News Summary
The City of Irvine has signed a deal with Brookfield Residential to develop Gateway Village, an 80-acre site aiming to build 1,138 new homes to help address regional housing shortages. The deal includes a purchase price of $654 million, raising eyebrows due to significant appraisal disparities. Additionally, the Irvine Company plans to transform retail spaces into apartments while committing to affordable housing units, all as part of broader efforts to tackle California’s housing crisis.
The City of Irvine has officially entered into an agreement with Brookfield Residential to develop a significant housing project on an 80-acre parcel of land known as the Gateway Village. The planned project is expected to include 1,138 new homes, an initiative aimed at addressing the housing shortage in the region.
Brookfield’s purchase price for the land is estimated at $654 million, which breaks down to over $8 million per acre. This purchase price is significantly higher than the $285 million that the City of Irvine previously paid for a nearby asphalt plant, which enabled them to secure control of the future housing site. A recent appraisal from CBRE valued the land at $412 million, or approximately $5.1 million per acre, leading to questions about the substantial price differential in the new sale agreement.
The CBRE appraisal referenced older, less expensive land deals in adjacent locations such as Huntington Beach and Orange. Furthermore, it included a sale at Irvine’s Great Park Neighborhoods which was priced at $6.9 million an acre, though current prices in that area have soared to about $11.7 million per acre. This raises concerns about the city’s willingness to pay $12.5 million per acre for the VKCC office complex near the airport while reconsidering the valuation of the Gateway Village land.
In addition to the Gateway Village development, Irvine’s largest apartment owner, the Irvine Company, has introduced plans to replace large-box retail spaces in the Market Place shopping center with 1,261 apartments. This proposal includes a commitment that 20% of the units will be classified as affordable housing. The first segment of this project, known as the Colonnade at the Market Place, has generated attention for its pricing; the smallest one-bedroom apartments in this complex currently list at $3,270 per month. To afford one of these units, potential tenants would need an income of around $130,000 per year, especially concerning given that the average salary in Irvine is approximately $80,000 annually.
The second phase of the Market Place housing development, branded as Meridian, is anticipated to provide more affordable housing options compared to the Colonnade. Additionally, the Irvine Company is in the process of developing 3,000 rental units distributed across three sites in Orange County even as new apartment developments decline nationally.
Donald Bren’s Irvine Company remains financially healthy despite a reported 25% decrease in multifamily permits across California in the past two years. The firm has been transforming existing properties such as office and retail locations into mixed-use developments, which aligns with state housing mandates aimed at increasing residential options.
Moreover, the City of Newport Beach has allocated 1,500 out of 2,349 planned units to the Irvine Company, contingent upon including 105 affordable housing units in their proposal. The Irvine Company is also responsible for $17 million in street and landscape improvements, along with expected financial incentives totaling $53 million to support the city’s development initiatives.
Looking forward, the City of Irvine aims to zone for over 50,000 new homes in the next decade to satisfy state housing requirements. However, there are already signs of skepticism among residents of Newport Beach regarding the efficacy of luxury apartments in curbing the rising housing costs, expressing fears about increased exclusivity and the implications it could have on the local housing market.
In conclusion, the City of Irvine’s partnership with Brookfield Residential and ongoing developments from the Irvine Company reflect an active response to California’s pressing housing crisis, yet they are met with mixed reactions from the community regarding affordability and accessibility.
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Additional Resources
- OC Register: Irvine Co Has Different Plan for Apartments
- LA Times: Newport Center Irvine Company
- LAist: Townhomes and Nature Preserve in Irvine
- Bisnow: Irvine Co Wants to Replace Golf Course with Homes
- OC Business Journal: Irvine Co Proposes New Housing for Spectrum Area
- Wikipedia: Housing in the United States
- Google Search: California Housing Crisis
- Google Scholar: Housing Affordability California
- Encyclopedia Britannica: Housing
- Google News: California Housing News
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The COSTA MESA STAFF WRITER represents the experienced team at HERECostaMesa.com, your go-to source for actionable local news and information in Costa Mesa, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the OC Fair, Concerts in the Park, and Fish Fry. Our coverage extends to key organizations like the Costa Mesa Chamber of Commerce and Boys & Girls Clubs of Central Orange Coast, plus leading businesses in retail, fashion, and technology that power the local economy such as Vans, Experian, and South Coast Plaza. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
