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Scott Weimer 1-17-08
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GG Journal 9-18-08
OC News Story 2-20-08
GG Journal 1-17-08
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Real Estate Journal 10-8-07
GG Journal 10-4-07
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GG Journal 7-26-07
GG Journal 6-28-07
OC Weekly Expose' 4-26-07
OC Register 4-26-07
GG Journal 4-12-07
OC News Story 4-11-07
OC News Editorial 4-11-07
OC News Editorial 11-17-06
GG Journal 10-26-06
From the California Real Estate Journal October 8, 2007
Remember the Main Street Parking
By JULIE NAKASHIMA, CREJ Staff Writer
Illustrating the pressures that can arise as cities turn their parking lots over for redevelopment, a Garden Grove downtown business group is fighting the city's decision to sell a parking lot in the city's historic Main Street shopping district so that a developer can build a five-story, 100-unit condominium project.
The Garden Grove Downtown Business Association, composed of business and property owners on Main Street, views the transaction as even worse than eminent domain. The group claims at one time Main Street had six parking lots purchased with the business and property owners' money, and that over the years the city has taken over the lots and handed them to developers in order to increase tax revenues.
Association President Scott Weimer said the lot in question is the last dedicated parking lot serving the historic Main Street district, which dates back to 1874. He owns Weimer & Associates, an independent real estate brokerage located on Main Street.
"The city has arbitrarily decided, against overwhelming opposition by not only our organization but the community at large, to arbitrarily take the parking lot and sell it to one of their developer friends under the guise of redevelopment," Weimer said.
He explained that the six lots originally were acquired through a parking district formed in 1955, before Garden Grove became an incorporated city, and held in trust under the county's name. The problem is that when the city was incorporated, the lots were transferred to the city's name, Weimer said, calling it a "David vs. Goliath situation."
According to the association, neither the city's Parking Commission nor the Main Street Commission had any say regarding the parking lot sale or subsequent approval of the condominium project, contrary to the city's own procedures.
The association also claims the city circumvented the competitive bidding process by transferring the property from the city to the redevelopment agency. In addition, Weimer said the developer "arbitrarily" increased the size of the project to 100 units from 80.
The group filed a petition for a writ of mandate in Orange County Superior Court on Jan. 22, to which the city responded with a motion to deny. Upon review of the case, the judge requested a two-month postponement.
"We are challenging the due process, or lack of due process, that was exercised by the redevelopment agency in delivering this parking lot over to this handpicked developer on what we refer to as a silver platter," Weimer said.
The developer, Stephen Sheldon, declined to comment on the controversy on the grounds that the association is suing him. However, he said his project would add residents downtown.
"Many businesses on Main Street support this project because they saw it as a way to invigorate the downtown area with residential mixed-use [development]," Sheldon said.
Citing litigation, Chet Yoshizaki, Garden Grove economic development manager, said he could not comment on the association's allegations. But in terms of the project, he said the condominium development would bring density to downtown.
"It'll create some synergy downtown for more hours of the day," Yoshizaki said. "The problem that the downtown has faced is that it's a relatively small downtown. The critical mass is lacking as well as substantial major tenants."
A hearing was held on Sept. 28, before Orange County Superior Court Judge David A. Thompson. His tentative ruling, posted the day before, granted Sheldon's motion to deny the writ of mandate, accepting the argument that the association had no legal standing to bring the matter. Most of the causes of action were predicated on abuses against the Parking Commission, which by state code has control over all parking spaces.
"We were so devastated by this new angle being used against us that we almost didn't show up in court," Weimer said. But the association got a continuance from Thompson, who instructed the group to file additional briefs by Oct. 5. Sheldon and the city have until Oct. 12 to file their response.
Garden Grove's situation is not unique. In downtown Los Angeles, for example, there's hardly a parking lot that has not been eyed for redevelopment. Astani Enterprises, Trammell Crow Residential and the CIM Group, among others, have anteed up big bucks for surface lots on which to build residential or mixed-use projects.
A study by the city's Community Redevelopment Agency two years ago found that one of the consequences of downtown revitalization may be a shortage of parking.
Larry J. Kosmont, president of the development services firm Kosmont Cos., said parking lots can be a city's greatest land resource.
"A redeveloping downtown typically has parking available," Kosmont said, "and it's usually underutilized parking, because the downtown is tired or has underperforming uses. It's really not atypical for a city like Garden Grove to take a parking lot, combine it with other private property, say an adjacent piece, and build a higher and better use."
Usually cities create a parking plan that examines which properties it should sell or develop. The key is to balance the demand for parking with the objectives of new private investment.
"Very often when they offer the opportunity to real estate developers, they designate a certain amount of land for structured parking," Kosmont said.
Weimer said the 1.6-acre Garden Grove parking lot contains 165 spaces. According to Yoshizaki, the developer is responsible for replacing the parking lost to the development and spaces to service the condominiums.
"Based on our studies, it should be well parked," he said.
But the association disputes the city's parking study. For one thing, Weimer said it was conducted when many of the pre-1933 buildings on Main Street were undergoing seismic retrofit; eight buildings were completely empty, creating an artificial reduction in parking demand. He also said that the city has not fulfilled promises to replace parking.
In addition, the City Council approved the land sale to the developer for $1.5 million, or $15,000 per unit - below fair market value. Yoshizaki said the price is above the property's fair reuse value.
Weimer said parking has been a problem on Main Street that impacts tenant decisions.
"The highest and best use of these occupancies has not been utilized," Weimer said. "We've kind of been getting by by the skin of our teeth, but if this lot is going, it'll be the final nail in the coffin on Main Street."
2007 Daily Journal Corporation. All rights reserved.
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