With $400-Million Concourse, Japanese Spur Santa Ana Revival : Development: Orient Corp. wants to build the county’s tallest office tower, hotel, shops and condominiums on Main Street north of downtown area.
A Japanese developer unveiled plans Tuesday to build $400 million worth of office towers, shops, a hotel and housing north of Santa Ana’s downtown in one of the largest real estate developments in the city.
The project, if approved and completed, will forge another link in the massive redevelopment of Santa Ana’s aging Main Street, which runs between the city’s northern and southern boundaries.
Under current plans, Shimizu America Corp. will build the project--tentatively called Main Street Concourse--for the landowner, Orient Corp. Orient is Japan’s largest consumer finance company.
The project includes a 32-story office building that would be Orange County’s tallest, and a 20-story tower.
A monorail station is part of the tentative plan for the project. Mayor Daniel H. Young said that if the station is built, it would bring the city’s ambitious plans for a monorail line up Main Street a step closer to reality.
“The monorail is critical to the redevelopment along Main Street because developments like Concourse are going to increase traffic,” Young said. “If it’s successful, though, we’ll have a way to move people through central Orange County far more efficiently.”
Concourse is Orient’s first project on the U.S. mainland. Shimizu, whose U.S. subsidiary is based in Los Angeles, has built office parks and hotels around the Southwest.
The project represents a major shift in Japanese real estate investment in Orange County, real estate experts said. Until now, most Japanese investors merely bought buildings in the county rather than building their own.
The property is across North Main Street from MainPlace/Santa Ana mall, a few blocks from both the Santa Ana and Garden Grove freeways in central Orange County.
Shimizu doesn’t yet have approval to build the project, which is larger than all but a few real estate developments in this city of 237,000.
City officials and the developer, however, say they expect Concourse will be approved much as the developer presented it Tuesday to the press, although that could take as long as 18 months.
Nevertheless, Shimizu said it expects to complete by 1993 the construction of the 32-story office tower, 150,000 square feet of shops, 32,000 square feet of cafe, exhibit space and meeting space, six movie theaters, two restaurants, a 3,000-space parking garage and 264 condominiums.
The second phase--expected to be built by 1997--includes a second, 20-story office tower, 1,200 more spaces in the eight-story parking garage, a 350-room hotel, a 16-story tower with 192 condominiums and another 40,000 square feet of stores and restaurants.
Three stories of shops, meeting and exhibit space will front on Main Street, separated from the two office towers and the parking garage by a pedestrian concourse. Behind the offices will be the two towers of the hotel, and behind that at the far end of the 18-acre lot will be the housing.
“We envision it as a place to bring people back to the central city after work hours, a place where people want to stay,” said Steven W. Spillman, a vice president at Birtcher, a Laguna Niguel developer that is advising Shimizu on the project. “The idea is it’ll be a 16-hour community, instead of just a place to work.”
Concourse also marks a shifting of the center of Santa Ana from its historic downtown farther north along Main Street, said Scott Perley of commercial real estate broker Cushman & Wakefield.
Across North Main Street, at MainPlace mall, developer C.J. Segerstrom & Sons plans three office towers, including one of 31 stories. Nearby are the two freeways. And there are also plans to redevelop the sprawling Town and Country Center just across the city line in Orange, an area of one-story stores.
“This is becoming Santa Ana’s new downtown, and Orange’s too, for that matter,” Perley said.
So dense is development becoming along North Main Street that a monorail or some other form of mass transportation may be necessary to keep the area from choking on automobile traffic, said Mayor Young, one of the monorail’s most ardent supporters.
Santa Ana ordered a study late last year of a monorail system that could eventually stretch from Fullerton, in the northern end of the county, down through the thickly populated cities of Anaheim and Santa Ana to the booming office neighborhood around John Wayne Airport.
If developers along Main Street build the terminals, which account for one-third the cost of building a monorail system, Young said a private company might be able to build and run the system at a profit and without public funds. Should that prove not feasible, Young concedes that he doesn’t know where public funds might be obtained for such a system.
Since the mid-1980s, Orange County’s biggest developers--and developers from elsewhere too--have begun building office towers in the county’s central cities.
The gleaming new office towers went up first around Anaheim Stadium and have now spread through neighborhoods that, in some cases, were until recently seedy industrial neighborhoods or--in the case of Concourse--land that had always been vacant.
It amounts to a long-awaited payoff for struggling redevelopment programs in the county’s older cities, such as Anaheim and Santa Ana. Anaheim on Tuesday approved the sale of 16 acres of vacant downtown land to the Koll Co. for $2 million. Koll plans to build offices, a hotel and a movie theater on the property.
Unlike Anaheim, Santa Ana did not bulldoze broad swatches of inner city neighborhoods when it revved up its redevelopment program in the 1970s. Santa Ana’s downtown, the city’s Civic Center and the home of Orange County government, has the largest historic district in the state outside Sacramento, with dozens of pre-1920s buildings.
To the south of downtown, Santa Ana has seen several office projects as big or larger than Concourse, including the 66-acre, $700-million McArthur Place and only slightly smaller Hutton Centre. Much of the land in those projects, however, is being cut up and sold, so Concourse and Segerstrom’s MainPlace projects up Main Street are probably the largest real estate projects in the city under one ownership, experts said.
Meanwhile, immediately north of downtown, the Bowers Museum District--90 acres of run-down two-story stores and houses--will be up for grabs Friday.
That is when the city will interview four developers who want to draw up a master plan to redevelop the area. In return, the winner will get to develop the choicest parcels. Among the four is Birtcher, which says developing in Santa Ana is a key part of its business strategy.
But some experts worry that dumping the Concourse’s nearly 1 million square feet of office space on the central county market over the next five years or so could bring a glut and hurt other building owners. The county’s office buildings already run a vacancy rate of more than 20%, and some developers in the central county have delayed putting up more buildings.
Birtcher, however, professes not to be worried. “I see vacancy rates falling dramatically over the next few years in this area,” Spillman, the firm’s vice president, said, “because nothing much is being built.”
That may be so, but one of Birtcher’s own partners on a building nearby is getting cold feet and wants to sell. That’s the Xerox Towers building on 1st Street in Santa Ana, a 16-story, 305,000-square-foot office tower that Xerox Realty Corp. developed and owns with Birtcher. Xerox wants out of real estate, and the building is on the market right now.
MAIN STREET CONCOURSE
Construction of the Main Street Concourse is planned in two phases totaling 2.01 million square feet with 5,026 parking spaces.
PHASE ONE
Square footage
Office: 609,325
Retail (with theaters): 152,300
Restaurant: 13,000
Cultural building: 32,625
Sports club: 23,715
Condominiums: 294,800
Phase 1 Total: 1,125,765
PHASE TWO
Square footage
Office: 343,850
Retail: 30,300
Hotel (with restaurant): 245,000
Hotel facilities: 54,700
High-rise condos: 215,360
Phase 2 Total: 889,210
Source: Shimizu America Corp.
PROPOSED MAIN STREET CONCOURSE Shimizu America Corp will develop a $400-million mixed-use development project, called Main Street Concourse, for Orient Corp. in Santa Ana across the street from MainPlace/Santa Ana mall. 1. 32-story office building, 600,000 sq. ft. 2. 20-story office building, 344,000 sq. ft. 3. 13-story hotel, 350 rooms 4. 16-story condominium tower, 192 units 5. 4-story condominiums, 264 units 6. Shops, exhibit space, meeting rooms, theaters 7. 8-story parking structure, 4,259 parking spaces 8. 3-story monorail station Source: Shimizu America Corp. and Orient Corp.
