Why doesn’t the City insist MGP provide more retail space and less office and housing space?

See FAQ No. 3.  It should be noted the City would like to have more retail on the site; however, the outlook for traditional brick and mortar retail is not very positive.  While good retail locations will continue to do well, underperforming retail sites will continue to lose tenants and face redevelopment pressures as consumer support for traditional brick and mortar locations erode.  Nationwide, over 7,000 retail stores closed in 2017, followed by 5,000 stores in 2018.  Over 12,000 stores are projected to close by the end of 2019.  The most significant trend impacting traditional retail stores is the continued rise of e-commerce retail sales.  As on-line retail sales continue to increase, it is estimated that 75,000 more stores will need to be shuttered by 2026.  

Sources:

Orange County Business Council https://www.ocbc.org/research/ocbc-retail-study/

USA Today July 3, 2019 https://www.usatoday.com/story/money/2019/07/03/2019-store-closings-list-these-retailers-shuttering-locations/1597997001/

Coresight Research: https://coresight.com/research/weekly-us-and-uk-store-openings-and-closures-tracker-2019-week-36/

March 2021 Update: The information above was written prior to the COVID-19 pandemic. A variety of news sources have described how the pandemic has accelerated the trends described above. Coresight Research, a leading retail research firm, reports that 25 percent of America’s roughly 1,000 malls will close over the next three to five years. By 2025 experts expect a cumulative loss of over 500 malls. However, Class A malls in high income communities are the most likely to survive.  The highly successful Irvine Spectrum and Newport Beach Fashion Island represent Class A competitive malls in the surrounding area to Laguna Hills.  Notably, no new malls have been built in the U.S. in many years, with few exceptions. 

Examples of malls being “re-imagined” are becoming more frequent. Westminster Mall is an example of how suburban malls are evolving.  Although the mall still has Macy’s, JCPenney and Target as anchor stores, the City of Westminster has recognized its future is in great jeopardy. As a result, they started community outreach to develop a new Specific Plan for the 100-acre site that could allow up to 3,000 multi-family units in conjunction with hotel and office and a substantially reduced open air retail center.   

Sources: https://www.usatoday.com/story/money/2020/07/14/coronavirus-closings-retail-mall-closures-shopping-changes/5400200002/

Sources: http://tca-arch.com/work/westminster-mall/

Sources: CNBC August 27, 2020 https://www.cnbc.com/2020/08/27/25percent-of-us-malls-are-set-to-shut-within-5-years-what-comes-next.html

CNBC March 4, 2021 (video) Why U.S. Malls Are Disappearing: https://www.youtube.com/watch?v=C_JiP-j2FwM

Show All Answers

1. Explain the current zoning, conditional use permits, and land use for the 68-acre property [the former Laguna Hills Mall] and adjacent developments. What can/can’t the City Council control?
2. What is the status of the plan MGP showed the community at their April 2019 Community Forum? How does it compare to the approved 2016 plan?
3. How much housing does the City’s Zoning Code allow on the property?
4. Does the City consider traffic in evaluating development proposals in the UVSP?
5. In 2016, the City approved over 926,000 sq. feet of retail and office building area and 988 dwelling units. If MGP is an established developer, why has Five Lagunas taken so long to get started?
6. What does the City Council see as a viable solution for the development of the site? When considering a new development, does and can the City Council factor in the greater good of the community?
7. How do the new and future proposed/approved Oakbrook apartments factor into any decision making?
8. What are current vacancy rates for existing apartment complexes?
9. Why doesn’t the City insist MGP provide more retail space and less office and housing space?
10. What creates the most value for the city and community: High-density multifamily housing, retail, or commercial office?
11. What kind of retail space can residents expect to see since the outlook for traditional storefronts is so negative?
12. How much revenue has the City lost from the mall closing?
13. How has the City responded to this loss of revenue?
14. How will property taxes benefit the city and how much will the city actually receive?
15. How does more development on the site, especially more residential development, impact community infrastructure such as police services, fire and paramedic services, traffic, water, schools, etc.?
16. What were the projected traffic levels for the originally approved Five Lagunas Project? What is the difference between retail development and apartment development with respect to traffic?
17. How will high-density apartments/multifamily housing benefit residents? Did the 09 General Plan call for 300 apartments w/ options to add more in future phases? Are the approved 988 units mandated
18. What if residents do not want to see more housing developed beyond the 988 units approved in 2016 in a future project?
19. Why doesn’t the City simply ignore State housing element law?
20. What is the City’s obligation to help address the Statewide/federal affordable housing shortage, including low-income and homeless shelters?
21. What exactly is the Housing Crisis Act (SB 330) and how does it impact the new project submitted by MGP?
22. What are the key steps involved in the entitlement process?
23. How long will it take for the project to reach the public hearing?