Treasure Island Developers Agree to Scale Back Plans


The owners of an oceanfront mobile home park that is slated for redevelopment announced Thursday that they will scale down the planned development by 25% to meet city guidelines for the prime parcel known as Treasure Island.

The development of the 30-acre bluff top is considered the highest planning priority in the city, and officials here welcomed the news of the scaled-back proposal. Some city officials had already made it clear that the original plan offered in February called for too dense a development.

“We’ve been trying to get the point across for a long time that we’re not going to approve things unless they work within our rules,” City Councilman Steve Dicterow said Thursday. “It’s nice to know that they have voluntarily seen the light.”

A written statement from Treasure Island Associates, the partnership that owns the property, said the decision to reduce the number of homes from 268 to 191 was prompted by requests from City Council members and meetings with various community groups.


“Our goal is to create a plan for Treasure Island that reflects the desires of the local community and the city of Laguna Beach, while still being economically feasible,” Richard Hall, a Costa Mesa businessman who along with Merrill Lynch Hubbard heads the partnership, said in the statement.


The development proposal includes condominiums, estate-size lots, beach cottages and a luxury hotel. The statement said the number of condominiums will be cut from 169 to 111 and the beach houses will be reduced from 72 to 53. The plan still includes 27 estate-size lots.

Earlier, the developers had said the hotel would have 300 rooms, but a spokesman for the owners said Thursday that number could dip to 200, depending on the wishes of the City Council. The development must win approval from both the City Council and the California Coastal Commission.

In a community where development has for years been sharply limited, the prospect of such a project has captivated city planners.

Officials said the hotel is expected to yield from $1 million to $2 million in revenue annually.

The project also would open an expanse of coastline to the public for the first time.

But if the planned development is good news in some corners, it presents a bleak reality for some residents who have still not moved from their coaches in Treasure Island Mobilehome Park, a tight-knit community that has been a fixture in this city for 36 years.


Tenants passed one deadline this month when an agreement struck last June between the landowners and most of the park’s permanent residents expired. That agreement guaranteed the residents 27.5% of the value of their coaches, provided they move within a year.

Some of the residents began packing this month, but others have stayed, vowing to continue their legal fight over the park’s closure.

It is a bitter battle involving relocation benefits and withheld rents. The case is expected to be heard in Orange County Superior Court on July 17.

K.P. Rice, one of the tenants who stayed, said Thursday that it is tough to see “a lifestyle evaporate.”


“Everybody feels sad about the folks moving,” Rice said. “But the morale of the people who are still fighting is pretty good. In fact, it’s excellent.”

Some residents are still hoping they can find a way to buy the land and stay, Rice said.

But Bill Strateman, a spokesman for Treasure Island Associates, said Thursday that the park owners expect the remaining issues to be cleared up in the next few months.