Judge Rejects Lawsuit to Block Centerpointe; Developers Seek Financing

Opponents of a $75-million hotel-office complex in downtown Santa Ana lost a bid to block the project Monday when a Superior Court judge rejected their lawsuit.

Judge Richard N. Parslow Jr., who said in December that he probably would rule to allow construction, issued a formal decision to that effect Monday. The action clears the way for financing and other plans, city officials and developers said Monday.

Although the residents’ groups behind the lawsuit say they will appeal, that will not hold up plans to build Centerpointe on a lot southeast of Ross Street and Santa Ana Boulevard, said Maureen McAvey, director of development for Carley Capital Group. “We’re not waiting for an appeal (to be filed),” she said.

McAvey said her company is attempting to arrange financing and a hotel firm for the twin-towered structure, which city officials have called the “anchor” for their plans to revamp the downtown area. The project will include 200 hotel rooms; 240,000 square feet of office space; 60,000 square feet of retail space; a 50,000-square-foot conference center and a 1,250-space parking garage.

Original plans for the site called for a single 32-story office tower that would have been the largest in Orange County. Earlier, those plans were scaled back to two smaller structures at an estimated cost of about $90 million. They have been reduced even further to the current estimated cost of $75 million, McAvey said.

The lawsuit was filed 18 months ago by the Alliance for Fair Redevelopment and the Citizens Property Rights Committee. The groups claim the city’s involvement in the project, which includes financing of the parking structure and the land and a promise to lease about 75,000 square feet of office space, violated state redevelopment laws.

Atty. David L. Llewellyn Jr., who represents the plaintiffs, said he hadn’t seen the judge’s final decision Monday and couldn’t comment on specifics. However, he said, “The odds are that we will appeal.”

Roger Kooi, downtown development director, said the city will have to wait for Carley to arrange the financing, but in the meantime will proceed with plans to acquire and demolish the old Broadway Theater and another adjoining building. “We’re going to do this project. It’s just a matter of when,” Kooi said.

McAvey said Carley probably will have a better idea of the time frame for development within six weeks. On Monday, however, she estimated that ground breaking could occur within a year.

Although there is now a surplus of office space that remains vacant in downtown Santa Ana, McAvey said she believes that the growth of courts, of federal, state and county government offices and of nearby businesses will coincide with Centerpointe’s construction.

“It’s leading the market a little bit,” she said. “But it will be approximately three years before the project is completed and that whole area is really going to be doing well. Businesses along Main Street and Broadway are continuing to expand and grow, so they’ll be looking for more space. And people working there are going to be looking for places to shop and eat.”