The Calacas Cafe recently relaunched after changing from a coffee shop to a Mexican cafeteria to compete in the changing downtown atmosphere, labeled by some as one of the hippest scenes in Orange County, according to the O.C. Register.
With a new bar or restaurant opening downtown just about every other month, the owner of Calacas, Rudy Cordova, said he felt he just couldn’t keep up.
No one can keep up. There are only so many hipsters around and the only way that Downtown Santa Ana’s hipster food and drinking – and arts – scene is going to survive is with a massive influx of new customers.
Now how is that going to happen? The solution is currently a big empty dirt lot called the “One Broadway Plaza.” Developer Mike Harrah wants to build Orange County’s tallest office tower there and many have called his scheme plain nuts. But if he succeeds and if folks lease out the space Harrah just might save the DTSA bars and restaurants.
Face it. There is a different vibe in Downtown Santa Ana. It isn’t the boring pre-planned Irvine or the Resort Wasteland of Anaheim. We are the County Seat and Santa Ana also is home to many courthouses and state and federal agencies.
What about the DTSA Artists Village? Well the artists are now complaining that they want the City of Santa Ana to invest millions to keep them afloat. That is simply not going to happen. But if the OBP Tower gets built and gets filled it will bring new customers to the Artists Village including business owners who just might want to buy new artwork to decorate their OBP offices.
Now the downside to all this is that the continued gentrification of Downtown Santa Ana could in the end push all of the low end artists out of town. That is happening in the Los Angeles Arts District already, according to a recent L.A. Times article.
Spending tax money on subsidizing artist studios is a no go in Santa Ana. The reality is that they are either going to have to a) figure out how to sell their work to the masses or b) move to other parts of town that are more blue collar and have cheaper rents. The Artists Village was never about helping them. The main intention of the city leaders was always to gentrify Downtown Santa Ana and to increase property values and rents.
As for our Downtown, Santa Ana’s city leaders would be wise to look at the business mix in Downtown Brea and in Downtown San Diego where foodie type establishments coexist with national chains. DTSA needs family friendly restaurants in addition to all of the pricey hipster joints.
The reality is that the majority of Santa Ana’s residents have few reasons to visit DTSA. But that doesn’t have to be the case. Build OBP and let’s see who else opens up businesses in our Downtown.
What about the Luddites who oppose OBP? They need to realize that the changes happening in our Downtown aren’t going to be sustainable without the OBP bringing in new masses. New masses = more sales and more sales tax revenues and new business license fees.
I still don’t like the money-wasting idea that is the proposed Santa Ana Light Rail to nowhere but fun trolley buses could be used to convey folks from the train station to OBP and DTSA.
First of course Harrah has to fill up his OBP tower. That may prove to be a real challenge but Harrah doesn’t take no for an answer. I trust he will find a way even without the redevelopment money that Mayor Miguel Pulido used to such effect in our Downtown for so many years.
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When will OBP begin to be built?
I believe that Harrah has to lease 40% of it before he can start construction.
I believe the ten year entitlement expired. So I think that the planning would need to start from scratch.
That would be great. It should be a mixed use tower with condos and offices.
I believe he received an extension at part pf the 2010 modifications to the development agreement.
That's the only chance his grand fantasy of a "Vibriant" downtown Santa Ana has.
We repeatedly hear politicians (council members with NO jobs) promote the "New DTSA", in reality, the community, the city can not support this. How about a ROSS or a Walmart hybrid. Trendy bars like in San Jose only survive when you have well paying jobs.
Let's be honest, most of Santa Ana is immigrant class laborers: Maids, Gardeners, Low Level factory workers and Laborers. Those are good working people, but to pretend that a community made of this demographic could support a place like the "PLAYGROUND" is insane.
Look, I know the Brea guy, the Irvine guy and the other unfamiliar a**holes like to talk about how the Santa Ana spring has revitalized the city. That is absolute BULLSHIT. Townsend is a F*CKING war zone, Standard street is a haunt for Meth addicts and hookers, the streets are bad, the services worse, the entire city infrastructure is in disrepair.
But we are opening an "Alehouse" on Forth street. Good Luck.
YOU NEED MONEY.
Which Brea guy? Which Irvine guy? Who are you talking about? Names please
As much as I would like to see it get underway, OBP is an ill-conceived project. At a reported $300M to build, Harrah will need to invest roughly $500 to $600 per sq ft to finish this building. Yet office building in well established office markets like Irvine and Costa Mesa sell for roughly half that amount.
2030 Main St. in Irvine sold for $320 per sq ft last year. There office lease rates range from $2.25 - $3.00 per sq ft. In the South Coast Metro area, Griffin Towers sold recently for $237 per sq ft with asking lease rates at $2.25 per sq ft. Closer to DTSA, the State Fund building on 4th St sold for $175 per sq ft.
Office space in the immediate DTSA typical leases for less than $2.00 per sq ft. However, Harrah would have to secure leases in the $4.00 per sq ft range to justify his investment. In Newport Beach, the Irvine Co. can obtain that level of lease rates, but it is highly doubtful that will occur here.
The math for this project that was publicly announced in 2001 and secured entitlements in 2004, 2005 does not come close to closing.
I think the tower really needs to be mixed use with nice condos and offices.
That I idea could work for building significantly shorter, but it still would not work for the size Harrah hopes to build. The demand is just not there, even with the residential component. The city strongly communicated to the developers of the Lyon project on 1st Street and The Met project in South Coast Metro area their desire for hi-rise residential projects for those locations. Yet those developers was able to get approval for mid-rise projects because they convinced the city that there was no consumer demand or support from capital markets for hi-rise projects.
Not sure who you have me confused with. I neither actively campaigned or protested this project or voted against. I also certainly do not live in or near French Park or downtown. I actually hope Harrah will prove me wrong, because it will have an overall positive impacts for SA. DTSA could certainly use an influx corporate businesses beyond the concentration of gov't offices and criminal defense and personal injury attorneys presently located there. Unfortunately, I don’t think he will do that.
The economy had delayed building construction everywhere. However earlier this year, PIMCO relocated to a newly completed office tower in the Newport Center and the Irvine Co. has a second office hi-rise under construction. They have submitted plans for two more towers in the Irvine Spectrum. The largest building on the West Coast is underway in DTLA. These projects did not even receive entitlements prior to the downturn like OBP. So where there is a market, the economy is no longer factor. Again facts and data suggest that OBP in present configuration is very ill concieved,
Harrah has systematically sold off his other assets including his beloved Original Mike's Restaurant. He does not take no for an answer. I have no doubt that he will find a way to build this tower.
Guess you won't be running for Mayor then.
Would electing you have made a difference? You still need four votes on the Council to get anything done.
Well at least mix in some Negra Modelos or some Dos Equis with your backyard beers.
Nice. That's the year of my birth. You may wish me a happy birthday on August 12.
Mr Fiala - Thanks for the clarification toward whom you were addressing your previous comments. However, there are few corrections to the statements you made regarding how long OBP was tied up in legal entanglement.
Harrah received approval for OBP in 2003 from the city council that included a zoning change and development agreement. One stipulation of the development agreement required Harrah to have lease commitments for 50% of the building before he could begin construction (typically most bank would also have this same threshold to obtain financing). Citizens shortly after the council approval gathered enough signatures to put the zoning change up for approval by citizens in an election in 2004. Harrah prevailed in that election and was free to build the project under the conditions of the zoning changes and development agreement he negotiated and agreed upon. In 2010, Harrah went back to the city council to request changes to the development agreement and one of those changes was the removal of the pre-leasing requirements. The council approved that change along with others. The council did not approve his request for financial support. The Editor testified at the public hearing in support of Harrah changes, although in prior posts written in his OJ blog he had been unequivocally in opposition to OBP. Citizens did file a lawsuit in 2011 that the changes to the development agreement required another city wide voter approval. That lawsuit was stroke down by an appellate court in 2011.
This project has not been significantly encumbered by lawsuits, but by market forces.
Your memory is clouded. Our readers know who the Usual Suspects are.
Interesting to note that OC Business Journal's annual list of OC wealthiest individuals that will be published tomorrow, no longer contains Mike Harrah. Previous list pegged his net wealth at $300M. This year list has a cutoff at $250M. Either previous years list overestimated his worth or his current investments have been negatively impacted.
He has definitely been actively selling off assets so he can invest in OBP. He is all in!
The sale of those assets at perhaps reduced values factored into the estimates of those who develop this list.
The more I think about your suggestion that he should transform this project into a mix of offices and condos, the more I think that maybe exactly what Harrah is planning.
It will be interesting to find if that is the case.
Yet the picture atop this post is a recent one. How do you explain all that equipment?
I took that photo about two weeks ago.
The equipment and the work being done in the lot (OBP) was from the city rebuild of Broadway and now from the OCHSA construction. I see my front door is open but I don't see me drinking lemonade on the porch.
The OCBJ is reporting this week that Mike Harrah has bid on buying the OCR building on Grand Ave for $27M. One other bidder is believed to have made a offer several million below Harrah's. There were no specific details about the deal or whether the OCR would remain a tenant. It is believed the price included several parcels surrounding the building that total to about 4 acres. The acquisition price would come to about $150 per sq ft, similar to the State Fund building that sold on 4th street. The OCTA was interested in purchasing that building late last year.
In my attempt to mimic Stanley - ………….Hmmmmmmmmm!
In the same article, it is rumored that the William Lyon Co might be backing out of a deal to purchase 40 acres of land adjacent to OCR building that the Register sold in a separate transaction earlier this year for a reported $40M. Entitlement issues is sited as the reason.