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By Ruth Clark, San Juan Capistrano

Most of the time I find that the things San Juan Capistrano City Councilman Derek Reeve says leave my head spinning and wondering why he dispenses so much misinformation, untruths and insults. His particular take on things has me questioning his agenda.

But even though I disagree with almost everything Mr. Reeve seems to stand for, I have to say I agree with his and Dr. Byrnes’ recent vote against the Urban Village plan for our historic downtown area.

I think the city’s residents and tourists alike feel the same as I do about the importance of our family-oriented activities, concerts, fairs and fiestas held in the Historic Town Center Park and downtown area. Permanent residences bordering the park would likely result in noise concerns and complaints and could potentially curtail future musical performances, annual celebrations and the various fairs and festivals the tens of thousands of people come to San Juan Capistrano to enjoy.

An upscale, large-capacity hotel is very important for San Juan to keep visitors, their tourist dollars and taxes here. People come to our quaint little town—that’s over 200 years old—from all over the world to visit the Mission, petting zoo, the boutiques along Los Rios Street, the antique mall, Camino Real Playhouse, the adobes and other historic buildings.

But then they stay in Dana Point at the Ritz-Carlton, St. Regis and Laguna Cliffs Marriott. The Residence Inn and Best Western hotels really can’t compete with those luxury accommodations. While we have a lot that keep tourists coming, we could probably create more points of interest—like some of what the planners of the Urban Village group had in mind—to make sure that San Juan Capistrano remains a major tourist destination. We still have to keep our little town just as special as it’s always been.

Think of what we have here in our famous little town: the train station, horse stables, hiking and horseback riding trails, world-class rodeos, the famous Swallow’s Inn, the newly remodeled Regency movie theater, many wonderful restaurants, The Coach House with great music, local wineries, a beautiful regional library (designed by the renowned architect Michael Graves), a golf course and dozens of unique shops and several historic landmarks.

A trolley or tram service would be fun and useful for the downtown area that would benefit tourists and locals alike—park your car once and walk or ride the tram to places of interest, shops and restaurants. This would make downtown and points beyond more accessible for the older senior citizens and disabled people, as some places are not within easy walking distance. I’m sure there are many more ideas out there and I find it difficult to believe that San Juan Capistrano cannot support a first-class, luxury hotel without permanent housing.

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comments (5)

  • I agree with Ruth Clark — San Juan Capistrano is able to support a first rate hotel. That is, provided the price of the land the owner is demanding matches the land use. What makes any use uneconomical is the over priced land in relation to the permitted use.

    If the owner is demanding an inflated price, a developer will have to increase the intensity of the proposed development to make the project economically feasible. So, that is one of the key reasons the project is being proposed as not only a hotel but also 30 or more dwellings in the downtown.

  • James,
    While I understand your comment there are some points for consideration.

    First, the Plaza Banderas was unable to find a hotel developer to buy the site in 5 years!

    The reason is because there was a lack of understanding about the value of land for hotel development before the project was planned out. According to hotel buyers and brokers that I spoke with the highest offer Plaza Banderas received was just under $25k per door or $3.1 million dollars. The site is 3.1 acres so the highest offer price per square foot was $22.

    The current market rate for office and retail land is between $50-$55 per square foot and the value for residential is $60-$65 per square foot. That means the owner of the Plaza Banderas site would take a $3+ million dollar haircut to sale the land as a hotel. It is easy to ask other people to take a loss. What if you owned the land James and it was zoned for office/retail that would yield you $50 per square foot, but I told you that you would be greedy not to develop as a hotel and take a $3 million dollar loss?

    The Plaza Banderas at best would have been an extended stay like the Marriott Residence Inn. At the City Council meeting to hear the San Juan Hotel & Villas project the Hilton developer said it would at best have been a Hilton Garden Inn site.

    After extensive time, money and faith we were able to design and deliver a full-service, four star hotel that would greatly exceed the quality of construction and economics for the City over an extended stay hotel. To do this we were taking nearly a $2 million dollar loss on land and soft costs. The residential element is part of the hotel, just as the St. Regis, Ritz Carlton and Montage have residential elements. Except in this case the residential was subsidizing the loss on the hotel land.

    I would implore that you actually look at the 3d models and elevations for the residential component. These are million dollar villas with exceptional architectural design, high end finishes and compliment the design of the hotel to comprise one project.

    Further, the Historic Town Center Master Plan allows for 33 units to the acre, by right. This would equate to a potential of 104 units on the site. The City requires that a developer pay an affordable housing in-lieu fee. Per state code a developer can get a 35% bonus density for affordable housing. This means that the project could have 140 units! Our project by contrast only has 30 units which equates to 18.96 units per acre or 45% less density than allowed.

    So if we were a greedy developer looking to maximize our return why wouldn’t we present the plan that was identified in the Historic Town Center Master Plan (Commercial and Residential).

    The fact is we have worked diligently to create a well designed project that is vitally needed in the Downtown.

    We have continually worked with the community hosting several work-shops and over 100 one -on-ones. We have more than 250 supporters that represent residents and business owners. I realize that some people do not want anything to change or they want a project that is not feasible. The problem is that the Downtown is not thriving. In fact many of the restaurants are suffering. They cannot make money on just weekend business. There is not sufficient businesses to pay for upgrades or improvements, so existing businesses continue to collect deferred maintenance. Historical buildings are not cheap to maintain, in fact they are much more expensive. So without economic viability who is to pay to keep things the same?

    • Joshua,
      Following that logic (simply going for the greatest amount of bucks per square foot, when planning and developing a community, the entire downtown would be developed with dwellings so the landowners could get $60-$65 per square foot for residential projects rather than develop excellent retail or hotel facilities.

      • James,
        I doubt that you are intentionally misinterpreting my post. Please read again. The market pricing I provided was to illustrate the substantial value difference between hotel land and other approved uses. Asking a land owner to take a 50%+ haircut is unfair.

        Consider this. Your home is zoned residential, but most likely a park is also an acceptable land use. What if you went to sale your home and I (with no stake in your property) said that I think your home should be sold as a park. Well the community benefit of a park could be huge, but you would loose substantial money if I could force you to comply.

        Our density is 46% below the allowed density in the Historic Town Center Master Plan. This is the lowest density you will see on this property and protects the property from opponents that have plans for much higher density projects.

        We are not maximizing the dollar value for our group or for the property sellers. Our offer was far from the highest price that the Oedekerk family received for the property and they selected our offer because our plan was not about maxing out land value, but rather designing a mixed-use project that takes consideration of all stakeholders (Community, City, Buyer, Seller).

        Only through faith and fortitude have we been able to put together this challenging project. We have a full-service, four star hotel operator, a beautifully designed hotel and 30 high end villas. The Villas are million dollar homes with high end facades, landscaping, architectural elements and have lifetime rights to hotel amenities. These amenities include pool service, spa service, room service, valet parking and maid service (similar to the montage).

        This is a legacy project that we would see through to the end to insure every detail completes our vision. If we get the project approved both my family and my partners family plan on purchasing villas.

        If you have concerns about the project I would be happy to meet with you to review the project in detail. You can reach me at (949) 476-1000.

  • Ruth,

    Thank you for the time you put into your op-ed which I just reviewed. There were a few points that you may want to consider.

    You mentioned that San Juan cannot complete with St. Regis and Ritz Carlton so why not focus on amenities and Dan Point can handle the hotel accommodations.

    The challenge with this is three prong.

    1. Money for the City.
    To pay for the things important to the Downtown and town in general, like convenient parking, parks, open space, clean streets and great programming it takes money. As stated by Mayor Sam Allevato in the past the City of Dana Point gets roughly $22 million in revenue from their hotels why San Juan gets roughly about $700k. That $22 million is used by Dana Point to enhance parks, provide great events, add great services and keep the town clean. This creates a perpetual cycle. As the City of Dana Point continues to improve it becomes more attractive to tourists and has a better level of living for residents.

    2. Money for Businesses.
    Downtown is not thriving. I am down there several times a week and weekend. Businesses cannot be profitable on just weekend traffic. We are blessed to have 14 historical buildings in town, but how are those buildings to be maintained without viable economics? If you look at San Clemente, Dana Point or Laguna Beach they all have Downtown hotels that bring in tourists that typically spend more on meals and entertainment because they are on vacation. Further, the restaurants in town miss out on many dinners and breakfasts because the tourists visit the Mission, eat lunch and then go back to their hotel in Dana Point. A local restaurateur on the restaurant council ran the numbers of having the San Juan Hotel & Villas in town. Based on his numbers the hotel would produce $125k in profit for each of the 12 restaurants in Downtown. This is money that can be used to pay for deferred maintenance and make improvements that benefit tourists and residents alike (a virtuous cycle).

    3. Parking.
    When tourists stay in Dana Point they drive into San Juan and use our parking. Tourists staying at the proposed San Juan Hotel & Villas project would be parked at the hotel or even better they took the train into town (not an option for tourists staying in Dana Point). These tourists are not taking up public parking spaces Downtown, but rather are parked at the hotel. The City commissioned parking study found that the project has more than sufficient parking to meet peak parking demand. In addition we have signed a 15 year lease (inc. extensions) that provides an additional 40 parking spaces. For a majority of the week and year the hotel will not be at full capacity, meaning that there is an excess of public parking available to help solve the current parking challenges Downtown.

    4. Traffic.
    There are two types of traffic, good traffic and bad traffic. Good traffic results in purchases in town that create economic prosperity for businesses and the City resulting in a better level of living for residents. Bad traffic is traffic that does not result in purchases in town like pass through traffic. The tourists that visit the hotel are spending money in town and they are on the park-once plan so they do not add unnecessary traffic. Further, we are buying the land and paying to build a public road and sidewalks to connect Forster from Camino Cap to Del Obispo to relieve traffic.

    I have heard the claim that San Juan doesn’t need or cannot sustain a hotel Downtown. I think these points of view shed a poor view on the potential of the Downtown. It is true that it was very difficult to find the right hotel developer for the Downtown. It is true that developing in San Juan is akin to a lobotomy and I would never undergo such pain again. However, we are at the finish line and have designed a world class hotel that could serve residents and tourists for years to come. There are no unicorns, this is real.

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