The Urban Flop? Will Mid-Rise condos EVER have a place in Orange County?

As a society, we’ve been trying to design housing to provide the best balance of proximity with open spaces and quiet. As a result, some far-fetched ideas never make it and some are built with lofty expectations.

Wild Concept: Disneyland's "House of the Future" was a wild idea that had many materials made of PLASTIC.
Wild Concept: Disneyland’s “House of the Future” was a wild idea that had many materials made of PLASTIC.

At the height of the housing boom of ’04-’06, investors were literally drowning in credit lines and cash and the housing market seemed like a no-brainer for growth. Since the new generation of buyers didn’t seem to mind about shrinking backyard spaces (or no backyard at all), builders started to think even bigger.

After being released in 2007, the "Stadium Lofts" in Anaheim had studio units starting at $400,000 with melo roos. The project sit directly across the corner from Angel's Stadium and a Metro / Amtrak Station.
After being released in 2007, the “Stadium Lofts” in Anaheim had studio units starting at $400,000 with melo roos. The project sits directly across the corner from Angel’s Stadium and a Metro / Amtrak Station.

IMG00670With successful rejuvenated Downtown areas like the Gaslamp District in San Diego gaining headlines, it became easier to pitch to investors that buyers have come full circle: Suburbs are out; downtown living is in. California freeways are getting slower and slower. Couples are getting married much later in life and having less kids or no kids at all.

Stadium Lofts opened with El Torito, Subway, and Kelly's as their tenants on the ground floor. While I don't know exactly what led to the retail locations closing, I do remember many occasions where the structure didn't have available parking. Angel fans found a way to park in the structure and have their tickets validated.
Stadium Lofts opened with El Torito, Subway, and Kelly’s as their tenants on the ground floor. While I don’t know exactly what led to the retail locations closing, I do remember many occasions where the structure didn’t have available parking. Angel fans found a way to park in the structure and have their tickets validated.
Private outdoor spaces give way to lavish common amenities such as exercise rooms, saunas, and pools.
Private outdoor spaces give way to lavish common amenities such as exercise rooms, saunas, and pools.

After all, everyone longs for living like the characters of “Friends” and “Seinfeld” where they’re only a short elevator ride away from bars, subway access and, shopping, right?

Well….sort of. There are many factors that made these mid-rise developments immediate flops. For starters, the lifestyle would not be like Seinfeld because most would still need to commute to just about everywhere. Public transportation in Southern California has always been very limited due to our love for cars and freeways. Socially, Orange County has been notorious for being “snobs” that don’t even know who lives next door. Forget about the idea of going downstairs to the local bar or hangout where “everyone knows your name.”

While the fancy marketing and amenities were enough to get crowds to the models, buyers knew the idea was a contradiction on many levels.

TOO MANY OPTIONS: During the housing slump of 2008-2010, a 2 bedroom condo like the one shown above can be bought for around $270,000. No melo roos and HOA dues were much cheaper.
TOO MANY OPTIONS: During the housing slump of 2008-2010, a 2 bedroom condo like the one shown above can be bought for around $270,000 in Anaheim Hills. The owner would enjoy the convenience of a direct access garage and a private patio area. No melo roos and HOA dues were much cheaper.
BIGGEST FLOP: "Astoria" in Irvine's "Central Park West" had lower floors available in the high 400s. After factoring melo roos and TWO HOAs, it was the equivalent monthly payment of buying a home near $700k.
BIGGEST FLOP: “Astoria” in Irvine’s “Central Park West” had lower floors available in the high 400s. After factoring melo roos and TWO HOAs, it was the equivalent monthly payment of buying a home near $700k. The building has since been converted to rental units.

 Going Urban 2.0

After the countless price reductions and conversions to rentals, builders were able to learn many lessons.

Brookfield’s “The Domain” community is directly across the street from The Packing District of Anaheim.

Since people love their cars in Southern California, most buyers prefer a private garage over underground terrace parking.
LESSONS LEARNED: The Domain has many units that have a direct access garage. Housing assistance is available through the City of Anaheim.

 

A sheik rooftop lounge is a great gathering place to entertain and look down on the rooftops of nearby buildings.
A sheik rooftop lounge is a great gathering place to entertain and look down on the rooftops of nearby buildings.

No project was impacted by the flop more than Anaheim’s “A-Town” project that was supposed to take cues from San Diego’s Petco Park.

MISSING THE MARK: Anaheim's "A-Town" has sat empty for almost 7 years. The project has since been scaled back to more of your cookie-cutter townhouse development.
MISSING THE MARK: Anaheim’s “A-Town” has sat empty for almost 7 years. The project has since been scaled back to more of your cookie-cutter townhouse development.

From the OC Register:

“Gone are the grandiose ideas to change Anaheim’s skyline with 11 high-rises, an urban village of 2,681 homes and 150,000 square feet of office and retail space near Angel Stadium….

Plans now call for building 1,400 to 1,742 condominiums and apartments, along with up to 50,000 square feet of shopping and office space grouped into eight neighborhoods spanning 43.1 acres, according to a revised development application submitted Thursday to the Anaheim Planning Department.”

After reading the article, most of the blame was placed on the housing market. I have a feeling the builders are in denial or just don’t get it.

2 thoughts on “The Urban Flop? Will Mid-Rise condos EVER have a place in Orange County?”

  1. The biggest snobs are in the bay area. I have a cousin that lives in Walnut Creek. OC its a bad repute because its Republican and LA which has more liberal snobs doesn’t. In fact folks in OC knows who is next door more than LA unless its a Latino part of LA. Also, being a snob is based upon your politics, OC thinks they are friendly and LA is not while LA thinks they are friendly and OC isn’t.In 20 years, who knows the midrise might make it. A lot of the old-time conservatives in Anaheim hate it, so it didn’t get much of a chance to begin with.. They think Anaheim should all be tract houses which doesn’t worked that much in the high cost of housing and large Latino population that can’t afford most of the housing except 15 percent. In fact Uber and Lyft and BMW will reduce driving in OC by 20 percent by 2025 since they will have driveless cars and about 20 percent of the population by them will work by remote. The midrise will probably work in Anaheim in the next decade as their is less space and the demographics might change from being mainly poorer Latinos to more of a mixed.

    1. In order for the mid-rise/higher density concept to work, I think it needs to have several elements to combat the oxymoron of the “urban living” design cues. The urban lifestyle is associated with being able to access public transportation and walk short distances to all the needs of everyday life: grocery, restaurants, cafes, shopping, bars, clubs, and entertainment.

      Currently in Orange County, the lifestyle still revolves heavily around getting in your own car and driving somewhere. With that said, the only way these types of properties would be able to compete in the Real Estate market is to offer direct garage access (like The Domain in Anaheim) or to price them accordingly.

      At the time of their releases, lofty projects like Stadium Lofts in Anaheim and Astoria in Irvine didn’t present a good alternative to the homes that were competing at the same price point and the buyers responded (by not responding) accordingly.

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