers desiring excellent regional exposure and convenient access to regional airports and market area clients.
Opportunity Site Area 4 (Centerpointe Business Park)
The 38.76-acre business park is currently improved with a diverse mix of office-flex buildings, Class A office buildings, retail buildings, and a 158-room hotel. All combined, existing buildings total 760,000 square feet and equate to an FAR of 0.45:1.00. The Centerpointe Business Park represents a landmark business- employment center within a gateway location of Orange County, but the overall intensity of building improvements more closely reflects a suburban employment district. Long-term regional growth is expected to increase demand for business- employment centers reflecting more intense levels of building development, often exceeding an FAR of 1.00:1.00. Currently, only 1 of the 17 improved parcels in the business park is improved at a level of intensity that characterizes landmark
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business-employment centers such as the Warner Center in Woodland Hills and the Centre Lake Business District in Ontario.
Over the long-term, market dynamics will dictate the timing of higher-intensity development that requires structured parking improvements. Lower-intensity office- flex buildings and retail buildings within Centerpointe represent good prospective locations to host more intense forms of development. Existing retail facilities should be expanded as necessary to serve increased business and lodging employment within the business park. The strong business-industrial orientation of the surrounding area limits Centerpointe as an optimal location for a retail center that serves the daily consumption needs of area residents. Finally, the relatively safe and aesthetic setting of Centerpointe represents an attractive location to increase the supply of lodging facilities within the City of La Palma.
Opportunity Site Area 5
The 20.61-acre site area host two retail buildings and a corporate headquarters office. All combined, building improvements equate to an FAR of less than 0.20:1.00, a very low level of utilization for a regional-oriented site location. The site area has excellent visibility and exposure to heavy regional traffic flows. Access to the site area from the freeway requires familiarity with the local street system but is otherwise relatively easy. The site area is separated from surrounding land uses that could be adversely affected by more intense levels of development. The site area is a good location to host additional freestanding retail uses catering to consumer leisure-dining demand but is not an optimal location for a retail center serving daily consumption needs of area residents. Finally, the underdeveloped site area represents a very attractive location for another hotel facility within the City of La Palma.
Opportunity Site Areas 10 and 11 (Medical Campus)
The 16.9-acre Medical Campus site area includes La Palma Intercommunity Hospital, adjoining medical office buildings, an assisted living center, and a freestanding bank. The Medical Campus is bisected by Walker Street and reflects a critical property resource within the heart of the community. Building improvements describing the Medical Campus equate to an effective FAR of 0.38:1.00, substantially below the level of building intensity that characterizes active medical campuses that rely on a
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network of local-based medical practitioners. More importantly, surrounding office facilities are only two-thirds occupied, and existing tenants include a limited supply of medical testing labs or medical practitioners. From a utilization standpoint, the Medical Campus does not currently make effective use of a critical property resource within the heart of the community. Also, broader market trends indicate the current hospital operation cannot be expected to drive a foreseeable resurgence in the use of adjacent medical buildings, which already reflect a relatively low level of improvement intensity.
Over the long-term, an alternate use of the 16.9-acre site area is expected to provide greater economic and social benefit to the community. The site area represents an attractive location to host a variety of alternate land uses needed in the community including more retail development and medium- to high-density housing.
Opportunity Site Area 16
This 5.55-acre site area is a neighborhood retail center across from the Medical Campus and is located on the south side of La Palma Avenue. The site area represents a very attractive location for retail or higher-density housing development. The site area is currently improved with nearly 53,900 square feet of retail space, including a 30,800-square-foot anchor which is vacant. Site development equates to an FAR of 0.22:1.00 which is consistent with most forms of suburban retail development. The condition of existing improvements is in decline and the center reflects a very aged appearance, characteristic of development during the 60’s and early 70’s. Without an anchor store in place to generate repeat customer traffic driving sales in adjacent stores, the center does not reflect effective use of the site area. Protracted anchor store vacancy in the center will further diminish effective utilization of the site area.
F: LA PALMA GPU 4-2012.DOC/APRIL 24, 2012 B
Market Study for the La Palma General Plan Update I-15 EXHIBIT I-1 CITY OF LA PALMA OPPORTUNITY SITE LOCATIONS
- Priority 1 Opportunity Sites - Priority 2 Opportunity Sites - Commercial Opportunity Sites
Source: City of La Palma, Hogle-Ireland, and Alfred Gobar Associates
Opportunity Area Map Exhibit.xls/3/29/2012 RE ALFRED GOBAR ASSOCIATES
Chapter II Retail Market Assessment
Retail Market Overview
Retail is a population-serving form of land use, meaning retail facilities are built to satisfy consumer demand for products and services. Retail spending largely reflects a home-based event, meaning the vast majority of retail spending is made in connection with the daily living routines of area residents. The old adage “rooftops drive retail” underscores the inter-connectedness of retail land use and the resident population it is developed to serve. All consumers make some of their retail purchases (e.g., food, clothing, and sundries) while on vacation or while at work, but the bulk of retail purchase activity reflects home-based consumer trips. It is for this reason the surrounding area resident population largely defines sales support that can be expected for local retailers. When a local area lacks enough retail facilities to adequately serve demand, consumers are forced to travel outside the community to satisfy their purchase needs.
Retail land use is also an important source of fiscal support that cities rely on to fund the cost of providing public services demanded by residents, businesses, and local visitors (police protection, fire protection, roadway maintenance, etc.). Primary sources of fiscal funding support generated by retail land use include property tax, sales tax, franchise fees, and charges for services (operating and event security, fire inspection, etc.). In the State of California, each city receives a 1.0 percent share of sales tax collected on the taxable value of sales transacted at city-based establishments. Sales tax revenue increases with the volume and value of products sold by local retailers, unlike property tax revenue which cannot increase any more than 2.0 percent annually unless sold or substantially improved under Proposition 13 legislation. It is for this reason retail is a desired form of land use. Retail land use offers local governments the opportunity to hedge the inflationary cost of providing public services demanded in the community.
Within the City of La Palma, General Fund operating budget projects $3.2 million in sales tax revenue support during the FY2011-12 operating period. Budgeted sales
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tax revenue accounts for more than 30.0 percent of total funding support for City operating responsibilities. The reality is the vast majority of sales tax support cannot be attributed to taxable sales transacted in City-based retail establishments. Sales tax is also collected on the value of products sold in connection with many forms of value-added manufacturing, import-export trade, and wholesale-distribution that result in subsequent sales being transacted outside of California. Within the City of La Palma, roughly $2.5 million in sales tax revenue is generated in connection with the non-retail activities of local manufacturers, distributors, and wholesalers. These factors suggest that the retail sector describing the City of La Palma contributes no more than $0.7 million in sales tax revenue support for the City General Fund operating budget. This level of retail sales tax support translates to roughly $4,200 in annual per capita sales (taxable) captured by City-based retail establishments. By comparison, retail establishments throughout all of Southern California captured the equivalent of $8,550 in annual per capital sales (taxable) in 2009.
Circumstances describing sales tax revenue support within the City of La Palma provide a strong indication that the City’s retail sector is not adequately serving the consumer demands of local area residents. The purpose of the retail market assessment is to evaluate factors describing local area supply and demand in order to identify market-based potential for improving the effective performance of the City of La Palma retail sector.
City of La Palma Retail Facilities
As part of the market assessment of retail potential, an in-field audit was conducted of existing retail facilities within the City of La Palma and in the surrounding area where City-based retailers are expected to compete most directly for consumer support. A summary of the field audit of existing retail storefront facilities within the City of La Palma is summarized below.
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Figure II-1 Existing Retail Facilities Audited Within City of La Palma - February 2012 All Retail Storefronts Non-Anchor Storefronts Anchor-Scale Storefronts Store- Square Footage Store- Square Footage Store- Square Footage Store Type Activity fronts Total Vacant fronts Total Vacant fronts Total Vacant
Audited Facilities: 115 315,999 43,553 112 242,455 12,747 3 73,544 30,806
Note: Vacancy rate equal to 13.9% for all storefront space; 5.3% for non-anchor space; and 41.9% for anchor space. Anchors typically include storefront locations with at least 10,000 square feet of contiguous space.
Source: AGA.
The field audit of existing City retail facilities identified 115 storefronts locations representing about 316,000 square feet of space. The field audit was limited to retail buildings and generally excludes existing space within dedicated office buildings, specialized medical buildings, industrial buildings, and institutional-government buildings.
Over the years, the total amount of retail space required to serve a mature trade area setting has changed and fluctuated with emerging social-economic trends, branding and distribution technology, industry cycles of expansion and contraction, and most recently, emerging digital technologies. Traditionally, a benchmark index of 50 square feet per capita served as a crude indicator of the amount of space needed to serve consumer demand across all forms of retail development (convenience, neighborhood, power-big box, community-serving, entertainment-lifestyle, regional, super-regional, etc.). The advent of volume-discount pricing, internet shopping, and an embrace of new urbanism concepts in planning reflect a number of recent trends that have effectively served to reduce the amount of floor space utilized to merchandise products and services to retail consumers. Neighborhood- and community-serving retail has historically accounted for the majority of occupied retail space due to the widespread distribution of these local-serving developments. Retail studies conducted by AGA over the past 25 years suggests roughly 25 to 30 square feet of space per capita is sufficient to adequately serve a mature neighborhood and community trade area setting. By comparison, the existing base of retail facilities within the City of La Palma (315,999 square feet) equates to approximately 19 square feet of space per capita.
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Competitive Supply Factors
It is important to recognize that La Palma retailers do not compete in isolation for consumer support. The City of La Palma and adjoining communities are densely populated (over 8,000 residents per square mile), and City-based establishments must compete with retail facilities in outside the community. A shortage of retail space within La Palma may reflect the competitive influence of existing retail facilities in adjoining communities.
Taxable Sales Trends
For purpose of this market assessment, taxable retail trends describing the 4-City area of La Palma, Cypress, Buena Park, and Cerritos are used to evaluate the retail environment in which La Palma based establishments must compete. Exhibit II-1 compares per capita and per establishment taxable sales across major store-group activities within selected geographic region based on the latest annual data (2009) available from the State Board of Equalization (SBOE). In general, the data in Exhibit II-1 indicates overall levels of per capita sales describing each area varies considerably, but overall levels of sales per establishment are less varied across geographic region.
Within a large geographic area (such as a state, region, or county), per capita sales provides a good indication of consumer spending behavior. The 2009 annual level of per capita sales describing selected geographic areas is illustrated below.
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Figure II-2 2009 Per Capita Sales Level (Excluding Autos & Gasoline)
$9,000
$8,500 $8,750 $8,000
$7,500
$7,000 $7,261 $6,500
$6,000
$5,500 $5,935 $5,920
$5,000
$4,500 $4,000 4-City Area Orange County So-Calif Calfornia
Source: State Board of Equalization; Alfred Gobar Associates
As shown above, the overall per capita spending by consumers throughout California and Southern California equates to approximately $5,930 per capita per year, excluding spending on automobiles and gasoline.
At the City level of reporting, per capita sales provide a good indication about the competitive influence exerted by local retailers. As shown, the level of per capita sales achieved by retailers in the 4-City area is about 1.5 times higher than is true for all of Southern California. This does not mean residents in the 4-City area spend 1.5 times as much on taxable retail products as other consumers, but that local retailers are attracting some portion of sales support from consumers who live outside the 4- City area. A strong level of overall per capita sales performance should be expected for the 4-City area, which includes two regional shopping centers (Los Cerritos Shopping Center and Buena Park Mall). Indicated per capita sales describing Orange County are also above the Southern California and Statewide average and reflect a combination of factors including a relative abundance of affluent households, strong attraction as a domestic and international leisure travel destination, and high concentration of employment including workers that reside in adjoining counties.
Retailers within the 4-City area have consistently attracted an above-average level of support from consumers in the surrounding area, as indicated by a 10-year comparison of per capita sales within Orange County and Southern California shown in Exhibit II-2. As the cyclical pattern of sales suggests, retailers within the 4-City
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area have also been affected by economic cycles, including the Great Recession, but consistently attract a level of per capita sales support that exceeds Orange County and Southern California as a whole.
The strong competitive influence of retailers within the 4-City area is also evident from a comparison of distinct store-groups of retail activity, as shown in Exhibit II-3 and illustrated below. Figure II-3 2009 Per Capita Sales By Major Store-Group Activity
$3,000
$2,500
$2,000 $5,860
$1,500
$1,000
SALES PER CAPITA PER SALES $500
$0 Gen Drug Retail Food & Eating- Appl Grocery Drinking Mchdse- Specialty Servi ce Bl dg Mat- Apparel & Apparel Furn-Elect- Misc Retail Auto Retail- Auto Accessories SoCal - Per Capita 4-City Area - Per Capita
Source: State Board of Equalization; Alfred Gobar Associates
The competitive influence of the two regional malls contributes to strong per capita sales performance within the (G) general merchandise, (A) apparel, (F) furniture- furnishings-electronics, and (O) other specialty retail groups—GAFO. GAFO is an industry term used to describe store-group activities closely associated with regional malls, lifestyle centers, factory outlet centers, and regional-oriented big box centers. The two regional shopping centers and Knott’s Berry Farm resort district are likely factors contributing to a relatively high level of sales per capita describing the eating and drinking store group. Similarly, the Cerritos Auto Mall contributes substantially to a level of per capita sales within the auto retail-service group that is more than two times the average for all of Southern California. Strong per capita sales performance within the building materials and miscellaneous group not only reflects the presence of the Home Depot chain in Cypress and Cerritos, but also the longstanding presence of Ganahl Lumber and Buena Park lumber (two major contract suppliers) in the City of Buena Park. The food and grocery store group represents the only exception to strong per capita sales performance describing the 4-City area. Indicated per capita
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sales describing food and grocery retailers within the 4-City area ($393 per capita— taxable in 2009) is nearly 20.0 percent below the overall average used to gauge consumer spending habits throughout the Southern California region ($487 per capita—taxable in 2009).
Retail Establishment Representation
Retailing is a process of choice and selection among alternatives. Consumers seek a variety of related products and services from which they can choose to best suit their preferences, budget, and individual circumstances. Product promotion campaigns, computing technologies, and retail practices have served to reinforce the consumer’s expectation of choice and selection. This dynamic is not only evident by the number of related products displayed on store shelves but also the number of related storefront operations vying for consumer support.
The number of retail establishments represented within a given area is another indicator about the range of purchase options available to consumers. The overall level of storefront representation within the 4-City area over a 10-year period is described in Exhibit II-4 in terms of storefronts per 1,000 residents. Over the 10-year period identified, storefront representation within the 4-City area has actually been lower than is true for Orange County but higher than is true for Southern California. A relatively high level of storefront representation does not automatically indicate an oversupply of competing retailers. A closer review of establishment permits per 1,000 population by retail store-group suggests representation within the 4-City area is not excessive, as shown in Exhibit II-5 and illustrated below.
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Figure II-4 2009 Retail Representation By Major Store-Group Activity
3.00
2.50 5.53 7.00
2.00
1.50
1.00
0.50
Retail Permits Per 1,000 Population 1,000 Per Permits Retail 0.00 Gen Drug Retail Food & Eating- Appl Grocery Drinking Mchdse- Specialty Service Bldg Mat- Bldg Apparel & Apparel Furn-Elect- Misc Retail Auto Retail- Auto Accessories SoCal - Per Capita 4-City Area - Per Capita
Source: State Board of Equalization; Alfred Gobar Associates
As should be expected, the GAFO store groups are characterized by a relatively high level of representation due to the large concentration of storefront activities within the two regional malls. Interestingly enough, the auto retail-service group has a relatively low level of representation.
Retail Sales Per Establishment
Sales per establishment is simply total sales divided by total establishments but can provide an indication about the merchandising strength of existing retailers. A local area may achieve a relatively low level of per capita sales because existing merchandisers are not effective merchandisers or because there simply are too few retailers competing for consumer support. Conversely, a local area may not be characterized by low capita sales, but the retail demands of consumers are not being adequately satisfied because there is a proliferation of weak merchandisers. Sales per establishment provide a useful gauge of the merchandising prowess of existing retailers.
Concurrent review of per capita sales and storefront representation trends discussed above (refer to Figure II-3 and Figure II-4) suggests the 4-City area is a competitive environment with many strong merchandisers. A closer review of sales per establishment confirms such an interpretation, as illustrated below.
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Figure II-5 2009 Taxable Sales Per Establishment By Major Store-Group Activity
$2,5003.00
$2,0002.50 5.53 7.00 $3,510 $6,775 2.00 $1,500 1.50 $1,000 1.00
$500
Sales Per Estab ($000's) 0.50
Retail Permits Per 1,000 Population 1,000 Per Permits Retail 0.00$0 Gen Gen Drug Drug Retail Retail Food & Food & Eating- Eating- Appl Appl Grocery Grocery Drinking Drinking Mchdse- Mchdse- Specialty Specialty Service Service Bldg Mat- Bldg Bl dg Mat- Apparel & Apparel & Apparel Misc Retail Furn-Elect-Furn-Elect- Misc Retail Auto Retail- Retail- Auto Auto Accessories Accessories SoCalSoCal - Per- Per Capita Estab 4-City4-City Area Area - Per- Per Capita Estab
Source: State Board of Equalization; Alfred Gobar Associates
Evidence of the strong competitive attraction associated with the regional malls, national chain home improvement stores, and the large auto center in Cerritos is reflected in a relatively high level of sales per establishment among the GAFO, building materials, and auto retail-service store groups. Per establishment sales performance describing all other store groups is slightly higher than the average for Southern California. The lone exception is the food store group, with sales per establishment (taxable) just below the regional average.
Competitive Retail Sales Flows
The assessment of per capita sales, storefront representation, and sales per establishment provides clear evidence that the 4-City area includes a strong collection of retail facilities. Also evident from an initial assessment of retail facilities and sales activity is that the City of La Palma has not benefited from its central location within the 4-City area. Exhibit II-6 provides a detailed assessment of the competitive flow of taxable retail sales support into and within the 4-City area during 2009 (latest available SBOE data). In terms of total taxable sales, existing retailers have been able to capture $1.79 billion in annual sales support. Total taxable sales captured in 2009 represents a $575 million inflow of consumer support (using an 2009 support index of $5,925 in per capita sales, excluding automobile and gasoline sales), or 47.0 percent more sales support than suggested by a population base of nearly 205,000 residents. As a whole, existing retailers exert considerable influence on the purchase decisions of consumers residing within and outside of 4-City area.
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By its very nature, retailing is a highly competitive process. The competitive nature of retailing is not only reinforced by profit motivation but also anti-trust laws that prohibit systematic coordination of merchandising practices that would benefit any individual or group of competitors. The paradigm of modern retailing not only places individual operators in direct competition but also host cities which see competitive merchandisers as an attractive source of fiscal funding for public services. From the detailed assessment in Exhibit II-6, it is clear that cities do not benefit from retail activity in direct proportion to the resident population they are tasked with serving. A comparison of factors describing the competitive interaction within the 4-City area is summarized below. Figure II-6 Summary of 2009 Taxable Retail Sales Flows Within 4-City Area 4-City Performance Criteria La Palma Cypress Buena Park Cerritos Area Share of Population 8% 24% 41% 27% 100% Share of Retail Sales 2% 24% 32% 42% 100% Competitive Index 0.25 0.98 0.79 1.56 1.00 Taxable Retail Sales 35,042 427,712 578,367 748,606 1,789,727 Taxable Sales Potential 96,417 295,465 496,825 325,235 1,213,942 Effective Inflow/(Outflow) -61,375 132,247 81,542 423,371 575,785 As Percent of Potential -64% 45% 16% 130% 47%
Note: Taxable retail sales excludes automobile and gasoline purchases Taxable sales potential based on overall average for Southern California and mid-year population of city.
Source: California State Board of Equalization; California Department of Finance, AGA.
As shown above, the City of La Palma accounts for an 8.0 percent share of total population describing the 4-City area but only captures a 2.0 percent share of taxable retail sales. A competitive index (share of population divided by share of retail sales) is assigned to each city to gauge the relative strength of city-based retail facilities. The competitive index that describes the relative strength of La Palma’s retail sector (Index = 0.25) is significantly lower than is true for the other three communities. In all fairness, retail representation describing the retail sector of La Palma as a whole (7.57 retail permits per 1,000 population) is 48.0 percent below the level describing the 4-City area (14.46 retail permits per 1,000 population) and 38.0 percent below the benchmark level describing all of Southern California (12.28 retail permits per 1,000 population). In effect, a serious lack of retail facilities needed to adequately serve the
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retail consumption needs of local area residents is a significant factor contributing to weak overall retail performance in La Palma.
Competitive Trade Area Setting
The retail sector of La Palma competes with retail facilities in adjoining communities for sales support from area consumers. The geographic area in which La Palma retailers can expect to compete most effectively is strongly influenced by the current distribution of competing retail facilities. As indicated above, the surrounding area is well represented with retail storefronts, and there is no significant shortage of effective merchandisers. The existing supply of strong competitors is a factor that constrains the geographic trade area in which city-based retailers can effectively attract sales support. All things equal, consumers prefer convenience. This means a prospective retailer within the City of La Palma will be challenged to attract a substantial level of sales support from consumers who must drive past similar retail stores in the surrounding area in order to reach the La Palma storefront location. The trade area setting from which the bulk of sales support for the La Palma retail sector can be expected to originate reflects a 1.5-mile ring area, as illustrated below. Figure II-7 La Palma Retail Sector Trade Area
The identified trade area basically includes consumers residing within a 3- to 5- minute drive of the indicated central location (La Palma Avenue and Walker Street). The 1.5-mile trade area ring serves to identify a geographic area where La Palma
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retail establishments can compete most effectively on the basis of their proximity to consumers residing within the designated ring area. The identified trade area ring does not identify an isolated area of potential retail support. La Palma retail establishments will need to compete with existing retailers located within and outside the identified trade area ring.
Competitive Area Retail Facilities
An in-field audit was conducted to assess the geographic distribution, store-type activity, and floor space represented by existing retail facilities within the City of La Palma, the 1.5-mile trade ring, and larger overall area up to 0.5 miles beyond the trade ring. In all, 675 storefront locations representing 3.43 million square feet of retail space was audited, as described in Exhibit II-7 and summarized below. Figure II-8 La Palma Area Retail - All Storefronts Audited Square Footage Audit Area Storefronts Total Vacant La Palma Area Overall 675 3,431,030 185,318 1.5 Mile Trade Ring 392 1,571,897 69,755 City of La Palma 115 315,999 43,553
Share of Total Space Vacancy Audit Area Occupied Vacant Rate La Palma Area Overall 100% 100% 5.4% 1.5 Mile Trade Ring 46% 38% 4.4% City of La Palma 9% 24% 13.8%
Source: February 2012 Field Audit by AGA.
As shown, the retail sector of La Palma is characterized by a relatively high vacancy rate of 13.8%. While only hosting about 9.0 percent of total retail space (occupied and vacant) within the overall area, La Palma accounts for 24.0 percent of all vacant space in the overall area. Over 70.0 percent of vacant retail space within the City of La Palma is in a single storefront location (a former grocery store representing 30,800 square feet). Excluding this single but large vacant storefront, the vacancy rate that characterizes the entire retail sector of La Palma is actually much lower at less than 4.5 percent.
Special effort was made to distinguish between “anchor” and “non-anchor” sized storefront locations during the field audit. Anchors generally include storefront locations with at least 10,000 square feet of contiguous floor space but can also
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include smaller retail operations. By comparison, non-anchor storefront locations most often range in size from 1,200 to 2,400 square feet. Anchors play an important role within any retail market area because these larger-scale retail operations often drive repeat shopper traffic that benefits many smaller retail operations within the center or adjacent area. Anchored retail centers tend to experience lower overall vacancy and command higher rents on non-anchor storefronts because of the added advantage that repeat shopper traffic represents for non-anchor retailers. The City of La Palma hosts a very limited supply of anchor-scale retail storefronts in comparison to the 1.5-mile trade ring and the La Palma area overall, as summarized below. Figure II-9 La Palma Area Retail - Anchor Storefronts Square Footage Audit Area Storefronts Total Vacant La Palma Area Overall 55 2,051,091 100,939 1.5 Mile Trade Ring 22 726,161 30,806 City of La Palma 3 73,544 30,806
Share of Total Space Vacancy Audit Area Occupied Vacant Rate La Palma Area Overall 100% 100% 4.9% 1.5 Mile Trade Ring 35% 31% 4.2% City of La Palma 4% 31% 41.9%
Source: February 2012 Field Audit by AGA.
As shown above, 55 anchor storefronts included in the audit represent 2.05 million square feet of retail space. Anchor-scale retail facilities only account for about 8.0 percent of total storefront locations in the overall area (55 out of 675 storefronts) but nearly 60.0 percent of existing space (2.05 out of 3.43 million square feet). The total amount of floor space occupied per anchor storefront location (about 37,300 square feet on average) is nearly 17 times larger than is true per non-anchor storefront location (about 2,225 square feet on average) and underscores the importance of anchors scale operations in meeting surrounding area consumer demand. A detailed summary of existing retail anchor is described in Exhibit II-8 in terms of store-type activity, name of retail operation, address location, floor space, and distance from the center of the identified trade ring.
This retail market assessment distinguishes between anchor and non-anchor retail storefronts because prospective anchor-scale operators within the City of La Palma will face greater competition from anchor-scale retailers located outside the City limit
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and beyond the 1.5-mile trade ring than is true for most non-anchor retail operations. Scales of operation dictate that anchor retailers attract sales support from a broader base of consumers than is otherwise required for similar but smaller scale retailers. In order to evaluate anchor store retail potential, this market assessment relies on a gravity model to account for trade area overlap and simulate the competitive influence of retailers located beyond the 1.5-mile trade ring. Non-anchor retailers are not immune to the competitive effect of overlapping trade areas, but the vast majority of small retail operations compete on the basis of convenience or proximity to an anchor that draws in consumers from a further distance. Non-anchor retail potential is evaluated in terms of the incidence of representation by detailed store-type activity within the 1.5-mile trade ring.
Market Demand Factors
Retail land use exists to provide goods and services for a consuming public. As such, the size of the consumer population that is served strongly influences market potential to support additional retail competitors and increase the existing supply of retail facilities. Retail market potential is also influenced by the demographic and income characteristics of consumers. Finally, consumers themselves are strongly influenced by economic cycles and general economic growth affecting overall purchase power of consumers.
Population of Competitive Trade Area Setting
Retail operators within the City of La Palma can expect to receive the bulk of sales support from consumers residing within a 1.5-mile trade ring that surrounds the City (refer to Figure II-7). The 1.5-mile trade ring constitutes the primary trade area for the bulk of storefront operations describing the City’s retail sector. Based on the 2010 Census, it is estimated the trade area ring will host approximately 65,750 residents in 2012. By comparison, the City of La Palma is expected to host about 15,650 residents, or roughly one-fourth of the trade area ring consumer population.
Although the trade area ring reflects a relatively small geographic area where the bulk of consumer support is expected to originate, it is a densely-populated environment. There are more than 9,300 persons per square mile residing in the trade area ring and more than 8,500 persons per square mile residing within the City of La Palma.
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By comparison, the population density of most suburban retail markets tends to range from 2,500 to 4,000 persons per square mile and from 7,000 to 9,000 persons per square mile in the more urban areas of Southern California. Population density serves to restrict the geographic limit of the trade area in which retailers can effectively compete. Within densely-populated areas, the incidence of demand is significantly higher because there are more consumers per unit of geography being served by a given storefront operation. Increased population density tends to attract more competing retailers, which in turn restricts the geographic area in which any given retailer can attract significant sales support.
Population growth is a significant factor contributing to future increases in market demand. The mid-term outlook of population growth is illustrated below. Figure II-10 La Palma Area Projected Population Growth
220 220 200 200 180 180 160 160 140 140 120 120 100 100 80 80
Population (000's) Population 60 60 40 40 20 20 0 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 4-City Area 1.5 Mile Trade Ring City of La Palma
Source: 2010 Census; SCAG 2008-RTP; ESRI; AGA
As shown, only a modest level of population growth is anticipated within the City of La Palma, 1.5-mile trade area ring, and the surrounding 4-City area. The modest growth outlook reflects the near built-out nature of the geographic areas described.
At any point in time retail represents a zero-sum gain for retail competitors. Simply increasing the supply of competing retail facilities does not drive a corresponding increase in spending by consumers over an extended period. Retail spending is largely influenced by the size of the consumer population served and the income limits of consumer households. Despite the influence of household income on total spending, the U.S. is a society of consumption. Household consumption, and related consumer spending, generally accounts for more than two-thirds of the nation’s GDP.
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The period between 2000 and 2007 reflects an exceptional time during which consumers leveraged anticipated increases in home equity and easy consumer credit to support short-term spending behavior, as illustrated below. Figure II-11 U.S. Personal Consumption-Savings As Share Of Per Capita Disposable Income
96% 12%
92% 9%
88% 6%
Per sonal Consumption Expendi tures - PC E Savings Share of DPI of Share Savings Spending Share of DPI of Share Spending 84% Avg PCE 3% Personal Savings - PS Avg PS 80% 0% 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Note: DPI - Disposable Personal Income is the after-tax income available for spending and savings. Source: Bureau of Economic Analysis - NIPA; AGA
The Great Recession of 2008-2009 imposed painful consequences on consumers that failed to manage personal purchase behavior but also brought personal consumption back in line with the longer-term trend describing a sustainable relationship between income and consumption. Over the mid-term, home equity losses, restrictive lending practices, and slow income growth will contribute to a “new normal,” where consumer spending behavior is more closely hinged to the income circumstances of consumer households.
Given the “new normal” that is expected to influence retail spending behavior, future increases in market demand will be largely predicated on future population growth within the trade area ring. Unfortunately, the outlook for population growth is very modest. A modest growth outlook means the ability to bolster the future competitive position of the City of La Palma retail sector is largely dependent on opportunities to re-capture local resident sales support that currently flows to retail operators outside the City.
Market Study for the La Palma General Plan Update II-16 ALFRED GOBAR ASSOCIATES
Consumer Characteristics of Trade Area Setting
Retail market potential within a given trade area is not only influenced by the number of consumers served but also demographic characteristics of the prospective pool of consumers. As an example, a trade area with a high ratio of family households may signify increased potential for apparel retailers that cater to the consumption needs of dependent children. Similarly, a trade area with a high ratio of elderly may signify decreased potential for retailers that specialize in household electronics and digital communication devices.
A selection of demographic and income characteristics describing the City of La Palma and 4-City area are summarized below in comparison to Orange County: Figure II-12 La Palma Area Selected Demographic Characteristics City of La Orange Social Characteristic Palma 4-City Area County Type of Household Non-Family 12.7% 17.0% 29.0% Family 87.3% 83.0% 71.0%
Average Household Size All Households 3.17 3.30 2.97 Family Households 3.40 3.57 3.49
Share of Households Households w/Children 40.2% 42.7% 38.1% Couples w/Children 28.8% 29.2% 26.5%
Households w/Seniors 65+ 33.8% 27.9% 23.8%
Owner Households 77.8% 69.8% 61.5% Renter Households 22.2% 30.2% 38.5%
Source: ACS; ESRI; AGA.
The selected characteristics summarized above indicate the La Palma area includes a strong family household orientation (83.0 percent to 87.0 percent) compared to Orange County (71.0 percent), although the average size of families within the City of La Palma (3.40 persons on average) is relatively small. The proportion of all households with children under 18 years of age (dependents) is modestly higher within the La Palma area (40.0 percent to 43.0 percent) than is true of Orange County (38.0 percent). There is also a modestly higher representation of married-couple families within the La Palma area. A high proportion of families increases the number
Market Study for the La Palma General Plan Update II-17 ALFRED GOBAR ASSOCIATES
of consumers demanding products and services but also decreases consumer per capita income due to the presence of dependent children. Within a given income range, the family structure tends to favor a higher rate of overall household spending but with greater emphasis on staple products.
The La Palma area also hosts a high proportion of owner households (70.0 percent to 78.0 percent) compared to Orange County as a whole (62.0 percent). A high rate of homeownership representation is an indicator of income stability and good purchase potential for household furnishings-electronics and home improvement purchases.
The proportion of households with senior-age residents (65+ years of age) is significantly higher within the City of La Palma (34.0 percent) than is true for Orange County (24.0 percent), but the high concentration of seniors declines as the La Palma area expands into the surrounding 4-City area (28.0 percent). A large proportion of seniors live on relatively fixed incomes, which limits potential for large consumption purchases (including furniture, appliances, automobiles, etc.) purchased more frequently by younger consumers entering the workforce, starting a family, and increasing personal income earnings. The high proportion of households with seniors can be attributed to residents in their early years of retirement (65 to 74), as illustrated below. Figure II-13 La Palma Area Age Distribution
20% 20%
16% 16%
12% 12%
8% 8% Share of of Population Share 4% 4%
0% 0% Under 10 10 to 19 20 to 24 25 to 34 35 to 44 45 to 54 55 to 64 65 to 74 75 & Up Age Range in Years 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
In general, the age distribution within the La Palma area includes a relatively higher share of residents between the age of 45 and 74. Most telling is the low proportion of young adults (ages 25 to 34), a prime period for improving employment stability,
Market Study for the La Palma General Plan Update II-18 ALFRED GOBAR ASSOCIATES
accelerating personal income earnings, starting a family, buying a home, etc. The low proportion of 25 to 34 year olds is also a likely factor contributing to the relatively low proportion of young children under 10 years of age.
Orange County is a racially and culturally diverse region. The La Palma area reflects a high degree of cultural diversity, particularly among Asian groups, as suggested by the area racial composition illustrated below: Figure II-14 La Palma Area Racial Composition and Hispanic Origins
64% 64%
56% 56%
48% 48%
40% 40%
32% 32%
24% 24%
Share of of Population Share 16% 16%
8% 8%
0% 0% White Black Asian Other Multi-Race Hispanic Origin 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
The strong representation of Asian races reflects a diverse mix of cultural influences as suggested by the mix of major Asian groups illustrated below: Figure II-15 La Palma Area Major Asian Population Groups
20% 20%
16% 16%
12% 12%
8% 8% Share of Populati on 4% 4%
0% 0% Asian Indian Chinese Filipino Japanese Korean Vietnamese Other Asian 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
Consumers of all racial-ethnic backgrounds share a common need to consume products and services widely demanded within the economic and geographic context
Market Study for the La Palma General Plan Update II-19 ALFRED GOBAR ASSOCIATES
of day-to-day living. This means overall demand for the consumption of gasoline, milk, meat, vegetables, clothing, shoes, electronics, etc. is not dominated by a single racial-ethnic group of consumers. A strong concentration of a particular racial-ethnic group creates the opportunity to provide products and services that are widely demanded in a format that is responsive to the cultural context or preference of a particularly group of consumers. Ethno-centric merchandising is a practice that seeks to prepare, package, and promote commonly demanded products in a format that appeals to a targeted cultural preference. The practice of ethno-centric merchandising is commonly recognized as applied by food and grocery retail operations. Much like “branding,” ethno-centric merchandising is a practice applied to nearly every type of product or service widely demanded by consumers.
Educational achievement is another indicator of the relative attraction of consumers within a given trade area setting. High educational achievement is strongly associated with the potential for future economic advancement, even if a trade area does not currently reflect high income standing. La Palma area adults over the age of 25 reflect a relatively high level of educational achievement, as illustrated below. Figure II-16 La Palma Area Educational Achievement 30% 30%
25% 25%
20% 20%
15% 15%
10% 10% Share of Pop Over 25 Over Pop of Share 5% 5%
0% 0% Less Than High High School Some College Associate Degree College Degree Graduate-Prof School Graduate Degree 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
The U.S. is a consumption-oriented society and household income greatly influences overall retail market potential because consumers spend a high proportion of household income on products and services (refer to Figure II-11). The latest available data from the U.S. Bureau of Census-American Community Survey identifies the relative affluence of residents living throughout the La Palma area, as illustrated below.
Market Study for the La Palma General Plan Update II-20 ALFRED GOBAR ASSOCIATES
Figure II-17 La Palma Area Selected Income Characteristics – 2010 City of La Orange Income Characteristic Palma 4-City Area County Median Household Income 89,788 77,307 74,344 Average Household Income 106,750 91,254 99,719 Per Capita Income 33,509 28,935 34,017
Source: ACS; ESRI; AGA.
The median household income (income level where one-half of households earn more and one-half earn less) in the La Palma area is estimated to range from $77,300 throughout the 4-City area to $89,800 within the City of La Palma, which is as much as 20.0 percent above the median household income level for Orange County. The distribution of household income is illustrated below and shows a relatively large share of La Palma area households with annual incomes between $100,000 and $200,000. Figure II-18 La Palma Area Household Income Distribution
24% 24%
20% 20%
16% 16%
12% 12%
8% 8% Share of Hous ehol ds 4% 4%
0% 0% Below $15,000 - $25,000 - $35,000 - $50,000 - $75,000 - $100,000 - $150,000 - $200,000 & $15,000 $24,999 $34,999 $49,999 $74,999 $99,999 $149,999 $199,999 Above Household Income Range 4-City Area City of La Palma Orange County Source: ACS; ESRI; AGA
As shown above, the La Palma area is characterized by a relatively low proportion of households with annual incomes below $50,000 and relatively high proportion of households with annual incomes above $100,000. In general, Orange County households earning less than $50,000 per year must spend a relatively large share of total income on day-to-day staple products (food, sundries, clothing, gasoline, etc.) and basic living expenses (rent-mortgage, auto payment, insurance, etc.), leaving less income available to make highly-discretionary purchases (brand-quality products, luxury items, upgraded products, etc.). By comparison, Orange County households
Market Study for the La Palma General Plan Update II-21 ALFRED GOBAR ASSOCIATES
that earn more than $100,000 per year outlay a relatively smaller share of total income on the purchase of daily staple products. According to the 2010 U.S. Bureau of Labor-Consumer Expenditure Survey, higher-income households spend a smaller share of annual income on retail products and services than is true of lower-income households, as illustrated below. Figure II-19 Household Retail Spending as Share of Annual Income
75% 70% 65% 60% 55% 50% 45% 40% 35% 30% Share of Income On Retail of Income Share 25% 20% $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 Annual Hous ehol d Income
Note: Indicated spending level is for taxable and non-taxable items and includes auto and gas purchases Source: Consumer Expenditure Survey, U.S. Bureau of Labor Statistics, October, 2010; AGA
Despite representing a lower share of annual income, the absolute level of retail spending by higher-income households substantially exceeds the absolute level spent by lower-income households, as illustrated in Exhibit II-9. As an example, a household earning between $100,000 and $120,000 per year generally spends 68.0 percent more on retail products than is true of a household earning $50,000 to $60,000 per year. The relationship between household income and retail spending as a share of household income strongly favors the 1.5-mile trade area ring as an attractive environment to compete for consumer sales support.
Retail Expenditure Trends
Retail spending potential describing the La Palma area is noticeably strong, but trade area consumers are not immune to the broader economic cycles affecting Orange County and the broader Southern California region. As previously stated, U.S. per capita spending significantly increased as a share of disposable income between 2000 and 2007 before the Great Recession forced consumer spending to fall more in line with the long-term trend of spending behavior (refer to Figure II-11). The effect of
Market Study for the La Palma General Plan Update II-22 ALFRED GOBAR ASSOCIATES
the recent expansion and contraction cycle on retailing throughout Southern California is illustrated below: Figure II-20 Selected Retail Trends For Southern California 1.45 1.40 1.35 1.30 1.25 1.20 1.15 1.10
Index Index Conditions of 2001 1.05 1.00 0.95 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total Retail Sales Sales Per Capita Cons umer Popul ati on Retailers Per 1,000 Pop
Note: Trends shown as an index of 1999 conditions described in terms of 2009 constant dollar (inflation adjusted) performance. Source: State Board of Equalization; Alfred Gobar Associates
As shown above, steady population growth combined with a rapid increase in per capita spending fueled an unprecedented boom in overall retail sales throughout Southern California. Also shown above is the supply response of retailers seeking to capitalize on expanding sales activity. Housing market distress in 2007 (and loss of homeowner equity credit) forced a sharp decline in per capita spending even before the Great Recession resulted in further financial and employment losses during 2008 and 2009.
Since the depths of the recession in 2009, overall per capita spending has been on a recovery track. The region has experienced promising gains in retail activity, despite persistently high unemployment, loss of homeowner equity, and meager gains in household incomes. Future gains in per capita spending, however, cannot be expected to match the rise that characterized the boom period preceding the housing crisis and Great Recession. Instead, future gains in per capita spending over the mid-term can be expected to follow a more modest track as dictated by employment growth and household income growth. The mid-term outlook for overall per capita retail spending throughout Southern California, Orange County, and the surrounding La Palma area is illustrated below.
Market Study for the La Palma General Plan Update II-23 ALFRED GOBAR ASSOCIATES
Figure II-21 Annual Per Capita Spending Potential
$10,000 $9,500 $9,000 $8,500 $8,000 $7,500 $7,000 $6,500 $6,000 $5,500 $5,000 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
California Southern California Orange County La Palma Area
Note: Indicated potential reflects per capita taxable spending, excluding automobile and gasoline purchases. illustrated spending levels reflect inflation-adjusted constant dollars based on 2009 reporting data. Source: SBOE; DOF; EDD; AGA
Estimated spending potential describing the La Palma area is based on the Southern California spending level adjusted to account for the high proportion of affluent households residing in the area. For purpose of this market assessment, estimated per capita spending potential is used in evaluating market potential for increasing the supply of retail anchor stores within the City of Palma.
City of La Palma Retail Market Potential
The retail sector of any community such as La Palma consists of a collection of anchor and non-anchor storefront operations competing for consumer support across a broad cross-section of store-group and store-type activities. A vibrant retail sector is a necessary component of economic growth and community stability, not just because retailers serve consumption demand of local residents but also because retailers generate critical fiscal support (sales tax, property tax, etc.) for publicly- demanded services the City must provide. This assessment evaluates market potential to bolster the City’s retail sector in terms of anchor and non-anchor retail activities that can better serve local residents and support public service objectives.
Retail Anchor Potential
Market potential for additional anchor-scale stores within the City of La Palma is evaluated by use of a gravity-model that simulates demand-supply interaction between existing anchor stores audited within the overall La Palma area (refer to
Market Study for the La Palma General Plan Update II-24 ALFRED GOBAR ASSOCIATES
Figure II-8) and spending potential (by retail store-type activity) that describes consumers residing within the 1.5-mile trade area ring. Market potential is identified in terms of the residual level of sales support available to an anchor of a given size and store-type after accounting for the competitive capture by existing anchors. An underlying premise of the modeling technique is that the competitive influence of surrounding area retailers tends to diminish with the distance a retail store is located from a defined location (City center at La Palma Avenue and Walker Street). As an example, a drug store located at the City center will have a greater competitive impact on market potential than a drug store located two miles away. The competitive influence of existing retailers eventually becomes negligible at more distant locations due to the natural resistance to movement through space, but also due to an increase in the variety of similar purchase options that become available to consumers residing or working further away. A retail store-type is deemed feasible when the projected level of residual support reaches a target threshold level of sales performance assigned to unique store-type activities. Different thresholds levels of sales performance are used to test the potential for different store type activities and can range from $150 to $400 per square foot. A threshold level of sales identifies a level of performance attractive to contemporary anchor-scale operators.
Exhibit II-10 summarizes the analysis of anchor store market potential for the vast majority of anchor-scale retail activities that also generate sales tax revenue for the local community. Market potential is identified in terms of the projected level of residual sales support (sales per square foot performance) available by distinct store- type activity and target store size. The analysis also identifies market potential over an immediate period (2012 feasibility), a near-term period (2015 feasibility), and longer-term period defined by the minimum population needed within the 1.5-mile trade area to attract a feasible level of sales support. Due to the modest level of future population growth anticipated, many threshold population levels identified will not be realized in the foreseeable future.
The analysis summarized in Exhibit II-10 identifies feasible potential for up to seven distinct store-type retailers occupying approximately 83,000 square feet of floor space, based on the competitive supply and geographic distribution of similar anchor stores now competing in the surrounding area. The mix and implicit sales performance of feasible store-type activities is further summarized below.
Market Study for the La Palma General Plan Update II-25 ALFRED GOBAR ASSOCIATES
Figure II-22 City of La Palma - Retail Anchor Potential Store Threshold Size Sales 2012 2015 Anchor Store-Type Activity Sq. Ft. Per Sq. Ft. Potential Potential Drug Store 15,000 400 Strong Strong Food-Grocery Store 30,000 375 Strong Strong Bedding & Housewares 8,000 200 Very Strong Very Strong Auto Parts Store 5,000 400 Very Strong Very Strong Sporting Goods Store 10,000 250 Very Strong Very Strong Book, Music, Media Store 5,000 250 Very Strong Very Strong Office Supply Store 10,000 240 Very Strong Very Strong
Overall Overall Area Sales Performance Overall Retail Potential 83,000 $27,000,000 $325/SF
Taxable Retail Potential 83,000 $15,787,500 $190/SF
Note: Taxable potential assumes only 35% of total drug store and food store sales are taxable.
Source: AGA.
Overall sales potential identified above assumes identified store-type activities achieve the indicated threshold level of sales performance. For many store-type activities, actual projected support potential exceeds the identified threshold level of sales performance. As an example, enough residual potential is projected in 2012 to support $423 per square foot in overall food and grocery sales within a 30,000- square-foot anchor space (refer to Exhibit II-10) compared to the $375 per square foot threshold level identified above. In this regard, the above assessment of market potential reflects a conservative interpretation of competitive potential over a near- to mid-term timeframe.
Non-Anchor Retail Potential
Market potential for additional non-anchor storefronts within the City of La Palma is evaluated in terms of existing storefront representation among 114 distinct store-type activities used to describe the vast majority of significant retail businesses found within contemporary shopping centers and retail districts. Market potential is identified in terms of store-type activities where there is a significantly low level of representation and the indicated undersupply is sufficiently large to accommodate one or more additional storefront operations without over-saturating the trade area. A current undersupply or oversupply of non-anchor storefronts is determined by
Market Study for the La Palma General Plan Update II-26 ALFRED GOBAR ASSOCIATES
comparing the existing supply of all storefront operations within the 1.5-mile trade area ring (refer to Figure II-8) against a regional incidence of payroll establishment representation by distinct store-type activity. The regional incidence of representation (storefronts per 1,000 population) serves as an analogous measure of the net demand-supply interaction that can be realistically supported in the form of storefront activity. The regional incidence of marketable support is limited to payroll establishments below a threshold size (typically fewer than 20 employees) that would otherwise suggest an anchor-scale retail operation. Market potential is further qualified in terms of the probable strength of support anticipated (marginal, good, strong, very strong). The relative strength of indicated support is determined by the extent of unmet demand that must be captured in order to add one more storefront operation.
Exhibit II-11 summarizes the market assessment of non-anchor storefront potential within the 1.5-mile trade area ring. Identified for each of the 114 store-type activities is the total number of non-anchor storefronts demanded (based on the regional incidence of representation), the total number of existing storefronts, and the near- term outlook of market potential for one additional storefront or more than one additional storefront. Also identified is the general store-group associated with the many store-type activities. Finally, each store-type activity is further categorized in terms of the physical location typically commanded within a retail center or district (retail, service, office, or freestanding). The “retail” location category includes storefronts that have a high level of visibility within a development and most often generate sales tax revenue. The “service” location category often describes less noticeable storefront locations including second-story suites and less visible multi- tenant pad buildings. The “office” location category describes locations provided the least amount of storefront visibility. The “freestanding” location category describes activities commonly separated from the main traffic and pedestrian flow of a retail center or district.
As described in Exhibit II-11, over 590 non-anchor storefront operations are currently demanded across 114 distinct store-type activities. The 1.5-mile trade area ring is currently represented with approximately 325 unique storefront operations. By comparison, good to strong potential is only identified for 32 to 47 storefront operations. The total number of storefronts with good to strong market potential is
Market Study for the La Palma General Plan Update II-27 ALFRED GOBAR ASSOCIATES
less than the difference between overall demand (590 storefronts) and overall supply (325 storefronts) because there is a limit to the amount of raw potential that can be effectively captured within the defined trade area. Market potential for one additional storefront is rated as “good” only when there is enough theoretical demand for at least two additional storefronts. This limit exists to account for the competitive interaction of retail operators at the periphery of the 1.5-mile trade area ring.
Non-anchor storefront opportunities with good to strong potential (32 to 47 storefronts overall) include 14 to 21 storefronts within first-tier retail locations (women’s apparel, furniture store, gift shop, full-service restaurant, etc.), 8 to 13 within second-tier service locations (child care center, electrical repair, fitness center, veterinary, etc.), and 9 to 12 within third-tier office locations (tax service, insurance agent, employment agency, etc.). Market potential is identified by location category because there are practical limits to the number of merchandising, service, and office-based businesses that should co-exist in a single development if a retail center is have a strong competitive influence on consumer purchase behavior. Service and office oriented storefront operations may represent as much as 40.0 percent of total storefronts businesses but rarely more than 15.0 percent of total occupied floor space within a neighborhood-community retail center with a strong retail attraction. A heavy mix of service and office-based businesses in a single site location tends to weaken the retail attraction of the development because of the narrowly defined nature of many service and administrative travel trips and because a proliferation of such storefront activity in a single location limits the attraction of businesses trying to merchandise retail products.
Project Specific Retail Potential
Identified market potential represents an opportunity to increase the supply of anchor and non-anchor retail storefronts in existing retail center throughout the City of La Palma. Identified market potential also represents good opportunity for a contemporary retail development project with a diverse mix of anchor and non-anchor retail storefront activity. Summarized below are two project scenarios used to describe a site-specific development program based on indicated retail market potential. The first project scenario is summarized below and reflects a lower range estimate of non-anchor retail potential:
Market Study for the La Palma General Plan Update II-28 ALFRED GOBAR ASSOCIATES
Figure II-23 Project Specific Retail Potential - Low Range Estimate Store- Storefront Floor Space Taxable Retail Operation fronts Dist Space Dist Gross Sales Sales Merchandising 14 42% 29,400 23% $5,880,000 $5,880,000 Service-Admin 12 36% 17,200 13% $2,580,000 Negligible
Non-Anchor Retail 26 79% 46,600 36% $8,460,000 $5,880,000
Anchor Retail 7 21% 83,000 64% $27,000,000 $15,800,000
Overall Site Potential 33 100% 129,600 100% $35,460,000 $21,680,000
Source: AGA.
The project scenario above describes a neighborhood-community center anchored by a grocery store and a drug store and 4 to 5 junior anchor stores ranging in size from 5,000 to 10,000 square feet (refer to Figure II-23). Overall, such a center would include nearly 130,000 square feet of leasable floor space and capture roughly $35.0 million in consumer sales support from the surrounding trade area. The overall sales tax benefit to the City of La Palma is estimated at about $216,000 per year, or 1.0 percent of taxable sales describing the 33 storefront locations.
The second project scenario is summarized below and reflects the high range estimate of non-anchor retail potential:
Figure II-24 Project Specific Retail Potential - High Range Estimate Store- Storefront Floor Space Taxable Retail Operation fronts Dist Space Dist Gross Sales Sales Merchandising 21 48% 44,100 29% $8,820,000 $8,820,000 Service-Admin 16 36% 23,200 15% $3,480,000 Negligible
Non-Anchor Retail 37 84% 67,300 45% $12,300,000 $8,820,000
Anchor Retail 7 16% 83,000 55% $27,000,000 $15,800,000
Overall Site Potential 44 100% 150,300 100% $39,300,000 $24,620,000
Source: AGA.
Overall, such a center would include about 150,000 square feet of leasable floor space and capture roughly $39.0 million in consumer sales support from the surrounding trade area. The overall sales tax benefit to the City of La Palma is estimated at about $246,000 per year, or a 1.0 percent share of taxable sales describing the 44 storefront locations.
Market Study for the La Palma General Plan Update II-29 EXHIBIT II-1 RETAIL PERFORMANCE COMPARISONS - 2009 COMBINED 4-CITY AREA AND SELECTED GEOGRAPHIC REGIONS
Taxable Retail Sales Per Capita Taxable Retail Sales Per Establishment ($000's) Retail Store-Group Activity 4-City Area2 County So. Cal. State 4-City Area2 County So. Cal State
Apparel, Shoes & Accessories $1,229 $870 $715 $667 $579 $461 $393 $420 General Merchandise 2,387 1,389 1,154 1,168 3,512 3,160 2,329 2,990 Drugs & Personal Health Care1 161 154 240 1,089 1,055 510 Grocery & Beverage 393 520 487 510 705 1,007 873 874 Beer, Wine, & Liquor1 81 70 76 552 485 508 Eating and Drinking 1,604 1,595 1,336 1,298 637 631 579 550 Home Furn-Elect-Appl 751 898 579 569 610 594 543 564 Bldg Mat & Garden Supplies 815 647 576 624 2,315 1,571 1,569 1,468 Auto Dealers and Auto Supplies 5,029 1,556 1,193 1,157 7,793 1,719 1,393 1,388 Service Stations 833 1,074 1,005 1,016 3,788 4,597 4,231 3,720 Other-Specialty Retail 1,571 1,099 864 768 224 169 160 141
All Retail Stores $14,612 $9,891 $8,133 $8,094 $953 $649 $608 $598 All-Excld Auto-Fuel Sales 8,750 7,261 5,935 5,920 605 515 631 476
- Performance is more than 1.15 times the average for Southern California - Performance is less than 0.85 times the average for Southern California Notes: 1 Taxable retail sales for the Drug & Personal Health Care and Beer, Wine and Liquor store-group categories no longer reported separately at the City level. Drug & Personal Health Care sales is included as part of the Other-Specialty Retail category beginning in 2009 and the General Merchandise category in prior years. Beer, Wine & Liquor sale is included as part of the Grocery & Beverage category beginning in 2009 and the Other-Specialty Retail category in prior years. 2 4-City Area includes; La Palma; Cypress, Buena Park, and Cerritos
Source: Alfred Gobar Associates; California State Board of Equalization; California Department of Finance.
4-City Area 2009.xls/3/28/2012 RE EXHIBIT II-2 2009 CONSTANT DOLLAR PER CAPITA SALES TRENDS FOR ALL RETAIL STORE-GROUP ACTIVITIES EXCLUDING AUTO SALES-SUPPLIES-FUEL
$12,000
$11,500
$11,000
$10,500
$10,000
$9,500
$9,000
$8,500
$8,000
$7,500
$7,000
$6,500
$6,000
$5,500
$5,000
$4,500
$4,000 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
4-City Area Orange County Southern California
Source: State Board of Equalization; CA-Department of Finance; Alfred Gobar Associates
4-City Area 2009.xls/Graph-2 EXHIBIT II-3 PER CAPITA SALES COMPARISON - 2009 COMBINED 4-CITY AREA VERSUS SOUTHERN CALIFORNIA
$6,000 $5,935 $8,750
$5,500
$5,000
$4,500
$4,000
$3,500
$3,000
$2,500
SALES PER CAPITA $2,000
$1,500
$1,000
$500
$0 Gen Mchdse- Apparel & Furn-Elect-Appl Specialty Retail Bldg Mat-Misc Food & Grocery Eating-Drinking Auto Retail- All Retail (Excld Drug Accessories Retail Service Auto)
SoCal - Per Capita 4-City Area - Per Capita
Note: Combined 4-City Area includes; La Palma, Cypress, Buena Park, and Cerritos
Source: State Board of Equalization; CA-Department of Finance; Alfred Gobar Associates
4-City Area 2009.xls/Graph-1 EXHIBIT II-4 RETAIL ESTABLISHMENT PERMIT TRENDS FOR ALL RETAIL STORE-GROUP ACTIVITIES EXCLUDING AUTO SALES-SUPPLIES-FUEL
15.0
14.0
13.0
12.0
11.0
Retail Permits Per 1,000 Population Retail 10.0
9.0
8.0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
4-City Area Orange County Southern California
Source: State Board of Equalization; CA-Department of Finance; Alfred Gobar Associates
4-City Area 2009.xls/Graph-2 EXHIBIT II-5 RETAIL ESTABLISHMENT REPRESENTATION - 2009 PERMITS PER 1,000 POPULATION COMBINED 4-CITY AREA VERSUS SOUTHERN CALIFORNIA
8.0 12.28 14.46
7.0
6.0
5.0
4.0
3.0
2.0 RETAIL PERMITS PER 1,000 POPULATION PER PERMITS RETAIL 1.0
0.0 Gen Mchdse- Apparel & Furn-Elect- Specialty Bldg Mat-Misc Food & Eating-Drinking Auto Retail- All Retail Drug Accessories Appl Retail Retail Grocery Service (Excld Auto)
SoCal - Incidence City - Incidence
Note: Combined 4-City Area includes; La Palma, Cypress, Buena Park, and Cerritos
Source: State Board of Equalization; CA-Department of Finance; Alfred Gobar Associates
4-City Area 2009.xls/Graph-1 EXHIBIT II-6 2009 TAXABLE RETAIL SALES FLOWS DESCRIBING 4-CITY AREA BASED ON SOUTHERN CALIFORNIA EXPENDITURE POTENTIAL
4-City Store Group Retail Activity La Palma Cypress Buena Park Cerritos Area
Mid-Year Population (000's) 16.2 49.8 83.7 54.8 204.5 Share of 4-City Area Population 8% 24% 41% 27% 100%
Estimated Retail Sales ($000's) Apparel-Shoes-Accessories $310 $15,641 $37,470 $197,942 $251,363 General Merchandise 474 163,065 133,987 190,687 488,212 Grocery-Specialty Foods 6,203 20,635 40,246 13,255 80,339 Eating-Snacks-Drinking 15,096 62,587 137,659 112,732 328,074 Home Furnishings-Appl-Elect 1,075 13,468 56,720 82,348 153,611 Building & Garden Supplies 5,657 69,123 47,142 44,775 166,698 Auto Dealers-Parts Supplies 258 12,878 416,934 598,545 1,028,614 Service Stations 29,883 50,194 56,971 33,395 170,443 Other-Specialty Merchandise 6,227 83,193 125,143 106,867 321,430 All Retail Store-Groups $65,183 $490,784 $1,052,272 $1,380,546 $2,988,785 Excld Auto-Fuel Sales $35,042 $427,712 $578,367 $748,606 $1,789,727 Share of 4-City Area Excld Auto-Fuel 2% 24% 32% 42% 100%
Potential Retail Sales ($000's) Apparel-Shoes-Accessories $11,623 $35,620 $59,894 $39,208 $146,346 General Merchandise 18,754 57,472 96,639 63,262 236,128 Grocery-Specialty Foods 9,037 27,693 46,566 30,484 113,780 Eating-Snacks-Drinking 21,698 66,493 111,809 73,193 273,193 Home Furnishings-Appl-Elect 9,409 28,833 48,482 31,738 118,462 Building & Garden Supplies 9,360 28,684 48,232 31,574 117,849 Auto Dealers-Parts Supplies 19,384 59,402 99,884 65,387 244,057 Service Stations 16,324 50,023 84,114 55,064 205,525 Other-Specialty Merchandise 16,535 50,671 85,203 55,776 208,185 All Retail Store-Groups $132,125 $404,890 $680,823 $445,686 $1,663,524 Excld Auto-Fuel Sales $96,417 $295,465 $496,825 $325,235 $1,213,942
Inflow-(Outflow) of Potential ($000's) Apparel-Shoes-Accessories ($11,313) ($19,978) ($22,425) $158,733 $105,017 General Merchandise (18,280) 105,593 37,348 127,424 252,085 Grocery-Specialty Foods (2,834) (7,058) (6,320) (17,229) (33,441) Eating-Snacks-Drinking (6,602) (3,906) 25,851 39,539 54,881 Home Furnishings-Appl-Elect (8,334) (15,364) 8,237 50,610 35,149 Building & Garden Supplies (3,703) 40,439 (1,089) 13,202 48,849 Auto Dealers-Parts Supplies (19,126) (46,524) 317,050 533,158 784,557 Service Stations 13,559 170 (27,144) (21,668) (35,082) Other-Specialty Merchandise (10,308) 32,522 39,940 51,091 113,245 All Retail Store-Groups ($66,942) $85,894 $371,448 $934,861 $1,325,260 Excld Auto-Fuel Sales ($61,375) $132,247 $81,542 $423,371 $575,785
Inflow-(Outflow) As Share of Potential Apparel-Shoes-Accessories (97.3%) (56.1%) (37.4%) 404.8% 71.8% General Merchandise (97.5%) 183.7% 38.6% 201.4% 106.8% Grocery-Specialty Foods (31.4%) (25.5%) (13.6%) (56.5%) (29.4%) Eating-Snacks-Drinking (30.4%) (5.9%) 23.1% 54.0% 20.1% Home Furnishings-Appl-Elect (88.6%) (53.3%) 17.0% 159.5% 29.7% Building & Garden Supplies (39.6%) 141.0% (2.3%) 41.8% 41.5% Auto Dealers-Parts Supplies (98.7%) (78.3%) 317.4% 815.4% 321.5% Service Stations 83.1% 0.3% (32.3%) (39.4%) (17.1%) Other-Specialty Merchandise (62.3%) 64.2% 46.9% 91.6% 54.4% All Retail Store-Groups (50.7%) 21.2% 54.6% 209.8% 79.7% Excld Auto-Fuel Sales (63.7%) 44.8% 16.4% 130.2% 47.4%
Note: Retail sales potential based on Southern California per capita expenditure level and mid-year population of each city. XXX - Indicated (Outflow) exceeds 33% of potential. XXX - Indicated Inflow exceeds 33% of potential.
Source: Alfred Gobar Associates; California State Board of Equalization; California Department of Finance. 4-City Area 2009.xls/TA Cities Sum EXHIBIT II-7 AUDIT OF RETAIL FACILITIES WITHIN LA PALMA AREA
Absolute Number of Storefronts and Retail Space Describing Existing Retail Facilities All Retail Storefronts Non-Anchor Storefronts Anchor-Scale Storefronts Store- Square Footage Store- Square Footage Store- Square Footage City Location fronts Total Vacant fronts Total Vacant fronts Total Vacant Anaheim 14 80,698 0 11 17,678 0 3 63,020 0 Buena Park 183 822,418 29,404 166 382,283 29,404 17 440,135 0 Cerritos 134 1,235,457 80,164 112 356,640 10,031 22 878,817 70,133 Cypress 174 456,981 24,742 168 298,887 24,742 6 158,094 0 Hawaiin Gardens 28 93,580 6,280 26 40,940 6,280 2 52,640 0 La Mirada 3 384,841 01002384,841 0 La Palma 119 323,136 43,553 116 249,592 12,747 3 73,544 30,806 Lakewood 20 33,919 1,175 20 33,919 1,175 0 0 0 Audited Area: 675 3,431,030 185,318 620 1,379,939 84,379 55 2,051,091 100,939
Distribution and Vacancy Characterisitcs of Existing Retail Facilities All Retail Storefronts Non-Anchor Storefronts Anchor-Scale Storefronts Share of Total Space Vacancy Share of Total Space Vacancy Share of Total Space Vacancy City Location Occupied Vacant Rate Occupied Vacant Rate Occupied Vacant Rate Anaheim 2.4% 0.0% 0.0% 1.3% 0.0% 0.0% 3.1% 0.0% 0.0% Buena Park 24.0% 15.9% 3.6% 27.7% 34.8% 7.7% 21.5% 0.0% 0.0% Cerritos 36.0% 43.3% 6.5% 25.8% 11.9% 2.8% 42.8% 69.5% 8.0% Cypress 13.3% 13.4% 5.4% 21.7% 29.3% 8.3% 7.7% 0.0% 0.0% Hawaiin Gardens 2.7% 3.4% 6.7% 3.0% 7.4% 15.3% 2.6% 0.0% 0.0% La Mirada 11.2% 0.0% 0.0% 0.0% 0.0% -- 18.8% 0.0% 0.0% La Palma 9.4% 23.5% 13.5% 18.1% 15.1% 5.1% 3.6% 30.5% 41.9% Lakewood 1.0% 0.6% 3.5% 2.5% 1.4% 3.5% 0.0% 0.0% -- Audited Area: 100% 100% 5.4% 100% 100% 6.1% 100% 100% 4.9%
Note: Anchor-scale retailers generally include storefront locations with at least 10,000 square feet of contiguous space.
Source: February 2012 field audit by Alfred Gobar Associates
La Palma Field Audit 02-2012.xls/3/28/2012 EXHIBIT II-8 RETAIL ANCHORS SURVEYED LA PALMA, CA - MARCH 2012
Square Dist. From Store Name Street Address Footage City Center
Women's Apparel Dress Barn 12859 Towne Center Dr, Cerritos 7,400 1.9 Total: 7,400
Family Apparel Ross Dress for Less 5895 Lincoln Ave, Buena Park 29,163 1.1 Duke and Dutchess - Clothing 9071 Walker St, Cypress 15,226 1.2 Total J Fashion 8900 Knott Ave, Buena Park 28,111 1.9 Ross Dress for Less 12731 Towne Center Dr, Cerritos 25,100 2.1 Total: 97,600
Drug Stores CVS Pharmacy 13303 South St, Cerritos 28,000 1.0 CVS Pharmacy 8850 Valley View St, Buena Park 17,476 1.1 Walgreens 6006 Lincoln Ave, Cypress 11,029 1.2 CVS 7065 La Palma Ave, Buena Park 12,054 1.6 Rite-Aid 8998 Knott Ave, Buena Park 18,052 1.9 Total: 86,611
Grocery Stores Super 1 Mart (Spring 2012) 4951 La Palma Ave, La Palma 25,506 0.5 Family Mart 4941 La Palma Ave, La Palma 17,232 0.5 Smart and Final 7930 Valley View St, Buena Park 25,604 0.6 Fresh and Easy 7880 Valley View St, Buena Park 20,038 0.6 Ralph's 13321 South St, Cerritos 35,000 1.0 Albertsons 8880 Valley View St, Buena Park 63,029 1.1 Seafood Market 4700 Lincoln Ave, Cypress 8,441 1.3 Superior Grocery 6931 La Palma Ave, Buena Park 31,856 1.5 Northgate Market 6991 Lincoln Ave, Buena Park 33,724 1.8 Zion Market 12565 Carson St, Hawaiin Gardens 35,000 1.8 Trader Joes 12861 Towne Center Dr, Cerritos 13,201 1.9 Grocery Outlet 8960-68 Knott Ave, Buena Park 27,180 1.9 Woori Market - Grocery 13321 Artesia Blvd, Cerritos 23,200 1.9 Stater Brothers 3430 Lincoln Ave, Anaheim 25,540 2.0 Total: 384,551
Department Stores (Non-Traditional) Marshalls 5893 Lincoln Ave, Buena Park 32,814 1.1 Target 20200 Bloomfield Ave, Cerritos 99,200 1.4 Kohl's 12821 Towne Center Dr, Cerritos 87,799 1.9 Walmart 12701 Towne Center Dr, Cerritos 125,694 2.2 Total: 345,507
Variety Stores Dollar Tree 8930 Valley View St, Buena Park 20,974 1.2 Big Lots 8932 Valley View St, Buena Park 19,528 1.2 99 Cent Store 3420 Lincoln Ave, Anaheim 25,569 2.0 Total: 66,071
La Palma - Anchor Tables.xls 3/28/2012 Page 1 of 3 EXHIBIT II-8 (Cont'd) RETAIL ANCHORS SURVEYED LA PALMA, CA - MARCH 2012
Square Dist. From Store Name Street Address Footage City Center
Bedding & Houseware Stores Anna's Linens 12831 Towne Center Dr, Cerritos 13,565 1.9 Total: 13,565
Home Electronics/Appliance Stores J & B Market and Video 4480 Lincoln Ave, Cypress 11,004 1.5 Best Buy 12989 Park Plaza Dr, Cerritos 48,430 1.8 Pacific Sales 12731 Towne Center Dr, Cerritos 29,004 2.1 Total: 88,438
Home Furnishings/Furniture Stores Ortho Mattress 17321 Valley View Ave, Cerritos 124,604 1.9 Fine Living Furniture 6390 Artesia Blvd, La Mirada 48,841 2.1 Living Spaces 14501 Artesia Blvd, La Mirada 336,000 2.1 Total: 509,445
Home Improvement Stores Home Depot 5800 Lincoln Ave, Cypress 103,697 1.2 Total: 103,697
Auto Parts Oreilly Auto Parts 3400 Lincoln Ave, Anaheim 11,911 2.0 Total: 11,911
Craft Stores Craft Outlet 13237 South St, Cerritos 40,000 1.1 Jo-Ann 5885 Lincoln Ave, Buena Park 40,538 1.1 Total: 80,538
Sporting Goods Stores Big 5 Sport 8990 Knott Ave, Buena Park 7,948 1.9 Total: 7,948
Office Supply Stores Office Max 12865 Towne Center Dr, Cerritos 24,552 1.9 Total: 24,552
Miscellaneous-Other Retail Stores Flower Mart 4470 Lincoln Ave, Cypress 8,697 1.5 Samy's Discount Outlet 8575 Knott Ave, Buena Park 12,046 1.6 Sav-Mor Thrift Store 12551 Carson St, Hawaiin Gardens 17,640 1.8 Petco 12601 Towne Center Dr, Cerritos 15,427 2.1 Sam Ash Music 12651 Artesia Blvd, Cerritos 26,470 2.3 Total: 80,280
La Palma - Anchor Tables.xls 3/28/2012 Page 2 of 3 EXHIBIT II-8 (Cont'd) RETAIL ANCHORS SURVEYED LA PALMA, CA - MARCH 2012
Square Dist. From Store Name Street Address Footage City Center
Vacant Anchor Space Vacant (former Ralphs) 5420 La Palma Ave, La Palma 30,806 0.1 Vacant 17510 Carmenita Rd, Cerritos 21,306 1.8 Vacant (former Borders) 12741 Towne Center Dr, Cerritos 13,911 2.1 Vacant - Mattress Gallery 12611 Artesia Blvd, Cerritos 8,829 2.3 Vacant - Borders Books 12615 Artesia Blvd, Cerritos 26,087 2.3 Total: 100,939
Multi-Plex Cinemas/Arcades Edwards Cinema 12761 Towne Center Dr, Cerritos 42,038 2.0 Total: 42,038
La Palma Area Retail Storefront Anchors Store-Type Classification (Sq. Ft.) Mix
Women's Apparel 7,400 0.4% Family Apparel 97,600 4.8% Drug Stores 86,611 4.2% Grocery Stores 384,551 18.7% Department Stores (Non-Traditional) 345,507 16.8% Variety Stores 66,071 3.2% Bedding & Houseware Stores 13,565 0.7% Home Electronics/Appliance Stores 88,438 4.3% Home Furnishings/Furniture Stores 509,445 24.8% Home Improvement Stores 103,697 5.1% Auto Parts 11,911 0.6% Craft Stores 80,538 3.9% Sporting Goods Stores 7,948 0.4% Office Supply Stores 24,552 1.2% Miscellaneous-Other Retail Stores 80,280 3.9% Vacant Anchor Space 100,939 4.9% Total Merchandising Anchor Space 2,009,053 98.0% Multi-Plex Cinema 42,038 2.0% Grand Total - All Retail Anchor Space 2,051,091 100.0%
Source: February 2012 Field Audit by Alfred Gobar Associates
La Palma - Anchor Tables.xls 3/28/2012 Page 3 of 3 EXHIBIT II-9 HOUSEHOLD RETAIL SPENDING BEHAVIOR BY INCOME LEVEL
$150,000 and above
$120,000 to $149,000
$100,000 to $119,999
$80,000 to $99,999
$70,000 to $79,999
$50,000 to $69,999
$40,000 to $49,999
$30,000 to GAFO-Specialty Items
Annual Household Income Annual Household $39,999 Home Bldg-Garden Supplies $20,000 to Grocery-Health Products $29,999 Eating & Drinking $15,000 to $19,999 Auto Supply-Misc Products
$10,000 to $14,999
All 46% 12% 14% 20% 8% Households
0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 1.80
Overall Indexed Level of Household Retail Spending
Note: - Indexed spending levels exclude automobile-gasoline purchases and spending on personal-repair services. - GAFO includes general merchandise, apparel & shoes, furnishings & appliances, and other specialty products. - Average 2010 retail spending per household in Southern California is estimated at $18,750 per year, excluding automobile and gasoline purchases; and $25,400 per year including these items.
Source: Consumer Expenditure Survey, U.S. Bureau of Labor Statistics, October, 2010; Alfred Gobar Associates
BLS‐SBOE Expend Pot ‐ La Palma.xls/BLS Hshld Expend Indx EXHIBIT II-10 RESIDUAL MARKET POTENTIAL FOR ADDITIONAL ANCHOR STORE MERCHANDISERS 1.5-MILE TRADE AREA RING - CITY OF LA PALMA
Floor Space Parameters (Sq Ft) 2012 Feasibility 2015 Feasibility Threshold Market Typical Size Range Targeted Effective Anchor Effective Anchor Threshold Minimum Anchor Store Type Of Merchandisers Store Size Sales/Sq Ft Feasibility Sales/Sq Ft Feasibility Sales/Sq Ft Pop Req'd
Women's Apparel 5,000 - 15,000 5,000 $288 Marginal $290 Marginal $350 80,000 -Pop Men's Apparel 5,000 - 15,000 5,000 $77 Not Feasible $77 Not Feasible $240 206,000 -Pop Family Apparel 10,000 - 30,000 10,000 $154 Not Feasible $156 Not Feasible $250 107,000 -Pop Shoe Store 5,000 - 20,000 5,000 $182 Not Feasible $184 Not Feasible $240 87,000 -Pop Drug Store 10,000 - 25,000 15,000 $458 Strong $463 Strong $400 Existing Pop. Food-Grocery Store 15,000 - 55,000 30,000 $423 Strong $427 Strong $375 Existing Pop. Traditional Dept Store 90,000 - 150,000 90,000 $118 Not Feasible $119 Not Feasible $300 168,000 -Pop Discount Dept Store 90,000 - 180,000 100,000 $191 Not Feasible $193 Not Feasible $300 103,000 -Pop Limited Price Variety Store 10,000 - 22,000 8,000 $46 Not Feasible $47 Not Feasible $140 199,000 -Pop Bedding & Housewares 15,000 - 30,000 8,000 $286 Very Strong $288 Very Strong $200 Existing Pop. Home Electronics-Appliances 15,000 - 50,000 15,000 $241 Not Feasible $244 Not Feasible $350 95,000 -Pop Home Furniture-Furnishings 10,000 - 40,000 15,000 $66 Not Feasible $67 Not Feasible $250 248,000 -Pop Home Improvement Store 90,000 - 140,000 120,000 $216 Not Feasible $207 Not Feasible $300 96,000 -Pop Auto Parts Store 5,000 - 12,000 5,000 $534 Very Strong $539 Very Strong $400 Existing Pop. Gift & Craft Store 15,000 - 30,000 10,000 $47 Not Feasible $48 Not Feasible $250 347,000 -Pop Sporting Goods Store 10,000 - 40,000 10,000 $638 Very Strong $644 Very Strong $250 Existing Pop. Book, Music, Media Store 12,000 - 35,000 5,000 $565 Very Strong $570 Very Strong $250 Existing Pop. Office Supply Store 15,000 - 40,000 10,000 $487 Very Strong $492 Very Strong $240 Existing Pop. Liquor Store 5,000 - 15,000 5,000 $130 Not Feasible $131 Not Feasible $350 177,000 -Pop Misc/Specialty Retail Store 10,000 - 40,000 8,000 $121 Not Feasible $123 Not Feasible $225 122,000 -Pop Total Floor Space Potential: 83,000 Sq. Ft. 83,000 Sq. Ft. Reference Area Population: 1-Mi Ring 31,870 1-Miles 32,230 1.5-Mi Ring 65,740 1.5-Miles 66,360 2-Mi Ring 105,720 2-Miles 106,710
Source: Alfred Gobar Associates
3/28/2012 LP Anchor Demand 1-5 Mile.xls/Feas Exhibit EXHIBIT II-11
NON-ANCHOR RETAIL STOREFRONT POTENTIAL 1.5-MILE TRADE AREA CITY OF LA PALMA, CA - MARCH 2012
Trade Area Population Base: Trade Area Trade Area City of La Palma Retail Storefront Potential 65,590 Residents Storefronts Existing One Add'l Max. Store Storefront Storefront Storefront Retail Type Demanded Storefronts Store Only Potential1 Category Retail Group
Gen. Mchdse & Dept. Stores - - Poor - Retail General Merchdse Warehse. Clubs/Superstores - - Poor - Retail General Merchdse Misc. General Mchdse Stores 2 2 Poor - Retail General Merchdse Men's Clothing Stores 2 - Marginal - Retail Apparel & Accessories Women's Clothing Stores 8 - Strong 3 Retail Apparel & Accessories Children's & Infant's Clothing 1 - Marginal - Retail Apparel & Accessories Family Clothing Stores 4 3 Poor - Retail Apparel & Accessories Clothing Accessories Stores 2 1 Poor - Retail Apparel & Accessories Misc. Clothing Stores 3 2 Poor - Retail Apparel & Accessories Shoe Stores 4 - Good 1 Retail Apparel & Accessories Furniture Stores 4 - Strong 2 Retail Furn-Appl-Elect 2 Floor Coverings 3 1 Marginal - Retail Furn-Appl-Elect Window Treatment Stores 1 - Poor - Retail Furn-Appl-Elect Misc. Home Furnishings 3 - Good 1 Retail Furn-Appl-Elect Appliance, Television & Elect. 1 - Poor - Retail Furn-Appl-Elect Computer & Software Stores 3 - Good 1 Retail Furn-Appl-Elect Camera & Photography - - Poor - Retail Other Specialty-Gifts Jewelry Stores 5 - Strong 2 Retail Other Specialty-Gifts Luggage & Leather Goods - - Poor - Retail Other Specialty-Gifts Sporting Goods Stores 4 3 Poor - Retail Other Specialty-Gifts Hobby, Toys, & Game Stores 2 3 Poor - Retail Other Specialty-Gifts Book Stores 1 2 Poor - Retail Other Specialty-Gifts Tape, CD, & Record Stores 1 2 Poor - Retail Other Specialty-Gifts Florists 3 2 Poor - Retail Other Specialty-Gifts Gift, Novelty & Souvenir Stores 4 1 Good 1 Retail Other Specialty-Gifts Pet & Pet Supply Stores 2 1 Poor - Retail Other Specialty-Gifts Pharmacies & Drug Stores 5 6 Poor - Retail Health-Personal Care Cosmetic & Beauty Supply 3 6 Poor - Retail Health-Personal Care Optical Goods Stores 2 - Marginal - Retail Health-Personal Care Health Food Stores 3 1 Marginal - Retail Health-Personal Care Misc. Health/Personal Care 2 1 Marginal - Retail Health-Personal Care Beer, Wine, & Liqour Stores 5 8 Poor - Retail Miscellaneous Retail Sewing & Needlework Stores 1 1 Poor - Retail Miscellaneous Retail Musical Instruments & Supplies - - Poor - Retail Miscellaneous Retail Newstands - - Poor - Retail Miscellaneous Retail Office Supply & Stationery 1 2 Poor - Retail Miscellaneous Retail Used Merchandise Stores 2 1 Poor - Retail Miscellaneous Retail Art Dealers 1 - Marginal - Retail Miscellaneous Retail Miscellaneous Retail 4 2 Good 1 Retail Miscellaneous Retail Supermarkets & Other Grocery 5 9 Poor - Retail Food & Grocery Convenience Stores 3 3 Poor - Retail Food & Grocery Meat Markets 1 - Poor - Retail Food & Grocery Fish & Seafood Markets - 1 Poor - Retail Food & Grocery Fruit & Vegetable Markets - - Poor - Retail Food & Grocery Misc. Specialty Food Stores 1 3 Poor - Retail Food & Grocery Full-Service Rest 42 40 Good 1 Retail Full Svc Rest Ltd-Service Rest 51 44 Strong 3 Retail Ltd Svc Rest 2 Cafeterias 1 - Poor - Retail Ltd Svc Rest 2 Caterers 3 - Good 1 Retail Ltd Svc Rest Snack & Beverage Bars 15 12 Good 1 Retail Ltd Svc Rest
3/28/2012 LP Non-Anchor Demand.xls/Demand Exhibit Page 1 of 3 EXHIBIT II-11 (Cont'd)
NON-ANCHOR RETAIL STOREFRONT POTENTIAL 1.5-MILE TRADE AREA CITY OF LA PALMA, CA - MARCH 2012
Trade Area Population Base: Trade Area Trade Area City of La Palma Retail Storefront Potential 65,590 Residents Storefronts Existing One Add'l Max. Store Storefront Storefront Storefront Retail Type Demanded Storefronts Store Only Potential1 Category Retail Group
Home Improvement Centers - 1 Poor - Retail Bldg Mat-Hardware Paint & Wallpaper Stores 1 - Poor - Retail Bldg Mat-Hardware Hardware Stores 1 - Poor - Retail Bldg Mat-Hardware Misc. Building Materials 5 1 Strong 2 Retail Bldg Mat-Hardware Lawn/Garden Power Equip. - 1 Poor - Retail Bldg Mat-Hardware Nursery & Garden Centers 1 - Poor - Retail Bldg Mat-Hardware Photo/Portrait Studios 2 2 Poor - Service Personal Services Misc. Schools of Instruction 11 30 Poor - Service Personal Services Child Day Care Services 6 - Strong 3 Service Personal Services Barber Shops 1 1 Poor - Service Personal Services Beauty Salons 14 26 Poor - Service Personal Services Nail Salons 5 7 Poor - Service Personal Services Diet Centers 1 - Poor - Service Personal Services Misc. Personal Care Services 3 6 Poor - Service Personal Services Formal Wear/Costume Rental - - Poor - Service Consumer Services Video Tape/Disc Rental 2 3 Poor - Retail Consumer Services Misc. Consumer Goods Rental 1 - Poor - Service Consumer Services General Rental Centers - - Poor - F.S. Retail Consumer Services Private Mail Centers 2 3 Poor - Service Consumer Services 2 Misc. Bus. Service Centers 2 2 Poor - Office Consumer Services Travel Agencies 4 1 Good 1 Service Consumer Services Coin-Operated Laundries 1 3 Poor - Service Consumer Services Drycleaning & Laundry Service 7 11 Poor - Service Consumer Services Pet Care/Grooming Services 2 3 Poor - Service Consumer Services Photofinishing - - Poor - Service Consumer Services Locksmiths 1 - Poor - Service Repair-Maint Svcs 2 Electronic/Precision Repair 4 - Good 1 Service Repair-Maint Svcs 2 Lawnmower & Appl. Repair 1 - Poor - Service Repair-Maint Svcs 2 Reupholstery/Furn. Repair 1 - Poor - Service Repair-Maint Svcs Shoe & Leather Good Repair - 1 Poor - Service Repair-Maint Svcs Misc. Personal Item Repair 2 - Good 1 Service Repair-Maint Svcs Motion Picture Theaters - - Poor - Service Ent-Rec-Leisure Amusement Arcades - 2 Poor - Service Ent-Rec-Leisure Fitness/Recreation Centers 4 - Good 1 Service Ent-Rec-Leisure Bowling Centers - 1 Poor - Service Ent-Rec-Leisure Misc. Amusement/Recreation 1 - Poor - Service Ent-Rec-Leisure Drinking Establisments 4 2 Marginal - Retail Ent-Rec-Leisure Depository Intermediaries (Banks) 8 9 Poor - Service F-I-R-E Svcs 2 Consumer Lending 1 - Poor - Service F-I-R-E Svcs Check Cashing Outlets 3 - Good 1 Service F-I-R-E Svcs 2 Insurance Agents/Brokers 27 9 Good 1 Office F-I-R-E Svcs 2 Real Estate Agents & Brokers 23 4 Good 1 Office F-I-R-E Svcs 2 Real Estate Related Activities 15 5 Good 1 Office F-I-R-E Svcs 2 Law Offices 38 - Strong 2 Office Med-Prof Svcs 2 Accounting/Tax Offices 26 5 Good 1 Office Med-Prof Svcs 2 Architectural/Eng. Services 23 - Good 1 Office Med-Prof Svcs 2 Specialized Design Services 10 1 Good 1 Office Med-Prof Svcs 2 Veterinary Services 5 - Strong 2 Service Med-Prof Svcs 2 Employment Services 8 1 Good 1 Office Med-Prof Svcs 2 Ambulatory Health Care 52 1 Strong 3 Office Med-Prof Svcs
3/28/2012 LP Non-Anchor Demand.xls/Demand Exhibit Page 2 of 3 EXHIBIT II-11 (Cont'd)
NON-ANCHOR RETAIL STOREFRONT POTENTIAL 1.5-MILE TRADE AREA CITY OF LA PALMA, CA - MARCH 2012
Trade Area Population Base: Trade Area Trade Area City of La Palma Retail Storefront Potential 65,590 Residents Storefronts Existing One Add'l Max. Store Storefront Storefront Storefront Retail Type Demanded Storefronts Store Only Potential1 Category Retail Group
Auto Parts & Accessories 5 4 Poor - Retail Automotive Tire Dealers 4 - Good 1 Retail Automotive Gas Stations W/Conv. Stores 9 10 Poor - F.S. Retail Automotive All Other Gas Stations 3 - Good 1 F.S. Retail Automotive 2 Automotive Repair/Maint. 17 - Strong 3 Service Automotive Car Washes 3 4 Poor - Service Automotive New Car Dealers 1 - Poor - F.S. Retail Retail & Service NEC Used Car Dealers 2 - Marginal - F.S. Retail Retail & Service NEC Recreational Vehicle Dealers - - Poor - F.S. Retail Retail & Service NEC Motorcycle Dealers 1 - Poor - F.S. Retail Retail & Service NEC Boat Dealers - - Poor - F.S. Retail Retail & Service NEC 2 Misc. Motor Vehicle Dealers - - Poor - F.S. Retail Retail & Service NEC Car Rental Agencies 2 1 Poor - Service Retail & Service NEC Truck & Trailer Rentals 1 - Poor - F.S. Retail Retail & Service NEC
114 Store Types 591 324
Non-Anchor Retail Potential Good-to-Strong Potential
One Add'l Store Per Retail Type: Retail 14 44% Service 8 25% Office 9 28% F.S. Retail 1 3% 32 100% Multiple Stores Per Retail Type: Retail 21 45% Service 13 28% Office 12 26% F.S. Retail 1 2% 47 100% Note: 1 Maximum potential based on 50% capture of residual opportunity 2 Does not account for existing supply located in office and industrial buildings
Source: Alfred Gobar Associates
3/28/2012 LP Non-Anchor Demand.xls/Demand Exhibit Page 3 of 3 ALFRED GOBAR ASSOCIATES
Chapter III Lodging Market Assessment
Lodging Market Overview
Travel and tourism is an important “export-oriented” industry for California, Orange County, and many local communities, including La Palma. According to the California Travel and Tourism Commission, visitor spending within Orange County during 2010 generated more than $8.2 billion in economic activity related to lodging, dining, entertainment, retail purchases, and transportation. Of this total more than $1.4 billion was spent on overnight accommodations, primarily in hotels.
The Orange County area is an important destination for leisure and business travelers, regularly capturing about one-eighth of all travel activity within California. While the City of La Palma only hosts one of more than 425 hotels competing in the Orange County area, lodging represents an important land use needed to serve area residents, businesses, and visitors. The objective of this market assessment is to identify market opportunity for increasing the local area supply of lodging available to serve future travel to this area of Orange County.
A fundamental set of demand and supply factors strongly influence market potential for lodging and most other forms of real estate development. Lodging market demand is driven by the need for overnight stays, commonly referred to as room-night demand. Underlying factors that drive room-night demand basically include three fundamental forms of economic activity:
• Population Growth – and related family gatherings, life events, interim housing, etc.
• Business Growth – and related meetings, conferences, regional staffing support, temporary workers, etc.
• Visitor Travel Growth – and related overnight stays involving leisure and business travel, as well as domestic and international travel.
Market Study for the La Palma General Plan Update III-1 ALFRED GOBAR ASSOCIATES
Lodging market supply refers to existing lodging facilities available to accommodate market demand. How well existing facilities are able to satisfy demand is commonly evaluated in terms of the following performance factors:
• Room Supply – describes the number of rooms (capacity) available to accommodate overnight stays.
• Occupancy – describes the effective utilization of capacity and is based on the number of rooms sold divided by the available room supply.
• Average Daily Rate (ADR) – describes the average charge per room for an overnight stay and is based on room revenue divided by rooms sold.
• Revenue Per Available Room (RevPAR) – is a measure of revenue performance and is based on room revenue divided by rooms available. RevPAR is a blended measure of occupancy and ADR.
This market assessment evaluates selected demand and supply factors in terms of conditions that favor an increase in the local supply of rooms via new development or substantial renovation and expansion of existing facilities.
Exhibit III-1 illustrates the indexed relationship between the three fundamental drivers of lodging demand (population, employment, and visitation) and the supply response in the form of total rooms sold (12-month moving average) throughout the Orange County region since 2001. As shown, Orange County has experienced significant seasonal fluctuations in visitor activity, less severe but cyclical fluctuations in payroll employment (an indicator of business activity), and relatively constant increases in resident population.
Orange County hosts more than 3.0 million residents and reflects a robust market for business travel and vacation-leisure travel. As such, each demand factor illustrated in Exhibit III-1 has had an influence on the total volume of room-nights sold over the 11-year period identified. Most recently, since the onset of the Great Recession, the overall volume of room-nights sold declined from July 2007 to July 2009 in response to business contraction and associated layoffs despite a sharp rise in visitor activity during 2008. During the Great Recession, overall visitor activity included fewer international travelers (global financial crisis) and a greater number domestic travelers taking day trips or staying with relatives in response to tighter household budgets. Beginning in 2010, the total volume of room-nights sold started to rebound despite
Market Study for the La Palma General Plan Update III-2 ALFRED GOBAR ASSOCIATES
only modest gains in payroll employment. The current recovery in lodging activity reflects less hesitation on the part of businesses to spend on travel, a rise in overnight visits in connection with domestic leisure travel, and a strong recovery in international travel.
La Palma Area Lodging Facilities
Lodging land use serves the transient consumer (travelers from outside the area or local residents needing interim shelter). In this regard, lodging facilities compete within a relatively broad geographic setting based on unique attributes and advantages that can be offered to prospective travelers (destination location, proximity to work, accessibility, affordability, security, quality of service, leisure experience, etc.). Lodging facilities in the La Palma area offer a unique blend of logistical advantages for both leisure and business travelers including:
• Within 25 minutes of LAX, Long Beach, and John Wayne airports
• Within 15 minutes of the Anaheim Visitor and Convention Center
• Within 10 minutes of the resort districts of Disney and Knott’s Berry Farm
• Easy access to major freeways connecting all of Southern California
• A central location to more than 4,700 local area businesses
• A central location to more than 210,000 local area residents
For purpose of the market assessment, the La Palma area includes 18 hotel facilities described in Exhibit III-2. In all, La Palma area hotels represent an available supply of nearly 2,840 rooms, or about 5.3 percent of the total room supply in Orange County. As shown, La Palma area hotel facilities are concentrated along the major freeways or in the Knott’s Berry Farm resort district. Over 50.0 percent of the available room supply exists in hotels with an economy to midscale operating focus (generally associated with 1-star to 2-star ranking) but less than 25.0 percent of rooms exist in a hotel with an upscale operating focus. The La Palma area does not offer any rooms at facilities with a luxury operating focus (most commonly associated with a 4-star or 5-star ranking). La Palma area hotels reflect an aging stock of rooms, with no new construction or renovation noted in the last 20 years. The sole exception
Market Study for the La Palma General Plan Update III-3 ALFRED GOBAR ASSOCIATES
is an economy hotel (Extended Stay America) built in 1998. No new facilities are being actively processed for development in the area.
Market Demand Factors
Factors that influence a traveler’s choice of hotel during an overnight stay are as unique and complex as each individual’s travel plans, travel budget, personal circumstance, personal preference, and a host of other intrinsic considerations. In aggregate, market demand for room-night stays can be reasonably assessed by evaluating trends related to population growth, business activity, and visitor activity.
Population Growth
The resident population of Orange County exceeded 3.0 million people in 2010 according to the U.S. Census. By comparison, La Palma area hotels provide a geographically convenient lodging option for approximately 210,000 residents living within La Palma and its adjacent communities (Cypress, Buena Park, Cerritos, and Artesia). The La Palma area is largely built out, in terms of the supply of undeveloped land available to host a significant increase in the number housing units and local residents. Between 2000 and 2010, total population in the La Palma area grew by less than 1,700 residents or about 0.8 percent. Over that same period, total population within the Orange County region grew by nearly 164,000 residents or about 5.8 percent. Recent Census figures and growth projections by the Southern Californian Association of Governments (SCAG RTP-2008) suggest the La Palma will experience a greater amount of growth between 2010 and 2020. Even with an increased level of absolute growth, the La Palma area will remain a relatively slow growing area in comparison to the larger Orange County region, as illustrated below:
Market Study for the La Palma General Plan Update III-4 ALFRED GOBAR ASSOCIATES
Figure III-1 Projected Population Growth
108% 108%
106% 106%
104% 104%
102% 102%
100% 100%
98% 98% Percentage Growth (2010 = 100%) = (2010 Growth Percentage
96% 96% 2010 2012 2014 2016 2018 2020 OC Region La Palma Area
Source: US Census; SCAG 2008 RTP; ESRI; AGA Business Activity
As an economic region grows, distinct concentrations of industry and employment emerge that provide tactical advantages (access to markets-workers, logistics support, intellectual-labor exchange, operating cost savings, etc.) for businesses in these location. Within Southern California, the Orange County region has emerged as a tactical location for business and employment as evidenced by more than 87,000 establishments supporting over 1.47 million jobs in 2011. Since 2010, the Orange County region has hosted roughly 530 jobs per 1,000 population compared to 430 jobs per 1,000 population for the whole of Southern California.
Within Orange County, the La Palma area also constitutes a concentration of business and employment that can be conveniently served by local area hotels. Based on the latest available information from the U.S. Census Bureau (2009 County Business Patterns), nearly 4,700 businesses host an average of 430 jobs per 1,000 population within the La Palma area, compared to 446 jobs per 1,000 population for Orange County during the same 2009 period. The La Palma area also hosts about 22 payroll establishments per 1,000 population, which is below the Orange County average of 29 payroll establishments per 1,000 population. For its part, the La Palma area hosts a relatively greater concentration businesses with at least 50 payroll employees.
Market Study for the La Palma General Plan Update III-5 ALFRED GOBAR ASSOCIATES
Illustrated below is the relative mix of business private-sector establishments describing Orange County, the La Palma area, and the City of La Palma. As shown, the La Palma area includes a relatively larger mix of wholesale, retail, dining-lodging, and transportation-warehouse-utility industry businesses than characterizes Orange County as a whole. Figure III-2 Industry Mix Of Private Payroll Establishments 30%
e 25%
20%
15%
10%
Share of Establishm 5%
0% Min-Const Mfg Wholesale Retail Ent-Dine- Transp- Fin-Info Prof-Misc Ed-Health Lodging Wrhse- Svcs Svcs Svcs Utility Orange Co La Palma Area City of La Palma
Note: La Palma Area includes following ZIP Codes: 90263, 90703,90620,90630, 90715, 90716, & 90701 Source: U.S. Census Bureau - 2009 County Business Patterns; AGA
Business-related travel can be anticipated at some level with all forms of business, but some forms of business (construction, manufacturing, financial services, and State-Federal government agencies) tend to involve greater levels of overnight travel in connection with daily operations.
The size of business is another factor influencing business-related room-night demand. Larger firms often compete in regional, national, and international markets in order to support scale of operations. The broad geographic focus of many large firms tends to generate travel activity in connection with client visits, regional staffing, staff training programs, temporary work assignments, etc. Small firms also generate room-night demand but typically on the part of local staff traveling to clients, projects, corporate offices, or market locations. The size range mix of payroll establishments describing Orange County and the La Palma area is illustrated below.
Market Study for the La Palma General Plan Update III-6 ALFRED GOBAR ASSOCIATES
Figure III-3 Size Range Mix Of Payroll Establishments 60%
e 50%
40%
30%
20%
10% Share of Establishm
0% 1-4 5-9 10-19 20-49 50-99 100-Plus Payroll Workers Per Establishment Orange County La Palma Area
Note: La Palma Area includes following ZIP Codes: 90263, 90703,90620,90630, 90715, 90716, & 90701
Source: U.S. Census Bureau - County Business Patterns; California Employment Development Department; AGA
Larger firms with 50 or more employees constitute a small share of all payroll establishments. In general, roughly 70.0 percent of all payroll establishments within a given region have fewer than 10 payroll employees. In Orange County, 73.1 percent of payroll establishments had fewer than 10 payroll employees in 2009, compared to 69.7 percent within the La Palma area. By comparison, 7.8 percent of establishments in the La Palma area employed 50 or more workers compared to 5.6 percent for Orange County. Historically, the number of larger payroll establishments that have chosen to locate within the La Palma area compares favorably with Orange County as illustrated below. Figure III-4 Payroll Establishment Growth Trends - Larger Firms With 50+ Employees
1.10 1.08 1.06
w 1.04 1.02 1.00 0.98
Indexed Gro 0.96 0.94 0.92 0.90 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Orange County La Palma Area
Note: La Palma Area includes following ZIP Codes: 90263, 90703,90620,90630, 90715, 90716, & 90701
Source: U.S. Census Bureau - County Business Patterns; California Employment Development Department; AGA
Market Study for the La Palma General Plan Update III-7 ALFRED GOBAR ASSOCIATES
Across all size-ranges of business, the number of establishments choosing to operate in the La Palma area compares quite favorably against Orange County in terms of overall growth since 2000, as illustrated below. Figure III-5 Payroll Establishment Growth Trends - All Establishments 1.30
1.20 w 1.10 1.00 0.90
In dexed Gro 0.80
0.70 2000200120022003200420052006200720082009 Orange County La Palma Area
Total Number of Payroll Establishments Geographic Area 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 La Palma Area 4,173 4,248 4,408 4,424 4,545 4,772 4,865 4,949 4,791 4,692 Orange County 78,556 79,937 81,674 83,164 85,368 87,905 89,587 90,950 89,527 87,483
Note: La Palma Area includes following ZIP Codes: 90263, 90703,90620,90630, 90715, 90716, & 90701 Source: U.S. Census Bureau - County Business Patterns; California Employment Development Department; AGA
Despite widespread business contraction triggered by the Great Recession in 2008 and 2009, La Palma area businesses have proven to be a resilient group of employers within this northern sub-market of Orange County. City-level employment growth projections prepared by SCAG suggest the La Palma area employment will continue to grow at a pace that matches and even rivals the larger Orange County region, as illustrated below. Figure III-6 Projected Payroll Employment Growth
1.14 1.14
1.12 1.12
1.10 1.10
1.08 1.08
1.06 1.06
1.04 1.04
1.02 1.02 Index of 2010 Le 2010 of Index 1.00 1.00
0.98 0.98
0.96 0.96 2010 2012 2014 2016 2018 2020 OC Region La Palma Area
Source: California EDD; SCAG 2008 RTP; ESRI; AGA
Market Study for the La Palma General Plan Update III-8 ALFRED GOBAR ASSOCIATES
Visitor Activity
Orange County is a top destination for domestic and international travelers, whether visiting the area on business or as part of a vacation-leisure trip. According to the California Travel and Tourism Commission, Orange County has consistently captured a 10.0 percent to 12.0 percent share of Statewide travel activity even as the share of travel to California by visitors coming from other U.S. states and other countries has been on the rise. The Great Recession of 2008 and 2009 significantly impacted the travel economy, including the lodging, dining, transportation, entertainment- amusement, and retail industries. A modest rebound in travel activity to California began in early 2010 and gained momentum through the 2011 calendar year. Coming out of the Great Recession, overall travel to California is estimated to have increased from 322 million person-trips in 2009 to nearly 354 million person trips in 2011. Over the next several years, overall travel activity to California is expected to continue to increase (albeit at a more moderate pace) as the State, National, and many global economies gain traction. Using multiple data sources available from the California Travel and Tourism Commission, projected growth in travel activity throughout the Orange County region is illustrated below. Figure III-7 Projected Travel Activity - OC Region
40.0 1.40
35.0 1.30
30.0 1.20
25.0 1.10
20.0 1.00
15.0 0.90
Pe rs on T rips10.0 (M illio 0.80 Index of 2010 Activity L 2010 Activity Index of
5.0 0.70
0.0 0.60 2010 2012 2014 2016 2018 2020 Leisure Travel Business Travel Total Travel Activity Index
Source: California Travel & Tourism Commission; Tourism Economics; AGA
Estimated travel volume reflects independent traveler survey and economic studies (D.K. Shifflett & Associates, TNS Travel America, Dean Runyan & Associates,
Market Study for the La Palma General Plan Update III-9 ALFRED GOBAR ASSOCIATES
Tourism Economics, etc.) sponsored by the State. Alternative sources cite different absolute travel volumes. This analysis relies on the use of consistently-reported time series data in order to identify the relationship between incidence of room-night demand and incidence of travel activity. This analysis also relies on regional travel estimates because the reliability of methods used to track travel activity by region and because the La Palma area offers a convenient option for visitors to the resort districts of Disney and Knott’s Berry Farm (two major destination attractions within the region). According to the Themed Entertainment Association, in 2010 the Disney resort district drew 22.25 million paid admissions to its dual theme park attraction (Disneyland and California Adventure), while Knott’s Berry Farm saw a sharp increase to 3.6 million paid admissions. Paid admission visitor volume to the Disney resort district ranked second in the world in 2010, and the 2011 calendar year is estimated to show strong gains when official figures are released.
Market Supply Trends
Factors that describe how existing hotel facilities have responded to changes in room-night demand serve to define market supply conditions. Market supply factors not only include the absolute capacity of lodging facilities (room supply) but also its effective utilization (occupancy) and pricing performance (ADR) within the competitive environment.
Room Supply
The 18 hotel facilities within the La Palma area represent a supply base of 2,837 rooms, or about 5.3 percent of the total room supply throughout Orange County. Since 2001, the supply base of rooms throughout Orange County has fluctuated due to the shuttering of dilapidated facilities or conversion of older facilities for transitional housing, but overall has increased in response to growing economic activity in the region. By comparison, the supply of hotel rooms in the La Palma area has not increased over the past 11 years but has actually experienced a net decline, as illustrated below.
Market Study for the La Palma General Plan Update III-10 ALFRED GOBAR ASSOCIATES
Figure III-8 Indexed Trends of Available Room Supply
1.15 1.15 1.12 1.12 1.09 1.09 1.06 1.06
1.03 1.03 1.00 1.00 0.97 0.97
0.94 0.94 0.91 0.91 0.88 0.88 0.85 0.85 2001 2003 2005 2007 2009 2011 OC Region La Palma Area
Source: Smith Travel Research; Alfred Gobar Associates
An increase in the supply of available rooms is a necessary market response whenever there is an increase in underlying economic activity (population-business- visitor activity) driving room-night demand. Ever-increasing levels of occupancy (an indicator of competitive attraction and operating efficiency) are difficult to sustain with a fixed base of rooms in a market area that does not have a monopoly on location. The La Palma area is one of many sub-market areas competing for overnight stays on the part of regional travelers.
In 2001, the base supply of rooms within the La Palma area equated to a room- business ratio of 0.67 rooms per area business establishment (2,836 rooms divided by 4,248 establishments) compared to 0.60 rooms per establishment for all of Orange County (50,402 rooms divided by 78,556 establishments). By 2009, the effective room-business ratio describing the La Palma area declined to 0.60 rooms per establishment, while the corresponding ratio for Orange County increased slightly to 0.61 rooms per establishment. In relation to total number of business establishments, the supply base of hotel rooms for Orange County as a whole has consistently increased in response to growing economic activity, while the supply base of hotel rooms in the La Palma area has actually declined in terms of overnight stay options available to local area travelers.
Market Study for the La Palma General Plan Update III-11 ALFRED GOBAR ASSOCIATES
Hotel Occupancy
Hotel occupancy simply describes the share of available rooms that have been sold in a give time period (week, month, year, etc.). Hotel occupancy performance serves to gauge the competitive attraction of an individual hotel or group of hotels competing for support from the traveling public. Hotel occupancy fluctuates on a daily, weekly, seasonal, and annual basis in response to fluctuations in travel behavior. Hotels and market locations that offer an attractive advantage to area travelers tend to achieve higher overall levels of occupancy and recover more rapidly from cyclical declines in overnight stay activity. Precedent occupancy performance of La Palma area hotels is illustrated below in comparison to the Orange County region as a whole. Figure III-9 Average Annual Occupancy Trends
80% 80%
75% 75%
70% 70%
65% 65%
60% 60%
55% 55%
50% 50% 2001 2003 2005 2007 2009 2011 OC Region La Palma Area
Source: Smith Travel Research; Alfred Gobar Associates
Precedent trends indicate that overall occupancy performance describing La Palma area hotels drops further during periods of economic decline than is true of all hotels in Orange County and rebounds relatively slowly during periods of economic recovery. During the 11-year period identified, the overall occupancy level achieved by La Palma area hotels (66.6 percent) has frequently lagged Orange County as a whole by 3.0 percent and by as much as 5.0 percent during periods of economic decline. The sharp decline and slow recovery nature of occupancy performance among La Palma area hotels is most consistent with payroll employment trends related to economic business cycles and suggest a relatively strong operating focus on business travelers (Refer to Exhibit III-1).
Market Study for the La Palma General Plan Update III-12 ALFRED GOBAR ASSOCIATES
Hotel Average Daily Rates
Average daily rates (ADR) reflect the average effective charge per room-night sold. The average daily rate is not the same as the “rack rate,” which reflects the suggested retail value of a room night stay often posted within each hotel room. Instead, ADR is a measure of average revenue received per room sold, including discounts for web-based reservations, promotional codes, package deals, affinity group rates (AAA, AARP, etc.), tour group and event rates, and contract rates for corporations and government agencies. ADR provides a good measure of the competitive pricing position of hotels in a given market area. To a large extent, La Palma area hotels compete on a price-competitive basis when compared to the Orange County region as a whole as illustrated below. Figure III-10 Average Daily Rate (ADR) Trends
$130 $130
$120 $120
$110 $110
$100 $100
$90 $90
$80 $80
$70 $70
$60 $60
$50 $50 2001 2003 2005 2007 2009 2011 OC Region La Palma Area
Source: Smith Travel Research; Alfred Gobar Associates
In general, average daily rates in all markets have fluctuated with economic cycles and events including the 911 Crisis in 2001, the Tech-Stock crash in 2002, and the Great Recession in 2008-09. Between 2001 and 2006, the ADR for La Palma area hotels consistently represented a 23.0 percent to 25.0 percent discounted rate in comparison to the Orange County region as a whole. The precedent discount is largely a reflection of the market focus of La Palma area hotels, with a heavy mix of economy and midscale hotels and relative absence of upper-upscale and luxury hotels commonly found in other areas of Orange County.
Beginning in 2007, the price gap distinguishing the ADR for the La Palma area and ADR for Orange County significantly jumped to reflect a 30.0 percent discount and
Market Study for the La Palma General Plan Update III-13 ALFRED GOBAR ASSOCIATES
has consistently increased to reflect a 33.0 percent discount in 2011. Between 2006 and 2008 (a period of leveraged consumer spending and rampant capital market investment), the ADR for Orange County jumped 18.0 percent from $112 per room- night to $123 per room-night, while the ADR for La Palma area hotels remained flat at $84 per room night over the same period. Between 2008 and 2010, economic fallout from the Great Recession extracted a 12.0 percent decline in ADR for Orange County and the La Palma area. By 2011, ADR for Orange County began a recovery, increasing 5.0 percent to $113 per room-night. By comparison, ADR for the La Palma area has remained relatively flat at a near recession low of $75 per room-night and now constitutes a 33.0 percent discount from the Orange County average. Most recent trends in ADR from 2006 to 2011 suggest the inability to raise rates in the La Palma area is not only constrained by the heavy mix of economy and midscale lodging options but also the aging condition of hotel rooms and hotel facilities offered to local areas travelers.
Lodging Market Potential
A structural increase in economic activity within a region bolsters market opportunity to increase the supply of hotel rooms available to serve room-night demand of the traveling public. La Palma area hotels do not compete for traveler support as an isolated group of properties but as one of several overnight options within the larger Orange County region. In this regard, market growth potential describing the greater Orange County region also influences market potential for increasing the supply of lodging options within the La Palma area.
Regional Demand Outlook
Room-nights sold reflect the culmination of marketing, promotional, and operating practices by hotels in an effort to capture room-night demand. The ability of hotels to capture a share of room-night demand can be measured in relation to indices of economic activity including population growth, business activity, and visitor activity. For purpose of this market assessment, the incidence of a room-night sold (historical capture) and a room-night demanded (projected potential) is measured in relation to an overall index of population, employment, and visitor (PEV) activity, as illustrated below:
Market Study for the La Palma General Plan Update III-14 ALFRED GOBAR ASSOCIATES
Figure III-11 Projected Room-Night Demand - OC Region
16.0 1.35
15.5 1.30
15.0 1.25
14.5 1.20 d
n 14.0 1.15
13.5 1.10
13.0 1.05
12.5 1.00 Rm -Nts (Millio
12.0 0.95 PEV-Lodging In
11.5 0.90
11.0 0.85
10.5 0.80
10.0 0.75 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Historic Demand Projected Demand PEV Activity PEV Capture Rate
Note: PEV Index describes population, employment, and visitor activity in region Source: Alfred Gobar Associates
As shown above, the total number of room-nights sold between 2001 and 2011 has generally fluctuated in response to economic cycles of PEV activity. The PEV activity index charted above is the sum total of the three demand drivers describing economic activity (average monthly resident population plus average monthly payroll employment plus average monthly visitor person trips). In 2001, the monthly average level of PEV activity was equal to an index of 6.54 million (2.88 million residents plus 1.41 million payroll workers plus 2.25 million visitors). A more detailed tracking of all three components of PEV activity has been previously illustrated in Exhibit III-1. Also shown above is the PEV capture rate as an index of 2001 level of competitive performance. The 2001 capture index is equal to approximately 150 room-nights per 1,000 units of PEV activity. Like the total number of room-nights sold, the PEV capture rate has also fluctuated but has generally been declining in relation to an 11- year average capture rate of 156 room-nights sold per 1,000 units of PEV activity.
Hotel operators are motivated to capture future increases in room-night demand. Competitive and operating realities constrain the total volume of increased demand that existing operators are likely to capture before additional hotels are built, thereby increasing room supply and further limiting gains in occupancy and ADR that can be realistically achieved. Projected growth in room-night demand assumes existing hotel
Market Study for the La Palma General Plan Update III-15 ALFRED GOBAR ASSOCIATES
operators achieve a PEV capture rate at or near the 11-year average level of competitive performance. Projected room-night demand is projected to grow in response to increasing PEV activity from 13.91 million room-nights sold in 2011 to an estimated 15.65 million room-nights sold in 2020. The projected increase in room- night demand equates to enough market potential to add another 4,700 rooms in Orange County by 2020, assuming existing operators achieve an overall occupancy level of 71.0 percent (the 11-year average occupancy level is 69.0 percent). Projected market potential equates to an average of 522 additional rooms per year between 2012 and 2020. Between 2001 and 2011, the competitive supply of available rooms increased by a net total of 5,871 rooms, or an average of 534 additional rooms per year.
La Palma Area Demand Outlook
The projected outlook of market potential within the La Palma area relies on the same methodology used to estimate growth in room-night demand within the surrounding region. The outlook of market potential within the La Palma area is distinguished by the use of two scenarios (“Trend” and “Potential”) to describe the future competitive performance of area hotels in capturing room-night demand, as illustrated below: Figure III-12 Projected Room-Night Demand - La Palma Trade Area
0.95 1.30
0.90 1.25
0.85 1.20 n o 0.80 1.15
0.75 1.10
0.70 1.05
0.65 1.00
0.60 0.95 Rm-Nt Potential (Milli Rm-Nt Potential 0.55 0.90 Rm -Nt/PEV Capture I
0.50 0.85
0.45 0.80
0.40 0.75 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Demand Potential Demand Trend PEV Capture Potential PEV Capture Trend
Note: Rm-Nt/PEV Capture Index describes rooms sold in relation to growth in pop, emp, & visitor activity Source: Alfred Gobar Associates
Market Study for the La Palma General Plan Update III-16 ALFRED GOBAR ASSOCIATES
As shown above, the 2001 indexed level of PEV capture (equal to 8.78 room-nights sold per 1,000 units of PEV activity) has only been achieved one other time (2005) over the 11-year historical period identified (2001 to 2011). Overall, the PEV capture index describing the competitive attraction of La Palma area hotels has been in sharp decline. The decline means area hotel operators are capturing diminishing shares of room-night demand growth in the region, despite strong local area business- employment trends and proximate location to the Disney and Knott’s Berry Farm resort districts. Between 2005 and 2009, the PEV capture rate plunged 20.0 percent from an index level of 1.0 to an index level of 0.8. Since 2009, the PEV capture rate has managed to recover to an index level of 0.88 but continues to lag market capture performance of the region as a whole.
The “Trend” scenario illustrated above assumes the La Palma area continues to exert the same level of competitive attraction as indicated by the 2011 PEV capture index. Under this scenario, overall room-night demand would increase from 0.72 million room-nights sold per year in 2011 to 0.80 million room-nights demanded and sold in 2020. The projected increase in room-night demand equates to enough market potential to add another 250 rooms in the La Palma area within eight years, assuming existing operators achieve an overall occupancy level of 69.0 percent (the 11-year average occupancy level in the La Palma is area less than 67.0 percent). It is highly unlikely existing hotel facilities can increase occupancy to capture a significant share of indicated market potential. It is much more likely many of the 18 existing hotel facilities will struggle to consistently achieve an historical level of average occupancy (67.0 percent) over the next 8 years without embarking on significant modernizing programs.
The “Potential” scenario illustrated above assumes the La Palma area reverses its long-term decline in competitive attraction through a combination of new hotel construction and modernization of existing hotel facilities. Under the “Potential” scenario, the PEV capture rate continues to recover, with approximately 0.88 million room-nights demanded and sold in 2020. The projected increase in room-night demand equates to enough market potential to add another 350 rooms in the La Palma area, assuming existing operators achieve an overall occupancy level of nearly 69.0 percent (the 11-year average occupancy level in the La Palma area less is than 67.0 percent).
Market Study for the La Palma General Plan Update III-17 ALFRED GOBAR ASSOCIATES
Project Specific Lodging Potential
Identified market potential represents the opportunity to more than double the supply of rooms within the City of La Palma over the next 4 to 8 years. Site-specific locations where a prospective hotel development can be located and effectively compete for lodging support are discussed in Chapter V—Opportunity Area Assessment. A summary of four realistic project scenarios describing the market outlook over the next 4 to 8 years are summarized below. Figure III-13 Project-Specific Lodging Potential 2012 Room 8% Hotel Market Project Scope ADR Occupancy Revenue Tax Outlook 120 Room Hotel $113 72% $3,560,000 $284,800 4-Yr 180 Room Hotel $113 72% $5,350,000 $428,000 4-Yr 250 Room Hotel $113 72% $7,420,000 $593,600 8-Yr 350 Room Hotel $113 72% $10,390,000 $831,200 8-Yr
Source: AGA.
Each project scenario assumes the hotel operation is able to command an ADR consistent with the 2011 average for all of Orange County. Identified ADR performance reflects a conservative interpretation of pricing potential describing a newly-developed upper mid-scale to upper-scale hotel facility. Overall, hotel facilities within the Orange County beach communities report average daily rates of $140 per night as of mid-year 2011. A slightly higher level of year-round occupancy is also assumed (compared to an historical average of 67.0 percent in the La Palma area).
F:\LA PALMA GPU 4-2012.DOC\APRIL 11, 2012\B
Market Study for the La Palma General Plan Update III-18 EXHIBIT III-1 INDEXED POPULATION-EMPLOYMENT-VISITOR AND ROOM-NIGHT SALES TRENDS ORANGE COUNTY METROPOLITAN REGION
1.60 1.60
1.50 1.50
1.40 1.40
1.30 1.30
1.20 1.20
1.10 1.10
1.00 1.00
0.90 0.90
0.80 0.80
0.70 0.70 Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- Jul- Jan- 01 01 02 02 03 03 04 04 05 05 06 06 07 07 08 08 09 09 10 10 11 11 12
Population Payroll Employment Visitors (6-Mo Avg) Rm-Nts Sold (12-Mo Avg)
Note: All trends indexed against 2001 12-month average.
Source: California Travel & Tourism Commission; D.K. Shifflett Associates; Tourism Economics; CA-Dept of Finance; CA-Employment Development Dept; Alfred Gobar Associates
OC-LP-Econ-Lodging Analysis1.xls/Exhibits EXHIBIT III-2 LA PALMA TRADE AREA - EXISTING HOTEL FACILITIES Year Built Name of Facility City Location ZIP Location No. of Rooms Renovated Market Scale Sheraton Hotel Cerritos 90703 203 May-90 Upper Upscale Courtyard By Marriott Buena Park 90620 145 Dec-86 Upscale Radisson Suites Hotel Buena Park 90620 200 Jul-82 Upscale Residence Inn La Mirada 90638 147 Jun-92 Upscale Holiday Inn Conference Center Buena Park 90620 248 Dec-73 Upper Midscale Fairfield Inn & Suites Buena Park 90621 137 Nov-86 Upper Midscale Holiday Inn La Mirada 90638 292 Mar-84 Upper Midscale Knott`s Berry Farm Hotel Buena Park 90620 320 Jun-74 Midscale Howard Johnson Buena Park 90621 100 Jun-68 Midscale La Quinta Inns & Suites La Palma 90623 158 Nov-87 Midscale Quality Inn & Suites Artesia 90701 161 Jun-83 Midscale Motel 6 Buena Park 90620 187 Aug-88 Economy Red Roof Inn Buena Park 90620 131 Jan-85 Economy Days Inn Buena Park 90620 58 Jun-80 Economy Good Nite Inn Buena Park 90621 131 Apr-90 Economy Extended Stay America La Mirada 90638 104 Jun-98 Economy Days Inn Artesia 90701 66 Jun-87 Economy Rodeway Inn Artesia 90701 49 Jun-64 Economy
Market Scale of Operation Facilities Avg Size No. of Rooms Room Mix Avg Age Upper Upscale 1 203 Rooms 203 7% 21.8 Years Upscale 3 164 Rooms 492 17% 24.9 Years Upper Midscale 3 226 Rooms 677 24% 30.5 Years Midscale 4 185 Rooms 739 26% 33.7 Years Economy 7 104 Rooms 726 26% 27.3 Years 18 158 Rooms 2,837 100% 28.5 Years
Cerritos Buena Park
La Palma
Source: Smith Travel Research - STR and Alfred Gobar Associates
STR - Participation Lists Combines (3509) La Palma, CA 1-12.xls/LP TA Hotels ALFRED GOBAR ASSOCIATES
Chapter IV Medical Campus Assessment
La Palma hosts 1 of 35 licensed hospitals operating within an approximately 20- minute drive of the City. Hospitals reflect a population-serving land use, meaning they exist and operate in response to public demand for a variety of medical services. Traditionally, hospitals have been regarded as a location to receive a level of acute care (emergency treatment, scheduled surgery, intensive care, etc.) that cannot be readily provided from the office of a private medical practice or community health clinic. Within rural areas, an acute care hospital is a vital resource demanded to protect the medical wellbeing of local citizens who are otherwise forced to travel great distances to receive the care needed in an emergency situation. Within the urban area of North Orange County and Southeast Los Angeles County, an acute care hospital serves to broaden the options available to first responders (paramedics, ambulance services, etc.) where acute care services can be provided in accordance with the hospital’s capabilities and patient’s needs.
Over the years, the healthcare industry has undergone significant change, driven by technological advancements, government programs, political discourse, and the economic challenge of providing medical care service. One objective of this assessment is to review macro-level trends affecting the care capacity of hospital facilities. Another objective is to review local operating performance trends that signify related changes in demand for acute care services provided from smaller community-serving hospital facilities such as the La Palma Intercommunity Hospital. The purpose of this assessment is to gauge the relative necessity of maintaining an acute care hospital facility and adjoining medical offices within the City of La Palma.
The La Palma Intercommunity Hospital is a licensed “General Acute Care” hospital with a licensed capacity of 141 beds. Development of the hospital and adjoining properties constitutes a medical campus that consists of the hospital itself (where many acute care services are performed) and adjoining medical office buildings (where physicians providing the acute care services maintain their private practice). A medical campus reflects a fundamental configuration for hospital facilities that serve
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as a preferred location to receive acute care services demanded by the general public. Within the City of La Palma, the hospital medical campus encompasses nearly 17 acres within the heart of a community.
U.S. Healthcare Trends
The healthcare industry has suffered through considerable challenges over the years, resulting in the closure of hospitals across the country. Macro factors contributing to these hospital closures include the following:
Lower admissions per 1,000 population Fewer patient days per 1,000 population Challenging economic climate Declining reimbursements Improved efficiencies Reductions in critical high-cost services Healthcare reform legislation Improved hospital-physician partnerships Emergence of hospital-sponsored healthcare retail clinics New technologies Improved clinical expertise Greater balance between hospital-based and community-based care Seismic regulations
A number of these factors have been impacted by reduced hospital requirements associated with more proactive health- and wellness-oriented programs (to better prevent illness) along with better care coordination (comprehensive electronic medical record systems, etc.), comprehensive chronic disease management (to actively manage chronic conditions like diabetes, respiratory illnesses, heart disease, and cancer), reduced readmissions, improved post-acute care treatments (most notably to reduce hospitalization requirements of at-risk and elderly populations), improvements in the quality of medical care, and increased use of outpatient services and ongoing population growth.
Collectively, these macro factors have contributed to significant reductions in the number of U.S. hospital beds per capita as highlighted below:
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Figure IV-1 U.S. Hospital Beds Per 1,000 Population Year Number 1960 9.2 1970 7.9 1980 6.0 1990 4.9 2000 3.5 2009 3.1
Source: OECD Health Data 2011.
Hospital bed demand today is roughly one-third of corresponding demand witnessed in 1960 for reasons noted above. Local witness to this trend was the completion of the Kaiser Permanente Hospital in Irvine in 2008, the first new hospital in Orange County in roughly 20 years during a period of numerous hospital closures and ongoing population growth.
California Hospital Trends
The same macro trends that have impacted the nation’s hospitals have also impacted California hospitals, in addition to a number of California-specific factors including more significant increases in charity care, the proposed expansion of a pilot project that places seniors and disabled patients that currently rely on Medi-Cal and Medicare into managed care programs, ongoing Medi-Cal budget cuts, and the proposed California Health Benefits Exchange—a State-run health benefits exchange that will target households with incomes within 133.0 percent to 400.0 percent of the poverty line (roughly $29,000 to $88,000 per year for a family of four) and small companies with less than 10 employees. The proposed health benefits exchange will be funded through a $39 million federal grant, with a scheduled launch date in conjunction with federal healthcare reforms (Affordable Care Act, etc.) set to roll-out in 2014.
Of the 82 hospitals in the State of California that were de-licensed over the nine-year period 1997 through 2006, the majority (78.1 percent) involved General Acute Care (GAC) hospitals, predominantly smaller (under 100 beds), For-Profit facilities as identified by the Office of Statewide Health Planning and Development (OSHPD). A similar evaluation of changes in licensed beds indicates a reduction of 12,057 licensed hospital beds across California between 1997 and 2006, reflecting a 12.0 percent bed count reduction. General acute care hospitals accounted for 42.5
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percent of the bed count reductions, for reasons noted earlier. While medical/surgical beds accounted for the largest component of this bed count reduction, atypical increases in bed counts were observed for intensive care newborn nursery beds (a net increase of 497 beds) and intensive care beds (a net increase of 220 beds) over the nine-year period.
From June 30, 2007 to June 30, 2011, the number of licensed GAC hospitals across the State of California actually expanded by 39 facilities, reflecting a 9.1 percent increase. The corresponding change in licensed GAC beds across the State from June 30, 2007 to June 30, 2011 was a net increase of 1,025 beds, reflecting a meager 1.1 percent increase in licensed bed supply.
Regional Hospital Trends
Between 2008 and 2009, Orange County hospitals witnessed a minor increase in the total number of licensed beds—a net increase of 64 beds or 0.8 percent increase— followed by a significant decrease in licensed beds between 2009 and 2010—a net decrease of 1,455 beds, reflecting an 18.1 percent decrease in the total base of licensed beds. Los Angeles County hospitals witnessed a similar decline in licensed bed count, decreasing 123 beds between 2008 and 2009, and an additional 3,195 beds between 2009 and 2010—a net increase of 3,318 beds reflecting an 11.5 percent decrease in total bed count, as detailed below:
Figure IV-2 Los Angeles & Orange County Hospitals Bed Count 2008 Total 2009 Total 2010 Total Licensed Beds Licensed Beds Licensed Beds Totals LA County Hospitals 28,916 28,793 25,598 Totals Orange County Hospitals 7,999 8,063 6,608
Source: California Office of Statewide Health Planning and Development; AGA.
Regional trends pertaining to total census days witnessed a similar decline over the three-year period 2008 through 2010, as total census days across Orange County declined 4.5 percent from 2008 to 2009, followed by an additional decline of 13.5 percent from 2009 to 2010. Los Angeles County hospitals experienced a 2.4 percent reduction in total census days from 2008 to 2009, subsequently followed by a 10.4 percent reduction in census days between 2009 and 2010, as identified below:
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Figure IV-3 Los Angeles & Orange County Hospitals Census Days 2008 Total 2009 Total 2010 Total Census Days Census Days Census Days Totals LA County Hospitals 6,340,866 6,190,196 5,548,518 Totals Orange County Hospitals 1,583,843 1,513,302 1,309,012
Source: California Office of Statewide Health Planning and Development; AGA.
Site Area Hospital Trends
In order to assess hospital performance in the more immediate site area, the Consultants evaluated a number of trends associated with the 34 general acute care (GAC) hospitals within closest proximity to the subject hospital, comparing their performance to the performance of the subject hospital—La Palma Intercommunity Hospital. Exhibit IV-1 arrays all 35 hospitals based on their distance from the subject hospital, including reference to the County in which the hospital is located. This latter identification is important in that Orange County only recognizes Long Beach Memorial Medical Center as an approved emergency medical receiving center capable of potentially accepting trauma cases from Orange County if the hospital is able to accommodate the trauma requirement and if the hospital is more readily accessible than Orange County trauma centers, the closest—UC Irvine Medical Center—located 9.6 miles from the subject hospital.
Exhibit IV-1 also identifies the parent company of each site area hospital to determine which hospital systems (owners of multiple hospital facilities) are in place in the site area and their respective market share. Prime Healthcare Services, the owner/operator of La Palma Intercommunity Hospital, currently has four site area hospitals which are part of their hospital system, as identified below:
Figure IV-4 Prime Healthcare Services Hospitals No. of No. of Distance From Licensed Staffed Subject Hospital Hospital City Beds Beds (Avg.) (Miles) La Palma Intercommunity La Palma 141 47 0.0 West Anaheim Medical Center Anaheim 219 96 2.9 Garden Grove Hospital Garden Grove 167 66 8.8 Huntington Beach Hospital Huntington Beach 131 41 10.4
Source: California Office of Statewide Health Planning and Development; AGA.
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Factors supporting possible closure of La Palma Intercommunity Hospital include the following:
Its comparatively small scale of operations—only 141 licensed beds— representing the second smallest Prime hospital in the site area. Its comparatively low bed staffing ratio—only 33.3 percent, well below the comparable staffing ratios for West Anaheim (43.8 percent) and Garden Grove (39.5 percent). Surplus capacity of approximately 123 unstaffed beds at West Anaheim Medical Center less than three miles from the subject hospital.
Alternatively, Prime Healthcare Services may be more amenable to the closure of one of its three surrounding area hospitals, each involving multi-story structures facing the possibility of costly seismic retrofitting costs.
Patient Volume Trends
Exhibit IV-2 identifies trends involving patient days and outpatient activity for hospitals within 15 miles of the subject hospital for the four-year period 2008 through 2011 (2011 data has yet to be published for a number of hospitals awaiting release of audited financial statements). Patient days (a.k.a. census days) are one indicator of hospital performance as it identifies the total number of days each patient stayed at the hospital. As an example, if 200 patients stayed three days and 120 patients stayed two days, the total number of patient days for the hospital during that period would be 840. The exhibit also includes reference to any changes in licensed bed count as increase in bed supply provides an opportunity for increased patient days.
Excluding the two Kaiser hospitals for which data is generally unreported, site area hospitals (excluding the subject hospital) witnessed a 3.4 percent decrease in patient days from 2008 to 2009, followed by a 3.8 percent decrease in patient days from 2009 to 2010. Of the hospitals reporting patient days for 2011, a 3.4 percent decrease in patient days was identified from 2010 to 2011. A comparison of this performance to the subject hospital is provided below:
Figure IV-5 Patient Day Trends Percent Change in Day Trends 2008-2009 2009-2010 2010-2011 La Palma Intercommunity 11.2% 18.1% 0.4% Surrounding Hospitals (3.4%) (3.8%) (3.4%)
Source: Office of Statewide Health Planning and Development; AGA.
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La Palma Intercommunity Hospital was fortunate to expand its number of patient days over the last three years through the introduction of new payer programs—Medicare Managed Care, Medi-Cal Managed Care, Indigent Traditional Care, Indigent Managed Care, and other indigent care—programs not pursued by the previous owners (i.e., pre-June 2006). As of 2010, however, the subject hospital accounted for only 1.2 percent of site area patient days, excluding the fairly sizable volume of patient days identified/estimated for each of the two site area Kaiser Permanent hospitals—Downey and Anaheim—the latter expected to ramp-up with the targeted April 2013 opening of Kaiser’s new 262-bed, 434,000-square-foot hospital in Anaheim, joining a recently-completed 172,000-square-foot, six-story medical office building.
Outpatient Trends (Emergency and Non-Emergency)
Trends pertaining to outpatient visits—one additional barometer of hospital performance—are also identified in Exhibit IV-2. A similar comparison of La Palma Intercommunity Hospital with surrounding site area hospitals is summarized below:
Figure IV-6 Outpatient Trends Percent Change in Outpatient Trends 2008-2009 2009-2010 2010-2011 La Palma Intercommunity 2.5% (6.0%) (15.6%) Surrounding Hospitals 1.1% (2.1%) 4.7%
Source: Office of Statewide Health Planning and Development; AGA.
La Palma Intercommunity Hospital has been negatively impacted by somewhat dramatic declines in outpatient visits over each of the last two years—including a 15.6 percent reduction from 2010 to 2011—during a period in which site area hospitals (in this case 12 Orange County hospitals) concurrently achieved a 4.7 percent increase in outpatient visits. As of 2010, the subject hospital accounted for only 0.8 percent of total outpatient visits within a 15-mile radius of the subject hospital, even lower if the two Kaiser Permanent hospitals are included.
Outpatient Emergency Services Trends
Unlike the previous comparisons that addressed all outpatient activity including emergency services, this comparison provides a separate breakout of outpatient visits specifically tied to emergency services. Exhibit IV-3 provides a detailed breakout of
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outpatient emergency services visits for the three-year period 2008 through 2010 along with a partial identification of 2011 visits. Excluding facilities without full three- year operating data, site area hospitals experienced a 10.0 percent increase in outpatient emergency services visits from 2008 (735,724 visits) to 2009 (808,970 visits), followed by a 2.3 percent increase in visits from 2009 to 2010 (827,735 visits). Of the 10 site area hospitals for which 2010 and 2011 operating data was available, these hospitals actually experienced a 4.1 percent decline in visits, as indicated below:
Figure IV-7 Outpatient Emergency Services Visits Percent Change in Visits 2008-2009 2009-2010 2010-2011 La Palma Intercommunity (0.2%) (4.2%) N.A. Site Area Hospitals 10.0% 2.3% (4.1%)
Source: California Office of Statewide Health Planning and Development; AGA.
In contrast to notable increases in outpatient emergency services visits at site area hospitals between 2008 and 2010—a net increase of 12.5 percent—La Palma Intercommunity Hospital experienced a 4.4 percent reduction in visits over this same period.
On an aggregate basis, La Palma Intercommunity hospital has captured a declining share of site area outpatient emergency services from 2008 through 2010, most recently responsible for only 1.3 percent of site area outpatient emergency services visits.
Utilization Rate Trends
Exhibit IV-4 provides a detailed breakout of hospital discharges and census days (a.k.a. patient days), the latter used to calculate hospital utilization rates, a key indicator of hospital performance. As indicated, hospital utilization rates have remained relatively unchanged between 2009 (an average utilization rate of 53.5 percent) and 2010 (an average utilization rate of 52.5 percent), each roughly three to four percentage points below the overall utilization rate observed during 2008—56.9 percent. While site area hospitals located in Los Angeles County enjoyed utilization rates above those observed for site area hospitals located in Orange County, each area achieve utilization rates nearly double those observed for La Palma Intercommunity Hospital, as illustrated below:
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Figure IV-8
Short-Term Hospital Utilization Rates 60.0% 55.0% 50.0% 45.0% 40.0% 35.0%
Utilization Rate Utilization 30.0% 25.0% 20.0% 2008 2009 2010 La Palma Hospital Los Angeles County Orange County
Source: California Office of Statewide Health Planning and Development; AGA.
Low hospital utilization rates at La Palma Intercommunity Hospital help to explain the operator’s decision for low bed staffing ratios to reduce labor costs and other related operating expenses.
Exhibit IV-5 represents a similar comparison of hospital utilization rates, in this case limited to general acute care operations excluding activity associated with chemical dependencies, psychiatric, skilled nursing, and any other specialty services considered outside the realm of general acute care services. Under this comparison, utilization rates at La Palma Intercommunity Hospital range from approximately 20.0 to 30.0 percent, well below site area hospitals where utilization rates associated with general acute care are generally in the vicinity of 50.0 percent, as illustrated below: Figure IV-9 General Acute Care (GAC) Hospital Utilization Rates 60.0% 55.0% 50.0% 45.0% 40.0% 35.0% 30.0%
Utilization Rate 25.0% 20.0% 15.0% 2008 2009 2010 La Palma Hospital Los Angeles County Orange County
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Below-average performance in general acute care services should be of more concern to site area residents than overall hospital performance, the latter inclusive of specialty services that involve very small percentages of the U.S. population.
Financial Trends
Exhibit IV-6 summarizes various financial trends of site area households over the last several years, focusing on two key financial indicators—net patient revenue and twelve-month pre-tax net income.
Surrounding area hospitals have benefited from steady increases in net patient revenue from 2008 to 2009—an increase of 4.5 percent—and from 2009 to 2010—an increase of 3.1 percent. Of the 17 site area hospitals with data reported for 2010 and 2011, their collective net patient revenue expanded by an impressive 9.7 percent over the past year. Following a reduction in net patient revenue in 2009, La Palma Intercommunity Hospital experienced a major ramp-up in net patient revenue during 2010, likely attributable to their capitalization of virtually every payer program available in the area, as identified below:
Figure IV-10 Net Patient Revenue Trends Percent Change in Net Patient Revenue 2008-2009 2009-2010 2010-2011 La Palma Intercommunity (1.9%) 35.0% 7.5% Surrounding Hospitals 4.5% 3.1% 9.7%
Source: Office of Statewide Health Planning and Development; AGA.
As of 2010, La Palma Intercommunity Hospital was responsible for only 1.1 percent of total net patient revenue generated throughout site area households, even less if the two Kaiser hospitals were part of the comparisons.
Twelve-month pre-tax net income (loss) varied dramatically across the 35 site area hospitals over the period 2008 through 2011. On an aggregate basis, 51.6 percent of site area hospitals experienced a net loss in pre-tax income during 2008, reducing to 25.8 percent during 2009 and 2010. Of the 18 hospitals with financial data identified for 2011, only 16.7 percent identified a loss in pre-tax net income during 2011. Over the last four years, La Palma Intercommunity hospital experienced a net loss in pre- tax income in 2008, consistent with site area hospitals.
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Financial trends for site area hospitals (excluding the subject hospital and two Kaiser facilities) identified a major ramp-up in pre-tax net income from 2008 ($114.6 million) to 2009 ($329.8 million), followed by a 13.4 percent reduction in pre-tax net income for 2010 ($285.6 million). For the 17 site area hospitals with full reporting data for 2010 and 2011, their collective pre-tax net income during 2010 ($193.8 million) expanded 19.0 percent in 2011, reflecting a $36.8 million increase in pre-tax net income.
Following a net loss of $1.4 million in pre-tax income during 2008, La Palma Intercommunity Hospital rebounded in 2009 with a $4.1 million increase in pre-tax income, followed by an additional increase in net pre-tax income of $3.8 million during 2010. The hospital’s $1.5 million reduction in net pre-tax income reported during 2011 reflects a 23.1 percent reduction in net pre-tax income in contrast to an increase of 19.0 percent achieved by surrounding area hospitals over the same interval.
Site Area Hospital Emergency Services
While the performance of La Palma Intercommunity Hospital is generally considered below the corresponding performance of site area hospitals, it is important to assess any unique emergency services offered at the subject hospital that may be unavailable at surrounding area hospitals. To make this determination, the Consultants conducted a detailed evaluation of emergency services offered for each of the 35 site area hospitals as detailed in Exhibit IV-7. As indicated, the more immediate site area offers an extensive array of basic emergency services including four Orange County-based emergency rooms (including La Palma Intercommunity Hospital) within 3.4 miles of the subject hospital. While each of these four hospitals offer basic emergency room services, two hospitals—West Anaheim Medical Center (2.9 miles) and Los Alamitos Medical Center (3.4 miles) are additionally recognized as certified cardiovascular receiving centers (CVRC), with Los Alamitos Medical Center also designated as a certified stroke neurology receiving center (SNRC). The closest identified trauma centers are Long Beach Memorial Medical Center (a Level II trauma center located 8.9 miles from the subject hospital capable of receiving Orange County patients) and UC Irvine Medical Center (a Level I trauma center 9.6 miles away).
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Exhibit IV-8 identifies the volume of emergency department visits for each of the 35 site area hospitals by order of severity. Of the four Orange County hospitals located within 3.4 miles of the subject hospital, the vast majority (75.2 percent) of emergency room visits are handled through West Anaheim Medical Center and Los Alamitos Medical Center.
While La Palma Intercommunity Hospital does offer four specialized services—labor and delivery, pediatrics, perinatal, and psychiatric—each of these specialized services are currently available at hospitals within 3.4 miles of La Palma Community Hospital. Alternatively, the subject hospital does not offer the services of a certified trauma center, a certified cardiovascular receiving center (CVRC), a certified stroke neurology receiving center (SNRC), nor a base hospital designation. Instead, the subject hospital offers only “basic” emergency care, care which is readily available at any of the other hospitals within close proximity of the subject hospital.
La Palma Intercommunity Hospital accommodated only 1.5 percent of total emergency room visits across the site area during 2010, including 1.7 percent of severe cases without a treat of death and 3.3 percent of severe cares involving a potential threat of death. The 14,752 total emergency room visits identified at the subject hospital were less than half of those recorded at Prime Healthcare Services’ nearby West Anaheim Medical enter, the latter establishing itself as the “go-to hospital” in the immediate site area for emergency services.
Site Area Hospital Non-Emergency Services
Exhibit IV-9 identifies services provided at each of the site area hospitals based on the number of licensed beds by type of medical specialty as reported by the California Office of Statewide Health Planning and Development. La Palma Intercommunity Hospital offers four of the nine general acute care specialties identified— medical/surgical, perinatal, intensive care, and coronary care—considered standard for hospitals in the more immediate site area. While there are no pediatric beds identified for the subject hospital, the hospital’s website identifies pediatrics as one of its general acute care services provided along with labor and delivery and perinatal. More expanded areas of general acute care are normally reserved for hospitals located beyond five miles from the subject hospital.
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In regards to specialty services outside the realm of general acute care, La Palma Intercommunity Hospital offers 17 beds designated for acute psychiatric care, one of only 13 hospitals providing this service of the 35 site area hospitals identified. The next closest hospital offering psychiatric care is West Anaheim Medical Center, offering 30 designated beds, nearly double the capacity identified at the subject hospital. La Palma Intercommunity Hospital has no beds designated for chemical dependency or skilled nursing, the latter however, accommodated at nearby West Anaheim Medical Center, a 219-bed hospital located only 2.9 miles from the subject hospital.
Site Area Hospital Patient Satisfaction Ratings
The U.S. Department of Health and Human Services conducts surveys of overnight hospital patients to gauge their level of satisfaction with the hospital under ten categories. On aggregate, Orange County-based hospitals in the site area generated higher patient satisfaction ratings over Los Angeles County-based hospitals in six of the ten categories in contrast to below-average scores in only three categories—the quietness of the area surrounding their room at night and, to a lesser extent, the cleanliness of their room and bathroom and the communication skills of their doctors—based on a 2011 survey summarized in Exhibit IV-10. In comparison to the satisfaction ratings of Orange County-based hospitals in the site area, La Palma Intercommunity Hospital achieved above-average satisfaction ratings in only two of the ten categories:
Hospital staff expedient response to help requests A quiet environment surrounding their room at night
In contrast, the subject hospital received below-average satisfaction ratings in seven of the ten categories identified in the 2011 survey, suggesting a generally low patient satisfaction rating by patients at La Palma Intercommunity Hospital. As indicated in Exhibit IV-10, only 59.0 percent of the patients at La Palma Intercommunity Hospital would definitely recommend the hospital to other prospective patients versus a 68.0 percent recommendation rate across the State and a 70.0 percent recommendation rate across the U.S.
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A more expanded 2010 survey of patients’ hospital experiences as published by Data.Medicicare.gov identifies 12.0 percent of patients at La Palma Intercommunity Hospital would not recommend the facility, nearly double the 7.0 percent Statewide average and more than double the 5.0 percent national average. In this survey, only 59.0 percent of patients at La Palma Intercommunity Hospital reported that they would definitely recommend the hospital in contrast to a 68.0 percent Statewide endorsement and a 69.0 percent national endorsement. The results for La Palma Intercommunity Hospital were based on between 100 and 299 completed surveys.
La Palma Intercommunity Hospital Overview
While the previous discussions benchmarked the performance of the subject hospital to competing hospitals in the site area, this discussion provides a more in-depth investigation of the hospital itself relative to services provided, patient volumes, staffed beds, various financial trends, and media-related reports concerning the hospital and, more specifically, the controversial practices of the owner/operator— Prime Healthcare Services.
Hospital Services
La Palma Intercommunity Hospital operates as an accredited hospital per The Joint Commission (TJC), formerly the Joint Commission on Accreditation of Healthcare Organizations (JCAHO). Among the various health care services identified on the hospital’s website are the following:
24-Hour Basic Emergency Cardio-Neuro Cardiovascular Lab Imaging Services Clinical Lab Critical Care Surgical Services Pharmacy Outpatient Physical Therapy Bio-Medical Women’s Care
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Stroke Patient Care Wound Care Patient Tracking & Data Systems
Under Vanguard Health Systems, La Palma Intercommunity Hospital previously offered only emergency services and on-site physicians on a 24-hour basis. Two years following Prime’s acquisition of the subject hospital they broadened the hospital’s list of services to also include 24-hour laboratory services, 24-hour radiology services, and 24-hour psychiatric emergency services, three 24-hour services not previously offered at La Palma Intercommunity Hospital.
The Emergency Department is designated by the Counties of Orange and Los Angeles as a Certified Paramedic Receiving Center along with 34 of the 35 site area hospitals (the exception Kindred Hospital in Westminster). The County of Los Angeles also recognizes the subject hospital as an Emergency Department Approved for Pediatrics (EDAP). The hospital’s primary service area includes residents of La Palma, Cerritos, Buena Park, Cypress, Artesia, Norwalk, La Mirada, Stanton, Los Alamitos, Hawaiian Gardens, and Anaheim.
Awards
La Palma Intercommunity Hospital was one of 405 accredited hospitals and critical access hospitals across the United States in 2010 honored in the Top Performers on Joint Commission Key Quality Measures program, a program that rewards hospitals that demonstrate and maintain excellent performance on critical, evidence-based process of care measures, measures that should ultimately translate to better patient outcomes. The program recognizes hospitals where staff provides the recommended clinical processes for at least 95 out of every 100 opportunities specific to five conditions—heart attack, heart failure, pneumonia, surgical, and children’s asthma. The 405 awarded hospitals represent the top 14.0 percent of accredited hospitals that report core measure performance data to the Joint Commission. La Palma Intercommunity Hospital attained excellence in accountability for each of the five conditions in 2010 (2011 awards have yet to be announced).
While La Palma Intercommunity Hospital was one of eight Prime hospitals identified as a “Top Performer for 2010,” it should be noted that Prime’s remaining eight
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hospitals did not make the list of top performing hospitals in 2010. Additionally, examination of three years of California Medicare billing data by California Watch’s (a project of the nonprofit Center for Investigative Reporting) identified Prime’s 13 California-based hospitals (excludes Alvarado Hospital Medical Center acquired in 2010) as collectively reporting acute heart failure among 12.9 percent of its Medicare patients, more than double the Statewide rate of 5.1 percent. Of the 10 California hospitals reporting the highest heart failure rates, eight involved hospitals owned by Prime Healthcare Services.
Prime Healthcare Services has been recognized as a “Top 15 Health System in the Nation” in 2012 according to Thomson Reuters, having previously achieved this award in 2009. The annual quantitative survey benchmarks the hospitals that comprise the health system against hospital ratings associated with similarly-sized health systems to determine the five highest ranked health systems by size of health system—small, medium (Prime Healthcare Services), and large. Key performance measures include mortality index, patient safety index, mortality rates, readmission rate, average length of stay, HCAHPS score, etc. Prime Healthcare Services was the only California-based health system of the 15 top-rated health systems across the U.S.
Patient Volume and Occupancy Trends
Exhibit IV-11 identifies changes in patient volume trends from 2002 through 2010. Included in the exhibit is a vertical dashed line that signifies operations under the previous owner (Vanguard Health Systems) and current owner (Prime Healthcare Services).
Patient volume trends and occupancy rates across the most recent eight-year operating period indicates that the previous operator accommodated a considerably higher volume of patients in virtually all measured categories relative to the new owners, as summarized in the following comparisons:
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Figure IV-11 Patient Volume Trends Vanguard 4-Year Average Prime 4-Year Average Ending 6/30/06 Ending 12/31/10 Patient (Census) Days 22,218 15,119 Discharges 4,713 3,895 Outpatient Visits (Incl. ER) 45,603 28,295 Outpatient ER Visits 17,383 11,360 Total ER Visits 21,225 14,769
Source: California Office of Statewide Health Planning and Development.
As indicated, patient (census) days are down 32.0 percent, discharges are down 17.4 percent, outpatient visits are down 38.0 percent, outpatient emergency room visits are down 34.7 percent, and total emergency room visits are down 30.4 percent under the current owners. The net impact of reduced patient volumes is corresponding reductions in hospital occupancy rate, as identified below:
Figure IV-12 Hospital Occupancy Rate Vanguard Health Systems Prime Healthcare Services 7/02-6/03 7/03-6/04 7/04-6/05 7/05-6/06 2007 2008 2009 2010 40.8% 44.6% 43.0% 44.2% 29.6% 24.7% 30.1% 33.0%
Source: California Office of Statewide Health Planning and Development.
One notable practice employed by Prime Healthcare Services since the beginning of 2008 is the dramatic reduction in the number of staffed beds at La Palma Intercommunity Hospital—from a low of only 26.2 percent of the 141 available beds in 2008 to a high of only 33.3 percent in 2010—well below the 100.0 percent bed staffing previously employed by Vanguard Health Systems. The practice of running a very low staffing ratio implies a combination of an oversupply of hospital beds in the immediate site area and an attempt to improve net income vis-à-vis a reduction in operating expenses.
Financial Trends
Exhibit IV-12 identifies financial trends for La Palma Intercommunity Hospital over the most recent eight years for which financial data was available, with the caveat that the 2010 statistics were unaudited as of the survey date. Despite a significant reduction in patient volume, the new owners of La Palma Intercommunity Hospital have been able to achieve substantially improved financial performance as indicated below:
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Figure IV-13 La Palma Intercommunity Hospital Financial Benchmarks Four-Year Averages Vanguard Prime Gross Inpatient Revenue $88,668,193 $109,001,140 Gross Outpatient Revenue $48,981,141 $42,692,206 Net Income ($577,998) $3,470,003 Net Inpatient Revenue Per Day $1,088 $2,257 Net Outpatient Revenue Per Visit $293 $461
Source: California Office of Statewide Health Planning and Development.
The financial successes achieved by Prime Healthcare Services at La Palma Intercommunity Hospital are a function of the following:
Implementation of payer systems not previously utilized by Vanguard Health Systems—Medicare Managed Care, Medi-Cal Managed Care, Indigent Traditional Care, and other indigent care.
Controversial inpatient billing practices currently under investigation (described in more detail later in this chapter).
Reduced operating expenses [vis-à-vis a significant reduction in the number of staffed beds and (presumably) other improved operating efficiencies].
The above observation regarding controversial inpatient billing practices would help to explain Prime Healthcare Services’ 22.9 percent increase in average gross inpatient revenue concurrent with a 12.8 percent decline in average gross outpatient revenue, as identified in Exhibit IV-12.
Site Area Medical Coverage Assessment
The Consultants evaluated site area medical coverage relative to emergency services and non-emergency services, each of which are discussed in the following sections of this chapter.
Emergency Medical Coverage
Total emergency room encounters (outpatient and admissions) across Orange County and Los Angeles County expanded from 2008 to 2009, followed by a reduction in encounters from 2009 to 2010:
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Table IV-14 Emergency Department Encounters 2008 2009 2010 Orange County 574,529 611,422 589,648 Los Angeles County 2,195,144 2,394,801 2,301,613
Source: California Office of Statewide Health Planning and Development.
On a per capita basis, the number of encounters per capita expanded in each area from 2008 to 2009, followed by a reduction in emergency service encounters per capita from 2009 to 2010:
Table IV-15 Emergency Department Encounters Per 1,000 Residents 2008 2009 2010 Orange County 192.6 203.9 195.4 Los Angeles County 224.1 244.2 234.2
Source: California Office of Statewide Health Planning and Development.
The comparisons indicate that Los Angeles County residents routinely generate higher emergency department demand relative to residents of Orange County by an average of 18.7 percent higher demand on a per capita-adjusted basis.
In 2010, the four hospitals located within a three-mile radius of the subject hospital collectively accounted for 59,350 emergency department encounters, translating to a ratio of 252.5 encounters per 1,000 residents, positioning demand above the corresponding ratios for Orange and Los Angeles Counties. In the three- to five-mile trade area, the two site area hospitals collectively accounted for 37,862 emergency department encounters, or an average per capita ratio of only 100.4. On a combined basis, the five-mile trade area surrounding the subject hospital generates an overall ratio of 158.8 encounters per every 1,000 residents, well below Orange County and Los Angeles County ratios, suggesting below-average emergency medical service demand in the site area and, presumably, sufficient surplus capacity across site area hospitals to absorb the possible closure of the subject hospital, the latter accommodating only 15.2 percent of site area (five-mile radius) emergency service encounters.
Two site area hospitals—West Anaheim Medical Center (2.9 miles) and Los Alamitos Medical Center (3.4 miles) collectively capture 60.3 percent of emergency department encounters within five miles of the subject hospital. The two Los Angeles County- based hospitals within five miles of the subject hospital—Tri-City Regional Medical
Market Study for the La Palma General Plan Update IV-19 ALFRED GOBAR ASSOCIATES
Center (2.5 miles) and Norwalk Community Hospital (4.6 miles)—collectively capture only 17.9 percent of emergency department encounters, potentially a function of lower standards for emergency services in Los Angeles County (per input provided by the Orange County Health Care Agency-Emergency Medical Services) and the inclusion of most northerly Orange County hospitals as approved paramedic receiving centers (PRC) by Los Angeles County Health Services-Emergency Medical Services. In reality, the potential closure of the subject hospital would likely have more of an impact on Los Angeles County residents than Orange County residents. Of the eleven cities identified as cities served by La Palma Intercommunity Hospital (per hospital’s website), five represent cities in Los Angeles County—Cerritos, Artesia, Norwalk, La Mirada, and Hawaiian Gardens.
As noted earlier, La Palma Intercommunity Hospital provides “basic” emergency care which is standard across all general acute care hospitals (except Kindred Hospital Westminster) within seven miles of the subject hospital. Furthermore, it is not certified as a cardiovascular receiving center (CVRC) nor a stroke neurology center (SNRC), services available at two site area hospitals—West Anaheim Medical Center (2.9 miles) and Los Alamitos Medical Center (3.4 miles).
Non-Emergency Medical Coverage
Non-emergency medical coverage is primarily evaluated based on the number of licensed hospital beds offered at short-term acute care hospitals in an area relative to the population it serves. The beds per 1,000 population ratios today are roughly one- third the ratios identified five decades ago based on a number of macro factors described at the beginning of this chapter. Application of this same methodology to the region surrounding the site area provides regional benchmarks from which the site area supply of beds can be assessed to determine possible oversupply or undersupply scenarios.
On a Countywide basis, Orange County residents have access to a slightly smaller ratio of licensed hospital beds—2.2 beds per 1,000 population—relative to Los Angeles County residents—2.6 beds per 1,000 population—paralleling our earlier identification of Los Angeles County residents’ greater demand for medical services including a higher incidence of emergency room encounters. In the immediate site area, the ratio of licensed hospital beds per 1,000 population is as follows:
Market Study for the La Palma General Plan Update IV-20 ALFRED GOBAR ASSOCIATES
Figure IV-16 Licensed Hospital Beds Per 1,000 Residents (2010): Survey Area Ratio 0- to 3-Mile Trade Area 2.4 3- to 5-Mile Trade Area 0.6 5- to 10-Mile Trade Area 2.3 Orange County Overall 2.2
Source: California Office of Statewide Health Planning and Development; ESRI.
With the exception of the three- to five-mile trade area, these ratios are above the Orange County ratio of 2.2 beds per 1,000 population. On an aggregate basis, the ten-mile trade area surrounding the subject hospital offers an overall licensed bed ratio of 2.1 beds per 1,000 population, negligibly under the Countywide ratio. Closure of the 141 licensed beds at La Palma Intercommunity Hospital would lower the three- mile ratio to 1.8 licensed beds per 1,000 residents and the ten-mile ratio to 2.0 licensed beds per 1,000 residents. While these ratios are slightly under the Orange County ratio of 2.2 beds per 1,000 population, the low hospital utilization rates of the subject hospital and the surrounding three-mile trade area suggest more than ample supply of licensed hospital beds in the immediate site area, as highlighted below:
Figure IV-17 Hospital Utilization Rates 2008-2010 Area 2008 2009 2010 La Palma Intercommunity Hospital 24.8% 30.1% 33.1% 0- to 3-Mile Trade Area (Excl. La Palma) 35.7% 42.9% 29.6% 3- to 5-Mile Trade Area 82.9% 83.6% 79.0% 5- to 10-Mile Trade Area 60.5% 52.4% 54.8% 10- to 15-Mile Trade Area 55.8% 53.9% 52.3% Orange County Overall 56.1% 54.5% 52.2% Los Angeles County Overall 54.2% 52.4% 52.9%
Source: California Office of Statewide Health Planning and Development.
The consideration to possibly close down operations at La Palma Intercommunity Hospital will ultimately be determined by the Orange County Health Care Agency- Emergency Medical Services.
Impact On Surrounding Land Uses
Land uses surrounding the 141-bed La Palma Intercommunity Hospital involve four medical office buildings, an assisted living facility, a freestanding modular building
Market Study for the La Palma General Plan Update IV-21 ALFRED GOBAR ASSOCIATES
involved in hospital-related activities, and a freestanding Bank of America building, the latter representing the only non-medical-related land use comprising this Priority 1 Opportunity Area.
Traditionally, medical office buildings adjoining a general acute care hospital (a.k.a. on-campus medical office buildings) benefit from the synergistic attributes associated with the hospital, including the following:
Off-site hospital operations accommodated in one or more adjoining medical office buildings. Hospital-generated demand for off-site support services—laboratories, dialysis center, etc. Medical office demand associated with the private practices of doctors on staff at the hospital. General medical and emergency services provided to patients at adjoining assisted living facilities.
La Palma Intercommunity Hospital currently occupies four medical office suites (Suites 105, 106, 107, and 109; an estimated 4,000 to 4,500 square feet) in Peppertree Plaza, a 20,400-square-foot, two-story medical office building located immediately north of the hospital. Suites 105-107 are occupied by the hospital’s Senior Outpatient and Behavioral Health Services, with no specified use of space for Suite 109. A major advantage of Suites 105-107 is their dual front and rear suite access, the latter providing direct pedestrian linkages to the hospital along with what appears to be shared parking for the hospital and medical office building. Peppertree Plaza was fully occupied at the time of the on-site field audit.
La Palma Intercommunity Hospital also occupies Suite 106 of La Palma Medical Building located at 5471 La Palma Avenue, a two-story, 20,488-square-foot medical building located immediately south of the hospital. The hospital utilizes this space for their wound care clinic, with excellent signage directing patients to this suite location from the abutting hospital.
While the Consultants are aware of the hospital’s utilization of at least one adjoining support service—Quest Diagnostics—it is likely that the hospital generates some level of work volume for other medical-related support services currently operating from the four adjoining medical office buildings including the following:
Market Study for the La Palma General Plan Update IV-22 ALFRED GOBAR ASSOCIATES
Consolidated Medical Laboratory La Palma Dialysis Center La Palma Towers Pharmacy Lab Corp
Of the roughly 30 doctors occupying space across the four surrounding medical office buildings, it is expected that a portion may be on staff at La Palma Intercommunity Hospital to capitalize on the convenient pedestrian linkages to the adjoining hospital.
According to representatives of the Sunrise assisted living facility, only a small percentage of patients at their facility are also patients of one or more of the 30-plus doctors who practice from one of the four medical office buildings adjoining the hospital. The representatives did, however, note that the hospital captures a number of medical emergencies involving patients from the assisted living facility.
While possible closure of the hospital facility would traditionally have a negative impact on occupancy at the four surrounding medical office buildings similar to the loss of an anchor tenant at a neighborhood shopping center, three of these four buildings currently suffer from abnormally high (relative to national trends) vacancy rates, as identified below:
Figure IV-18 Medical Office Space Availability Building Address Total Sq. Ft. Available Sq. Ft. Vacancy Rate 7872 Walker Street 59,245 33,683 56.9% 7851 Walker Street 20,400 0 0.0% 5451 La Palma Avenue 38,324 5,489 14.3% 5471 La Palma Avenue 20,488 7,546 36.8%
Totals 138,457 46,718 33.7%
Source: Brokers; LoopNet, Inc.; AGA.
The four on-campus medical office buildings were negatively impacted by an overall availability rate of 33.7 percent, or an occupancy rate of approximately 66.3 percent. According to Grubb & Ellis’ Healthcare Properties Group National Healthcare Real Estate Market Survey conducted during Fourth Quarter 2011, overall occupancy rates of medical office buildings were considerably higher for “on-campus” buildings versus “off-campus” buildings for reasons noted earlier. A comparison of on-campus versus off-campus medical office occupancy rates across the U.S. is as follows:
Market Study for the La Palma General Plan Update IV-23 ALFRED GOBAR ASSOCIATES
Figure IV-19 Percent Respondents Identifying Medical Office Building Occupancy Levels % Respondents: On-Campus Off-Campus Reported Occupancy Rate Location Location Less than 60% 1.5% 3.6% 60 – 75% 9.2% 14.5% 76 – 90% 33.8% 50.9% 91 – 100% 55.4% 30.9%
Source: Grubb & Ellis Healthcare Properties Group.
The 66.3 percent on-campus medical office occupancy rate across the four subject medical office buildings ranks in the lower 10.7 percent of on-campus medical office buildings across the U.S., suggesting very weak demand support currently generated by the hospital. This weak demand support would also help to explain the significant tenant turnover identified for all but one of the four medical office buildings surrounding La Palma Intercommunity Hospital and the unusually high representation of medical-related tenants that traditionally have no (or very limited) involvement with hospitals—eye doctors, acupuncturists, massage therapists, etc.
Below-average occupancy rates associated with the two-building La Palma Medical Building complex (5451 and 5471 La Palma Avenue) could also be attributable to deferred maintenance impacting each of these two buildings and poorly-identified parking identification which occasionally results in hospital visitors absorbing parking stalls intended for medical office visitors.
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Market Study for the La Palma General Plan Update IV-24 EXHIBIT IV-1 SITE AREA HOSPITALS
Distance Reference From Number Hospital Street City County Subject Site 1 La Palma Intercommunity Hospital (Subject Property) Prime Healthcare Services 7901 Walker Street La Palma OC 0 2 Tri-City Regional Medical Center Vista Healthcare 21530 S. Pioneer Boulevard Hawaiian Gardens LA 2.5 3 Anaheim General Hospital Pacific Health Corp. 3350 W. Ball Road Anaheim OC 2.8 4 West Anaheim Medical Center Prime Healthcare Services 3033 W. Orange Avenue Anaheim OC 2.9 5 Los Alamitos Medical Center Tenant Healthcare Corp. 3751 Katella Avenue Los Alamitos OC 3.4 6 Norwalk Community Hospital Alta Hospitals System, LLC 13222 Bloomfield Avenue Norwalk LA 4.6 7 Bellflower Medical Center Pacific Health Corp. 9542 Artesia Boulevard Bellflower LA 5.6 8 Coast Plaza Hospital Avanti Hospitals, LLC 13100 Studebaker Road Norwalk LA 5.7 9 AHMC-Anaheim Regional Medical Center AHMC & ARMC Healthcare, Inc. 1111 W. La Palma Avenue Anaheim OC 6.1 10 Kindred Hospital-Westminster Kindred Healthcare 200 Hospital Circle Westminster OC 6.3 11 Lakewood Regional Medical Center Tenant Healthcare Corp. 3700 E. South Street Lakewood LA 6.4 12 St. Jude Medical Center St. Joseph Health System 101 E. Valencia Mesa Drive Fullerton OC 7.1 13 Kaiser Permanente Downey Medical Center Kaiser Permanente 9333 Imperial Highway Downey LA 7.2 14 Community Hospital of Long Beach MemorialCare Health System 1720 Termino Avenue Long Beach LA 7.3 15 Whittier Hospital Medical Center AHMC Healthcare, Inc. 9080 Colima Road Whittier LA 7.4 16 Western Medical Center/Anaheim Integrated Healthcare 1026 S. Anaheim Boulevard Anaheim OC 7.7 17 Downey Regional Medical Center Downey Regional Medical Center 11500 Brookshire Avenue Downey LA 8.0 18 Presbyterian Intercommunity Hospital Interhealth Corp. 12401 Washington Boulevard Whittier LA 8.4 19 Garden Grove Hospital & Medical Center Prime Healthcare Services 12601 Garden Grove Boulevard Garden Grove OC 8.8 20 Long Beach Memorial Medical Center MemorialCare Health System 2801 Atlantic Avenue Long Beach LA 8.9 21 Pacific Hospital of Long Beach HealthSmart Pacific, Inc. 2776 Pacific Avenue Long Beach LA 9.3 22 UC Irvine Medical Center Regents of the University of California 101 The City Drive South Orange OC 9.6 23 St. Mary Medical Center Catholic Healthcare West 1050 Linden Avenue Long Beach LA 9.7 24 Huntington Beach Hospital Prime Healthcare Services 17772 Beach Boulevard Huntington Beach OC 10.4 25 St. Joseph Hospital St. Joseph Health System 1100 W. Steward Drive Orange OC 11.0 26 Fountain Valley Regional Hospital Tenant Healthcare Corp. 17100 Euclid Street Fountain Valley OC 11.0 27 St. Francis Medical Center Daughters of Charity Health System 3630 E. Imperial Highway Lynwood LA 11.0 28 Orange Coast Memorial Medical Center MemorialCare Health System 9920 Talbert Avenue Fountain Valley OC 11.1 29 Kaiser Permanente Anaheim (Under Construction) Kaiser Permanente La Palma Avenue & Grove Avenue Anaheim OC 11.1 30 Placentia-Linda Hospital Tenant Healthcare Corp. 1301 N. Rose Drive Placentia OC 11.6 31 Beverly Hospital Beverly Community Hospital Assn. 309 W. Beverly Boulevard Montebello LA 12.1 32 Kaiser Permanente Anaheim Medical Center Kaiser Permanente 441 N. Lakeview Avenue Anaheim OC 12.7 33 Chapman Medical Center Integrated Healthcare 2601 E. Chapman Avenue Orange OC 12.9 34 Coastal Communities Hospital Integrated Healthcare 2701 S. Bristol Street Santa Ana OC 12.9 35 Western Medical Center/Santa Ana Integrated Healthcare 1001 N. Tustin Avenue Santa Ana OC 13.4
Note: Excludes VA Hospital in Long Beach (just over 8.0 miles west of subject hospital (Miller Children's Hospital in Long Beach (approximately 10.5 miles west), Children's Hospital of Orange (approximately 11.0 miles east), and LA County Los Amigos National Rehabilitation Center in Downey (approximately 11.0 miles northwest of the subject hospital.
Source: Google Earth Pro; AGA.
Hospitals Distance From Site.xls 3/28/2012 EXHIBIT IV-2 PATIENT VOLUME TRENDS 2008 - 2010 SITE AREA HOSPITALS
Ref. Licensed Beds Patient Days Outpatient Visits* # Hospital 2008 2009 2010 2008 2009 2010 2008 2009** 2010 1 La Palma Intercommunity Hospital (Subject) 141 141 141 12,754 15,486 17,029 25,717 26,357 24,776 2 Tri-City Regional Medical Center 137 107 107 16,374 17,253 15,667 14,939 16,171 16,577 3 Anaheim General Hospital 101 101 101 12,636 0 2,020 18,568 12,510 7,756 4 West Anaheim Medical Center 219 219 219 32,056 33,320 34,557 41,801 55,940 62,093 5 Los Alamitos Medical Center 167 167 167 43,327 43,083 42,595 85,577 85,619 80,482 6 Norwalk Community Hospital 50 50 50 17,273 17,597 16,088 N.A. N.A. N.A. 7 Bellflower Medical Center 144 144 144 24,868 23,462 22,235 39,185 36,439 32,993 8 Coast Plaza Hospital 117 117 117 17,759 16,244 13,604 15,609 17,800 21,010 9 AMHC Anaheim Regional Medical Center 223 223 223 55,819 26,701 54,760 73,746 72,484 74,659 10 Kindred Hospital-Westminster 109 109 109 38,310 36,092 34,866 0 0 0 11 Lakewood Regional Medical Center 172 172 172 39,212 37,801 38,428 57,286 56,689 51,983 12 St. Jude Medical Center 349 384 384 80,849 85,868 85,547 331,431 363,583 396,306 13 Kaiser Permanente Downey Medical Center - 352 352 - 21,095 79,533 - 43,326 138,997 14 Community Hospital of Long Beach 243 208 208 19,961 19,131 19,467 15,055 27,042 23,796 15 Whittier Hospital Medical Center 178 178 178 38,045 37,714 33,769 82,743 39,546 57,790 16 Western Medical Center/Anaheim 188 188 188 48,312 44,866 43,252 30,796 53,777 43,559 17 Downey Regional Medical Center 199 199 199 56,593 50,118 44,335 122,812 118,959 109,520 18 Presbyterian Intercommunity Hospital 444 444 444 85,912 75,109 79,053 306,474 298,933 274,843 19 Garden Grove Hospital & Medical Center 167 167 167 28,057 25,939 24,255 37,366 39,834 39,037 20 Long Beach Memorial Medical Center 462 462 462 125,953 114,425 108,972 187,896 179,192 162,256 21 Pacific Hospital of Long Beach 148 184 184 41,523 40,125 40,570 37,534 80,415 37,122 22 UC Irvine Medical Center 444 392 412 102,799 100,912 94,087 427,355 422,780 401,641 23 St. Mary Medical Center 389 389 389 63,236 59,508 57,648 198,800 187,382 206,475 24 Huntington Beach Hospital 131 131 131 16,929 15,741 15,302 37,549 37,581 36,829 25 St. Joseph Hospital 525 525 525 82,896 86,058 83,688 264,469 271,975 269,255 26 Fountain Valley Regional Hospital 293 293 293 82,019 87,463 88,166 73,944 75,817 82,640 27 St. Francis Medical Center 384 384 384 110,004 105,490 100,174 187,258 192,533 205,426 28 Orange Coast Memorial Medical Center 224 218 218 44,976 46,252 45,259 59,335 62,277 58,540 29 Kaiser Permanente Anaheim (U/C) ------30 Placentia-Linda Hospital 114 114 114 14,776 14,082 13,520 34,549 33,590 35,941 31 Beverly Hospital 224 224 224 38,927 35,415 35,768 49,261 40,277 37,646 32 Kaiser Permanente Anaheim Medical Center 200 200 200 52,342 47,131 46,710 180,328 N.A. 160,000*** 33 Chapman Medical Center 114 114 114 24,522 22,866 22,679 35,578 23,161 14,823 34 Coastal Communities Hospital 178 178 178 38,032 38,209 36,009 34,695 35,333 32,153 35 Western Medical Center/Santa Ana 282 282 282 53,783 45,794 39,294 39,586 36,108 38,997
*Outpatient visit data provided through the Orange County Business Journal Book of Lists. **Estimates based on reported percentage changes in volume from 2009 to 2010. ***Estimate.
Source: Orange County Business Journal; Office of Statewide Health Planning and Development; AGA. Patient Volume Trends 3-2012.xls 3/28/2012 EXHIBIT IV-3 OUTPATIENT EMERGENCY SERVICES VISITS
Reference Outpatient Emergency Services Visits Number Hospital 2008 2009 2010 2011 1 La Palma Intercommunity Hospital (Subject) 11,590 11,570 11,080 N.A. 2 Tri-City Regional Medical Center 8,347 9,230 8,880 N.A. 3 Anaheim General Hospital 8,989 7,757 6,481 N.A. 4 West Anaheim Medical Center 20,623 30,924 23,398 N.A. 5 Los Alamitos Medical Center 23,015 23,969 23,253 N.A. 6 Norwalk Community Hospital N.A. N.A. 6,749 N.A. 7 Bellflower Medical Center 11,529 11,358 11,396 N.A. 8 Coast Plaza Hospital 14,378 14,268 12,846 N.A. 9 AHMC Anaheim Regional Medical Center 34,190 34,999 57,998 35,971 10 Kindred Hospital-Westminster 0 0 0 N.A. 11 Lakewood Regional Medical Center 28,625 30,680 31,876 N.A. 12 St. Jude Medical Center 46,133 49,466 53,744 68,918 13 Kaiser Permanente Downey Medical Center N.A. 22,834 76,571 N.A. 14 Community Hospital of Long Beach 14,323 26,380 23,234 N.A. 15 Whittier Hospital Medical Center 18,436 11,172 21,025 21,141 16 Western Medical Center/Anaheim 15,335 14,697 13,888 N.A. 17 Downey Regional Medical Center 32,627 34,776 32,204 31,494 18 Presbyterian Intercommunity Hospital 52,801 54,762 53,854 N.A. 19 Garden Grove Hospital & Medical Center 21,912 26,385 21,255 N.A. 20 Long Beach Memorial Medical Center 35,181 36,820 36,066 38,199 21 Pacific Hospital of Long Beach 12,633 14,251 13,783 N.A. 22 UC Irvine Medical Center 10,090 11,735 17,694 19,184 23 St. Mary Medical Center 37,424 29,640 34,717 37,669 24 Huntington Beach Hospital 14,945 15,080 14,690 N.A. 25 St. Joseph Hospital 44,321 45,751 47,617 40,986 26 Fountain Valley Regional Hospital 25,719 28,489 28,467 N.A. 27 St. Francis Medical Center 43,913 66,789 66,927 57,608 28 Orange Coast Memorial Medical Center 17,840 17,400 18,293 19,342 29 Kaiser Permanente Anaheim (U/C) - - - - 30 Placentia-Linda Hospital 17,714 19,045 18,655 N.A. 31 Beverly Hospital 27,932 26,649 24,856 N.A. 32 Kaiser Permanente Anaheim Medical Center 47,505 66,529 64,580 N.A. 33 Chapman Medical Center 11,568 9,463 8,284 N.A. 34 Coastal Communities Hospital 19,503 20,862 19,387 N.A. 35 Western Medical Center/Santa Ana 18,173 19,644 18,387 N.A.
Source: Office of Statewide Health Planning & Development; AGA.
Outpatient Emergency Services Visits 3-2012.xls 3/28/2012 EXHIBIT IV-4 SHORT-TERM HOSPITAL UTILIZATION TRENDS
Reference 2008 No. of 2009 No. of 2010 No. of Total Discharges Total Census Days Hospital Utilization Rate Number Licensed Beds Licensed Beds Licensed Beds 2008 2009 2010 2008 2009 2010 2008 2009 2010 1 141 141 141 3,404 4,007 4,147 12,754 15,486 17,029 24.8% 30.1% 33.1% 2 137 107 107 3,482 3,688 3,602 16,374 17,253 15,667 32.7% 44.2% 40.1% 3 101 101 101 2,775 0 485 12,636 0 2,020 34.3% - 5.5% 4 219 219 219 6,619 6,840 6,540 32,056 33,320 34,557 40.1% 41.7% 43.2% 5 167 167 167 9,652 9,734 9,388 43,327 43,083 42,595 71.1% 70.7% 69.9% 6 50 50 50 2,603 2,707 2,716 17,273 17,597 16,088 94.6% 96.4% 88.2% 7 144 144 144 5,243 4,802 4,574 24,868 23,462 22,235 47.3% 44.6% 42.3% 8 117 117 117 4,188 4,272 3,895 17,759 16,244 13,604 41.6% 38.0% 31.9% 9 223 223 223 13,529 6,380 12,916 55,819 26,701 54,760 68.6% 32.8% 67.3% 10 109 109 109 1,100 1,018 994 38,310 36,092 34,866 96.3% 90.7% 87.6% 11 172 172 172 7,747 7,668 7,786 39,212 37,801 38,428 62.5% 60.2% 61.2% 12 349 384 384 16,875 17,163 17,289 80,849 85,868 85,547 63.5% 61.3% 61.0% 13 - 352 352 - 5,653 20,983 - 21,095 79,533 - 16.4% 61.9% 14 243 208 208 4,094 3,945 4,082 19,961 19,131 19,467 22.5% 25.2% 25.6% 15 178 178 178 9,290 9,485 8,131 38,045 37,714 33,769 58.6% 58.0% 52.0% 16 188 188 188 8,270 8,248 7,717 48,312 44,866 43,252 70.4% 65.4% 63.0% 17 199 199 199 13,647 13,539 12,057 56,593 50,118 44,335 77.9% 69.0% 61.0% 18 444 444 444 18,340 17,414 19,149 85,912 75,109 79,053 53.0% 46.3% 48.8% 19 167 167 167 8,977 7,199 6,825 28,057 25,939 24,255 46.0% 42.6% 39.8% 20 462 462 462 25,497 24,138 22,652 125,953 114,425 108,972 74.7% 67.9% 64.6% 21 148 184 184 6,967 7,084 7,496 41,523 40,125 40,570 76.9% 59.7% 60.4% 22 444 392 412 17,088 16,336 15,572 102,799 100,912 94,087 63.4% 70.5% 62.6% 23 389 389 389 11,085 10,869 10,892 63,236 59,508 57,648 44.5% 41.9% 40.6% 24 131 131 131 4,308 3,889 3,742 16,929 15,741 15,302 35.4% 32.9% 32.0% 25 525 525 525 22,054 22,521 21,013 82,896 86,058 83,688 43.3% 44.9% 43.7% 26 293 293 293 16,732 18,192 17,517 82,019 87,463 88,166 76.7% 81.8% 82.4% 27 384 384 384 27,380 21,505 19,800 110,004 105,490 100,174 78.5% 75.3% 71.5% 28 224 218 218 12,582 12,212 12,414 44,976 46,252 45,259 55.0% 58.1% 56.9% 29------30 114 114 114 4,397 4,006 4,295 14,776 14,082 13,520 35.5% 33.8% 32.5% 31 224 224 224 9,723 9,009 8,872 38,927 35,415 35,768 47.6% 43.3% 43.7% 32 200 200 200 13,635 12,684 11,931 52,342 47,131 46,710 71.7% 64.6% 64.0% 33 114 114 114 2,642 2,353 2,139 24,522 22,866 22,679 58.9% 55.0% 54.5% 34 178 178 178 4,932 5,014 4,690 38,032 38,209 36,009 58.5% 58.8% 55.4% 35 282 282 282 12,835 10,771 9,102 53,783 45,794 39,294 52.3% 44.5% 38.2%
Overall Average Utilization Rate: 56.9% 53.5% 52.5% Orange County Utilization Rate: 56.1% 54.5% 52.2% Los Angeles Average Utilization Rate: 54.2% 52.4% 52.9%
Notes: West Anaheim Medical Center (Reference #4) was prevously referred to as Anaheim General Medical Center prior to 2009. AHMC-Anaheim Regional Medical (Reference #9) was previously referred to as Anaheim Memorial Medical Center prior to 2009.
Source: California Office of Statewide Health Planning and Development; AGA.
Short-Term Hospital Utilization Trends 3-2012.xls 3/28/2012 EXHIBIT IV-5 GENERAL ACUTE CARE (GAC) HOSPITAL UTILIZATION TRENDS
2008 2009 2010 Reference No. of GAC No. of GAC No. of GAC Total GAC Discharges Total GAC Census Days GAC Hospital Utilization Rate Number Hospital Licensed Beds Licensed Beds Licensed Beds 2008 2009 2010 2008 2009 2010 2008 2009 2010 1 La Palma Intercommunity Hospital (Subject Property) 124 124 124 3,091 3,682 3,820 9,168 11,935 13,495 20.3% 26.4% 29.8% 2 Tri-City Regional Medical Center 137 107 107 3,482 3,688 3,602 16,374 17,253 15,667 32.7% 44.2% 40.1% 3 Anaheim General Hospital 101 101 101 2,775 0 485 12,636 0 2,020 34.3% 0.0% 5.5% 4 West Anaheim Medical Center 167 167 167 6,180 6,401 6,090 24,756 25,686 27,336 40.6% 42.1% 44.8% 5 Los Alamitos Medical Center 142 142 142 9,301 9,375 9,010 37,046 36,649 36,040 71.5% 70.7% 69.5% 6 Norwalk Community Hospital 50 50 50 2,603 2,707 2,716 17,273 17,597 16,088 94.6% 96.4% 88.2% 7 Bellflower Medical Center 112 112 112 4,238 3,659 3,425 16,096 14,174 12,246 39.4% 34.7% 30.0% 8 Coast Plaza Hospital 105 105 105 4,188 4,272 3,895 17,759 16,244 13,604 46.3% 42.4% 35.5% 9 AHMC-Anaheim Regional Medical Center 223 223 223 13,529 6,380 12,916 55,819 26,701 54,760 68.6% 32.8% 67.3% 10 Kindred Hospital-Westminster 109 109 109 1,100 1,018 994 38,310 36,092 34,866 96.3% 90.7% 87.6% 11 Lakewood Regional Medical Center 172 172 172 7,747 7,668 7,786 39,212 37,801 38,428 62.5% 60.2% 61.2% 12 St. Jude Medical Center 312 347 347 16,151 16,323 16,257 72,917 75,601 73,620 64.0% 59.7% 58.1% 13 Kaiser Permanente Downey Medical Center - 352 352 - 5,653 20,983 - 21,095 79,533 - 16.4% 61.9% 14 Community Hospital of Long Beach 188 163 163 2,955 2,790 2,843 11,329 10,901 10,701 16.5% 18.3% 18.0% 15 Whittier Hospital Medical Center 156 156 156 9,284 9,479 8,125 30,211 29,836 26,093 53.1% 52.4% 45.8% 16 Western Medical Center/Anaheim 97 97 97 5,438 5,141 4,602 21,235 18,500 17,131 60.0% 52.3% 48.4% 17 Downey Regional Medical Center 199 199 199 13,647 13,539 12,057 56,593 50,118 44,335 77.9% 69.0% 61.0% 18 Presbyterian Intercommunity Hospital 409 409 409 17,555 16,643 18,395 76,755 66,950 71,796 51.4% 44.8% 48.1% 19 Garden Grove Hospital & Medical Center 167 167 167 8,977 7,199 6,825 28,057 25,939 24,255 46.0% 42.6% 39.8% 20 Long Beach Memorial Medical Center 420 420 420 25,497 24,138 22,652 125,953 114,425 108,972 82.2% 74.6% 71.1% 21 Pacific Hospital of Long Beach 84 84 84 4,120 4,388 4,493 18,258 18,231 17,507 59.5% 59.5% 57.1% 22 UC Irvine Medical Center 360 325 345 15,289 14,688 14,168 85,593 86,036 81,341 65.1% 72.5% 64.6% 23 St. Mary Medical Center 389 389 389 11,085 10,869 10,892 63,236 59,508 57,648 44.5% 41.9% 40.6% 24 Huntington Beach Hospital 106 106 106 3,806 3,585 3,475 12,780 12,559 11,961 33.0% 32.5% 30.9% 25 St. Joseph Hospital 488 488 488 19,994 20,701 19,147 72,718 76,497 73,090 40.8% 42.9% 41.0% 26 Fountain Valley Regional Hospital 293 293 293 16,732 18,192 17,517 82,019 87,463 88,166 76.7% 81.8% 82.4% 27 St. Francis Medical Center 314 314 314 25,503 19,578 17,768 90,570 87,470 80,738 79.0% 76.3% 70.4% 28 Orange Coast Memorial Medical Center 224 218 218 12,582 12,212 12,414 44,976 46,252 45,259 55.0% 58.1% 56.9% 29 Kaiser Permanente Anaheim (Under Construction) ------30 Placentia-Linda Hospital 114 114 114 4,397 4,006 4,295 14,776 14,082 13,520 35.5% 33.8% 32.5% 31 Beverly Hospital 224 224 224 9,723 9,009 8,872 38,927 35,415 35,768 47.6% 43.3% 43.7% 32 Kaiser Permanente Anaheim Medical Center 200 200 200 13,635 12,689 11,931 52,342 47,131 46,710 71.7% 64.6% 64.0% 33 Chapman Medical Center 47 47 47 1,917 1,725 1,558 6,426 5,439 5,240 37.5% 31.7% 30.5% 34 Coastal Communities Hospital 109 109 109 4,443 4,486 4,234 17,473 17,433 16,500 43.9% 43.8% 41.5% 35 Western Medical Center/Santa Ana 254 282 282 12,272 10,692 9,102 46,722 44,917 39,294 50.4% 43.6% 38.2%
Overall Average Utilization Rate: 54.5% 51.4% 50.2% Average Utilization Rate for Orange County-Based Hospitals 53.2% 48.6% 49.1% Average Utilization Rate for Los Angeles-Based Hospitals: 56.2% 51.6% 51.5%
Notes: West Anaheim Medical Center (Reference #4) was prevously referred to as Anaheim General Medical Center prior to 2009. AHMC-Anaheim Regional Medical (Reference #9) was previously referred to as Anaheim Memorial Medical Center prior to 2009.
Source: California Office of Statewide Health Planning and Development; AGA.
GAC Hospital Utilization Trends 3-2012.xls 4/25/2012 EXHIBIT IV-6 HOSPITAL FINANCIAL TRENDS (IN MILLIONS OF DOLLARS) 2008 - 2011 SITE AREA HOSPITALS
Ref. Net Patient Revenue for 12 Months Ending 9/30: 12-Month Pre-Tax Net Income (Loss) No. Hospital 2008 2009* 2010 2011 2008 2009 2010 2011 1 La Palma Intercommunity Hospital (Subject) $42.5 $41.7 $56.3 $60.5 ($1.4) $2.7 $6.5 $5.0 2 Tri-City Regional Medical Center $46.9 $68.5 $70.6 N.A. ($1.5) $7.8 $1.6 N.A. 3 Anaheim General Hospital $37.4 $24.4 $11.7 $18.9 ($4.1) ($5.6) ($22.2) ($52.8) 4 West Anaheim Medical Center $86.3 $88.9 $92.5 $89.3 ($0.5) $7.0 $5.8 $6.5 5 Los Alamitos Medical Center $141.5 $157.1 $158.7 $168.2 $17.2 $26.4 $21.9 $15.7 6 Norwalk Community Hospital N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. 7 Bellflower Medical Center $42.0 $39.7 $33.7 N.A. ($4.1) ($1.6) ($1.3) N.A. 8 Coast Plaza Hospital $46.7 $41.0 $44.6 N.A. ($7.0) ($4.6) ($1.7) N.A. 9 AHMC Anaheim Regional Medical Center $184.5 $177.4 $182.7 $210.0 $2.6 ($0.9) $1.5 $12.3 10 Kindred Hospital-Westminster $66.7 $67.6 $62.2 $65.2 $13.1 $13.7 $5.6 $8.2 11 Lakewood Regional Medical Center $110.6 $119.4 $147.9 N.A. ($2.9) $1.2 $9.5 N.A. 12 St. Jude Medical Center $385.4 $415.8 $444.9 $468.0 ($3.3) $47.3 $64.8 $37.7 13 Kaiser Permanente Downey Medical Center N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. 14 Community Hospital of Long Beach $50.8 $49.5 $44.9 N.A. $1.0 ($1.3) $0.4 N.A. 15 Whittier Hospital Medical Center $83.0 $81.1 $87.7 N.A. $3.1 $2.5 $4.5 N.A. 16 Western Medical Center/Anaheim $71.5 $75.8 $78.8 $93.8 ($2.6) $3.1 $3.5 $3.1 17 Downey Regional Medical Center $173.0 $178.4 $139.3 N.A. ($10.0) $13.8 ($27.3) N.A. 18 Presbyterian Intercommunity Hospital $343.1 $355.0 $366.5 N.A. ($29.9) $30.7 $34.8 N.A. 19 Garden Grove Hospital & Medical Center $80.3 $82.8 $92.7 $104.5 $2.7 $1.6 $1.6 $12.9 20 Long Beach Memorial Medical Center $438.1 $445.7 $460.3 N.A. $68.7 $53.7 $67.8 N.A. 21 Pacific Hospital of Long Beach $119.2 $114.3 $134.9 N.A. ($1.1) ($0.5) ($1.2) N.A. 22 UC Irvine Medical Center $534.6 $601.3 $613.3 $705.3 $59.6 $64.0 $38.5 $121.8 23 St. Mary Medical Center $183.8 $184.0 $182.1 N.A. $5.7 $3.5 ($7.6) N.A. 24 Huntington Beach Hospital $53.5 $52.2 $56.4 $59.2 ($1.5) $4.3 $3.8 $7.6 25 St. Joseph Hospital $466.1 $494.1 $523.7 $557.0 ($7.9) $23.0 $39.7 $8.8 26 Fountain Valley Regional Hospital $252.1 $257.9 $275.9 $317.2 $8.6 $7.2 $11.4 $27.7 27 St. Francis Medical Center $288.2 $289.7 $290.7 N.A. $7.3 ($10.4) $8.5 N.A. 28 Orange Coast Memorial Medical Center $194.4 $205.8 $224.3 $235.4 $11.3 $15.3 $10.2 $18.4 29 Kaiser Permanente Anaheim (U/C) ------30 Placentia-Linda Hospital $60.8 $68.5 $75.3 $77.6 $2.4 $8.3 $9.2 $9.0 31 Beverly Hospital $109.8 $116.0 $140.2 N.A. ($15.0) $1.7 $3.8 N.A. 32 Kaiser Permanente Anaheim Medical Center $200.0** N.A. $450.0 $450.0 N.A. N.A. N.A. N.A. 33 Chapman Medical Center $38.7 $41.7 $43.0 $43.4 ($4.5) ($3.8) ($3.2) ($5.6) 34 Coastal Communities Hospital $58.3 $60.6 $61.8 $63.3 $0.9 $3.7 $3.3 ($3.9) 35 Western Medical Center/Santa Ana $164.0 $178.6 $151.8 $178.5 $6.3 $18.7 ($1.6) $3.2
*Estimate generated from identified percentage increase/decrease from 2010 net patient revenue. **Estimate.
Source: Orange County Business Journal; Office of Statewide Health Planning and Development; AGA. Hospital Financial Trends 3-2012.xls 3/28/2012 EXHIBIT IV-7 SITE AREA HOSPITAL EMERGENCY SERVICES 2010 STATISTICS
Reference Distance From Trauma Emergency Number Hospital Site (Miles) County Center CVRC SNRC Room Other Specialized Services Observation Orthopedic Psychiatric 1 La Palma Intercommunity Hospital (SP) 0.0 OC - Basic L&D, Pediatrics, Perinatal, Psych X X X 2 Tri-City Regional Medical Center 2.5 LA - Basic - X X X 3 Anaheim General Hospital 2.8 OC - Basic Pediatrics, Perinatal X X X 4 West Anaheim Medical Center 2.9 OC - X Basic Psych X X X 5 Los Alamitos Medical Center 3.4 OC - X X Basic L&D, Psych X X X 6 Norwalk Community Hospital 4.6 LA - Basic Pediatrics, Perinatal X X X 7 Bellflower Medical Center 5.6 LA - Basic Perinatal, Psych X X X 8 Coast Plaza Hospital 5.7 LA - Basic - X X X 9 AHMC Anaheim Regional Medical Center 6.1 OC - X Basic Base, L&D, Perinatal, NICU X X X 10 Kindred Hospital-Westminster 6.3 OC - Basic - X X X 11 Lakewood Regional Medical Center 6.4 LA - X Basic - X X X 12 St. Jude Medical Center 7.1 OC - X X Advanced Base, L&D, Pediatrics, Perinatal, NICU X X X 13 Kaiser Permanente Downey Medical Center 7.2 LA - Basic Pediatrics, Perinatal, NICU X X X 14 Community Hospital of Long Beach 7.3 LA - Basic Perinatal, Psych X X X 15 Whittier Hospital Medical Center 7.4 LA - Basic Pediatrics, Perinatal X X X 16 Western Medical Center/Anaheim 7.7 OC - X Basic L&D, Perinatal, NICU, Psych X X X 17 Downey Regional Medical Center 8.0 LA - Basic Pediatrics, Perinatal, NICU X X X 18 Presbyterian Intercommunity Hospital 8.4 LA - X X Advanced Base, Pediatrics, Perinatal, NICU X X X 19 Garden Grove Hospital & Medical Center 8.8 OC - Basic L&D, Perinatal, NICU X X X 20 Long Beach Memorial Medical Center 8.9 LA Level II/ X X Advanced Base, Pediatrics, Perinatal, NICU X X X Level II Pediatrics 21 Pacific Hospital of Long Beach 9.3 LA - Basic Perinatal, Psych X X X 22 UC Irvine Medical Center 9.6 OC Level I X X Advanced Base, Burn, L&D, Replant, Perinatal, XXX NICU, Psych 23 St. Mary Medical Center 9.7 LA Level II* X X Advanced Base, Pediatrics, Perinatal, NICU X X X 24 Huntington Beach Hospital 10.4 OC - Basic Base, Psych X X X 25 St. Joseph Hospital 11.0 OC - X X Advanced L&D, Perinatal, Psych X X X 26 Fountain Valley Regional Hospital 11.0 OC - X X Basic L&D, Pediatrics, Perinatal, NICU X X X 27 St. Francis Medical Center 11.0 LA Level II* X Advanced Base, Pediatrics, Perinatal, NICU, Psych X X X 28 Orange Coast Memorial Medical Center 11.1 OC - X Basic L&D, Perinatal, NICU X X X 29 Kaiser Permanente Anaheim (Under Const.) 11.1 OC - - TBD - - - 30 Placentia-Linda Hospital 11.6 OC - Basic - X X X 31 Beverly Hospital 12.1 LA - X Basic Pediatrics, Perinatal X X X 32 Kaiser Permanente Anaheim Medical Center 12.7 OC - Basic L&D, Pediatrics, Perinatal, NICU X X X 33 Chapman Medical Center 12.9 OC - Basic Psych X X X 34 Coastal Communities Hospital 12.9 OC - Basic L&D, Pediatrics, Perinatal, Psych X X X 35 Western Medical Center/Santa Ana 13.4 OC Level II X X Advanced Base, Burn, L&D, Replant, Pediatrics, XXX Perinatal, NICU
Key: CVRC - Cardiovascular Receiving Center; SNRC - Stroke Neurology Receiving Center; L&D - Labor and Delivery Units; NICU - Neonatal Intensive Care Units; Psych - Acute Psychiatric Units.
*Not available for Orange County patients.
Source: California Office of Statewide Health Planning and Development; Orange County Health Care Agency-Emergency Medical Services; County of Los Angeles Department of Health Services; AGA.
Hospital Emergency Services.xls Emergency Services 3/28/2012 EXHIBIT IV-8 EMERGENCY DEPARTMENT VISITS BY SEVERITY 2010 STATISTICS
Reference Low/ Severe Severe Total Number Hospital Minor Moderate Moderate W/O Threat W/Threat Visits 1 La Palma Intercommunity Hospital (SP) 348 963 3,841 4,366 5,234 14,752 2 Tri-City Regional Medical Center 603 3,772 1,951 4,541 312 11,179 3 Anaheim General Hospital 4,070 256 136 64 36 4,562 4 West Anaheim Medical Center 657 1,574 9,191 9,005 9,279 29,706 5 Los Alamitos Medical Center 1,358 1,237 6,855 9,481 9,963 28,894 6 Norwalk Community Hospital 5 1,436 3,062 2,022 520 7,045 7 Bellflower Medical Center 204 1,135 2,989 661 278 5,267 8 Coast Plaza Hospital 303 661 3,484 5,332 6,251 16,031 9 AHMC Anaheim Regional Medical Center 2,558 12,507 13,228 9,307 3,438 41,038 10 Kindred Hospital-Westminster 000000 11 Lakewood Regional Medical Center 2,361 3,770 11,624 10,278 9,345 37,378 12 St. Jude Medical Center 1,059 1,549 22,459 21,402 13,167 59,636 13 Kaiser Permanente Downey Medical Center 391 2,848 62,284 18,303 4,938 88,764 14 Community Hospital of Long Beach 1,306 8,799 4,749 3,270 1,456 19,580 15 Whittier Hospital Medical Center 10,780 0 12,051 0 2,286 25,117 16 Western Medical Center/Anaheim 1,910 6,034 3,533 2,557 1,639 15,673 17 Downey Regional Medical Center 3,541 16,645 12,069 6,776 9,022 48,053 18 Presbyterian Intercommunity Hospital 1,141 6,246 21,624 29,678 6,908 65,597 19 Garden Grove Hospital & Medical Center 367 3,078 8,611 7,624 5,479 25,159 20 Long Beach Memorial Medical Center 491 8,729 19,470 17,506 5,938 52,134 21 Pacific Hospital of Long Beach 211 921 5,498 4,042 2,758 13,430 22 UC Irvine Medical Center 1,624 7,578 11,109 9,619 6,014 35,944 23 St. Mary Medical Center 1,936 10,451 20,107 10,994 3,537 47,025 24 Huntington Beach Hospital 225 945 5,599 2,892 8,557 18,218 25 St. Joseph Hospital 844 9,089 20,648 13,204 11,784 55,569 26 Fountain Valley Regional Hospital 000000 27 St. Francis Medical Center 104 1,751 22,400 25,257 9,890 59,402 28 Orange Coast Memorial Medical Center 403 7,132 9,246 7,888 851 25,520 29 Kaiser Permanente Anaheim (Under Const.) 30 Placentia-Linda Hospital 990 1,250 6,874 7,563 5,031 21,708 31 Beverly Hospital 2,552 533 5,027 7,906 6,294 22,312 32 Kaiser Permanente Anaheim Medical Center 236 3,959 29,127 5,835 759 39,916 33 Chapman Medical Center 1,330 3,820 2,052 1,229 706 9,137 34 Coastal Communities Hospital 2,140 7,972 4,063 2,936 3,681 20,792 35 Western Medical Center/Santa Ana 771 8,776 5,924 3,279 2,655 21,405
Source: California Office of Statewide Health Planning and Development; Orange County Health Care Agency-Emergency Medical Services; County of Los Angeles Department of Health Services; AGA.
Hospital Emergency Services.xls Visits by Severity 3/28/2012 EXHIBIT IV-9 SITE AREA HOSPITAL NON-EMERGENCY SERVICES - DECEMBER 31, 2010
Total General Acute IC Acute Chemical Acute Skilled Total Ref. Med/Surg. Perinatal Pediatric Coronary Respiratory Burn Newborn Rehab Care Dependency Psychiatric Nursing Licensed No. Hospital Beds Beds Beds IC Beds Care Beds Care Beds Beds Beds Beds Beds Beds Beds Beds Beds 1 La Palma Intercommunity Hospital (SP) 105 11 0 4 4 0 0 0 0 124 0 17 0 141 2 Tri-City Regional Medical Center 89 0 0 13 5 0 0 0 0 107 0 0 0 107 3 Anaheim General Hospital 70 14 5 12 0 0 0 0 0 101 0 0 0 101 4 West Anaheim Medical Center 147 0 0 10 10 0 0 0 0 167 0 30 22 219 0-3 Miles: 411 25 5 39 19 0 0 0 0 499 0 47 22 568 5 Los Alamitos Medical Center 113 12 0 9 8 0 0 0 0 142 0 25 0 167 6 Norwalk Community Hospital 37 0 7 6 0 0 0 0 0 50 0 0 0 50 3-5 Miles: 150 12 7 15 8 0 0 0 0 192 0 25 0 217 7 Bellflower Medical Center 85 17 0 5 5 0 0 0 0 112 0 32 0 144 8 Coast Plaza Hospital 98 0 0 4 3 0 0 0 0 105 0 0 12 117 9 AHMC-Anaheim Regional Medical Center 153 27 0 22 10 0 0 11 0 223 0 0 0 223 10 Kindred Hospital-Westminster 93 0 0 16 0 0 0 0 0 109 0 0 0 109 11 Lakewood Regional Medical Center 122 0 0 8 23 0 0 0 19 172 0 0 0 172 12 St. Jude Medical Center 200 39 12 52 0 0 0 14 30 347 0 0 37 384 13 Kaiser Permanente Downey Medical Center 182 66 17 38 0 0 0 49 0 352 0 0 0 352 14 Community Hospital of Long Beach 100 13 0 20 10 0 0 20 0 163 0 28 17 208 15 Whittier Hospital Medical Center 112 28 0 16 0 0 0 0 0 156 0 0 22 178 16 Western Medical Center/Anaheim 56 14 0 22 0 0 0 5 0 97 0 91 0 188 17 Downey Regional Medical Center 147 20 7 8 10 0 0 7 0 199 0 0 0 199 18 Presbyterian Intercommunity Hospital 268 32 34 24 0 0 0 34 17 409 0 0 35 444 19 Garden Grove Hospital & Medical Center 108 35 0 12 0 0 0 12 0 167 0 0 0 167 20 Long Beach Memorial Medical Center 317 0 0 61 0 0 0 0 42 420 0 0 42 462 21 Pacific Hospital of Long Beach 55 13 0 8 8 0 0 0 0 84 0 73 27 184 22 UC Irvine Medical Center 199 26 0 68 0 0 8 30 14 345 0 67 0 412 23 St. Mary Medical Center 218 25 28 39 8 0 0 25 46 389 0 0 0 389 5-10 Miles: 2,513 355 98 423 77 0 8 207 168 3,849 0 291 192 4,332 24 Huntington Beach Hospital 94 0 0 6 6 0 0 0 0 106 0 25 0 131 25 St. Joseph Hospital 379 57 0 32 20 0 0 0 0 488 0 37 0 525 26 Fountain Valley Regional Hospital 183 38 13 36 0 0 0 23 0 293 0 0 0 293 27 St. Francis Medical Center 164 71 14 36 0 0 0 29 0 314 0 40 30 384 28 Orange Coast Memorial Medical Center 164 21 0 21 0 0 0 12 0 218 0 0 0 218 29 Kaiser Permanente Anaheim (U/C) 30 Placentia-Linda Hospital 106 0 0 4 4 0 0 0 0 114 0 0 0 114 31 Beverly Hospital 156 18 15 12 13 0 0 10 0 224 0 0 0 224 32 Kaiser Permanente Anaheim Medical Center 117 36 11 12 10 0 0 14 0 200 0 0 0 200 33 Chapman Medical Center 35 0 0 12 0 0 0 0 0 47 28 12 27 114 34 Coastal Communities Hospital 79 12 9 9 0 0 0 0 0 109 0 23 46 178 35 Western Medical Center/Santa Ana 139 52 26 42 0 0 7 16 0 282 0 0 0 282 36 Greater El Monte Community Hospital 59 19 16 5 5 0 0 0 0 104 0 0 13 117 37 East Los Angeles Doctors Hospital 71 14 7 4 6 0 0 0 0 102 0 0 25 127 10-15 Miles: 1,746 338 111 231 64 0 7 104 0 2,601 28 137 141 2,907
Source: California Office of Statewide Health Planning and Development; AGA.
Hospital Bed Supply 12-31-10.xls 3/28/2012 EXHIBIT IV-10 PATIENT SATISFACTION RATINGS - 2011 ed that their pain ed that the area ted that their ted that their ted that they ted that their
Ref. No. Hospital Patients who repor well communicated nurses "Always" Patients who repor doctors "Always" communicated well Patients who repor "Always" received help as soon they wanted Patients who report was "Always" well controlled Patients who reported that staff "Always" explained about medicine before giving it to them Patients who repor room and bathroom were "Always" clean Patients who report around their room has "Always" quiet at night Patients who said "Yes" they were given at-home recovery procedures Patients who rated the hospital 9 or 10 on a scale from 0 (lowest) to (highest) Patients who would definitely recommend the hospital
1. La Palma Intercommunity Hospital (Subject) 68% 73% 59% 64% 55% 68% 49% 76% 63% 59% 2. Tri-City Regional Medical Center 69% 77% 55% 65% 50% 63% 50% 77% 61% 62% 3. Anaheim General Hospital N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 4. West Anaheim Medical Center 69% 76% 51% 69% 54% 70% 49% 78% 61% 61% 5. Los Alamitos Medical Center 73% 79% 62% 70% 58% 71% 42% 78% 67% 68% 6. Norwalk Community Hospital N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 7. Bellflower Medical Center 66% 77% 50% 65% 50% 69% 32% 79% 60% 56% 8. Coast Plaza Hospital 62% 68% 49% 55% 50% 62% 38% 72% 47% 49% 9. AHMC Anaheim Regional Medical Center 67% 70% 55% 64% 51% 67% 47% 78% 58% 64% 10. Kindred Hospital-Westminster N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 11. Lakewood Regional Medical Center 73% 79% 63% 65% 56% 69% 52% 79% 61% 69% 12. St. Jude Medical Center 67% 72% 52% 66% 53% 73% 42% 86% 70% 78% 13. Kaiser Permanente Downey Medical Center 76% 80% 64% 71% 61% 77% 61% 83% 80% 79% 14. Community Hospital of Long Beach 81% 82% 73% 79% 70% 80% 64% 78% 67% 71% 15. Whittier Hospital Medical Center 63% 69% 50% 61% 53% 71% 47% 73% 54% 54% 16. Western Medical Center/Anaheim 70% 77% 60% 66% 56% 69% 33% 76% 65% 59% 17. Downey Regional Medical Center 67% 71% 56% 66% 56% 70% 44% 77% 59% 59% 18. Presbyterian Intercommunity Hospital 77% 76% 56% 73% 61% 74% 55% 80% 80% 81% 19. Garden Grove Hospital & Medical Center 64% 73% 52% 62% 49% 61% 45% 79% 58% 56% 20. Long Beach Memorial Medical Center 69% 76% 60% 65% 56% 70% 49% 76% 69% 74% 21. Pacific Hospital of Long Beach 67% 72% 61% 62% 51% 72% 52% 76% 58% 59% 22. UC Irvine Medical Center 71% 74% 58% 63% 56% 70% 59% 84% 70% 76% 23. St. Mary Medical Center 70% 76% 53% 64% 56% 70% 51% 78% 67% 69% 24. Huntington Beach Hospital 66% 64% 50% 59% 44% 64% 39% 75% 52% 51% 25. St. Joseph Hospital 72% 76% 56% 68% 57% 75% 49% 83% 74% 82% 26. Fountain Valley Regional Hospital 68% 75% 52% 67% 51% 69% 45% 78% 62% 65% 27. St. Francis Medical Center 67% 70% 54% 65% 54% 61% 57% 75% 65% 69% 28. Orange Coast Memorial Medical Center 66% 73% 53% 63% 55% 68% 45% 74% 59% 67% 29. Kaiser Permanente Anaheim (U/C) N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 30. Placentia-Linda Hospital 74% 76% 59% 66% 58% 72% 50% 83% 69% 71% 31. Beverly Hospital 61% 70% 47% 56% 51% 64% 40% 71% 54% 51% 32. Kaiser Permanente Anaheim Medical Center 74% 81% 65% 70% 60% 75% 60% 84% 75% 77% 33. Chapman Medical Center 69% 79% 54% 70% 56% 69% 60% 77% 59% 61% 34. Coastal Communities Hospital 68% 67% 58% 68% 48% 71% 37% 72% 67% 63% 35. Western Medical Center/Santa Ana 76% 79% 60% 67% 57% 67% 45% 77% 69% 68%
Subject Hospital 68% 73% 59% 64% 55% 68% 49% 76% 63% 59% Site Area Orange County Median 69% 75% 55% 66% 55% 69% 45% 78% 65% 65% Site Area Los Angeles County Median 67% 76% 55% 65% 54% 70% 50% 77% 61% 62%
Source: US. Department of Health & Human Services; AGA.
Patient Satisfaction Ratings 3-2012.xls 3/28/2012 EXHIBIT IV-11 LA PALMA INTERCOMMUNITY HOSPITAL SERVICES TRENDS 2002 - 2010
Time Period 7/1/02-6/30/03 7/1/03-6/30/04 7/1/04-6/30/05 7/1/05-6/30/06 1/1/07-12/31/07 1/1/08-12/31/08 1/1/09-12/31/09 1/1/10-12/31/10 Patient (Census) Days 21,015 23,002 22,111 22,744 15,230 12,754 15,486 17,007 Occupancy Rate 00000000 Hospital Discharges (Excl. Nursery) 4,474 4,972 4,674 4,731 4,021 3,404 4,007 4,147 Outpatient Visits (Incl. ER Visits) 50,897 40,504 37,455 53,555 35,314 29,471 27,111 21,284 Outpatient Emergency Room Visits 24,146 14,590 13,735 17,060 11,198 11,590 11,570 11,080 Emergency Services (Visits) 31,970 17,057 16,217 19,655 14,521 14,705 15,098 14,752 Available Beds 141 141 141 141 141 141 141 141 Staffed Beds (Average) 141 141 141 141 114 37 43 47 Percent Available Beds Staffed 100.0% 100.0% 100.0% 100.0% 80.9% 26.2% 30.5% 33.3%
Source: California Office of Statewide Health Planning and Development-Hospital Annual Financial data.
La Palma Hospital Services Summary 3-2012.xls 3/28/2012 EXHIBIT IV-12 LA PALMA INTERCOMMUNITY HOSPITAL DISCLOSURE REPORT FINANCIAL HIGHLIGHTS 2002 - 2010
Time Period 7/02-6/03 7/03-6/04 7/04-6/05 7/05-6/06 2007 2008 2009 2010* Gross Inpatient Revenue $72,343,487 $90,172,127 $91,797,930 $100,359,247 $90,150,048 $83,840,329 $113,359,488 $148,654,693 Gross Outpatient Revenue $40,780,511 $45,321,506 $50,046,660 $59,775,886 $43,031,983 $38,995,434 $43,825,242 $44,916,164 Gross Patient Revenue $113,123,998 $135,493,633 $141,844,590 $160,135,133 $133,182,031 $122,835,763 $157,184,730 $193,570,857
Net Income ($3,534,785) ($3,290,796) ($1,041,742) $5,555,330 $3,576,874 $2,151,652 $2,969,552 $5,181,934
Net Inpatient Revenue Per Day $971 $1,076 $1,096 $1,208 $1,937 $1,949 $2,279 $2,862 Medicare Traditional $1,570 $1,348 $1,194 $1,354 $1,144 $1,208 $1,874 $2,279 Medicare Managed Care ----$1,978 $2,211 $2,771 $2,962 Medi-Cal Traditional $89 $20 $483 $685 $456 $537 $1,817 $3,196 Medi-Cal Managed Care ----$617 $812 $1,437 $5,159 Indigent Traditional ----$120 $235 $981 $660 Indigent Managed Care ------Third Party Traditional $4,093 $5,556 $7,375 $1,480 $6,224 $6,780 $4,987 $6,017 Third Party Managed Care $719 $947 $956 $1,260 $18,811 $8,420 $4,774 $4,778 Other Indigent ----($10,410) $1 $325 $0 Other Payers $5,191 $2,603 $3,399 $1,331 $4,611 - $4,729 $453
Net Outpatient Revenue Per Visit $229 $312 $359 $271 $410 $461 $464 $507 Medicare Traditional $129 $261 $122 $170 $99 $110 $220 $291 Medicare Managed Care ----$392 $511 $682 $1,163 Medi-Cal Traditional $25 $6 $228 $86 $184 $176 $402 $691 Medi-Cal Managed Care ----$152 $142 $357 $918 Indigent Traditional ----$176 $300 $167 $189 Indigent Managed Care ------Third Party Traditional $2,072 $1,071 $1,589 $300 $1,582 $1,331 $1,012 $923 Third Party Managed Care $265 $251 $548 $371 $8,325 $607 $444 $566 Other Indigent ----$2,234 $0 $332 $0 Other Payers $991 $1,072 $1,425 $381 $785 - $563 $30
*Unaudited financials.
Source: California Office of Statewide Health Planning and Development-Hospital Annual Financial data.
La Palma Hospital Disclosure Report Highlights 3-2012.xls 3/28/2012 ALFRED GOBAR ASSOCIATES
Chapter V Opportunity Area Assessment
Property Assessment Overview
Property represents a fundamental resource that is utilized in many forms (e.g., retail, industrial, and housing) so that businesses and residents can realize distinct but interrelated economic objectives (e.g., selling merchandise, providing services, fabricating products, raising a family, and going to work). Due to the cost of making property improvements, land will remain vacant until such time there is an economic purpose for improving the site. Newly-established communities generally have an abundance of vacant land, which is improved in order to host economic activities demanded as the community and surrounding area grow. By comparison, the City of La Palma is well established and has been virtually built out in response to past economic growth throughout the surrounding region.
Despite the built-out status of La Palma, it is part of the Orange County economy, which is projected to intensify as a business and employment destination within the broader Southern California region over the next 25 years. Future growth throughout the region will continue drive demand for more intense utilization of property, particularly in built-out areas, so that the Orange County region remains a business and employment center in Southern California and an advantageous place to live. Making more effective use of existing property resources is not only driven by regional-level demand but also a local-level need to address fiscal challenges facing individual communities. A growing base of business and lifestyle activity serves to fuel fiscal revenue support needed to maintain City infrastructure and provide business and residential services. The opportunity area assessment serves to identify the current level of utilization describing key property resources in the community.
Several opportunity areas throughout the community have been identified that may provide an opportunity to increase the economic utilization of property. Exhibit V-1 identifies 20 site area locations described according to three distinct levels of priority. Priority 1 areas reflect the focus of this assessment because they represent limited
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and unique property resources within the City of La Palma by virtue of their size, location, visibility, and anticipated ability to host activities that serve the local community and surrounding economic region. Priority 2 areas generally consist of larger-size properties in visible locations but may already be improved with significant amounts of residential housing. Finally, commercial opportunity areas (Priority 3) describe site locations of varying size with good visibility and exposure to community traffic flow. Nearly all 20 opportunity areas have been previously improved with buildings and structures supporting a full spectrum of land use activities.
Any property improvement reflects intended economic use of property. For purpose of this property assessment, economic utilization describes how the property has been improved to generate income value. The income value can be described in terms of manufactured products produced on-site, commercial rent, on-site sales, or even the mortgage value of residency, among other measures. Precisely measuring the income value of property improvements and activities reflects a complex investment analysis beyond the scope of this assessment. This property assessment gauges effective utilization within each opportunity area by comparing on-site improvements and general land use activity with general location attributes that describe the site’s relative attraction as a host location for the existing land use or an alternative land use.
Each opportunity area location has been assessed in terms of on-site improvements and the following site attribute characteristics commonly used to gauge site suitability for its intended use.
• Site Size & Configuration – the physical size of the location defines the maximum capacity for building area and functional use. The larger the site, the greater the capacity to host more building space, provide necessary separation from adjacent land use, and establish a land use identity. Maximum physical capacity can be substantially restricted by an irregular parcel configuration or challenging topographical features.
• Site Visibility – describes the sight-line viewing of building façades, on-site activities, and signage by passing traffic. Visibility can be obstructed by natural features, roadway features, adjacent development, or on-site
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improvements themselves (landscaping, building mass, etc.). Site frontage is an important consideration because it determines the time available for approaching travelers to see and recognize site improvements.
• Site Exposure – is distinct from site visibility and refers to the nature of passing traffic, frequency of repeat exposure, and scale of prospective customer base exposed. Freeway frontage is strongly associated with regional exposure to a wide base of consumers, while frontage along an arterial provides exposure on a community level.
• Site Access – describes the ease of reaching the immediate area and getting on-site. Access is enhanced by signalized intersections and turn pockets that serve a site location. Access may be impeded by raised center medians, undefined curb entry, unsafe site ingress and egress, or circuitous routing making it difficult to reach the site area.
• Existing Site Conditions – describes physical factors (topography, drainage, habitat, etc.) that must be addressed in order to host development. Existing conditions also include site improvements (buildings, historic use, special structures, etc.) that are likely to influence future on-site activity.
• Adjacent Land Uses – describes current conditions or potential future conditions implied by zoning, etc., that may enhance or restrict future use of the site location for an intended purpose.
An opportunity area assessment sheet has been prepared for each of the 20 site area locations and provides useful information reflecting many of the site attribute factors noted above. Each site location area is assessed in Exhibit V-2 through Exhibit V-21 with additional summary discussion provided below.
Priority 1 – Opportunity Areas
These unique site area locations offer regional exposure to prospective land use locations by virtue of their proximity to the Artesia Freeway and Centerpointe Business Park, or represent a sizeable and important property resource that cannot be readily duplicated in other areas of the community (refer to Exhibit V-1).
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Site 1 – Bettencourt & Rainbow Park Areas
As shown in Exhibit V-2, the 4.73-acre site area location consists of two small neighborhood parks separating residential neighborhoods from the Artesia Freeway. Each site is a below-grade location that also serves as a storm water catch basin for runoff from the surrounding area. Direct visibility from the freeway is virtually blocked by a high sound wall barrier. Each park is served by a small parking lot with access off a residential feeder street. The two parks and neighborhoods are connected by an elevated pedestrian bridge over the freeway.
Utilization Assessment
Existing site conditions, including below-grade topography and residential street access, limit potential to increase current utilization. Potential may exist for a ground lease to host a communication cell tower or billboard structure.
Site 2 – Walker Street Industrial Area
As shown in Exhibit V-3, the 3.8-acre triangular-shaped site location is currently improved with nearly 76,000 square feet of fully-occupied industrial space, which translates to a floor area ratio (FAR) of 0.46:1.00. Site area improvements are situated below the adjacent freeway but enjoy excellent visibility and exposure to passing freeway traffic. Site location is most easily accessed using the eastbound Orangethorpe Avenue exit ramp but otherwise requires driver familiarity with local street system. The site location does not benefit from a high amount of consumer- traffic or commuter traffic flow as indicated by low vehicle traffic volume (7,000 ADT). Site location is flanked by industrial-commercial uses on the east, Artesia Freeway on the south, and 275-foot wide flood control channel on the west.
Utilization Assessment
Site utilization is consistent with most forms of contemporary industrial land use. Site constitutes good location of employment-based land use. Site location requires familiarity with local street system but is otherwise relatively easy to reach. Site area is not an optimal location for most contemporary forms of brick-and-mortar retail land use. Physical attributes of property represent good potential to host a marquee name employment center at significantly higher building intensity.
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Site 3 – Marin Circle-Fresca Drive Industrial Area
As shown in Exhibit V-4, the 16.47-acre site area includes several rectangular and slightly irregular shaped properties improved with more than 460,000 square feet of industrial building space. Intensity of existing building improvements is equal to an FAR of 0.64:1.00. Site and improvements are situated below the adjacent freeway but enjoy excellent visibility and exposure to passing freeway traffic. Site location requires familiarity with local street system but is otherwise relatively easy to reach. The site location does not benefit from a high amount of consumer-traffic or commuter traffic flow as indicated by low vehicle traffic volume (7,000 ADT).
Utilization Assessment
Site utilization is consistent with most forms of contemporary industrial land use. Site constitutes good location of employment-based land use. Site location requires familiarity with local street system but is otherwise relatively easy to reach. Site area is not an optimal location for most contemporary forms of brick-and-mortar retail land use. Physical attributes of property represent good potential to host a marquee name employment center at significantly higher building intensity.
Site 4 – Centerpointe Business Park Site Area
The Centerpointe Business Park was planned as a strategic location for business and employment within this northern area of Orange County. Centerpointe is a well- designed business park and commercial district with easy freeway access. As described in Exhibit V-5, the 38.76-acre site area consists of 17 parcels ranging in size from 0.5 acres to 3.39 acres. Since its inception in 1985, Centerpointe has been improved with a wide variety of office, lodging, and retail land use intended to serve businesses and employees, area visitors, and surrounding area consumers. Summarized below is a breakdown of Centerpointe building improvements and building intensity by parcel location and major land use classification:
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Figure V-1 Description of Building Improvements Within Centerpointe Address & Location Land Use Activity Parcel Acreage Building Sq. Ft. FAR 3 Centerpointe Dr Hotel-Lodging 2.41 81,253 0.77 2 Centerpointe Dr Retail-Dining 0.98 7,310 0.17 10 Centerpointe Dr Retail-Dining 1.81 12,491 0.16 30 Centerpointe Dr Retail-Dining 2.34 21,176 0.21 38 Centerpointe Dr Retail-Dining 1.26 10,472 0.19 50 Centerpointe Dr Retail-Dining 1.24 9,133 0.17 5 Centerpointe Dr Medical Center 2.81 63,654 0.52 26 Centerpointe Dr Medical Center 0.50 21,643 1.00 1 Centerpointe Dr Office-Class A 6.92 89,323 0.30 4 Centerpointe Dr Office-Class A 2.76 86,662 0.72 6 Centerpointe Dr Office-Class A 2.96 151,355 1.17 16 Centerpointe Dr Office-Flex Tech 3.77 51,784 0.32 18 Centerpointe Dr Office-Flex Tech 2.45 35,004 0.33 20 Centerpointe Dr Office-Flex Tech 3.39 56,280 0.38 22 Centerpointe Dr Office-Flex Tech 1.14 21,176 0.42 24 Centerpointe Dr Office-Flex Tech 1.52 22,657 0.34 28 Centerpointe Dr Office-Flex Tech 0.50 21,785 1.00
Centerpointe Total 38.76 763,158 0.45
1 Parcels Hotel-Lodging 2.41 81,253 0.77 5 Parcels Retail-Dining 7.64 60,582 0.18 2 Parcels Medical Center 3.30 85,297 0.59 3 Parcels Office-Class A 12.64 327,340 0.59 6 Parcels Office-Flex Tech 12.77 208,686 0.38 17 Parcels Centerpointe Total 38.76 763,158 0.45
Source: Google Earth; Field Audit by AGA.
As shown, the business park is currently improved with over 763,000 square feet of building space, which equates to a building FAR of 0.45:1.00. The intensity of building improvements, however, varies by parcel location and by class of land use activity. In general, retail developed land uses reflect the lowest overall building intensity with an FAR of 0.18:1.00, and the City’s only hotel facility reflects the highest building intensity with an FAR of 0.77:1.00. The highest building intensity describing parcel-specific land use is a mid-rise (7-story) office building (151,355 square feet) at an FAR of 1.14:1.00, excluding adjoining parking in a multi-level structure.
The Centerpointe Business Park currently hosts over 60,000 square feet of leasable retail space in five building locations. At present, the mix of retail facilities within the business park reflect a strong dining and service orientation as summarized below:
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Figure V-2 Description of Centerpointe Retail Facilities Building Share of Retail Activity Sq. Ft. Sq. Ft. Retail Merchandising 2,498 4.2% Full-Limited Service Dining 21,079 35.1% Personal Services 9,352 15.6% Business-Finance Services 16,267 27.1% Vacant Retail Space 10,935 18.2%
Centerpointe Retail Total 60,131 100.0%
Source: Google Earth; Field Audit by AGA.
The heavy dining and service orientation of existing retail facilities reflects the business and traveler orientation of the Centerpointe Business Park.
The Centerpointe Business Park is strategically located 25 minutes from three major Southern California airports (Los Angeles International, John Wayne Airport, and Long Beach Airport), within two miles of two major freeway corridors bisecting Southern California (Artesia-91 Freeway and Santa Ana-5 Freeway), and in a location that is convenient to nearly 4,700 local businesses within two to three miles. As such, the Centerpointe Business Park represents a gateway location in Orange County, which is projected to expand its role as a business and employment center within Southern California over the next 25 years.
Utilization Assessment
The increasing role of Orange County as an economic engine in Southern California also increases the potential for La Palma and the Centerpointe Business Park to bolster its role as a strategic gateway location serving regional commerce. Similar regional economic growth has fostered the development of other gateway business- employment centers throughout Southern California, such as the Warner Center in Woodland Hills and the Centre Lake Business District in Ontario with overall building intensity exceeding an FAR of 1.00:1.00. As the regional economy grows, the Centerpointe Business Park will continue to command a tactical location and should also assume a greater role in serving increasing business demand. The office facility at 6 Centerpointe Drive, however, is the only parcel improved with a mid-rise building and parking structure needed to support a higher level of building intensity. In order to continue to function as an important gateway business-employment center in Northern Orange County, overall building intensity within the Centerpointe Business
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Park will need to be increased to accommodate greater long-term demand for business growth and related employment.
Intensified land use development within the Centerpointe Business Park should seek to leverage the site area’s attributes as a tactical location for businesses that serve a regional market or rely on labor skills of the regional workforce. Over the long-term, market dynamics will dictate the development timing for higher-intensity building improvements that require structured parking to adequately serve on-site activity. Within the Centerpointe site area, prospective locations where higher-intensity development could be readily accommodated include single-story office-flex tech buildings on the west side of the business park. Also, retail facilities should be expanded as needed to serve work-based shopping demand, including overnight business and vacation travelers. A sparse supply of housing to the north and Artesia Freeway to the south limits market potential for a neighborhood retail center that caters to the daily purchase habits of community residents. Finally, the relatively safe and aesthetic setting of the business park and an abundance of entertainment and dining options in the surrounding area make the Centerpointe Business Park an attractive location to increase the supply of lodging options within the La Palma area.
Site 5 – Walker Street-Orangethorpe Avenue Commercial Area (NWC)
As shown in Exhibit V-6, the 20.61-acre site area consists of two street-side properties of less than 1.2 acres each and a large trapezoidal-shaped property of 18.3 acres. The site location is improved with a 9,700-square-foot buffet restaurant, a 4,690-square-foot bank, and 154,225-square-foot headquarters for ADP, an accounting and payroll service company. The retail improvements (restaurant and bank) equate to an FAR of 0.15:1.00 and the headquarters building equates to an FAR of 0.19:1.00. The site location fronts along the Artesia Freeway and enjoys excellent visibility and exposure to passing travelers. The site location also enjoys direct freeway access for eastbound travelers along the Artesia Freeway. Westbound travelers must exit the freeway before seeing the site but otherwise have relatively easy access via Orangethorpe Avenue.
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Utilization Assessment
Site utilization is significantly below the intensity of building improvements that can be physically accommodated within the site size and configuration. The high level of regional exposure and other positive site attributes, including visibility and access, argue for a much higher level of utilization than currently exists. The site location is relatively isolated from any adjoining low-intensity land use that may be adversely affected by an increase in intensity of development that could involve higher overall building heights, structured parking, or a combination office, lodging, and traveler- serving retail land use activities.
Site 6 – Walker Street-Orangethorpe Avenue Commercial Area (NEC)
As shown in Exhibit V-7, this small 1.66-acre triangular site area consists of four properties ranging in size from 0.19 acres to 0.67 acres. The site area location is improved with about 13,750 square feet of building space, which equates to an FAR of 0.19:1.00. The site location reflects a mix of retail-oriented commercial buildings, each designed within its own ingress and egress. The site area abuts the eastbound Orangethorpe exit ramp of the Artesia Freeway but lacks significant visibility for passing freeway traffic or off-ramp traffic due to mature freeway landscaping. The site location does enjoy very good sight-line visibility along Orangethorpe Avenue and good visibility along Walker Street. A raised landscape median along Orangethorpe Avenue limits site access to turn lane pockets at an intersection and mid-block location.
Utilization Assessment
Given the site area size and configuration limits identified, the intensity of site improvements is consistent with the retailing nature of existing land use activities. Any program effort to increase site utilization is likely to require removal and replacement of all existing structures to significantly improve the economic capacity of existing site improvements.
Sites 10 & 11 – La Palma Intercommunity Hospital Site Area
The La Palma Intercommunity Hospital site area (Medical Campus Site Area) is illustrated in Exhibit V-1 as Site 10 and Site 11 and described in more detail in Exhibit
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V-11 and Exhibit V-12. A breakdown of existing building improvements and activities within the Hospital Site Area is summarized below: Figure V-3 Description of Building Improvements Within Hospital Site Area Parcel Building Vacant Address Land Use Activity Acreage Sq. Ft. Sq. Ft. FAR Site Area – 10 (East Side Walker Street): 7982 Walker St. Bank of America 1.30 7,602 -- 0.13 7872 Walker St. La Palma Prof. Center (MOB) 2.15 59,245 33,683 0.63
Subtotal 3.45 66,847 33,683 0.44
Site Area - 11 (West Site Walker Street): 5321 La Palma Ave. Sunrise Assisted Living 2.68 43,760 -- 0.37 5451 La Palma Ave. La Palma Medical Bldg. 0.89 38,324 5,489 0.99 5471 La Palma Ave. La Palma Medical Bldg. 1.36 20,488 7,546 0.35 7901 Walker St. Hospital 6.41 93,132 -- 0.33 7851 Walker St. Peppertree Plaza (MOB) 0.93 20,400 -- 0.50 Behind 7851 Walker Parking Lot for Hospital/MOB 1.17 ------
Subtotal 13.44 216,104 13,035 0.37 Total 16.89 282,951 46,718 0.38
Note: MOB denotes Medical Office Building
Source: Field Audit by AGA.
As shown above, the site area is largely defined by a collection of medical-related uses surrounding the main hospital facility (Bank of America being the only exception). Hospital facilities are important drivers of demand for medical office space in the immediate vicinity in order to facilitate quick and coordinated delivery of diverse medical services based on areas of acute care specialization represented at the hospital. In all, the 16.9-acre site area has been improved with nearly 283,000 square feet of buildings, including more than 138,000 square feet in office space intended to host medical practitioners serving the hospital. An in-field audit revealed that approximately 46,700 square feet of space within the four medical office buildings is vacant, which equates to a vacancy rate of nearly 35.0 percent. A review of office directory listings also indicates very limited representation of medical-related businesses within the adjoining office facilities (primarily medical labs and testing facilities but few medical practices).
The overall scope of building improvements within the Medical Campus Site Area (283,000 square feet) equates to an FAR of 0.38:1.00. Effective building intensity varies by location within the site area (ranging from an FAR of 0.19:1.00 to
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0.99:1.00), with the highest levels of intensity describing office buildings that share parking with adjoining land uses. The hospital facility itself is a single-story structure with a maximum rated capacity of 141 acute care beds. The Bank of America building (7,600 square feet) is a freestanding retail-commercial use with no logistical connection to the hospital. Finally, the assisted living center (44,500 square feet) operates as a self-contained facility and is not dependent on the hospital to provide resident services under its operating license.
Utilization Assessment
A hospital facility that provides acute care services through a network of affiliated local practitioners is invariably flanked by a complex of medical facilities characterized by a building intensity that frequently exceeds an FAR of 1.00:1.00. At an FAR of 0.38:1.00, building intensity describing the Medical Campus Site Area falls below the level associated with an acute care complex in high demand. More importantly, over one-third of leasable space within the medical office buildings is vacant, and medical- related uses are sparsely represented among existing tenants. By comparison, the majority of acute care hospitals that coordinate services with private practitioners in adjoining office buildings report office vacancies of less than 10.0 percent. Less than 2.0 percent of integrated hospital and medical office complexes report office vacancy in excess of 30.0 percent, as is the case in La Palma. These factors indicate the hospital operation is generating negligible demand for the services from local-based medical practitioners, which is a necessary demand driver for medical office space adjacent to a hospital facility. The 16.89-acre site area has the capacity to host more intense levels of land use development whether in the form of acute-care campus that provides a broad cross-section of medical services in coordination with local medical practitioners or in the form of an alternate future land use.
Priority 2 – Opportunity Areas
These site location areas generally consist of larger size properties in visible locations (refer to Exhibit V-1) already fully improved with significant amounts of residential housing or retail-commercial development.
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Site 7 – Brookside Apartment Area
As shown in Exhibit V-8, this very large complex with 528 apartments occupies 20.11 acres along Orangethorpe Avenue at the eastbound on-ramp to the Artesia Freeway. The entire site area location is improved for residential living at an approximate density of 26 dwelling units per acre. The property enjoys easy freeway access. Street level access is provided with a signalized intersection and turn pocket access. The apartment property is in a busy travel location next to the only freeway interchange serving the City. The site also has 750 feet of frontage along Walker Street and along Orangethorpe Avenue.
Utilization Assessment
Effective utilization of the site is consistent with many forms of residential apartment housing serving this northern region of Orange County. The site visibility, location, and size make it an attractive location for a wide variety of commercial land uses.
Site 8 – Nova Casa-La Palma Apartment Homes Area
As shown in Exhibit V-9, this rectangular 11.9-acre site hosts 272 apartments on the west side of Valley View Street about 0.25 miles north of La Palma Avenue. The entire site area is improved for residential living at an approximate density of nearly 23 dwelling units per acre. The property commands a mid-block location with gate- controlled driveway access for southbound traffic. A raised median requires northbound travelers to negotiate a U-turn from a left turn pocket. Adjacent land uses included a long linear park under a power line on the north and residential development on the east and south side of the site location.
Utilization Assessment
Effective utilization of the site is consistent with many forms of residential apartment housing serving this northern region of Orange County. The site in is a mid-block location and does not readily lend itself to non-residential land use.
Site 9 – La Palma Convenience Center Site Area
As shown in Exhibit V-10, this small 3.41-acre site area is improved with nearly 32,900 square feet of retail-commercial space, which equates to an FAR of 0.22:1.00.
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The site location is anchored by a recently-constructed Walgreens drug store (9,857 square feet) and is improved with two street-side pads (2,435 square feet and 2,714 square feet) and long in-line tenant building (17,860 square feet) to the rear of the site. The retail buildings are fully occupied and reflect a mix of convenience-oriented retail merchandising and service activities. The site location has very good visibility with over 600 feet of frontage along Valley View and nearly 240 feet of frontage along La Palma Avenue. Site access is very easy for southbound and westbound traffic but requires eastbound traffic to negotiate a U-turn and northbound traffic to negotiate an uncontrolled left turn from a mid-block merging lane. The site location is on the City limit boundary and competes with a Buena Park neighborhood center anchored by a Fresh-N-Easy grocery store on the opposite side of the street.
Utilization Assessment
Site utilization reflects optimum use of a relatively shallow retail site (maximum depth of 240 feet) within a neighborhood serving retail location.
Commercial Opportunity Areas
Commercial opportunity areas included a diverse a mix of site locations of varying size (refer to Exhibit V-1) that generally enjoy good visibility and exposure to community traffic flow.
Site 12 – La Palma Avenue-Moody Street Site Area (NEC)
This 0.71-acre site area described in Exhibit V-13 includes a full-service car wash at the immediate corner and small commercial building to the east. Current building improvements total about 5,700 square feet and equate to an FAR of 0.18:1.00. Given the small depth and width of the site and extensive use of circulation for car wash activities, the site is being effectively utilized in a manner consistent with service-oriented retail.
Site 13 – Family Mart-Super 1 Mart Site Area
This 5.60-acre site area described in Exhibit V-14 is a neighborhood shopping center anchored by two independent grocery stores. Current building improvements total nearly 79,200 square feet, which equates to an FAR of 0.32:1.00. The center enjoys very good street-side visibility with nearly 450 feet of frontage along Moody Street
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and 550 feet of frontage along La Palma Avenue. The Family Mart anchor (17,232 square feet) and recently opened Super 1 Mart anchor (25,506 square feet) are retail activities that generate frequent shopper trips. Only one of the 23 storefront locations in the center is currently vacant. The building intensity of improvements currently exceeds the FAR of most traditional neighborhood serving centers in Orange County. The site location is being effectively utilized in a manner consistent with active neighborhood-serving retail center.
Site 14 – La Palma Avenue-Moody Street Site Area (SWC)
As described in Exhibit V-15, this 2.58-acre site area consists of a 0.51-acre retail parcel at the immediate corner that is wrapped by a 2.07-acre institutional parcel. Building intensity describing 5,800 square feet of space on the retail parcel equates to an FAR of 0.26:1.00, while the corresponding FAR for the 5,800-square-foot building on the institutional property equates to an FAR of only 0.06:1.00. The retail building reflects the design and configuration of a small strip-commercial retail center and is fully occupied. The institutional building and associated grounds reflects a high quality design style. The retail portion of the site area is being effectively utilized given the small size of the retail parcel. Overall building intensity of the institutional building is very low for an administrative function.
Site 15 – Carl’s Junior Site Area
This 0.5-acre site area described in Exhibit V-16 includes a Carl’s Jr. quick-serve restaurant with a drive-thru window. The existing building totals just over 2,125 square feet and equates to an FAR of 0.10:1.00. Given the small depth and width of the site, high ratio of parking required for restaurant dining, and site circulation area required for the drive-thru window, the small retail parcel is being effectively utilized as a standalone retail property.
Site 16 – Walker Street-La Palma Avenue Site Area (SWC)
This 5.55-acre site area described in Exhibit V-17 is a neighborhood shopping center with a vacant anchor store (formerly occupied by a Ralph’s grocery store). Current building improvements total nearly 53,900 square feet, which equates to an FAR of 0.22:1.00. The center has very good visibility with nearly 330 feet of frontage along Walker Street and 535 feet of frontage along La Palma Avenue. The center lacks a
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unifying building design, signage program, or thematic landscaping and is characterized by expansive paving areas with multiple ingress-egress driveways typical of retail center design during the 60’s and early 70’s. The vacant anchor store (30,800 square feet) is the only vacancy among the 17 storefronts within the center. The tenant mix reflects a heavy emphasis on convenience (liquor, florist, gas station, etc.) and personal service (shoe repair, dry cleaner, dentistry, etc.) storefront activities. The vacated anchor has significantly reduced consumer traffic activity within the center. Despite a low level of consumer activity, site building intensity is characteristic of many retail centers in the northern area of Orange County.
Site 17 – Walker Street-La Palma Avenue Site Area (SEC)
This 0.79-acre site area described in Exhibit V-18 consists of a small 0.2-acre retail parcel at the immediate corner and an adjacent 0.6-acre commercial parcel. The retail parcel includes a 2,200-square-foot building which equates to an FAR of 0.28:1.00. The retail building originally hosted a pharmacy with drive-thru window but is currently vacant. The larger commercial parcel has been improved with a 9,500- square-foot, two-story Christian school for pre-school and K-6 education. Building intensity on the school property equates to an FAR of 0.36:1.00. The site area location is abutted by single-family homes to the south and east. The intensity of building improvements makes it difficult to further increase site utilization without removing and replacing structures.
Site 18 – Walker Street-Crescent Avenue Site Area (NWC)
This 0.21-acre site area described in Exhibit V-19 includes a freestanding full-service car wash. The main car wash building totals nearly 3,360 square feet and equates to an FAR of 0.37:1.00. The site location is at the immediate corner and is surrounded by the parking lot for the local high school. Given the small size of the site, it is being effectively utilized as a standalone retail property. Relatively low traffic counts at the intersection (about 16,000 ADT) and absence of retail in other quadrants of the intersection limit potential to replace existing improvements with more intense retail activity.
Market Study for the La Palma General Plan Update V-15 ALFRED GOBAR ASSOCIATES
Site 19 – Moody Street-Crescent Avenue Site Area (NEC)
This 0.90-acre site area described in Exhibit V-20 is a convenience-oriented strip- commercial center totaling 10,180 square feet, which equates to an FAR of 0.26:1.00. The small center is fully occupied and includes a convenience market (2,550 square feet), limited service restaurant (1,275 square feet), and heavy mix of personal service (video rental, hair care, dry cleaning, etc.) storefront activities. The strip center and auto service center on the opposing corner are the only retail land uses within proximity to the intersection. The site area has good visibility and lane- controlled access along Moody Street. The small center reflects the most effective retail use at this location.
Site 20 – Moody Street-Crescent Avenue Site Area (SEC)
This 0.42-acre site area location described in Exhibit V-21 is a vacant parcel at the immediate intersection. The parcel has the physical capacity to host about 4,500 square feet of in-line building space and parking at a 4-to-1 ratio or up to 3,000 square feet of restaurant space and parking up to an 8-to-1 ratio. The parcel is flanked on the east and south by residential development. Current traffic volume through the intersection is equal to approximately 17,000 ADT. Most national chain quick-serve restaurants and snack-beverage shops seek a location with a minimum threshold volume of 25,000 ADT. If developed for retail purposes, the parcel would constitute the third commercial improvement at the intersection. The Moody Street Crescent Avenue intersection currently hosts a freestanding auto service shop center on the southwest corner and small strip-commercial center (refer to Site 19) on the northeast corner.
F:\LA PALMA GPU 4-2012.DOC\APRIL 11, 2012\B
Market Study for the La Palma General Plan Update V-16 EXHIBIT V-1 CITY OF LA PALMA OPPORTUNITY SITE LOCATIONS
- Priority 1 Opportunity Sites - Priority 2 Opportunity Sites - Commercial Opportunity Sites
Source: City of La Palma, Hogle-Ireland, and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE EXHIBIT V-2
SITE 1 LOCATED NW/SW CORNER OF 91 AND CANAL WEST OF WALKER STREET Priority 1 Opportunity Area Total Acreage: 4.73
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape - NW Corner 91 and Canal 2.19 0 - Triangular - SW Corner 91 and Canal 2.55 0 - Triangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound None None None East Bound None None None North Bound None None None South Bound None None None
RETAIL TENANT LIST Address Name Sq. Ft. NAICS SW Corner 91 and Canal Bettencourt Park - - NW Corner 91 and Canal Rainbow Park - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE EXHIBIT V-3
SITE 2 LOCATED ON WALKER STREET NORTH OF ORANGETHORPE AVENUE Priority 1 Opportunity Area Total Acreage: 3.80
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 27607109 6811 Walker St 1.29 22,894 1976 Irregular 27607114 6861 Walker St 1.47 37,999 - Irregular 27607111 6951 Walker St 1.04 14,918 1976 Irregular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Orangethorpe Ave - - East Bound Orangethorpe Ave - - North Bound Walker St - - South Bound Walker St 7,000 370 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 6811 Walker St No Retail - - 6861 Walker St No Retail - - 6951 Walker St No Retail - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE EXHIBIT V-4
SITE 3 LOCATED SEC OF WALKER STREET AND FRESCA DRIVE Priority 1 Opportunity Area Total Acreage: 16.47
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 27608101 6842 Walker St 2.11 150,007 1973 Rectangular 27608112 6841 Marlin Cir 2.58 57,039 1973 Rectangular 27608113 5600 Fresca Dr 2.07 40,507 1973 Trapezoidal 27608103 5692 Fresca Dr 3.80 100,107 1973 Rectangular 27608109 6892 Marlin Cir 2.91 59,679 1973 Trapezoidal 27608122 6911 Marlin Cir 1.58 32,024 1973 Trapezoidal 27608166 6907 Marlin Cir 1.42 25,116 1974 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Fresca Dr - - East Bound Fresca Dr - 935 Feet/350 Feet North Bound Walker St 7,000 325 Feet South Bound Walker St - - Both Marin Circle - 990 Feet
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-4 (Cont'd)
SITE 3 LOCATED SEC OF WALKER STREET AND FRESCA DRIVE Priority 1 Opportunity Area Total Acreage: 16.47
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 6811 Walker St No Retail - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-5
SITE 4 LOCATED NWC OF ORANGETHORPE AVENUE AND VALLEY VIEW STREET Priority 1 Opportunity Area Total Acreage: 38.76
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 27608142 18 Centerpointe Dr 2.45 35,004 1985 Irregular 27608152 20 Centerpointe Dr 3.39 56,280 1987 Irregular 27608153 22 Centerpointe Dr 1.14 21,176 1987 Irregular 27608154 24 Centerpointe Dr 1.52 22,657 1987 Irregular 27608140 26 Centerpointe Dr 0.50 21,643 1985 Rectangular 27608139 28 Centerpointe Dr 0.50 21,785 1985 Irregular 27608138 30 Centerpointe Dr 2.34 21,176 1985 Irregular 27608136 38 Centerpointe Dr 1.26 10,472 1986 Irregular 27608151 50 Centerpointe Dr 1.24 9,133 1986 Irregular 27608146 2 Centerpointe Dr 0.98 7,310 1986 Rectangular 27608161 4 Centerpointe Dr 2.76 86,662 1987 Irregular 27608162 6 Centerpointe Dr 2.96 151,355 1989 Irregular 27608164 10 Centerpointe Dr 1.81 12,491 1989 Irregular 27608143 16 Centerpointe Dr 3.77 51,784 1985 Irregular 27608149 5 Centerpointe Dr 2.81 63,654 1989 Irregular 27608150 3 Centerpointe Dr 2.41 81,253 1987 Irregular 27608148 1 Centerpointe Dr 6.92 89,323 1985 Irregular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Orangethorpe Ave - - East Bound Orangethorpe Ave 17,200 1,140 Feet North Bound Valley View St - - South Bound Valley View St 13,000 1,325 Feet
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE Page 1 of 3 EXHIBIT V-5 (Cont'd)
SITE 4 LOCATED NWC OF ORANGETHORPE AVENUE AND VALLEY VIEW STREET Priority 1 Opportunity Area Total Acreage: 38.76
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 2 Centerpointe Dr Panda Lion Restaurant 7,310 72211 50 Centerpointe Dr FedEx Office 4,566 561431 50 Centerpointe Dr Sushi Ya 4,566 72211 38 Centerpointe Dr Vacant (Restaurant) 5,790 99900 38 Centerpointe Dr Minute Man Press 1,411 98800 38 Centerpointe Dr Golden Spa Salon 1,411 812112 38 Centerpointe Dr Flame Broiler 1,411 722211 30 Centerpointe Dr Aroma Restaurant 2,647 72211 30 Centerpointe Dr Buy America ERA Real Estate 2,647 53121 30 Centerpointe Dr Center Stage Salon 2,647 812112 30 Centerpointe Dr Day Spa 2,647 812199 30 Centerpointe Dr Dentist 2,647 6212 30 Centerpointe Dr Cameo Escrow 2,647 53131 30 Centerpointe Dr Quizno's Subs 2,647 722211 30 Centerpointe Dr Vacant 2,647 99900 10 Centerpointe Dr The Market Place 2,498 44511 10 Centerpointe Dr Printing 1,249 561439 10 Centerpointe Dr Latte Da 1,249 722211 10 Centerpointe Dr Tokyo Grill 1,249 72211 10 Centerpointe Dr Source One Staffing 1,249 5613 10 Centerpointe Dr Next Day Signs 1,249 45321 10 Centerpointe Dr Vacant 2,498 99900 10 Centerpointe Dr TEI - Tech 1,249 98800
Retail Square Footage: 60,131 Store Fronts: 23 Occupied: 49,196 Occupied: 20 Vacant: 10,935 Vacant: 3 Percent Occupied: 82%
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE Page 2 of 3 EXHIBIT V-5 (Cont'd)
SITE 4 LOCATED NWC OF ORANGETHORPE AVENUE AND VALLEY VIEW STREET Priority 1 Opportunity Area Total Acreage: 38.76
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE Page 3 of 3 EXHIBIT V-6
SITE 5 LOCATED AT NWC OF ORANGETHORPE AVENUE AND WALKER STREET Priority 1 Opportunity Area Total Acreage: 20.61
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 27607212 5355 Orangethorpe Ave 18.34 154,225 1978 Trapezoidal 27607208 6901 Walker St 1.17 9,706 1973 Trapezoidal 27607216 5471 Orangethorpe Ave 1.09 4,690 1981 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Orangethorpe Ave 10,100 1,300 Feet East Bound Orangethorpe Ave 17,800 - North Bound Walker St 10,400 - South Bound Walker St 7,000 355 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5471 Orangethorpe Ave California Bank and Trust 4,690 52211 6901 Walker St Japanese Seafood Buffett 9,706 72211
Retail Square Footage: 14,396 Store Fronts: 2 Occupied: 14,396 Occupied: 2 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part I) - La Palma 3-12/3/28/2012 RE EXHIBIT V-7
SITE 6 LOCATED NEC OF ORANGETHORPE AVENUE AND WALKER STREET Priority 1 Opportunity Area Total Acreage: 1.66
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 27607302 6940 Walker St 0.27 3,814 1971 Triangular 27607303 5501 Orangethorpe Ave 0.52 5,701 1974 Rectangular 27607304 5545 Orangethorpe Ave 0.68 3,013 1971 Trapezoidal 27607305 5551 Orangethorpe Ave 0.19 1,231 1965 Trapezoidal
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Orangethorpe Ave 14,100 445 Feet East Bound Orangethorpe Ave 12,700 - North Bound Walker St 10,400 305 Feet South Bound Walker St 7,000 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5501 Orangethorpe Granada Liquor 2,851 44531 5511 Orangethorpe Road King Restaurant 2,850 72211 5545 Orangethorpe Burger King 3,013 722211
Retail Square Footage: 8,714 Store Fronts: 3 Occupied: 8,714 Occupied: 3 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE EXHIBIT V-8
SITE 7 LOCATED SEC OF ORANGETHORPE AVENUE AND WALKER STREET Priority 2 Opportunity Area Total Acreage: 20.11
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26307104 5600 Orangethorpe Ave 9.71 216,128 1971 Rectangular 26307103 5600 Orangethorpe Ave 10.40 214,253 1972 Trapezoidal
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Orangethorpe Ave 14,100 - East Bound Orangethorpe Ave 12,700 740 Feet North Bound Walker St 10,400 750 Feet South Bound Walker St 7,000 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5600 Orangethorpe Ave No Retail - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE EXHIBIT V-9
SITE 8 LOCATED ALONG VALLEY VIEW STREET NORTH OF LA PALMA AVE Priority 2 Opportunity Area Total Acreage: 11.90
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26324146 7799 Valley View St 11.90 - - Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave - - East Bound La Palma Ave - - North Bound Valley View St - - South Bound Valley View St 21,300 665 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 7799 Valley View St No Retail - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE EXHIBIT V-10
SITE 9 LOCATED AT NWC OF LA PALMA AVENUE AND VALLEY VIEW STREET Priority 2 Opportunity Area Total Acreage: 3.41
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape - La Palma and Valley View 2.56 7,602 - Irregular - La Palma and Valley View 0.86 23,016 - Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 12,900 235 Feet East Bound La Palma Ave - - North Bound Valley View St - 615 Feet South Bound Valley View St 21,300 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5961 La Palma Ave Walgreens 9,857 44611 7971 Valley View St The Wok Experience 2,435 72211 7955/51 Valley View St Medical Supplies 2,714 446199 7945 Valley View St Beauty Salon 1,357 812112 7941 Valley View St All State 1,357 52421 7931 Valley View St Acupuncture 1,357 6213 7925 Valley View St Nail Boutique 1,357 812113 7921 Valley View St Pinoy Grille 1,357 72211 7881 Valley View St La Palma Dental 1,357 6212 7871 Valley View St Plummer 1,357 98800 7861 Valley View St NA 1,357 98800 7881 Valley View St Message Therapy 1,357 812199 7841/31 Valley View St State Farm 2,714 52421 7821 Valley View St Tailors and Cleaners 1,355 81232 7811 Valley View St Julninies JR Burger 1,585 722211
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-10 (Cont'd)
SITE 9 LOCATED AT NWC OF LA PALMA AVENUE AND VALLEY VIEW STREET Priority 2 Opportunity Area Total Acreage: 3.41
Retail Square Footage: 32,873 Store Fronts: 15 Occupied: 32,873 Occupied: 15 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-11
SITE 10 LOCATED AT NEC OF LA PALMA AVENUE AND WALKER STREET Priority 1 Opportunity Area Total Acreage: 3.45
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26326144 7982 Walker St 1.30 7,602 1970 Rectangular 26326143 7872 Walker St 2.15 77,973 1984 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 9,800 205 Feet East Bound La Palma Ave 12,900 - North Bound Walker St 10,600 725 Feet South Bound Walker St 8,500 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5531 La Palma Ave La Palma Ave 7,602 52211
Retail Square Footage: 7,602 Store Fronts: 1 Occupied: 7,602 Occupied: 1 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part II) - La Palma 3-12/3/28/2012 RE EXHIBIT V-12
SITE 11 LOCATED AT NWC OF LA PALMA AVENUE AND WALKER STREET Priority 1 Opportunity Area Total Acreage: 13.44
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26363420 5321 La Palma Ave 2.68 44,500 - Rectangular 26328111 5451 La Palma Ave 0.89 38,324 1975 Rectangular 26328113 5471 La Palma Ave 1.36 20,488 1972 Rectangular 26328112 7901 Walker St 6.41 92,392 1971 Rectangular 26328103 7851 Walker St 0.93 20,400 1978 Rectangular - Behind 7851 Walker St 1.17 0 - Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 9,800 865 Feet East Bound La Palma Ave 12,900 - North Bound Walker St 10,600 - South Bound Walker St 8,500 740 Feet
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-12 (Cont'd)
SITE 11 LOCATED AT NWC OF LA PALMA AVENUE AND WALKER STREET Priority 1 Opportunity Area Total Acreage: 13.44
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5022 Crescent Ave No Retail - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: N.A.
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-13
SITE 12 LOCATED AT NEC OF LA PALMA AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 0.71
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26330261 5031 La Palma Ave 0.24 2,701 1966 Rectangular 26330260 5021 La Palma Ave 0.47 3,001 1973 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 10,100 195 Feet East Bound La Palma Ave 17,800 - North Bound Moody St 10,400 150 Feet South Bound Moody St 7,000 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5021 La Palma Ave Car Wash La Palma 3,001 811192
Retail Square Footage: 3,001 Store Fronts: 1 Occupied: 3,001 Occupied: 1 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE EXHIBIT V-14
SITE 13 LOCATED AT NWC OF LA PALMA AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 5.60
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26331265 4997 La Palma Ave 0.36 3,305 1982 Rectangle 26331266 4961 La Palma Ave 0.55 5,886 1976 Rectangle 26331264 4951 La Palma Ave 2.07 25,506 1969 Irregular 26331263 4881 La Palma Ave 2.29 22,706 1969 Irregular 26331262 4877 La Palma Ave 0.11 1,506 1971 Rectangle 26331261 4875 La Palma Ave 0.22 2,541 1972 Rectangle
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 9,300 550 Feet East Bound La Palma Ave 9,800 - North Bound Moody St 10,200 - South Bound Moody St 11,800 445 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 4875 La Palma Ave BBCN - Bank 4,016 52211 4877 La Palma Ave Phang Mo Restaurant 1,248 72211 4881 La Palma Ave Pharmacy 1,248 44611 4883 La Palma Ave Restaurant 1,248 72211 4885 La Palma Ave Hair 1,248 812112 4887 La Palma Ave Dentistry 1,248 6212 4889 La Palma Ave Bakery 1,248 445299 4891 La Palma Ave Video 1,248 53223 4941 La Palma Ave Family Mart 17,232 44511 4943 La Palma Ave Vacant 1,812 99900 4943 La Palma Ave Cleaners 1,812 81232 4943 La Palma Ave Bobalooca - Tea and Coffee 1,812 722213 4943 La Palma Ave Pho Restaurant 1,812 72211 4943 La Palma Ave Tutor 1,812 6116 4943 La Palma Ave Hair 1,812 812112
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-14 (Cont'd)
SITE 13 LOCATED AT NWC OF LA PALMA AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 5.60
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 4943 La Palma Ave Book Academy 1,812 6116 4943 La Palma Ave Acupuncture 1,812 6213 4951 La Palma Ave Super 1 Mart 25,506 44511 4961 La Palma Ave Soy Tofu Restaurant 1,472 72211 4971 La Palma Ave Sweet - Clothing 1,471 44819 4981 La Palma Ave Motouch - Wigs 1,471 44815 4991 La Palma Ave Korean BBQ 1,472 72211 4997 La Palma Ave La Capilla Mexican Restaurant 3,305 72211
Retail Square Footage: 79,177 Store Fronts: 23 Occupied: 77,365 Occupied: 22 Vacant: 1,812 Vacant: 1 Percent Occupied: 98%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-15
SITE 14 LOCATED AT SWC OF LA PALMA AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 2.58
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26204230 4982 La Palma Ave 0.51 5,804 1985 Rectangular 26204266 8081 Moody St 2.07 5,801 1980 L-Shaped
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 10,100 - East Bound La Palma Ave 17,800 275 Feet North Bound Moody St 10,400 - South Bound Moody St 7,000 390 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 4992 La Palma Ave Eden Day Spa 3,250 812199 4982 La Palma Ave Tackle Yours - Bait Shop 1,054 45111 4982 La Palma Ave Pharmacy 1,500 44611 Retail Square Footage: 5,804 Store Fronts: 3 Occupied: 5,804 Occupied: 3 Vacant: 0 Vacant: 0 Percent Occupied: 100% OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE EXHIBIT V-16
SITE 15 LOCATED AT SEC OF LA PALMA AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 0.50
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26208106 5012 La Palma Ave 0.50 2,126 1970 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 10,100 - East Bound La Palma Ave 17,800 135 Feet North Bound Moody St 10,400 200 Feet South Bound Moody St 7,000 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5012 La Palma Ave Carls Junior 2,126 722211
Retail Square Footage: 2,126 Store Fronts: 1 Occupied: 2,126 Occupied: 1 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part III) - La Palma 3-12/3/28/2012 RE EXHIBIT V-17
SITE 16 LOCATED AT SWC OF LA PALMA AVENUE AND WALKER STREET Commercial Opportunity Area Total Acreage: 5.55
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26220104 8471 Walker St 0.21 906 1964 Rectangular 26213110 5510 La Palma Ave 0.61 9,489 1974 Rectangular 26210216 5482 La Palma Ave 0.52 1,659 1968 Rectangular 26210219 5456 La Palma Ave 0.57 7,006 1973 Rectangular 26210218 5422 La Palma Ave 0.73 9,006 1970 Irregular 26210217 5420 La Palma Ave 2.48 30,806 1970 Irregular 26210215 5418 La Palma Ave 0.19 2,406 1970 Rectangular 26210214 5410 La Palma Ave 0.24 3,006 1972 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 12,900 - East Bound La Palma Ave 9,800 535 Feet North Bound Walker St 10,600 - South Bound Walker St 8,500 330 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5410 La Palma Ave The Hub - Activity Center 3,006 813 5418 La Palma Ave Palma Liquor 2,406 44531 5420 La Palma Ave Vacant (former Ralphs) 30,806 99900 5438 La Palma Ave Yogurt Time 1,000 722213 5448 La Palma Ave Cleaners 1,000 81232 5446 La Palma Ave Shoe Repair 1,000 81143 5442 La Palma Ave Multi-DVD/Gift 1,000 45122 5438 La Palma Ave Classic Florist 1,000 45311 5434 La Palma Ave Beauty Supply 1,000 44612 5430 La Palma Ave Smokes 1,000 453991 5426 La Palma Ave Hair Etc 1,000 812112 5422 La Palma Ave Optometry 1,006 6213 5456 La Palma Ave Chinese Food 1,402 72211
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-17 (Cont'd)
SITE 16 LOCATED AT SWC OF LA PALMA AVENUE AND WALKER STREET Commercial Opportunity Area Total Acreage: 5.55
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5462 La Palma Ave Subway 1,401 722211 5486 La Palma Ave Herb and ACU 1,401 446191 5486 La Palma Ave Dentistry 2,802 6212 5482 La Palma Ave 76 Station 1,659 44711
Retail Square Footage: 53,889 Store Fronts: 17 Occupied: 23,083 Occupied: 16 Vacant: 0 Vacant: 1 Percent Occupied: 57%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-18
SITE 17 LOCATED AT SEC OF LA PALMA AVENUE AND WALKER STREET Commercial Opportunity Area Total Acreage: 0.79
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26213110 5510 La Palma Ave 0.61 9,489 1974 Rectangular 26213148 5522 La Palma Ave 0.18 3,180 1963 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound La Palma Ave 12,900 - East Bound La Palma Ave 9,800 360 Feet North Bound Walker St 10,600 145 Feet South Bound Walker St 9,200 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5510 La Palma Ave Vacant 2,200 -
Retail Square Footage: 2,200 Store Fronts: 1 Occupied: 0 Occupied: 0 Vacant: 2,200 Vacant: 1 Percent Occupied: 0%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE EXHIBIT V-19
SITE 18 LOCATED AT NWC OF CRESCENT AVENUE AND WALKER STREET Commercial Opportunity Area Total Acreage: 0.21
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26220104 8471 Walker St 0.21 906 1964 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Crescent Ave 5,900 160 Feet East Bound Crescent Ave - - North Bound Walker St - - South Bound Walker St 9,500 175 Feet
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 8471 Walker St Car Wash 3,359 811192
Retail Square Footage: 3,359 Store Fronts: 1 Occupied: 3,359 Occupied: 1 Vacant: 0 Vacant: 0 Percent Occupied: 100%
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE EXHIBIT V-20
SITE 19 LOCATED AT NEC OF CRESCENT AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 0.90
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26221247 8402 Moody St 0.90 10,188 1979 Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Crescent Ave 5,900 160 Feet East Bound Crescent Ave - - North Bound Moody St - 250 Feet South Bound Moody St 11,500 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 8402 Moody St Tutor Zone 1,273 6116 8412 Moody St The Cottage Restaurant 1,273 72211 8422 Moody St Star Hair 1,273 812112 8432 Moody St Cleaners 1,273 81232 8442 Moody St State Farm 1,273 52421 8452 Moody St Video Choice 1,273 53223 8462 Moody St 7 Eleven 2,546 44512
Retail Square Footage: 10,184 Store Fronts: 7 Occupied: 10,814 Occupied: 7 Vacant: 0 Vacant: 0 Percent Occupied: 100%
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE Page 1 of 2 EXHIBIT V-20 (Cont'd)
SITE 19 LOCATED AT NEC OF CRESCENT AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 0.90
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE Page 2 of 2 EXHIBIT V-21
SITE 20 LOCATED AT SEC OF CRESCENT AVENUE AND MOODY STREET Commercial Opportunity Area Total Acreage: 0.42
PARCEL LIST APN Address Acres Bldg. Year Built Site Shape 26238001 5022 Crescent Ave 0.42 0 - Rectangular
TRAFFIC VOLUME - 2011 Direction Street Traffic Count Street Frontage West Bound Crescent Ave 5,900 160 Feet East Bound Crescent Ave - - North Bound Moody St - 250 Feet South Bound Moody St 11,500 -
RETAIL TENANT LIST Address Name Sq. Ft. NAICS 5022 Crescent Ave No Structure - -
Retail Square Footage: 0 Store Fronts: 0 Occupied: 0 Occupied: 0 Vacant: 0 Vacant: 0 Percent Occupied: 0
OPPORTUNITY AREA PHOTOS
Source: City of La Palma and Alfred Gobar Associates
Opportunity Area Profiles (Part IV) - La Palma 3-12/3/28/2012 RE