After years of planning, negotiations and political battles, redevelopment of the former Marine Corps base in Tustin is proceeding. A developer is in the midst of building 565 single-family homes, townhouses and “paired homes,” and another 4,000 housing units are on the way.

In late February, the Tustin City Council approved a general plan amendment for about 1,500 of those units, clearing the way for the next phase of base redevelopment. In all, 4,600 housing units and 9.2 million square feet of retail, office and industrial space are planned for the closed base in central Orange County.

“There has been a lot of progress made in the last 12 months,” said Tustin Assistant City Manager Christine Shingleton.

Years of work lie behind the recent progress. The Department of Defense marked the Tustin helicopter base for closure in 1993, and the Marine Corps finally turned out the lights in mid-1999. The city approved a reuse plan in early 2001. The Navy certified that plan, and federal officials eventually handed 977 acres of the 1,600-acre base to the City of Tustin in 2002. Another 150 acres is scheduled to be conveyed after more environmental cleanup is complete, but not before 2008, according to Shingleton. The Navy sold 235 acres directly to two developers, and it was that property that the city entitled in February.

For nearly 10 years, Tustin and the Santa Ana Unified School District waged a nasty battle with ethnic overtones about school construction at the site. The Santa Ana district, which is 95% Latino and very crowded, contended that it was entitled to 100 acres of the base for construction of a unique kindergarten-through-community college campus. Tustin, however, long proposed setting aside land for the Tustin and Irvine schools and for the Mission Viejo-based South Orange County Community College District.

Tustin city officials vehemently denied there were racial underpinnings for their base reuse plans. Eventually, the city and Santa Ana school officials settled their dispute when Tustin earmarked 37 acres for Santa Ana Unified and the Rancho Santiago Community College District, and agreed to pay Santa Ana Unified $38 million from base redevelopment proceeds (see CP&DR Deals, October 2001). When Santa Ana Unified concluded that its 22 acres were too contaminated for school construction, Tustin agreed to pay another $22 million and took back the land, apparently ending the dispute.

What was never in dispute was the need for housing. Over the years, central Orange County has become job-rich and housing-poor. This is especially true for Tustin's neighbor Irvine, which has more than twice as many jobs as housing units.

The first project to get developed is John Laing Homes' Tustin Fields project, which is a mix of old and new Orange County styles. The first phase, which opened in May 2004, is planned to have 376 townhouses, single-family units and paired homes on 32 acres. A second phase of 189 larger single-family houses on 36 acres opened in February. As expected, sales are brisk.

“These are ideally located sites in central Orange County, where land is very scarce,” said Dan Flynn, vice president of land acquisitions for Laing. “It was almost a perfect infill site.”

The attached units could represent the future of Orange County housing. The three-story townhouses feature alleys and front stoops, and they resemble East Coast brownstones. Containing 3 bedrooms and 3 1/2 bathrooms, the townhouses are proving popular with nontraditional households because unrelated people or members of extended families can have their own living space within one unit, said Linda Mamet, vice president of sales and marketing for Laing.

The paired homes are houses of up to 1,900 square feet that share one wall, usually along a kitchen. Because the individual units have different elevations, the common wall is minimized. Thus, the units feel detached - and Laing is able to build about 10 per acre. The single-family houses are a bit more typical for Southern California, with sizes ranging up to 3,400 square feet.

Tustin city officials provided density parameters, but they let the developer decide on the mix of housing units. Laing expects to complete the project next year.

What the city did insist on was a large affordable housing component. Twenty-one percent of Tustin Fields is designated affordable, with nearly one-third of those units for very low-income families. Townhouses for very low-income buyers (less than 50% of median) start at $78,000. The priciest units for moderate-income families (up to 120% of median) cost $299,000.

The city has subsidized the affordable housing by writing down the land by $30 million, Shingleton said. Additionally, the city will own the real estate for 45 years. Thus, “buyers” will get a place to live and tax benefits, but no equity. It is an arrangement that is proving easier to sell to very low- and low-income buyers than to those with median incomes.

On a different part of the former base, the city expects to close escrow shortly on an 87-acre parcel on Jamboree Road. Vestar Kimpco Partners is buying the land for development of a 1.1 million-square-foot retail and entertainment complex. The project is planned to include a movie theater, restaurants, and retail stores. Wal-Mart, Costco and Target are likely tenants.

In February, the city approved a general plan amendment and zoning changes for 195 acres controlled by a partnership of William Lyon Homes and Lennar Homes. They purchased a total of 235 acres directly from the Navy during a late 2002 auction, with the proceeds of $208.5 million helping to offset the Navy's base cleanup expenses, which are ongoing.

Tustin approved 1,545 units in two projects proposed by Lyon and Lennar. The remaining 40 acres lie in Irvine, where the developers plan another 365 housing units.

Also scheduled for this year is the renovation of former military housing for use as transitional housing. The city has leased the property to the Orange County Rescue Mission, which plans to open 192 transitional units and 40,000 square feet of offices and community facilities this fall.

This month, the Orange County Community College District plans to break ground on a 68-acre “advanced technology education park.” Other education projects planned at the former base are a 15-acre police and fire training facility run by Rancho Santiago CCD, a high school and three elementary schools. Other public uses include an 84-acre regional park and several smaller parks.

The biggest chunk of development - an 800-acre specific plan area - remains in the future, however. In 2003, the city approved the specific plan and selected a partnership of Centex and Shea to serve as master developer. The specific plan calls for 2,100 housing units, and 7 million square feet of commercial development. Under the plan, development would include a residential village near a commuter rail station, a large “community core” with a variety of uses, and a 260-acre business park that would provide thousands of jobs.

Because the specific plan and a related environmental impact report are complete, the master developer will not have to revisit the entitlement process, and project-level environmental review should be minimal, Shingleton said. The bigger issue is infrastructure, as there is very little to build upon in the 800-acre site. The city and the developers are working on a master business plan that should address infrastructure. The city intends to convey the property to Centex and Shea in four or five phases over about seven years, according to Shingleton.

Contacts:
Christine Shingleton, City of Tustin, (714) 573-3107.
Dan Flynn, John Laing Homes, (949) 265-6808.
Bill Jacobs, City of Irvine, (949) 724-6521.
Base re-use website: www.tustinlegacy.com.