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HomeMy WebLinkAboutFile 1 of 2 - Specific Plan No. 13 - Public Hearing - Zoning Council/Agency Meeting Held: 8-7-oo Deferred/Continue* d to' Approved Condit 1 Wally Ap roved _Denied JE?, glo C Signature Council Meeting Date: 8/7/00 Department ID Number: R690-46 CITY OF HUNTINGTON BEACH REQUEST FOR COUNCIL ACTION Cj SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS fill > SUBMITTED BY: RAY SILVER, City Administrator opop to PREPARED BY: HOWARD ZELEFSKY, Director of Piping SUBJECT: APPROVE ZONING MAP AMENDMENT NO. 00-01 AND ZONING TEXT AMENDMENT NO. 00-02 TO ALLOW ONE DRIVE-THROUGH BAKERY (THE CROSSINGS AT HUNTINGTON BEACH) IIStatement of issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachments) Statement of Issue: Transmitted for the City Council's approval is the reconsideration of Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 (Specific Plan No. 13, The Crossings at Huntington Beach) on approximately 63 acres formerly known as the Huntington Beach Mall. The reconsideration is requested to amend the specific plan to allow one drive-through bakery on-site with certain design and development standards. On July 5, 2000 the City Council approved Specific Plan No. 13 but excluded drive-though uses as permitted businesses. On July 17, 2000, Council Member Sullivan requested the City Council reconsider the previous action and amend the Specific Plan to allow one drive- though bakery on-site with certain design and development standards (Recommended Action - A). Staff continues to recommend that drive-through uses be omitted from the Specific Plan (Recommended Action - B) because drive-throughs are not a Regional Commercial use. Funding Source: Not applicable. Recommended Action: A. CITY COUNCIL DIRECTION: 1. "Approve Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 with findings for approval (ATTACHMENT NO. 1), adopt Resolution No. -.2­ 064�-,80 (ATTACHMENT NO. 4), and include the following modifications: a. Include one drive-through bakery in the Permitted Uses chart b. Include a definition of drive-through bakery c. Establish design and development regulations (Attachment No.4)." 3 REQUEST FOR COUNCIL ACTION MEETING DATE: 8/7/00 DEPARTMENT ID NUMBER: PL00-46 B. STAFF RECOMMENDATION: Motion t : "Approve1. „ Alternative Action(s): 1. " with findings for approval (ATTAeHMENT NE). 1), adopt Resolution No. .; t): a. Inelude design and development regulations as amended by Planning eunnnis with an addotmena' med0foeation to Number 11 (Attach � „ n 2. "Continue Zo,iiny Map Amendment No. 00-0 1 andZoning Text Amendment Analysis: On July 5, 2000 the City Council approved Specific Plan No. 13 and determined that drive- through uses are not Regional Commercial and deleted them as a permitted use. On July 17, City Council Member Dave Sullivan requested that the City Council reconsider their action and permit one drive-through bakery within the Specific Plan boundaries because it would be a unique use and have the potential for a regional draw. The City Council voted to schedule a second public hearing to reconsider allowing a drive-though bakery at the mall property. Staff continues to recommend against allowing all drive-through uses as well as a drive- through bakery as a permitted use because staff believes that drive-throughs are not appropriate for this particular location. Drive-through bakeries and their typical architecture, type of food and beverages offered, and negative aspects of noise, visual aesthetics, and air quality impacts associated with vehicle queuing, will not positively contribute to the desired atmosphere for the mall property and Italian Village design guidelines. PL00-46a -2- 07/27/00 4:56 PM REQUEST FOR COUNCIL ACTION MEETING DATE: 8/7/00 DEPARTMENT ID NUMBER: PL00-46 Should the City Council amend the list of permitted uses to allow a drive-through bakery, the following definition is recommended: "Drive-Through Bakery —A shop where only bread, cake, pastries, doughnuts, and similar goods are baked (and/or fried) and sold on the premises and is designed to serve patrons who remain in their cars. Tables-and chairs may also be provided indoors or within an outdoor patio but a minimum of one drive-through lane and one outdoor pick-up window for vehicle service of bakery goods must be provided." In addition, development standards for drive-throughs are also recommended. The following is a list of suggested standards prepared by staff and, at Ezralow's request, amended by the Planning Commission as depicted in strike-through and bold type below. Staff recommends inclusion of the following suggested development standards as originally submitted (without the strikethrough and bold text as amended by Planning Commission): 1. The building shall be the predominant visual element along street frontages, not parking lots or drive through lanes. 2. Drive through aisles shall be , away fFE)FR the street-# GntagLa„a screened from streets and from adjacent parking areas. 4. Drive-through aisles shall provide adequate on-site queuing distance to accommodate five cars (150 feet) before the first stopping stop (e.g. menu board, teller window, and automatic teller machine). No portion of the queuing aisle should serve as a parking aisle. 5. Drive through lanes shall not exit directly to the site's main entrance. Drive-through aisles shall provide at a minimum 25-foot interior radius for any curve. 6. The main structure should be sited so as to maximize the distance for vehicle queuing while screening the drive through operations. 7. All building elevations shall comply with the architectural guidelines as specified herein. 8. Buildings shall incorporate a full roof with built-in roof top wells for mechanical equipment screening. 9. A canopy shall be provided over the drive-through lane at the pick-up window. The canopy shall be architecturally compatible and fully integrated as part of the building design. PL00-46a -3- 07/27/00 4:48 PM REQUEST FOR COUNCIL ACTION MEETING DATE: 8/7/00 DEPARTMENT ID NUMBER: PL00-46 10. No individual freestanding or pole signs shall be permitted for drive-through uses. 11.Drive-through uses shall be limited to a maximum of efle two drive-through uses on the 63 acre site-; one on Center Avenue and one on Edinger Avenue. E. SUMMARY Staff recommends that the City Council approve Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 as originally adopted and do not permit a drive-through bakery within Specific Plan No. 13 because a drive-through bakery is not consistent with the goals and policies of the Land Use Element of the General Plan, which designates the site as Regional Commercial. Environmental Status: Adoption or amendment of a Specific Plan constitutes a project under the California Environmental Quality Act (CEQA) and the State's Environmental Impact Report (EIR) Guidelines. In this case, since an EIR has been prepared for the City's adopted General Plan and the Specific Plan is included within the umbrella of the General Plan and associated Certified EIR, the specific plan does not require separate environmental review. The General Plan EIR anticipated approximately 1.4 million square feet of development on the subject property. Specific Plan No. 13 allows up to 1,100,640 square feet of development, which falls below the square footage considered in the General Plan EIR. The Specific Plan, therefore, is considered covered under the previously certified EIR. Subsequent development proposals, however, shall be subject to environmental review as mandated by CEQA Guidelines. Any applicable environmental mitigation measures, as specified in the future environmental analysis, will be included as conditions of approval on individual Site Plan Review applications. Attachments: City Clerk's Page Number No. Description 1. Findings for Approval for Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 2. Suggested Definition and Design and Development Standards 3. Design and Development Standards as Approved by Planning 4. 1Commission Resolution No. gp RCA Author:"`:lane JamesMerb`Fa Wand PL00-46a -4- 08/02/00 9:09 AM (7) August 7, 2000 - Council/Agency Agenda - Page 7 D. PUBLIC HEARINGS Anyone wishing to speak on an OPEN public hearing is requested to complete the attached pink form and give it to the Sergeant-at-Arms located near the Speaker's Podium. D-1. (City Council) Public Hearing to Reconsider Zoning Map Amendment No. 00-01/Zoning Text Amendment No. 00-02 Specific Plan No. 13 — "The Crossings at Huntington Beach" (formerly Huntington Center Mail) to Allow Drive- Through Bakery Use - Adopt Resolution No. 2000-80 (450.30) Applicant: the City of Huntington Beach and the Redevelopment Agency of the City of Huntington Beach. Request: Reconsideration of a zoning map amendment and zoning text amendment to adopt Specific Plan No. 13 for the Huntington Beach mall property. Zoning Map Amendment: Amend zoning from CG (General Commercial) and CG-FP2 (General Commercial-Flood Plain) to Specific Plan No. 13. Zoning Text Amendment: Adopt Specific Plan No. 13, which establishes zoning, development standards, site design, and architectural guidelines to govern future development, requires Regional Commercial uses and creates an amortization schedule for non-conforming uses and structures at the 63 acre property. Location: 7777 Edinger Avenue (bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad). Environmental Status: The above item is covered under the General Plan Environmental Impact Report certified and adopted by the Huntington Beach City Council on May 13, 1996, pursuant to the provisions of the California Environmental Quality Act. On file:A copy of the proposed request is on file in the Planning Department, 2000 Main Street, Huntington Beach, California for inspection by the public. A copy of the staff report will be available to interested parties at City Hall or the Main City Library, (7111 Talbert Avenue)after August 3, 2000. All interested persons are invited to attend said hearing and express opinions or submit evidence for or against the application as outlined above. If you challenge the City Council's action in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice or in written correspondence delivered to the city at or prior to the public hearing. If there are any further questions please call the Planning Department at 714/536-5271 and refer to the above item. Direct your written communications to the City Clerk 1. Staff report 2. City Council discussion 3. Open Public hearing 4. Following public input, close public hearing 'Communication dated August 3, 2000 from Sheppard, Mullin, Richter& Hampton, LLP Attomeys-at-Law re: Montgomery Ward, LLC v. City of Huntington Beach, et al. *''Communication dated August 3, 2000 from Spencer H. Heine, President of Montgomery Wards Properties requesting a Tolling Agreement. (Continued on the Next Page) (8) August 7, 2000 - Council/Agency Agenda - Page 8 Recommended Action: Motion to: A. City Council Direction: 1. Approve Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 with findings for approval (ATTACHMENT NO. 1); and 2. Adopt Resolution No. 2000-80 (ATTACHMENT NO. 4) — "A Resolution of the City Council of the City of Huntington Beach Adopting Specific Plan No. 13 to Change the Zoning Designation on Real Property Bounded Generally by Beach Boulevard, EdingerAvenue, CenterAvenue, and the Southern Pacific Railroad from General Commercial(CG) and General Commercial—Flood Plain (CG-FP2) to Specific Plan No. 13 (the Crossings at Huntington Beach Specific Plan),"and include the following modifications: a. Include one drive-through bakery in the Permitted Uses chart b. Include a definition of drive-through bakery c. Establish design and development regulations (ATTACHMENT NO. 2 3). [Approved 4-1-1-1 (Dettloff No; Garofalo abstain; Harman absent)] OR ATTACHMENT 1 .1 ATTACHMENT NO. 1 SUGGESTED FINDINGS FOR APPROVAL ZONING MAP AMENDMENT NO. 00-01/ ZONING TEXT AMENDMENT NO. 00-02 SUGGESTED FINDINGS FOR APPROVAL - ZONING MAP AMENDMENT NO. 00-01 AND ZONING TEXT AMENDMENT NO. 00-02: 1. Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 to change the zoning on an approximate 63 acre parcel from CG (General Commercial) and CG-FP2 (General Commercial — Floodplain) to The Crossings at Huntington Beach Specific Plan No. 13 is consistent with the objectives, policies, general land uses and programs specified in the General Plan. The proposed Specific Plan is consistent with the goals and policies of the Land Use Element of the General Plan. The Specific Plan will allow for the creation of a development compatible with and sensitive to the existing land uses in the project area. The Specific Plan provides development regulations which address issues of compatibility by providing unique architectural and design guidelines, adequate setbacks, building heights, parking, landscaping, and signing in order to provide a high quality regional commercial and entertainment complex. The proposed zoning document is consistent with the goals and policies of the Economic Development Element of the General Plan. The Specific Plan will stimulate business opportunities within the City by allowing for and encouraging development consistent with the Specific Plan under an expedited entitlement process. Additionally, the Specific Plan provides for a range of employment opportunities in the professional, retail, service and entertainment fields, thus stimulating business opportunities and strengthening the employee base of the community. The Specific Plan also identifies design/architectural standards, consistent with the intent of the goals and polices of Subarea 5A and the Urban Design Element. The Specific Plan provides design/ architectural guidelines which requires construction of an Italian Village themed development and promotes use of high quality colors, materials, architecture and design concepts. These development policies and standards encourage improving the existing property and carry out the goals and policies established in the Urban Design Element. The Specific Plan addresses future infrastructure needs for the property which complies with the Circulation Element, Growth Management Element, Public Facilities and Public Services Element, and Utilities Element. PL00-46ATT 1 7/25/00 10:13 AM 2. In the case of a general land use provision, the zoning map and text amendments are compatible with the uses authorized in, and the standards prescribed for, the zoning district for which it is proposed. The proposed uses identified in the Crossings at Huntington Beach Specific Plan No. 13 allows commercial related uses along with regional commercial land uses consistent with the General Plan. 3. A community need is demonstrated for the change proposed. The proposed Specific Plan provides the standards necessary to develop a high quality regional commercial shopping and entertainment complex. The Design Guidelines and development standards of the specific plan provide standards which exceed the minimum requirements identified in Section 211, Commercial Districts of the Huntington Beach Zoning and Subdivision Ordinance. In addition, the continued expansion of the regional commercial base of the community provides jobs, an increase in property and payroll taxes, and contributes to the City's jobs-housing balance. 4. The adoption of the Crossings at Huntington Beach Specific Plan will be in conformity with public convenience, general welfare and good zoning practice. A comprehensive approach in reviewing and establishing a set of development standards, design/architectural guidelines, landscape guidelines, and signing standards provides the necessary zoning provisions for a high quality, successful, and interesting regional commercial shopping and entertainment complex. 5. The Planning Commission finds that establishment of the Specific Plan project will not have any significant effect on the environment because the overall development parameters have previously been evaluated in the EIR certified in conjunction with the General Plan update. In addition, future requests for development projects at the site will require environmental analysis as mandated by the California Environmental Quality Act (CEQA) and the CEQA Guidelines. PL00-46ATT 2 7/25/00 10:13 AM ATTACHMENT 2 ATTACHMENT NO. 2 RECONSIDERATION OF ZONING MAP AMENDMENT NO. 00-01/ ZONING TEXT AMENDMENT NO. 00-02 SUGGESTED DEFINITION AND DESIGN AND DEVELOPMENT STANDARDS FOR DRIVE-THROUGH BAKERY If the City Council desires to allow for a drive-through bakery, staff recommends establishing a definition as written below. Staff also recommends the following Design and Development Standards be included within Specific Plan No. 13 to regulate the appearance and site design of the drive-through bakery. Definition: "Drive-Through Bakery —A shop where only bread, cake, pastries, doughnuts, and similar goods are baked (and/or fried) and sold on the premises and is designed to serve patrons who remain in their cars. Tables and chairs may also be provided indoors or within an outdoor patio but a minimum of one drive-through lane and one outdoor pick-up window for vehicle service of bakery goods must be provided." Design and Development Standards: 1. The building shall be the predominant visual element along street frontages, not parking lots or drive through lanes. 2. Drive through aisles shall be located towards the rear of the building, away from the street frontage, and screened from adjacent parking areas. 3. Buildings with drive-through services shall be "built-to" the minimum front setback lines. 4. Drive-through aisles shall provide adequate on-site queuing distance to accommodate eight cars (150 feet) before the first stopping point (e.g. menu board, ordering speaker). No portion of the queuing aisle should serve as a parking aisle. 5. Drive through lanes shall not exit directly to the site's main entrance. Drive-through aisles shall provide at a minimum 25-foot interior radius for any curve. 6. The main structure should be sited so as to maximize the distance for vehicle queuing while screening the drive through operations. 7. All building elevations shall comply with the architectural guidelines as specified herein. 8. Buildings shall incorporate a full roof with built-in roof top wells for mechanical equipment screening. PL00-46ATT 1 7/25/00 10:13 AM 9. A canopy shall be provided over the drive-through lane at the pick-up window. The canopy shall be architecturally compatible and fully integrated as part of the building design. 10.No individual freestanding or pole signs shall be permitted for the drive-through bakery. 11.A maximum of one drive-through bakery shall be permitted on the 63 acre site. PL00-46ATT 2 7/25/00 10:13 AM ATTACHMENT 3�1 ATTACHMENT NO. 3 RECONSIDERATION OF ZONING MAP AMENDMENT NO. 00-01/ ZONING TEXT AMENDMENT NO. 00-02 DESIGN AND DEVELOPMENT STANDARDS FOR DRIVE-THROUGHS AS AMENDED BY THE PLANNING COMMISSION WITH ONE ADDITIONAL MODIFICATION TO NUMBER 11 (EZRALOW'S REQUEST) 1. The building shall be the predominant visual element along street frontages, not parking lots or drive through lanes. 2. Drive through aisles shall be , away ftem the screened from streets and from adjacent parking areas. ',t 4. Drive-through aisles shall provide adequate on-site queuing distance to accommodate five cars (150 feet) before the first stopping stop (e.g. menu board, teller window, and automatic teller machine). No portion of the queuing aisle should serve as a parking aisle. 5. Drive through lanes shall not exit directly to the site's main entrance. Drive-through aisles shall provide at a minimum 25-foot interior radius for any curve. 6. The main structure should be sited so as to maximize the distance for vehicle queuing while screening the drive through operations. 7. All building elevations shall comply with the architectural guidelines as specified herein. 8. Buildings shall incorporate a full roof with built-in roof top wells for mechanical equipment screening. 9. A canopy shall be provided over the drive-through lane at the pick-up window. The canopy shall be architecturally compatible and fully integrated as part of the building design. 10.No individual freestanding or pole signs shall be permitted for drive-through uses. 11. the rag aGFe-sife.; GRe on GenteF Avenue d Gne on EdinneF Avenue A maximum of one drive-through bakery shall be permitted on the 63 acre site. PL00-46ATT 1 7/25/00 10:13 AM ATTACHMENT 4 Aug-07-2000 01:21pm From-Tuchman & Associates 2133850595 T-14T P.001 F-328 TUCHMAN & ASSOCIATES A rTORNl:YS AT LAW 3435 WEI SHIRE BOULEVARD 30TH FLOOR LOS ANGELES,CALIFORNIA ON 10 0 1 PHONE 20 385.30M-FAX 213.385.059$ FAX COVER SHEET ' CJ. FAX TO: Us49 Crt a..�-�..�'' FIRM NAME: FAX NO., FROM: A/ 1 V ATV G�� REGARD TO: SL OUR FILE NO.: DATE & TIME: 8 --7 O o NO. OF PAGES (Including this page) : Per Your Request _ Response Requested Per Our Conversation_ Response Not Required For Your Information Please call us upon Receipt SPECIAL COMNUNTS p•� •�J �c�W ciT( ! To 1-0 c, c- . THIS FACSIMILE IS NTffiDED ONLY FOR THE F&SON TO WHOM IS ADDRESSED AND AAY CONTAIN PRIVILEGED. PROPRIETARY,OR OTHER DATA PROTECTED FROM DISCLOSURE CRUDER APPLICABLE LAW- IF YOU ARE NOT TIM ADDRESSEE OR THE PERSON RESPONSIBLE FOR OCLIVERJNG THIS TO THE ADDRESSEE,YOU ARE HEREBY NOTIFIED THAT COPYING OR DISTRIBUTING TEAS TRANSMISSION IS PROHIBITED. IF YOU HAVE RECUWD THIS FAC586W IN ERROR,PLEASE TELEPHONE US IMMEDIATELY AND RETURN IT BY MAIL TO THE.PERSON AT THE ABOVE ADDRESS. THANK YOU. Aug-07-2000 01 :21pm From-Tuchman & Associates 2133850595 T-147 P.002 F-328 )rUCHMAN & ASSOCIATES ATTORNEYS AT LAW 3435 WILSHIRE BOULEVARD 30TH FLOOR LOS ANGELES, CALIFORNIA 90010 .PHONE 213.385.8000 • FAX 213.385.0595 July 5,2000 HAND DELIVERED AND SENT VIA FASCIMILE (714)375-5087 City Council City of Huntington Breach 2000 Main Street Huntington Beach, California 92648 Re: City Council Meeting on Tuesday,.T�ii y 5, 200 Re Adoption of the Specific Plan for the Huntington Center ' ",`„^ Honorable Members of the City Council of the City of Huntington Beach: This Firm represents Burlington Coat Factory Warehouse of Huntington}*ach, Inc. ("Burlington") in connection with the above-referenced matter. As you may knowiJ > Burlington is a tenant in what is commonly known as The"Huntington Center Mall" ("Huntington Center"). Huntington Center is owned by Huntington Center Associates,which is a subsidiary of Ezralow Retail Properties and The Ezralow Company(collectively referred to as "HCA"). Today,the City Council will consider whether to adopt the Specific Plan as the zoning for the entire Huntington Center. Burlington objects to the adoption of the Specific Plan on the grounds that certain City administrators and officials for the City of Huntington Beach (the"City")and the Redevelopment Agency of the City of Huntington Beach(the "Redevelopment Agency")engaged in a scheme and course of conduct wherein they acted outside the scope of their authority, including without limitation,declaring the Specific Plan to be a"City-initiated project,"without giving any notice to Burlington(and other interested parties),and without following the City's awn rules and regulations relating to the proper procedures when seeking to establish the Specific Plan as the new zoning for Huntington Center. In addition, Burlington objects to the Specific Plan because it is in direct contravention to the Redevelopment Act and established law,and which,if passed,seeks zoning which calls for the demolition of Burlington's leased premises,which,therefore, amounts to a"taking" of property without"due process"of law. The events and circumstances that led to the City application for adoption of the Specific Plan has caused Burlington to file two lawsuits--one in federal court and the other in state court-- against the City and Redevelopment Agency, and HCA, respectively. Briefly stated,the Redevelopment Agency and HCA have conspired to engage is a scheme and course of conduct to strip Burlington of its rights as a tenant in the Huntington Center unless Burlington agreed to a rent increase of almost four times that for which it is required to pay under the Burlington Lease. Aug-07-2000 01:21pm From—Tuchman & Associates 2133850595 T-147 P.003 F-328 City Council of the City of Huntington Beach July 5,2000 Page 2 The purpose of the letter is familiarize the City Council with the chronology of events which led Burlington to seek redress from the courts in an effort to preserve and maintain its status as a tenant in Huntington Center. The first suit(as explained in fiurther detail below) was filed against the owner/landlord` of Huntington Center for Breach of the Burlington Lease. The second suit was filed in Federal Court against the City and Redevelopment Agency. Both lawsuits concern the redevelopment of Huntington Center and the combined efforts of HCA and the Redevelopment Agency to strip Burlington of its long-term leasehold interest as a tenant in Huntington Center. Finally, as further discussed below,this letter with apprise the City Council of the legal ramifications and liabilities that the City and Redevelopment Agency will incur in the event this particular Specific Plan is adopted by the City Council,as well as the legal ramifications and liabilities which the City and Redevelopment Agency have exposed themselves to as a result of the June 5, 2000 memorandum authored by Ray Silver. It is not Burlington's intention to prevent the redevelopment of Huntington Center. Burlington wants to be a part of it. When Burlington first became a tenant of Huntington Center, it was assured by Former Landlord that Huntington Center would undergo redevelopment with the participation of Burlington. Indeed,Burlington's lease expressly preserved Burlington's tenancy in the event of redevelopment. In a June 22, 2000 memorandum, Toni.Livengood, planning Commissioner for the City,stated it best when he wrote that a Specific Plan should be adopted that"provides more flexibility and provides some protection for the three (3)existing anchor stores." Mr. Livengood further stated that the Specific Plan which calls for "[o]nly 80,000 square feet. . . for existing anchors" sends"[t]he message,no room for Burlington or Wards."2 The City Council should not reward HCA and the Redevelopment Agency for their surreptitious backroom negotiations,but rather instruct and direct the Redevelopment Agency to work with Burlington, Montgomery Ward,"and HCA in order to reach common ground as to how each respective tenant,as well as HCA and the citizenry of Huntington Beach, will benefit from the redevelopment of Huntington Center. In the alternative,the City Council decision should be continued in order to consider the legal issues raised in this letter. ' Huntington Center Associates(HCA")is the owner/landlord of Huntington Center. 2 Mr. Livengood's,Tune 22, 2000 memorandum is attached hereto as Exhibit"A" and is also attached to the Staff Report as Exhibit"16". 3 Burlington joins and concurs with the objections raised by Montgomery Ward in its letter to the City Council. Aug-07-2000 01:22pm From—Tuchman & Associates 2133850595 T-147 P.004/033 F-328 City Council of the City of Huntington Beach July S, 2000 Page 3 SUMMARY OF COMMENTS AND OBJECTIONS IF THE CITY COUNCIL ADOPTS THE SPECIFIC PLAN BACKGROUNDFACTS................... .............. ............ ............. ............ ............ .......... .........6 EurlingtonLease. ............. ................ ......................................... ......... .........................6 Ezralow and HCA Purchase Huntin n Center. ............. .......... ......... ..........................7 Burlington's Neeo— tiations With HCA. ..... .............. ........... ............ ............................8 Redevelopment Agency and HCA Hold Secret Closed Door Meetings to Discuss Redevelopment. ................ ......................................... ...................9 The Redevelopment Agena Gets Involved in the Redevelopment of Huntington Center............................. ............... .......................... ......9 HCA Elects to Raze Burlington's Demised Premises. ........... ........................ ..............I 1 Burlington Files Lawsuit Against Ezralow and HCA to Enforce Lease. .... ..................I I City Administrators and Officials Interfere With Burlington's Lawsuit. .... .............. ...12 I. THE REDEVELOPMENT AGENCY HAS NOT COMPLIED WITH THE CALIFORNIA COMMUNITY REDEVELOPMENT ACT...........................................12 A. Overview of the Calif omia Comrnunily Redevelopment Act.............................12 B. The Redevelopment A e�ncy Has Failed to Provide Burlington with a Reasonable Opportunity to Particivate in the Redevelopment ofHuntington Ccnter. ... ................................................................................ ....13 II. THE REDEVELOPMENT AGENCY'S ACTIONS AND THE SPECIFIC PLAN ARE IN VIOLATION OF THE FIFTH AND FOURTEENTH AMENDMENT OF THE UNITED STATES CONSTITUTION AND THE STATUTORY AND COMMON LAW OF THE STATE OF CALIFORNIA.......... ............... .......................15 Au&-07-2000 01:22pm From-Tuchman Associates 2133850595 T-147 P.005/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 4 A. The Redevelopmgnt A enc 's Actions and the S cific Plan Are In Viol on of Equal Protection. Substantive Due Process and Procedures] Due Process as Guaranteed by the Fourteenth Amendment otLie UnitedStates Constitut> . ............................................................ ....................15 B. The Redevelopment Agency's Actions Amount to Tortious Conduct Under California's Statutoly and Decisional Law.......................... ...............................17 1, City Administrators and Officials Intentionally Interfered With Burlington's Contractual Relationship With HCA.............. ...................17 2. City Administrators and Officials Intentionally Interfered With Burlington's Prospective Economic Relationship with HCA..................18 3. City Administrators and Officials Conspired to Induce HCA to Breach its Contractual Relationship With Burlington............... ............19 III. EZRALOW'S RESPONSE TO THE RFP CANNOT BE LEGALLY ACCEPTED BECAUSE IT PROPOSES A SPECIFIC PLAN THAT VIOLATES THE CITY'S GENERAL PLAN AND ESTABLISHED LAW............................................................19 A. The Sn cific Plan Is Not in Compliance with the General Plan...........................20 B. The Specific Plan Does Not Com 1 with State Law and Munici al Co e Requirements for Specific Plans. ........... . ...................... ..................... .............20 C. 3jX Adoption of the-Specific Plan Will Viol to the California Environmental Qua lily Act an Environmental Imgact Report Must Be Pmared. ............... . .21 1. The mu prepare and certify au EIR for the Proposed Secific P1an. ................ ..................................... .................... ..............21 a. Overview o CE A. ......... .................................. .................. .21 b. Fair Argument Test Requires an EIR. ..... ................ ................23 2, The Specific Plan Is a Project unde�OA. ........ ................................24 3. The Ci and ft Redevelopment A&Mcy Mug UndertaLe CE A Review Before P eeding wi the Ado tion of thc SRgcifc Plan........24 Aug-07-2000 01:22pm From-Tuchman & Associates 2133850595 T-147 P.006/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 5 4. The Elements of Tiering Are Not Met. .............. . . ...... . . . . .............25 5. The C-ily and the Redevelopment Agency.Have Unlawfully"Split" the Project for Purposes of Environmental Review.................. 6. The Adoption of the Specific Plan As Currently Contemplated Without Environmental Review Would Unlawfully Defer EnvironmentalReview............................................................................28 7. The Adoption of the Specific Plan As Currently Contemplated without Environmental Review Will Result in an Unlawful Failure to Undertake a Cumulative An&sis of the Project's Environmental Impacts................29 IV. CONCLUSION...... .................................. ......................................................................29 Aug-07-2000 01:22pm From-Tuchman & Associates 2133850595 T-147 P.007/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 6 BACKGROUND FACTS The Huntington Center is part of the Huntington Beach Redevelopment Project ("Redevelopment Plats"), which was approved and adopted by the City Council of the City on or about December 16, 1996 by Resolution No. 3343. "Rules Governing participation and Preferences by Property Owners and Business Occupants for the Huntington Beach Redevelopment Project,"dated August 1996("Owner Participation Rules"),were adopted as required by California Community Redevelopment Act to govern the participation of property owners in connection with redevelopment under the Redevelopment Plan. Burlingion Lease On April 28, 1995,Burlington entered into a long-term lease agreement ("Burlington Lease")with MCA Huntington Associates,L.P. ("Former Landlord") whereby Burlington would occupy 133,500 square feet of space as a tenant in a portion of Huntington Center for a term of thirty(30)years. In addition,Burlington has other property rights pursuant to certain Reciprocal Easement Agreements ("REA"). At the time the Burlington Lease was being negotiated,Former Landlord advised Burlington that Huntington Center would undergo redevelopment in the near future,and that the Redevelopment Agency would be involved in the redevelopment because Huntington Center was located within a City designated Redevelopment Project Area. With that in mind,the Burlington Lease was specially drafted to include certain provisions addressing Burlington's rights in the event Landlord elected to redevelop Burlington's demised premises. In particular,the Burlington Lease provides that Landlord reserves the right at any time during the term of the Burlington Lease to renovate,reconfigure and/or modernize Huntington Center,including Burlington's structure. The lease further states that Burlington s l have the right to approve the conceptual design.(the"Design") of the reconfigured Huntington Center in the event Landlord elected to raze Burlington's structure. The following lease provision sets forth the procedures to be followed by both Burlington and Landlord in the event Landlord elects to redevelop Burlington's demised premises: Landlord shall, at its sole cost and expense, prepare and deliver to Tenant a conceptual design (the "Design") for the reconfigured Shopping Center showing the approximate location of the New Premises as well as the location of other buildings and other improvements to be located in the reconfigured Shopping Center. Tenant shall have the right to approve the Design of the reconfigured Shopping Center including the location of the New Premises which approval shall not be unreasonably withheld or delayed. If Tenant Aug-07-2000 01;23pm From-Tuchman & Associates 2133850595 T-147 P.008/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 7 shall not approve the Design,Tenant and Landlord shall use their best efforts to cooperate and agree on all of the modifications necessary to obtain the approval of Tenant to the Design, and Landlord's project architect(the"Center Architect")shall promptly revise the Design to incorporate all such modifications which are mutually acceptable to Landlord and Tenant. In the event Landlord and Burlington(despite their best efforts)are unable to agree upon the Design for the reconfigured Huntington Center including the location of Burlington's structure,Article XVII of the Burlington Lease provides for arbitration of all "Unresolved Issues". The lease states,in pertinent part,that: The Unresolved Issues shall be submitted to nal alrt binding arbitration as follows:Landlord and Tenant shall each within twenty (20) days of receipt of the Center Architect's Notice designate one person, as hereinafter provided, to represent it as an arbitrator. The arbitrators so appointed by Landlord and Tenant shall within ten(10) days following the aforesaid twenty (20) day period designate one additional person as arbitrator to the end that the total number of arbitrators shall be three(3). The appointment of all arbitrators under this Section shall be in writing and shall be submitted to the other party. Any person designated as an arbitrator shall be knowledgeable and experienced in the development and design of regional shopping centers, but shall not be in the employment of either Landlord or Tenant,directly,indirectly or as an agent,except in connection with the arbitration then proceeding. The arbitrators shall meet or otherwise confer as deemed necessary by the arbitrators to resolve the Unresolved Issues and a decision of a majority of the arbitrators will be final and binding upon Landlord and Tenant. The decision of the arbitrators shall be in writing and shall be made as promptly as possible after the designation of the third (31) arbitrator, but in no event later than thirty(30)days from the date of the designation of the third(3`d)arbitrator. A copy of the decision of the arbitrators shall be signed by at least two(2)of the arbitrators and given to each parry in the manner provided in Section 2 1.10 of this lease for the giving of notice. Ezralow and HCA Purchase Huntington Center Prior to August 1999,Huntington Center was owned by Macerich Huntington Limited Partnership("Macerich"). Macerich purchased the Huntington Center from Former Aug-07-2000 01:23pm From—Tuchman & Associates 2133850595 T-147 P.009/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page $ Landlord. On or about August 5, 1999, The Ezralow Company and Ezralow Retail Properties (collectively referred to as "Ezralow")entered into an agreement with Macerich for the purchase of Huntington Center. Prior to closing of that transaction, Ezralow assigned ali.of its rights and obligations under that purchase agreement to HCA, a subsidiary of Ezralow. After the assignment from Ezralow,HCA proceeded with the purchase transaction, which closed on or about November 16, 1999.4 Ezralow and HCA acquired Huntington Center for the purpose of redeveloping it into a retail and entertainment center pursuant to prospective redevelopment agreements with the Redevelopment Agency. HCA seeks to redevelop Huntington Center with the help of Ezralow, which is in the business of developing commercial real estate. As indicated in the Specific Plan, HCA's redevelopment plan will require the demolition and removal of much of the existing improvements on the site, including Burlington's demised premises. Burlin o 's Ne otiations With HCA In the later part of 1999,Douglas Gray,the President of Ezralow Properties,sent to Burlington a large 100 scale preliminary site plan for the proposed redevelopment of Huntington Center. The plan proposed Burlington's participation as a tenant in the redeveloped Huntington Center. On or about September 23, 1999,Mr. Gray, on behalf of Ezralow, contacted Burlington in connection with opening discussions regarding Burlington's interest in participating as a tenant of the redeveloped center. Mr.Gray offered Burlington space within the redeveloped shopping center only if Burlington leased space at a cost of$22 per square foot, plus taxes,CAM charges, and insurance. In addition,Mr. Gray's proposal sought to decrease Burlington's space within the redeveloped mall by approximately 50,000 square feet. Notwithstanding Mr. Gray's offer to increase Burlington's rent to$22 per square foot,the Burlington Lease states that Burlington's rent shall remain the same.($6 per square foot which includes CAM charges)in the event Landlord elects to raze or redevelop Burlington's demised premises. In particular, the Burlington Lease states, in pertinent part,that: The Fixed Minimum Rent and Common Area Costs for the New Premises shall be the same as the Fixed Minimum Rent and Common Area Costs applicable to the Existing Premises. Ezralow's offer was not acceptable to Burlington due to the proposed rent increase of almost four times that of the rent provided by the Burlington Lease and the proposed 4 Pursuant to that transaction, HCA purchased all right,title,and interest of Macerich in and to the land on which Huntington Center is built and the improvements located on such land, and HCA was assigned all right,title,and interest of Macerich as landlord under the leases in effect for Huntington Center. One such lease is the Burlington Lease. Aug-07-2000 01:23pm From-Tuchman & Associates 2133850595 T-14T P-010/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 9 decrease is Burlington's square footage. Accordingly,Burlington rejected Ezralow's offer. On or about November 1999,Burlington requested that Ezralow and HCA deliver to.Burlington any proposed redevelopment plans concerning the redevelopment of Huntington Center or proposed alterations of Burlington's demised premises. Ezralow and HCA, however, refused to deliver such plans. In addition,HCA refused to consult with Burlington concerning the nature of the plans being submitted by HCA to the Redevelopment Agency. Redevelopment Agency and HCA Hold Secretflo-,;.e .d Door Meetings to Discuss Redevelopment The Redevelopment Agency,HCA,and Ezralow held several secret closed door meetings relating to HCA's purchase and redevelopment of Huntington Center. One such meeting occurred on or about November 15, 1999,the day before HCA actually took title to Huntington Center. No tangible evidence(e.g.,minutes)were kept of said meetings, even though the Brown_Act requires that public entities keep a record of any meetings with third parties relating to the business of the public entity. Mr. Murray Kane,of Kane Ballmer& Berkman was present at this meeting. Burlington was not invited, nor was it informed at the time that such a meeting was going to take place. In December, 1999,Burlington met with Mr. Gray and other representatives of Ezralow in order to discuss redevelopment of Huntington Center as well as Burlington's location within the shopping center. Mr. Gray advised Burlington that if it did not accept Ezralow's rent increase from$6 to$22 per square foot,the Redevelopment Agency has assured Ezralow and HCA that Burlington's leasehold interest would be condemned. Mr. Gray further stated that Burlington had no redevelopment rights once the Redevelopment Agency was brought in to condemn Burlington's lease. Simply put,unless Burlington accepted Ezralow's extortionate rent increase, the Burlington Lease--which preserves Burlington's tenancy in the event the shopping center undergoes redevelopment--would be condemned by the Redevelopment Agency. As alleged in Burlington's federal lawsuit against the City and the Redevelopment Agency,Ezralow made such threats after it received assurance from the Redevelopment Agency that Burlington's leasehold interest would be condemned. From the time period of December 1999 to the present, Ezralow has cut off all communications with Burlington, and refuses to abide by the provisions set forth in the Burlington Lease. The Redevelopment Agency Gets Involved in the Redevelopment of Huntington Center On or about March 3,2000,the Director of Economic Development for the City of Huntington Beach sent a Request For Proposal("RFP")to all persons or entities that qualified as an owner within Huntington Center. The RFD's requested that said owners submit Statements of Interest and Requests for Development proposals in connection with entering into a Owner - -- - -- ---_ I Aug-07-2000 01:24PM From-Tuchman & Associates 2133850595 T-147 P.O11/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 10 Participation Agreement("OPA")with a qualified owner.' Within the time required by the RFP, Burlington submitted to the Redevelopment Agency its Statement of Interest and Response to the RFP("Burlington Response"), HCA also submitted a response to the RFP by a letter from their attorneys, j Whitman Breed Abbott& Morgan LLP, by letter dated May 2,2000 ("HCA Response"), which included as its alleged redevelopment concept the City of Huntington Beach Specific plan No. 13, entitled"The Crossings at Huntington Beach"(the"Specific Plan'. Prior to HCA submitting the HCA Response, HCA submitted an application to the City for the establishment of the new Specific Plan as the zoning for the entire Huntington Center. This application is dated March 31, 2000, but, oddly, acknowledged in the"Official Use Only"box as received by the City on March 30,2000 and distributed by the City on March 16,2000. The City's Planning Commission held study sessions on May 9, 2000 and May 30,2000 to consider the Specific Plan,and a formal Planning Commission hearing was held on Tuesday, June 13, 2000,which was continued to a special Planning Commission hearing that was held on June 20, 2000. Burlington received written notice--in which HCA is referenced as the"applicant"for the Specific Plan--of a Planning Commission hearing for Tuesday,June 13, 2000. However, on June 5,2000, Ray Silver, City Administrator and Executive Director of the Redevelopment Agency,unilaterally declared by memorandum dated June 5, 2000,that the City and the Redevelopment Agency were the"applicants"for the Specific Plan because it was a "city-initiated project." Despite the fact that Burlington has operated its business in Huntington Center since 1995,under one of the proposed Specific Plan exhibits,Burlington's building is excluded from the new Huntington Center. The RFP that was sent to Burlington does not mention the Specific Plan and,rather, requests that any submission in response to the RFP provide for a redevelopment concept for the site which includes a"[d]escription of proposed uses and the arrangement of these uses." Neither the City,nor the Redevelopment Agency, nor HCA ever contacted Burlington in connection with the development of the draft Specific Plan even though HCA is obligated to seek Burlington's approval in connection with any proposed redevelopment or razing of Burlington's demised premises. 5 Section 20OF of the Owner Participation Rules defines"Owner"as"any person, persons, corporation,association, partnership, or other entity holding recorded fee title to or a tone-term lease of real property in the Project Area for so long as such Owner hold such title or long-term lease." AuQ-07-2000 01:24pm From—Tuchman & Associates 2133850595 T-14T P-012/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page I HCA Elects to Raze Burlington's Demised Premises On or about March 20, 2000, HCA submitted to the Redevelopment Agency a Specific Plan 12 which showed that Burlington's demised premises would be razed and that Burlington would no longer be a part of the redeveloped Huntington Center. On or about March 31, 2000, HCA submitted an application with the Planning Commission for the establishment of the new Specific Plan as the zoning for the entire Huntington Center. Thereafter,and starting on or about April 4,2000, combined with numerous letters and requests in writing,during April and May,2000,Burlington undertook to obtain as much information as possible from the City and the Redevelopment Agency. Such information included a request for information as to any meetings,notices,plans submitted,and documentation relating to Huntington Center which the Redevelopment Agency was required to produce upon request,as required under the Brown Act. The Redevelopment Agency,however,engaged in a scheme and course of conduct to conceal documents specifically requested by Burlington and failed to disclose scheduled meetings between the Redevelopment Agency and Ezralow in relation to the redevelopment of Huntington Center, including,but not limited to,intentionally not informing Burlington of a Staff Meeting on April 13,2000, a Planning Commission meeting(or sometimes referred to as Study Sessions)dated May 9, 2000,and a Design Review Board Meeting on June 1, 2000, In addition,the Redevelopment Agency intentionally withheld and continues to withhold documents which were requested by Burlington. Burlington Files Lawsuit Against Ezralow and HCA to Enforce Lease On or about May 24,2000, Burlington filed a lawsuit against HCA and Ezralow in the Superior Court of Orange County--Central Justice Center, for breach of the Burlington Lease. The lawsuit alleged that Ezralow and HCA were in breach of the Burlington Lease when it refused to deliver to Burlington conceptual plans in connection with the redevelopment of Huntington Center,and when it submitted development plans to the Redevelopment Agency without seeking Burlington's approval to said plans. In addition,the complaint sought injunctive relief in order to prevent Ezralow and HCA from submitting plans that have not been approved by Burlington. On June 1,2000,Burlington gave notice to Ezralow and HCA that Burlington would seek ex parO relief from the court in order to obtain a temporary restraining order to 6 All parties appeared on June 2,2000 but the judge assigned to the case was unavailable. The matter was put over to the following Wednesday June 7,2000 at the request of Ezralow. The judge heard the ex pane on June 7,2000. Aug-07-2000 01:25pm From-Tuchman & Associates 2133850595 T-147 P-013/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 12 prevent Ezralow and HCA from submitting development plans and zoning applications relating to the razing of Burlington's demised premises without seeking Burlington's approval to said plans. HCA represented to the court that it was no longer the applicant for the Specific Plan, but that the Redevelopment Agency and the City were the new applicants, The judge requested that the Agency provide a supplemental declaration stating that it was the new applicant. City Administrators.apd Officials Interfere With Burlington's Lawsuit In anticipation that a temporary restraining order would be granted by the court due to the fact that Ezralow submitted a development plan that was in contravention to the Burlington Lease, on June 5,2000,Ray Silver,the City Administrator and Executive Director of the Agency, wrote a memorandum wherein he, in his capacity as the City Administrator,declared That the Redevelopment Agency and the City would be the applicants for the Specific Plan which was initially submitted by HCA.' After considering Mr. Silver's memorandum and the accompanying declaration of Mr. Zelefsky,the Court deemed Burlington's ex parte application for a temporary restraining order to be moot considering that HCA was no longer the applicant. Mr. Silver's June 5, 2000 memorandum was the impetus for Burlington's lawsuit filed in federal court. The claims for relief sought in the lawsuit against the City and Redevelopment Agency are described in detail in Section H below. 1. THE REDEVELOPMENT AGENCY HAS NOT COMPLIED WITH THE CALIFORNIA COMMUNITY REDEVELOPMENT ACT. A, Overview pf the California Community Redevelopment Act. The California Community Redevelopment Act(Health and Safety Code, sections 33000, et seq.)("Redevelopment Act")was established to provide local officials with the ability to form redevelopment agencies that would be responsible for the planning and implementation of programs designed to rehabilitate blighted areas in American cities. The fundamental documents governing a redevelopment agency's activities is the redevelopment plan. The California Supreme Court has repeatedly affirmed that the redevelopment plan should be a very general document,providing the redevelopment agency with great flexibility to accommodate changing market conditions, development opportunities and the desires and needs of owners to participate in the redevelopment program. ComM o Santa Cruz v. City of Watson "lle 177 Cal.App. 3d 831 (1985); sepalso,In re Redevelopment plan_for Bunker Hill, 61 Cal, 2d 21 (1964). ' Attached as Exhibit"B"is a true and correct copy of the June 5,2000 memo authored by Mr. Silver. Aug—OT-2000 01:25pm From—Tuchman & Associates 2133850595 T-14T P.014/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 13 As noted in County of Santa Cruz v. City of Watsonville, supra, at 841: By exercising certain of its powers to implement redevelopment, a redevelopment agency may induce private investment in an area. The success of any redevelopment project is dependent upon whether private lenders, developers,owners,and tenants can be persuaded to participate in the process. Thus, a redevelopment agency is unique among public entities since in order to achieve its objective of eliminating blight it must rely upon cooperation with the private sector. Redevelopment is also a process which occurs over a period of years. These realities dictate that a redevelopment plan be written in terms that enhance a redevelopment agency's ability to respond to market conditions, development opportunities and the desires and abilities of owners and tenants. The Redevelopment Agency's power to implement redevelopment,however, does not give the Agency carte blanche authority to set aside constitutional guarantees of"due process of law,"nor does it give the Redevelopment Agency plenary power to stray from its own rules and regulations which govern redevelopment. B. The RedeveIonr gnt Agency has Failed.to Provide Burlingtton With a Reasonable Opno tv to Participate in the Redevelopment of Huntington Center. Pursuant to Health and Safety Code section 33339,a redevelopment plan must include a provision for participation by owners conditioned upon their agreeing to develop or rehabilitate their property in conformance with the redevelopment plan. Health and Safety Code section 33339 provides, in relevant part: Every redevelopment plan shall provide for participation in the redevelopment of property in the project area by the owners of all or party of such property if the owners agree to participate in the redevelopment in conformity with the redevelopment plan adopted by the legislative body for the area. In addition, section 33380 of the Health and Safety Code provides that: An agency shall permit owner participation in the redevelopment of property in the project area in conformity with the redevelopment plan adopted by the legislative body for the area. Moreover,while a redevelopment plan is not required to have provisions granting Aug-07-2000 01:25pm From—Tuchman & Associates 2133850595 T-147 P-015/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 14 priority to current business owners of the property subject to redevelopment,pursuant to Health and Safety Code section 33339.5, the redevelopment agency is required to adopt rules for owner participation and for preferences to businesses prior to the adoption of the redevelopment plan. Section 33339.5 states, in pertinent part: Every redevelopment agency shall extend reasonable preference to persons who are engages in business in the project area to reenter in business within the redeveloped area if they otherwise meet the requirements prescribed by the redevelopment plan. Indeed, section 302 of the Owner Participation Rules, which were adopted by the Redevelopment Agency, mandates that"Business Occupants engaged in business in the Project Area shill be extended reasonable preference to reenter in business within the redeveloped area if they otherwise meet the requirements prescribed by the Plan and these Rules." The Redevelopment Agency,however,has failed to provide a reasonable opportunity for Burlington to participate in the redevelopment of Huntington Center in spite of the fact that Burlington has requested a right to participate in such redevelopment. As stated above,on March 3, 2000,the Redevelopment Agency sent out its RFP to Burlington and other owners and tenants located within the Mall. The deadlines for the owners and tenants to submit a Statement of Interest and Development Proposal in response to the RFP were April 17,2000 and May 2,2000,respectively. In accordance with the time limits set forth in the Redevelopment Agency's RFP, Burlington submitted a Statement of Interest by April 17, 2000—expressing its interest in participating in the redevelopment of Huntington Center. Prior to and during this time, however, the City and the Redevelopment Agency were having meetings with HCA and Ezralow regarding 14CA's specific development proposal and, apparently,developing an elaborate scheme and schedule to exclude Burlington and others,but at the same time give the appearance of complying with the Redevelopment Act and its own Rules. For example,beginning on March 30,2000 (one day prior to Burlington's Petition to Compel Arbitration, and one day prior to HCA's application and more than one month prior to the HCA Response to the RFP), City staff began having meetings with HCA regarding its RFP--specifically the proposed Specific Plan —without any written notice to Burlington. Thus,at least two weeks before the Redevelopment Agency had received any other Statements of Interest or Development Proposals and prior to the expiration of the Redevelopment Agency's self-imposed deadline for those documents, the Redevelopment Agency was already implementing a scheme with HCA for HCA's development of Huntington Center and the taking of Burlington's demised premises. Such actions were in direct contravention of the Redevelopment Act. Indeed,the Redevelopment Act requires that once owner participation is invited,the Redevelopment Agency Aug-07-2000 01:26pm From—Tuchman & Associates 2133850595 T-147 P.016/033 F-328 .1--11 1---/ City Council of the City of Huntington Beach July 5,2000 Page 15 has a legal dint to treat all project applicants,including current owners,with "reasonableness" and "in good faith." In re Redevelopment Plan for Bunker Hill,61 Cal. 2d 21, 60(1964). The Redevelopment Agency's actions, however,were neither reasonable nor in good faith. In fact, the Redevelopment Agency's actions were especially egregious considering the RFP was vague in its requirement for a development concept, and since we now know that the HCA Response to the RFP(the proposed Specific Plan)is an alleged"city-initiated project." This"city-initiated project"of the Specific Plan was never disclosed or made public until after a formal Planning Commission hearing had been noticed. Based on the foregoing, it is clear that the Redevelopment Agency and the City have been in collusion with HCA for HCA to take Burlington's demised premises through the Redevelopment Agency's power of condemnation, and thereby allow HCA to escape the Burlington Lease,which requires that HCA seek the approval of Burlington before electing to redevelop Burlington's demised premises. These actions are in direct violation of State and local law and should not be further condoned by the City Council. II. THE REDEVELOPMENT AGENCY'S ACTIONS AND THE SPECIFIC PLAN ARE IN VIOLATION OF THE FIFTH AND FOURTEENTH AMENDMENT OF THE UNITED STATES CONSTITUTION AND THE STATUTORY AND COMMON LAW OF THE STATE OF CALIFORNIA. The power of state and local governments to regulate land use is expressly limited by the"due process"and"taking"clauses of the Fifth Amendment of the United States Constitution,which provides that"[n]o person shall . . . be deprived of life, liberty,property, without due process and wall; nor shall private property be taken for public use,without just compensation." In addition, state and local land use regulations are also,of course,subject to the Fourteenth Amendment's"equal protection"clause. Consequently,denial of equal protection may be the basis of a successful challenge to land use regulations which are alleged to single out the challenger for more onerous treatment than other landowners who are similarly situated. A. The Redevelopment Agency's Actions and the Specific Plan Are In Violation of Equal Protection, Substantive Due Process and Procedural Due Process as Guaranteed by the Fourteenth Amendment of the United States Constitution. The due process clause of the Fourteenth Amendment of the United States Constitution protects individuals against government deprivations of property without due process of law. U.S. Const., 14"Amend. And Cal. Const.,Art. I § 7. If a governmental action is clearly arbitrary and unreasonable, such action will be declared unconstitutional and a violation of substantive due process. eee Village of Euclid v. Ambler Really Co., 47 S. Ct, 114(1926); see aLso,Lockary v. Kayfetz,917 F.2d 1150(9' Cir. 1990)(noting that government conduct that Aug-07-2000 01:26pm From-Tuchman & Associates 2133850595 T-14T P.017/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 16 is malicious, irrational or plainly arbitrary will not be sustained). The premise behind the equal protection clause is that no person shall be denied the same protection of law that is enjoyed by another person is similar circumstances, See Hawn v. County of Ventura, 73 Cal. App. 3d 1009 (1977). Here,as set forth in detail above,by engaging in negotiations with HCA and considering HCA's Specific Plan before receiving any other development proposals, by"hiding the ball"that the Specific Plan was actually a"city-initiated project,"by pursuing an improper RFP process to give the appearance of complying with the Redevelopment Act and the Redevelopment Agency's own Rules,the Redevelopment Agency will unfairly discriminate against Burlington and deny Burlington a reasonable opportunity to participate in the redevelopment of Huntington Center. See, a g.,Hawn_v_. County of Ventura, 73 Cal. App. 3d 1009(1977). These action are malicious,irrational and plainly arbitrary in clear violation of the equal protection and substantive due process protections provided by the Fourteenth Amendment of the United States Constitution. Furthermore,the insufficient notice and lack of ability to participate also constitute denial of procedural due process under the Fourteenth Amendment. See,U,. Cargy v. Piphus,98 S. Ct. 1042 (1978). By adopting the Specific Plan, the City Council is condoning and furthering the illicit application process that was undertaken by the City and the Redevelopment Agency. Indeed, the City's own Zoning Ordinance requires that all property owners be included on the application. In particular, section 215.08 of the Zoning Ordinance states, in pertinent part,that: An amendment to reclassify property to a SP District may be initiated by a property owner or authorized agent,the Planning Commission, or the City Council. If the property is not under a single ownership, all owners shall loin in the application,and a map showing the extent of ownerships shall be submitted with concept plans and materials. As it stands now,the City and the Redevelopment Agency are the only applicants, The law is clear,Burlington, HCA, and Montgomery Ward should also be included on the application. As a platter of fact, HCA initiated the application process for the Specific flan,but it was replaced as the applicant via the June 5,2000 memorandum that was authored by Mr. Silver. Mr. Silver did not have the authority to initiate the application on behalf of the City and the Redevelopment Agency because section 215.08 mandates that all owners join in the application, including HCA,Montgomery Ward,and Burlington. In furtherance of a conspiracy to interfere with Burlington's lawsuit and the Burlington Lease, Mr. Silver intentionally excluded Ezralow as an applicant. In the event the City Council approves the Specific Plan, it would be putting its stamp of approval on a City-initiated zoning document for which the City does not have the statutory or legal authority to initiate without naming all owners as co-applicants. Because the City and the Redevelopment Agency are applying for the zoning change (in violation Aug-07-2000 01:26pm From-Tuchman & Associates 2133850595 T-147 P-018/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 17 of their own rules and regulations),both the City and the Agency have exposed themselves to liability. The foregoing actions are in violation of the Fourteenth Amendment and should not be condoned or allowed to continue by the City Council. B. The Redevelopment Agency's Actions Amount to Tortious Conduct Under California's Statutory and Decisional Law. 1. City Administrators and Officials Intentionally Interfered With Burlington's Contractual Relationship With FICA. Tort liability may be imposed upon a defendant who intentionally and improperly interferes with the plaintiffs rights under a contract with another person if the interference causes the plaintiff to lose a right under the contract or makes the contract rights more costly or less valuable. See Allen v.Powell,248 Cal. App. 2d 502 (1967). The acts which induce the breach need not be unlawful.It is sufficient if they are lawful,but without justification. Id. The actions of Mr. Silver in the instant case were both unlawful and without justification. First,Mr. Silver's unilateral act of substituting the City and the Redevelopment Agency as the applicants for the Specific Plan was an ultra vires act done for the sole purpose of interfering With Burlington's efforts to enforce its lease with its landlord. Second,the Zoning and Subdivision Ordinance for the City of Huntington Beach ("Zoning Ordinance") clearly sets forth the law with respect to initiating the process to reclassify property to a Specific Plan District. In particular, section 215.08 of the Zoning Ordinance states, in pertinent part,that: An amendment to reclassify property to a SP District may be initiated by a property owner or authorized agent,the Planning Commission, or the City Council. If the property is not under a single ownership, all owners shall join in the application,and a map showing the extent of ownerships shall be submitted with concept plans and materials. Mr. Silver did not have the authority to initiate the application on behalf of the City and the Redevelopment Agency. Moreover, Section 215.08 mandates that all owners join in the application, including Ezralow. Ia furtherance of a conspiracy to interfere with Burlington's lawsuit and the Burlington Lease,Mr. Silver intentionally declared the City and the Redevelopment Agency as the applicants for the Specific Plan. Aug-07-2000 01:27PM From-Tuchman & Associates 2133850595 T-147 P.019/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 18 2. City Administrators and Officials Intentionally Interfered With Burlington's Prospective Economic Relationship with HCA. The tort of Interference With Prospective Economic Advantage protects those expectancies involved in ordinary commercial dealings. See Youst v. Lonizo,43 Cal. 3d 64 (1987). The elements of a cause of action for intentional interference with prospective economic advantage are (1)an economic relationship containing the probability of future economic benefit; (2) knowledge by the defendant of the existence of the relationship; (3)intentional wrongful acts by the defendant to disrupt the relationship; (4) actual disruption of the relationship; and(5) plaintiff is damaged by such actions. Zimmerman v. Bank of America. 191 Cal. App, 2d 55, 57 (1961). In the instant case,there is an economic relationship between Burlington and HCA in that Burlington is leasing 133,500 square feet of retail space for a term of 30 years (expiring in 2025). The Redevelopment Agency,however,knew of Burlington's Lease with HCA, and interfered with said relationship when it endeavored to commit numerous acts which were both unjustified and illegal. For example,the Redevelopment Agency,HCA, and Ezralow had several secret closed door meetings relating to HCA's purchase and redevelopment of Huntington Center. One such meeting occurred on or about November 15, 1999,the day before .FICA actually took title to Huntington Center, No tangible evidence(e.g.,minutes)were kept of said meetings,even though the Brown Act requires that public entities keep of record of any meetings with third parties relating to the business of the public entity. In addition,the Redevelopment Agency concealed (and it continues to conceal) public documents which they are required to disclose (pursuant to the Brown Act)upon request. Burlington has asked for such documents for over the past four months only to receive 14 documents and a response that it is holding back documents because it feels it does not have to produce them at this time. Finally, Mr. Silver(and other City administrators and officials)interfered with Burlington's private lawsuit by declaring, in a June 5, 2000 memorandum,that the Specific Plan was a"City-initiated project"and therefore declared the City and the Redevelopment Agency as the new applicants. This was done a few days after Burlington sought injunctive relief from the court in an effort to preserve its lease rights as a tenant at Huntington Center. But for the acts of Mr. Silver and Mr.Zelefsky,Burlington would have been granted provisional relief and HCA would have been restrained. The acts of Mr. Silver(as an agent of the City and the Redevelopment Agency)was intentional and pre-meditated. Mr. Silver's June 5,2000 memorandum was intentionally calculated to directly and illegally intervene in Burlington's pursuit to vindicate its contract rights against HCA. The ultra vires acts of Mr. Silver went against every notion of constitutional due process and fair play. Simply put, Mr. Silver(acting on behalf of the City and the Redevelopment Agency)illegally manufactured evidence that he r Aug-07-2000 01:27pm From—Tuchman & Associates 2133850595 T-147 P.020/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 19 and HCA knew would counteract and defeat the then Pending ex parte application for temporary restraining order. The June 5, 2000 memorandum by Mr. Silver was orchestrated and fashioned to directly counteract the private suit. For the foregoing reasons,the City and the Redevelopment Agency intentionally interfered with Burlington's prospective economic advantage. 3. City Administrators and Officials Conspired to Induce HCA to Breach its Contractual Relationship With Burlington. The tort action of conspiracy to induce breach of contract applies the general principles of civil conspiracy to the tort of inducing breach of contract(or interference with contractual relations). A tort action will lie against third parties to a contract who,pursuant to a conspiracy, have wrongfully induced or procured the breach of contract. See Wise v. Southern Pacific CO., 223 Cal. App. 2d 50, 64 (1963). Mr. Silver and other City and Redevelopment Agency officials conspired to induce HCA into breaching its contract with Burlington by assuring Ezralow and HCA that Burlington's leasehold interest would be condemned so long as HCA omitted Burlington from its redevelopment plans,by engaging in negotiations with HCA and considering HCA's Specific Plan before receiving any other development proposals,by"hiding the ball"that the Specific Plan was actually a"city-initiated project,"by pursuing an improper RFP process to give the appearance of complying with the Redevelopment Act and the Redevelopment Agency's own Rules,and by concealing public records from Burlington in an effort to conceal the redevelopment process being undertaken by HCA and the Redevelopment Agency. Burlington will have its day in court,and it will establish that the City and Redevelopment Agency conspired to strip Burlington of its rights to participate as a tenant in the new Huntington Center. III. HCA'S RESPONSE TO THE RFP CANNOT BE LEGALLY ACCEPTED BECAUSE IT PROPOSES A SPECIFIC PLAN THAT VIOLATES THE CITY'S GENERAL PLAN AND ESTABLISHED LAW. The HCA Response is a development proposal that is the Specific Plan. As described below,this Specific Plan proposed by HCA, violates the City's General plan,the City's Municipal Code and State law. The Redevelopment Agency cannot now choose HCA as the "developer"based on a proposal(Specific Plan)that is unlawful. To do so would result in the Redevelopment Agency proposing to contract with HCA through an OPA to undertake unlawful acts,and the Redevelopment Agency cannot contract to undertake unlawful acts. If the Redevelopment Agency were to do so, it would violate State law, including the Redevelopment Aug-07-2000 01:28pm From—Tuchman & Associates 2133850595 T-147 P-021/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 20 Act,and be acting in an arbitrary, irrational and unreasonable manner, which provides additional grounds of violation of each of the principles and laws set forth above. A. The Specific Plan Is Not in Compliance with the General Plan. The City's General Plan requires that"development be designed to account for the unique characteristics of project sites and objectives for community character and in accordance with the Development `Overlay' Schedule(table LU-3)." See Policy LU 7.1.2. General Plan Policy LU 15.1.1 requires"the formulation,adoption,and implementation of Specific Plans for areas designated with a Specific Plan Overlay. Table LU-4 of the General Plan specifies the land use category for the Huntington Center as"Commercial Regional(CR)." . The Specific Plan does not comply with State law and the City's Municipal Code requirements for specific plans as explained in Paragraph B below. As a result,the Specific Plan is not in compliance with the General Plan, and HCA's response cannot be accepted because it is not consistent with the General plan. B. The Specific Plan Does Not Coldly with State Law and Moicipa I Code Requirements for S12ecific Plans. Section 65451(a)of the California Government Code provides in relevant part as follows: (a) A specific plan shall include a text and a diagram or diagrams which specify all of the following in detail: (1) The distribution, location, and extent of the uses of land, including open space,within the area covered by the plan, (2) The proposed distribution,location, and extent and intensity of major components of public and private transportation, sewage, water, drainage, solid waste disposal, energy, and other essential facilities proposed to be located within the area covered by the plan and needed to support the land uses described in plan- (3) Standards and criteria by which development will proceed, and standards for the conservation, development, and utilization of natural resources,where applicable. (4) A program of implementation measures including regulations, programs, public works projects, and financing measures Aug-07-2000 01:28pm From-Tuchman & Associates 2133850595 T-147 P-022/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 21 necessary to carry out paragraphs(1),(2), and(3). The Specific Plan does not meet these requirements of the Government Code because it does not specify in detail the distribution or location of any uses of land. Rather,the Specific Plan has two different"Illustrative Conceptual Master Plan"exhibits which specifically note the following. "This illustrative shows a hypothetical development scenario on the project site." The location and distribution of the uses and other essential facilities(including utilities and other infrastructure)are not specified(they are only"hypothetical")and are merely deferred to another day through potential future environmental review under CEQA and an improper site plan review process under section 2.3 of the Specific Plan, which process is done solely by the Planning Director without any requirement for public hearing or notice. This could result in any and all of the uses and other essential facilities permitted or required under the Specific Plan to be constructed anywhere,which is not consistent with Government Code section 65451. By delegation to a future date of an essential element of the Specific Platt,as required by law, General Plan Implementation Program I-LU4 and Municipal Code Chapter 215 will also be violated by not having the Planning Commission and City Council consider the location and distribution of uses. Section 2.0 of Specific Plan similarly violates this Implementation Program and Municipal Code Chapter 215 by allowing modifications of the Specific Plan by the Planning Director when determined by the Planning Director to be minor. By allowing this,all notice and hearing procedures under this and other Chapters of the Municipal Code are ignored and violated for amendments to the Specific Plan. In summary,the Specific Plan should be a tool to provide certainty regarding the location and distribution of future development in Huntington Center in compliance with State and local law. However, as currently proposed, the Specific Plan would create complete uncertainty regarding the development of Huntington Center in violation of law and unlawfully delegate the authority to determine the location and distribution of land uses and essential facilities to the Planning Director. C. The Adoption of the Specific Plan Will Violate the C if rnia Environmental %Witt'Act, an Environmental Impact Report Must Be Prepared 1. The City must prr.,pare and certify an EIR for the Proposed Specific Plan. a. Overview of CEQA. CEQA was enacted in response to the well- documented failure of state and local governmental agencies to consider fully the environmental implications of their actions. Selmi,The Judicial Department of the CalifQ�i�Bnvironmental Aug-07-2000 01:28pm From-Tuchman it Associates 2133850595 T-147 P.023/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 22 Qualia Act, 18 U.C.D.L. Rev. 197 (1984).8 The California Supreme Court has repeatedly affirmed that CEQA must be interpreted liberally"to afford the fullest possible protection to the environment within,the reasonable scope of the statutory language."Laurel Heights Improvement Assn. v. The Regents of the U0yersity of California("Laurel Heights I"),47 Cal. 3d 376, 390 (1988),quoting from Friends-of-Mammoth v. Board of Supervisors. 8 Cal. 3d 247, 259 (1972). Two of the central purposes of CEQA are to inform governmental decision makers and the public about the potential significant environmental effects of a proposed project and to identify ways that environmental damage can be avoided or significantly reduced. Guidelines §§ 15002(a)(1)and(2). The EIR is the heart of CEQA. Guidelines § 15003(a). As noted by the California Supreme Court, the EIR: is the primary means of achieving the Legislature's considered declaration that it is the policy of this state to `take all action necessary to protect, rehabilitate, and enhance the environmental quality of the state.' (§21001,subd. (a).) . . . Because the EIR must be certified or rejected by public officials, it is the document of accountability. If CEQA is scrupulously followed, the public will know the basis on which its responsible officials either approve or reject environmentally significant action,and the public, being duly informed,can respond accordingly to action with which it disagrees. (Citations). The EIR process protects not only the environment but also informed self-government. Laurel Heights I,super,at 392.9 CEQA provides for a three-tiered environmental analysis. First, the lead agency $ The Office of Planning and Research has promulgated guidelines to implement CEQA. 14 Cal. Code of Regs. § 15000, et seq. (the"Guidelines"). 9 An EfR serves"to demonstrate to an apprehensive citizenry that the agency has in fact analyzed and consider the ecological implications of its action." No Oil, Inc. v. City of Los AOgeles, 13 Cal. 3d 68, 86(1974). An EIR also allows the public to"determine the environmental and economic values of their elected and appointed officials,thus allowing for appropriate action on election day should a majority of the voters disagree." People v. County of Kern, 39 Cal.App. 3d 830, 842(1974). "The report. . .may be viewed as an environmental `alarm bell' whose purpose is to alert the public and its responsible officials to environmental changes before they have reached ecological points of no return." County of Inyo v._Yorty, 32 Cal. App. 3d 795, 810 (1973). Aug-07-2000 01:29pm From—Tuchman & Associates 2133850595 T-147 P.024/033 F-323 i City Council of the City of Huntington Beach July 5, 2000 Page 23 determines whether the project is exempt from CEQA review. Guidelines § 15061. If the lead agency concludes that the project is not exempt from CEQA,the lead agency then conducts an initial study to ascertain whether to prepare an EIR or a negative declaration in connection with the project. The lead agency may only adopt a"negative declaration"when the initial study concludes that"there is no substantial evidence . . . that the project may have a significant effect on the environment"and further CEQA review is unnecessary. Cal. Pub.Res. Code § 21080(c)(1). CEQA applies only to "discretionary projects." Cal. Pub. Res. Code §§ 21080(a) and(b)(1); Guidelines § 15268(a). A discretionary project is one which requires the exercise of judgment or deliberation when the public agency or body decides to approve or disapprove a particular activity, as distinguished from situations where the public agency or body merely has to determine whether there has been conformity with applicable statutes, ordinances,or regulations." Guidelines § 15357. b. Fair Argment Test Requires an El . If the administrative record contains substantial evidence that any aspect of a project"may have a significant effect on the environment," the lead agency must prepare an EIR. Cal.Pub. Res. Code § 21100; Guidelines §§ 15002(f)(1), 15063(b)(1) and 15064(a)(1).10 Put another way, . . . if the lead agency is presented with a fair ar en that a prof ect may have a significant effect on the environment, the lead agency shall prepare an EIR even Lhgueh it may also be presented with other substantial evidence that the project will not half a significant effect. (No Oil, Inc. v. City of Los-Angeles, 13 Cal. 3d 68 (1974)). Guidelines§ 15064(g)(1).(emphasis added). See also Friends of"B" Street v. City of Ha Ward,, 106 Cal. App, 3d 988, 1002(1980). A trial court is entitled to independently review an agency's determination that there was no evidence upon which a fair argument could be made that an EIR was required. As the court stated in Friends of"B" Street,su ra: if there was substantial evidence that the proposed project might have a significant environmental impact, evidence to the contrary is not sufficient to support the decision to dispose with preparation of an EIR and adopt a Negative Declaration, because it could be `fairly argued' that the project might have a significant environmental 10 Professor Selmi pointed out that one of the reasons that courts are permitted to closely examine CEQA decisions is that public agencies"are subject to political pressure to avoid the full EIR process"which is certainly the case here. Selmi, ssRrra, at 227. Aug-07-2000 01:29PM From-Tuchman & Associates 2133850595 T-147 P.025/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 24 impact. Stated another way, if the trial court perceives substantial evidence that the praiect might have such an impact,but the Agency failed to secure preparation of the required EIR the Agencies action is to be set aside because the agency abused its discretion by failing to proceed ` in a manner required by law.' (Pub. Res. Code § 21168.5.) 106 Cal. 3d at 1002. (Emphasis added). Under the fair argument standard,deference to the lead agency's determination is not appropriate and its decision not to require an EIR can be upheld"only when there is no credible evidence to the contrary." Sierra Club v. County of Sonoma,6 Cal, App. 4'h 1307, 1317- 18 (1992). The fair argument standard requires the reviewing court to employ"a certain degree of independent review of the record, rather than the typical substantial evidence standard which usually results in great deference being given to the factual determinations of the agency." Quail Botanical.Gardens Foundation. Inc. v. City of Encinitas, 29 Cal. App. 411597, 1602 (1994). The Supreme Court has concluded that the interpretation of CEQA"which will afford the fullest possible protection to the environment is one which will impose a low i thresholds requirement for preparation of an EIR." No Oil, Inc. v City of Los Angeles at 84. Given the magnitude of the proposed development under the Specific Plan and the anticipated significant adverse environmental impacts associated with demolition and construction, the Specific Plan is a"project"under CEQA that will have a significant adverse impact on the environment. Therefore,the City and the Redevelopment Agency will half to prepare an EIR. 2. The Specific Plan Is a Project under CEQA. Public Resources Code section 21065 defines project as an"activity which may cause either the direct physical change in the environment, or a reasonably foreseeable indirect physical activity which is directly undertaken by any public agency." Cal. Pub. Res. Code § 21065; Guidelines § 15378(a); .ee a o, goleta Union School Pistrict v. Regents of the University of California,37 Cal. App. e 1029, 1030 (2d Dist. 1995). The enactment and amendment of zoning ordinances has been determined to be in activity undertaken by a public agency that are subject to CEQA. See City of Carmel-by-the-Sea v. BoaWof Supervisors 183 Cal. App. 3d 229(1986). Here,the Specific Plan is seeking and amendment to the zoning of the property from CG(General Commercial)and CG-FP2 (General Commercial -Flood Plain)to Specific Plan No. 13. Accordingly,the Specific Plan is a project for purposes of C$QA review. 3. 'l he City and the Redevelopment Agency Must Undertake CAA Review Before Proceeding_with the Adoption of the Specific Plan. Public agencies shall not undertake actions relating to a proposed public project that would have a significant adverse effect on the environment, or limit its choice of alterations Aug-07-2000 01 :29pm From—Tuchman & Associates 2133850595 T-147 P-026/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 25 or mitigation measures, before complying with CEQA. Guidelines § 15004(b)(2). Under this standard, agencies may not make a formal decision to proceed with use of a site without first completing the CEQA review. In the instant case, should the City approve the Specific Plan, or the Redevelopment Agency take any action based thereon, it will be in violation of the aforementioned provision of CEQA. The Specific Plan establishes a master development plan, including without limitation, planning concepts,design and architectural guidelines and other development standards for Huntington Center. There has been no review or analysis in accordance with CEQA of the impacts relating to, among other things, changes and limitations of uses, new permissible heights,utilities,traffic and circulation, and the effect of removing the site from the Flood Plain Overlay District. This and other analyses are all left to another day after the new standards under the Specific Plan are adopted. This will also preclude any consideration of alternatives. Moreover, once approved,any future development will only be subject to site plan review by the Planning Director, rather than a public hearing process before the Design Review Board, the Planning Commission and/or City Council. Furthermore,the Planning Director can even make amendments to the Specific Plan without any public notice or hearing if he determines they are "minor." Thus,by proposing to approve the Specific Plan before undertaking the appropriate and required environmental review,the City is essentially limiting its ability to have any fiuther decision-making authority in connection with the future development of Huntington Center. This is in violation of CEQA and is not allowed. 4. The Elements of Tiering Are Not Met. Tiering is a process provided for by the Legislature in order to allow agencies to avoid repetitiveness, wasted time, and unnecessary premature speculation. See Cal. Pub. Res. Code §§21065, 21093(a); Guidelines § 15152. To qualify for the use of tiering, leader projects must: (1)be consistent with the program, plan,policy,or ordinance for which an EIR has been prepared and certified; (2) be consistent with applicable local land-use plans and zoning of the city, county,or city and county in which the later project would be located; and(3)not trigger the need for a subsequent EIR. See Cal. Pub. Res. Code § 21094(b). In addition,before deciding that tiering may be used with respect to a later project, the lead agency must prepare an"initial study or other analysis"to assist it in determining whether the project may cause any significant impacts not analyzed in a prior EIR. See Cal. pub. Res. Code § 21094(b); Guidelines § 15152(f). Here,the City and/or Redevelopment Agency have not prepared an initial study to analyze the potential adverse environmental impacts of the Specific Plan. Accordingly, before Aug-07-2000 01 :30pm From-Tuchman & Associates 2133850595 T-14T P.027/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 26 the City can approve the Specific Plan,an initial study will have to be prepared. In fact, to date,there exists no complete or legally adequate environmental analysis of- (i) the proposed conceptual plans contemplated by the Specific PIan; (ii)the development of these specific acres or analysis of the proposed design and architectural guidelines; or(iii)a program of mitigation which if implemented would eliminate any and all potential for adverse environmental impacts. Thus,before any further action is taking on the Specific Plan,an initial study will half to be prepared and the proper environmental review under CEQA must be performed. 5. The City and the Redevelopment A eenncy Have Unlawfully"Split the Project for Purposes of Environmental Review As noted above, the term"project"has been broadly defined under CEQA. "Project"means"the whole of an action,which has the potential for resulting in a physical change in the environment,directly or indirectly. . . ."Guidelines § 15378(a). All phases of project planning,implementation and operation must be considered in the initial study for a project. Guidelines § 15063(a)(1). The term"project"refers to the activity which is being approved and which may be subject to several discretional approvals by governmental agencies. The term"project"does not mean each separate governmental approval. Guidelines § 15378(c).. Under CEQA,a project must be fully analyzed in a sib environmental document. In agency may not split a project into two or more segments with mutually exclusive environmental documents. Citizens Assn. for Sensible Development of Bishop Area v. County oflnyo, 172 Cal. App. 3d 151, 165 (1985). Similarly,an agency cannot overlook a project's cumulative impacts by separately focusing on isolated parts of the whole. See McQueen v. Beard of Directors,202 Cal. App. 3d 1136, 1144(1988). In Citizens Assn. for Sensible Development of Bishop Area, sue,a county split a shopping center project into two segments,the first part consisting of general plan amendments and zoning classifications, and the second part involving a tentative map approval and road abandonment. The public agency prepared a separate negative declaration for each project segment. Because the project applicant had requested related discretionary approvals at different times,the county had failed to understand that it was dealing with a single project. The court overturned the negative declarations and the project approvals,holding that an agency cannot prepare mutually exclusive environmental documents for a single project. Id,;at 165-67. The project description in a CEQA document must include: an analysis of the environmental effects of future expansion or other action if, (1)it is a reasonable foreseeable consequence of the initial Aui-07-2000 01;30pm From-Tuchman & Associates 2133850595 T-147 P-028/033 F-328 City Council of the City of Huntington Beach July 5, 2000 Page 27 project; and(2)the future expansion or action will be significant in that it will likely change the scope or nature of the initial project or its environmental effects. Laurel Heights I, supra, at 396. In Laud Hei hts I, the Regents proposed the relocation of a biomedical research facility to a portion of a building located in the residential neighborhood. The EIR for the project failed to analyze the cumulative impacts of the anticipated full use of the building as a biomedical facility within a few years. The California Supreme Court rejected the Regents' argument that,because the proposed expansion had not been formally approved,the EIR's analysis could be limited to the project in its initial form_ Evidence in the record indicated that, despite the lack of a formal approval,the Regents' ultimate plans were clear. Therefore, because the expansion was reasonably foreseeable,and was likely to change the scope or nature of the initial project or its environmental effects,the EIR should have discussed at least the general effects of the reasonably foreseeable future uses in the anticipated measures for mitigating those effects. Laurel HeightO supra,at 396-398. "The fact that precision may not be possible . . . does not mean that no analysis is required." id. at 399. Another case that illustrates this principle is Whitman v. Board of Supervisors, 88 Cal. App. 3d 397(1979). In Whitman.an EIR was prepared in connection with an application to drill an exploratory oil and gas well,which omitted discussion of a contemplated pipeline if the well proved productive. The court found the EIR inadequate and explained that"[t]he record before us reflects that the construction of the pipeline was, from the very beginning within the contemplation of[the] overall plan for the project and could have been discussed in the EIR in at least eneral to s."Id. at 414-15. (Emphasis added). Under the current circumstances,the Specific Plan suffers from the same problems that occurred in Laurel Heights l and Whitman. First,there has been absolutely no environmental analysis performed in connection with development requirements,permitted uses, location of uses and exemptions from City procedures and requirements and all other matters that are set forth in the Specific Plan. Second,any potential analysis,actions and mitigation measures that may be associated with the actual development of the property are deferred to another day. which is an attempt, like Citizens Assn. for Sensible Develo ment of BUpRArea,to split the general plan and zoning classification(i.e.,the Specific Plan)from subsequent required approvals(site plan review by the Planning Director, etc.). This is an egregious violation under the current circumstances because of the current attempts of the City and the Redevelopment Agency to say that the Specific Plan was covered by the very general General Plan EIR.. As a result,in accordance with CEQA,the City and the Redevelopment Agency need to properly prepare an EIR or other environmental document under CEQA prior to the approval of the Specific Plan. Aug-07-2000 01:31pm From—Tuchman & Associates 2133850595 T-147 P.029/033 F-328 �. City Council of the City of Huntington Beach July S, 2000 Page 28 6. The Adoption of the Specific Plan As Currently Contemplated Without Environmental Review Would Unlawfully Defer Environmental Review. CEQA requires that environmental review and the formulation of appropriate mitigation measures occur at the earliest feasible state in the planning process. See Cal. Pub. Res. Code § 21003,1. CEQA also provides that any proposed negative declaration should only be prepared for a project when"revisions in the project plans or proposals made by or agreed to by the applicant before the proposed negative declaration is released for public review would avoid the effects or mitigate the effects to a point where clearly no significant effect on the environment with occur . . . ."Cal. Pub. Res. Code § 21080(c)(2). The case of Sundstrom v. County of Mendocino, 202 Cal, App. 3d 296(1988), illustrates these principles. In Surf Strom,the public agency approved a use permit for a motel and restaurant that included a private sewage treatment plant. The initial study did not analyze the environmental impacts of the treatment plant,but instead required that the developer prepare. a hydrological study after the approval of the negative declaration. The study was to provide a basis for establishing additional mitigation measures for the project. The court held that the public agency violated CEQA by including a condition that contemplated revisions to the project after the final adoption of the negative declaration. The court further held that the deferral of environmental review for the treatment plant ran counter to CEQA policy,which required environmental review at the earliest feasible change in the planning process. The court also noted that any mitigation measures added by the administrative staff as a result of this study would be exempt from public scrutiny since the public agency had already approved the negative declaration. The entire Specific Plan and the procedures set forth therein are an unlawful deferral of environmental review. First,no initial study was prepared for the Specific Plan to analyze potential environmental impacts and mitigation measures incorporated into the project, since environmental review would only be done with site plan reviews by the Planning Director. As a result,neither the impacts nor the proposed conditions for the mitigation are analyzed, including those for or relating to uses,light,glare, noise,aesthetics,traffic and circulation, geotechnical,hazardous waste, air quality,parking,flooding,construction and utilities, and each are deferred to another da . This type of deferral of environmental review and mitigation is not permitted under CEQA or the Guidelines and forms yet another unlawful proposal that is a part of the HCA Response. Aug—OT-2000 01:31pm From-Tuchman & Associates 2133850595 T-14T P-030/033 F-328 City Council of the City of Huntington Beach July 5,2000 Page 29 7. The Adoption of the Specific Plan As Currently Contemplated without Environmental Review Will Result in an Unlawful Failure to Undertake a Cumulative Analysis of the Project's Environmental Impacts. And environmental document must discuss"cumulative impacts"when they are significant. Guidelines § 15130(a). However, even if the cumulative impact is not deemed significant, the document must explain the basis for the conclusion. Citizens to Preserve the Ojai V. County o Ventura, 176 Cal. App, 3d 421,429(1985). "Cumulative impacts"are defined under CEQA as two or more individual effects which, when considered together, are considerable or which compound or increase other environmental impacts. See Cal.Pub. Res. Code § 21083(b). By failing to prepare an Initial Study and undertake any environmental analysis under CEQA, there will be no analysis of potential"cumulative impacts,"which is not permitted under CEQA. III. CONCLUSION Considering the multitude of legal issues raised by the inadequately prepared Specific Plan and the unlawful acts undertaken by City administrators and officials,the City Council should reject the Specific Plan and require that the Redevelopment Agency work with Burlington, Montgomery Ward,and HCA in preparing and submitting a new Specific Plan that conforms to the Burlington Lease and established law. In the alternative,the City Council decision should be continued in order to consider the legal issues raised in this letter. Respectfully submitted, TUCWdAN&ASSOCIATES AVIV I..TUCHMAN Counsel for Burlington Coat Factory Aug-07-2000 01:31PM From-Tuchman & Associates 2133850595 T-14T P.031/033 F-328 A 1 a, i yr n.u lI 111'N k ,r,,. UN BEACH ACH Inter Office Communication 93 0 Planning Department ' TO: Howard Zelefsky, Director of planning FROM: Tom Livengood,Planr ng Commissione4 DATE; June 22, 2000 SUBJECE SPECIFIC PLAN 13-CROSSINGS The PIanning Commission deleted Exhibits 4A and 4B (Project Description— Statistical Summary)by straw vote: I believe the attached revision ofLxlubit aB provides a better description of the overall site square footage. New and existing construction is combined. The revised summary provides more flexibility and provides some protection for the three(3) existing anchor stores. This is a request for you to review this and include in the staff report to the City Council. The 4A summary was not acceptable. Only 80,000 square feet was allowed for existing anchors, Mervyn's store is 80,000,square feet, The message,no room for Burlington or Wards. Ti_,:kjl , • Attachment xc: Planning Commission Shirley Dettloff; City Council Member Scott Hess,Principal Planner Herb Fauland, Senior Planner Jame James, Associate Pknner- o vQl►nv 4ac ,r o 1 0 o Recommended charge by Commissioner Li vegnood to combine two categories and delete "To be demolished" 0 N ri T O 23 1 C S 9 Miter 100,000 Anaho s 6000 q 386,488 Ilerstt 343,556 Restaurmts ass 84,546 Addition toSftip Center 71380 177,800 SU"OTAL 100,000 386,488 656,227 84,546 1,100,640 N "rVp;VVV O) !J O NN1a• Aram gpWbulzow err appmxinw&and maychaW as ikepwica is demkpad Project Description N (statistical summry combining new construction and existing to remain) w T Exhibit 4B (3;.KIWVARDOCAD "031Am Aug-07-2000 01:32pm From-Tuchman & Associates 2133850595 T-147 P.033/033 F-328 =POM _!7'r CF :A. MW Ce— ?7 F;V 1F1. 714 374 1S40 U :wn- 97 2-M a! M C.4 j,nie CITY OF HUNTINGTON BEACH INTER-DEPARTMENT COMMUNICATION TO: Howard Ze3 hky, Dinaw ofPWming FROM: Ray Saver, City Admnai9r0or/P. *oW- a Director of dw Redwmdopment Agency Of the City of Huctiven HeacIl waP SUSIX": SPECWIC nAN MO, 13—8 NMGTON REACH MALT. PRORI!.R'T'Y DATT; Jug 5, 20M ,M mqui and bar the City of HuntiWn Seacb General Plan'adoption of a Spode Plan is rrc"ww y to cstablisb zeal:&and drokpuxa itat 4w*for the 63 We Huak%ton Cantor propcM. The Specitic Plata allows the my to attabiith unique dcx p and anhitacturol pida%m to govern R=m developmem of the site. Adopdm of The Spenafic Plan m*"pry of a z=q map amaWmi ttt and g tit aawodram. The Ea'alaw Compow is the prop wty owner of t1w m:#jQ&y of the site;while Montgouve y wards owns approumutaiy 13 arras, and Sow Caldbsais 8di W Cgmpwy mtsim awwwjbip beaaath the high tension wires on the north sidt of the p vpa%y. Although an Mpli a don Scar s zone chop was subbed by the Emslow C*q=Y on Mwrb 30,200Q it is="appropriate for the crY sad the R &vdopmmnt Agency to be des purled as artwai appfic tsbf for the proposal becawao the Specific fta is a city-add"d projeet. Tlmr+stoM tbW 1 1s n-p OW my dr ahwe, as City A 9WAstrntor sad Exeanive AiareCW of the Rad0d0p09W Agast,Y of the City of HtmwWott Sww, scrvo as app6ation adbwwatsoo Aw the proccawS of Zowg Map Amendama No. 00.01 sad Taming Two Amoubmw No. 004)2(Specific Plsm No 13). Please upd,ata the PU=uV Dep artm at raccrda to this dfaM j cc: Hauer"Maya and'City C"s a7 membW3 CaaarnIke= s David Bim Economic Oeveiap=aA Dhi=or own Haan,Hauamg and RadevvWpment MawtW Scoot#Iola► Proxipal Plaamw Harb Portland, Senior Plamw Jana Jews, Assocaata Pk mw f � r Connie Brockway, City Clerk City of Huntington Beach To la. Office of the City Clerk P.O. Box 190 AM, _Ci NQ i Huntington Beach, CA 92648 ' '<D I 107 881 38 48 j Craig 8,Janet Monroe INGTpp, 8182 Ingram Cir / %•w10++►,, BF9 Westminster CA 92683 ' V MONRI82 926533019 IN 14 07/31/00 _ - RETURN TO SENDER NO FORWARD ORDER ON FILE UNABLE TO FORWAR RETURN TO SENDERD CpUNTY �a` LEGAL NOTICE- PUBLIC HEARING i Connie Brockway, City Clerk ' City of Huntington Beach �U; \�GT°h 6 >,,,.to,r:;r.,t_ Office of the City Clerk P.O. Box 190 �� <' '1117'OJ . 1 Huntington Beach, CA 92648 .� 142 511 255 H & F PA TNERSHIP TINE 412 W L ers PI \ i o��QN�ro�,TQ,j, Orange A 92867 � v ti R :- 'J �Tc ;� UiCO `s. R w � TO TY 1qq_ MAWNOTIGE PUBLI HEARING J l.!J C=::�._. �..�:_ ' ' '!3 t U�;�:�t11? II111111�11!"IIt�11111tllllllllltllltlltl�ttllllllllltltll111 This Resolution Supersedes Res. No. 2000-68 RESOLUTION NO. 2 0 0 0—8 0 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH ADOPTING SPECIFIC PLAN NO. 13 TO CHANGE THE ZONING DESIGNATION ON REAL PROPERTY BOUNDED GENERALLY BY BEACH BOULEVARD, EDINGER AVENUE, CENTER AVENUE, AND THE SOUTHERN PACIFIC RAILROAD FROM GENERAL COMMERCIAL(CG) AND GENERAL COMMERCIAL-FLOOD PLAIN(CG-FP2) TO SPECIFIC PLAN NO. 13 (THE CROSSINGS AT HUNTINGTON BEACH SPECIFIC PLAN) WHEREAS,pursuant to the State Planning and Zoning Law, the Huntington Beach Planning Commission and Huntington Beach City Council have held separate public hearings relative to Specific Plan No. 13, wherein both bodies have carefully considered all information presented at said hearings, and after due consideration of the findings and recommendations of the Planning Commission and all evidence presented to said City Council, the City Council finds that such zoning map amendment and zoning text amendment is proper and consistent with the General plan. NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby resolve as follows: 1. The Crossings at Huntington Beach Specific Plan No. 13, attached hereto as Exhibit A and incorporated by this reference as though fully set forth herein, is hereby adopted and approved. 2. That the real property generally described as bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad and more particularly described in the legal description and sketch collectively attached hereto as Exhibit B and incorporated by this reference as though fully set forth herein, is hereby changed from General Commercial (CG) and General Commercial-Flood Plain (CG-FP2) to Specific Plan No. 13 (The Crossings at Huntington Beach Specific Plan.) Mayor ATTEST: APPROVED AS TO FORM: City Clerk l a-I I o o f--City Attorney ?-j REVIEWED AND APPROVED: INITIATED AND APPROVED: JA 444 4K , - //C6 City A inistrator Director of P1 g 44/s:4-2009 Resolutions:Crossings at H.B. 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T' n rf"' tl r.ice t "rt!'b""^.' � ;�,3..^ ,Ir u.�,.t f l{��,.YJ{ 11,..:,',I r' r 3 .,. '.'D'ictr, `P+.lriv'Ilf.•.,yr i� i • 1 r Yd} 7Ily� �}tl.y,' { •y,j `� l t <�t.1... at Yr,I / '!-f'.uh i 3 �. / ^ -•.rye' .r,. '. t � T It YM" � tl 1, '• ,,. -•.k. s ...r t ,. 9 i 1 M Y � .+11M•.. ,.ird"w�+ �Hlimn{r eai' ". '"' ': yr{ rl n.^ t r /' � ; ` , �v F;° f�:',,� ., s�:• ���"�.wi„�,�,T,�. .: � ::r, irt3..>�.�i'rii:+t r:. ir.. 11 l ' 1 r r ,� .a:' ����� ..v �� •'�+. rL4;;�..Y r�} tnt;:N"•y'1S+ ,. ._ ., � ::�,,,ty,,.+.v. I';«."`M/f.•,.Y!!. t I :�'I 1 'M. 0 ` :" l y�� a •"^'r{G'rgo-rr'y�i ^��, 1��JnTI Y! t> i:.. t I }ti ti a? fr F l � r I r '•t 1 S I ii j �`1� 31r 4��'} ♦ ". ¢t t ' '..i r ~� � �'0j..,,�„'t r t , . :. .i.. • yr 7 r '! } 6 t ";:: The Crossing Huntin Crossings at ton Beach g City of Huntington Beach SPECIFIC PLAN NO . 1� 3 Prepared by City of Huntington Beach Planning Department Huntington Associates LLC. with Greenberg Farrow Architects EDAW y' Richard Sawyer : 0 c 0 a y c� N fD �pq N ;0 x N �y Adopted July 5, 2000—Resolution No. 2000-68 0 0 N N O O Reconsidered and Modified August 7, 2000—Resolution No. 2000-80 w o TABLE OF CONTENTS 1. INTRODUCTION 3. DEVELOPMENT CONCEPT 1.0 Purpose and Intent 6 3.0 General Development Plan 23 1.1 Authority and Procedures 6 3.1 Regional Commercial Uses 25 1.2 Scope and Format 7 3.2 Pedestrian Plaza and Walkways 28 1.3 Project Area Description 9 3.3 Circulation Plan 33 1.4 General Plan Designation 11 3.4 Public Facilities 35 1.5 Zoning Provisions . 12 3.5 Design Guidelines 42 1.6 State Mandated Requirements 12 3.5.1 Project Area Character 42 3.5.2 Site Planning Guidelines 42 2. IMPLEMENTATION 3.5.3 Common Area Guidelines 45 3.5.4 Architectural Guidelines 54 2.0 Administration 15 3.5.5 Landscape Guidelines 65 2.1 Development Phasing Plan 15 3.5.6 Signage Guidelines 70 2.2 Methods and Procedures 15 2.3 Site Plan Review 16 4. DEVELOPMENT REGULATIONS 2.4 Parcel Maps 17 2.5 Reuse/Change of Use Review 18 4. Purpose 72 2.6 Environmental Determination 18 4.1 General Provisions 72 2.7 Request for Deviation 18 4.2 Definitions 72 2.8 Specific Plan Amendment 19 4.3 Development Standards 74 2.9 Severability 19 4.3.1 Permitted Uses 74 4.3.2 Intensity 74 y 4.3.3 Building Height 74 N 4.3.4 Setbacks 74 ; 4.3.5 Landscaping 74 0 4.3.6 Signs 74 4.3.7 Lighting 74 4.3.8 Parking 78 c 4.3.9 Parking Structures 79 4.3.10 Drive-Through Bakery 79 y (n N OO N N O O O O O O c► bo ' Op O APPENDICES (Volume Two) A— Legal Description B— General Plan Consistency C—Sign Standards List of Exhibits Exhibit 1 Vicinity Maps 9 Exhibit 2 Aerial Photograph 10 Exhibit 3A Illustrative Conceptual Master Plan 21 Exhibit 3B Illustrative Conceptual Master Plan 22 Exhibit 4A Pedestrian Plaza/Walkways Plan 26 Exhibit 413 Pedestrian Plaza/Walkways Plan 27 Exhibit 5A Circulation Plan 29 Exhibit 5A Circulation Plan 30 Exhibit 5B 'Circulation Plan 31 Exhibit 513 Circulation Plan 32 Exhibit 6A Common Area Locations 45 Exhibit 6B Common Area Locations 46 Exhibit 7 Color and Materials of Common Areas 50-51 Exhibit 8 Typical Tenant Storefront 58 Exhibit 9A Landscape Concept Plan 63 Exhibit 913 . Landscape Concept Plan 64 Exhibit 10 Plant Materials Palette 67 Exhibit 11A Permitted Uses Chart 75 Exhibit 11 B Temporary and Seasonal Events Chart 76 Exhibit 12 Development Regulations Chart 77 Exhibit 13 Parking Standards and Details 78 Exhibit 14 Development Regulations Check List 80 ti a y fp N ID �N OO oo � The Crossings at Huntington Beach Specific Plan 4 � o August 7, 2000 D I • CTION U r �r ii �'� r•t i :•'f er r, its:. _t,...l i.'! •i > ;t 4ix:,%l'',vk V rl,`kf �:�:'(r�'� R,4�?5.�. :'.:�"�'`.' �11 �.•. �� A� C�' �51. -}La. tSt'ik^AFi 7::�rc'(rn�L� �` � a(„ 11,,�;Fft� ; � 1'�A.1M�,�`s „t.,p: �� � •'�pr'�w;_ ;'.ir..., a ,li"r ,,t .St '.i �'t• tit.•,Jii.r':^;:�.'r��,..�r t Ir^ AJ,1til•y,�>,3 1 ,tip` F ':��Ii��Tal� I �:'°tjJi",`�,' ��S:i;,,a' ��` ,:.:_.,r.. 4xix:l" • „'} ;,S�> ,R,. r. .;7�at;,` ,f.y{)'. f�,. �. ,; .... . 'r,';•. �, '�'�vi+.i :•f:;,pl,'P'. 4.h.,,Y co 06 T.':':t ..f. !i7+; ^�.:':I..,'ir'.�, CL•i ,���1yr uY.�r���r �! ' rt� r.?i'' Vl " i�•i;:'r�a�C ':i)i ;�y�t4' ��� •C sr;�.,..'a"g �t�F �i 'a' 'r�',.`tf°���., t!'.,i``. .+e-s,r,��� a�• •t.�:r a �... '{, L. t �i.. � ran:•, '','k",tyt•� '`�• � 4. ''^rti_71h1}:° '� + ��,:�'".:�:' ", ;r I�',�ts�.'r'� 15� a�;i� ;�,: 3; i'�'J''>u. �paP.,; �"�•y., ;'c r't10 ?Yi Z"^ t.i.�:,,,;. l;��?tj.� � .1 � r., �:j,�„4 si.y„i a..r t ;.j•d�• � O '.�'.,Yf)) r: �!f�r�l�: ,9d1.� F �i � yj�M( �''ihL� �•../a� f�\i!:i�r,�' :c�ff.'"t::' ';irri Li - - 'r p� ,...Jy: �:•:,... �� �, .,5. _ �y �-;��5.:: 'i,J��lti�'p*� �ly,,.;r� }' '•F��.::;i -+.i�-1 a.. ��.. .:r..., wTglSi':"�! S�,'�.'i'J 3y;A' �i�t;..:Y•.,v{�1t4, :}1�i;t�i�: � ''ice^> 7•'f"�, ,�� ;',rf�. .•,'`I t.1k;<�� rJ�i,�j'.�t � .� ". •r li. 's4•�J}-:•aJ,1�,F.:t�" 8.7.it.e±.y fD';�i^.,M�,A�- 'S`:.r... � �S.aY� d.... t,"Y:-�..•:�• +, ,�yyrSY�L ,ir'Y�4` +• �.F: -�'4:�.•._ t.�,�'.:: Q' ..5�: ►w..� Ii Z��. j1k�•'iS :')"'i��/r di�,, ,_;4��.��`• ^SI:�':'3's �:�; +.�_^ :�� w 1{t:.. .1y�...fi.Y a'�S`nL`!t,l•� �Tn fD fD F:pt�•;.�;'��i:1Y ttY;xYsa �:,;�S'��Sti Y��;�. t+4`�d to N igf.,:f•c 4:s:.i_��`5 .ti-'- �;i:ey�i:t � y .F i N N O O O O The Crossings at Huntington Beach Specific Plan 5 o August 7, 2000 INTRODUCTION . report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public 1.0 PURPOSE AND INTENT Resource Code Section 21083.3 The Crossings at Huntington Beach Specific Plan is currently exempt The Crossings at Huntington Beach Specific• Plan from preparation of an environmental assessment establishes the planning concept, design theme, until a site plan is submitted for approval by the City. development regulations and administrative Therefore, it would be "speculative" to provide an procedures necessary to achieve an orderly and assessment of impacts peculiar to the project. Once a compatible development of the project area, and to site plan is approved, an environmental assessment implement the goals, policies and objectives of the will be performed by the City of Huntington Beach, Huntington Beach General Plan. The intent is to and site plan mitigations will be applied to the project, establish a visitor serving, regional-commercial as necessary. shopping setting and achieve a high quality in retail and entertainment design. 1.1 AUTHORTI'Y AND PROCEDURE The Crossings at Huntington Beach Specific Plan The State of California requires that all cities and identifies the location, character and intensities for a counties prepare and adopt a comprehensive General regional commercial complex. The Specific Plan Plan for the physical development of their area of creates a compatible design theme for the project area jurisdiction. and establishes the development regulations necessary to accomplish the identified objectives. Following the adoption of the General Plan, the entity is required to develop and adopt regulating programs The Specific Plan is regulatory in nature and serves as (zoning and subdivision ordinances, building and zoning for The Crossings at Huntington Beach. housing codes, and other regulations), which will a Subsequent development plans, Parcel Maps and other implement the policies described in the General Plan. N' entitlement requests for the project area must be consistent with both the Specific Plan and the California State law authorizes cities with complete Huntington Beach General Plan. According to Public General Plans to prepare and adopt Specific Plans c Resources Code Section 21083.3(b), "If a development (Government Code Sections 65450 et. seq.). Specific ca project is consistent with the general plan of a local Plans are intended to be a bridge between the local agency and an environmental impact report was General Plan and individual development proposals. y certified with respect to that general plan, the Specific Plans contain both planning policies and a application of this division [CEQAI to the approval of regulations, and may combine zoning regulations, that development project shall be limited to effects on capital improvement programs, detailed development the environment which are peculiar to the parcel or standards and other regulatory methods into one ' to the project and which were not addressed as 0 o significant effects in the prior environmental impact o 0 The Crossings at Huntington Beach Specific Plan 6 Q Mo August 7, 2000 I document which can be tailored to meet the needs of a California Government Code, Title 7, Division 1, specific area. Chapter 3,Article 8,Sections 65450 through 65457. Local planning agencies or their legislative bodies may The Huntington Beach General Plan was adopted by designate areas within their jurisdictions as ones for the City Council on May 13, 1996. The General Plan which a Specific Plan is "necessary or convenient" designates the project area as Regional Commercial. (Government Code Section 65451). The Crossings at Huntington Beach Specific Plan is consistent with the 'goals and policies of the A Specific Plan may either be adopted by ordinance or Huntington Beach General Plan. resolution (Government Code Section 65507). Should the legislative body wish to change a proposed Specific 1.2 SCOPE AND FORMAT Plan recommended by the Planning Commission, the change must first be referred back to the Commission The Crossings at Huntington Beach Specific Plan is for consideration, if not previously considered divided into four sequential sections. Section One is (Government Code Section 65504). the Introduction and describes the purpose and intent of the document along with a brief explanation of Adoption or amendment of a Specific Plan constitutes Specific Plan procedures and authorization. a project under the California Environmental Quality Act (CEQA) and the State's Environmental Impact Section One also presents the Project Area Description Report (EIR) guidelines. If the initial environmental and is intended to establish the reasons why the review shows that the proposed or amended plan Specific Plan process is logical and necessary for this could significantly affect the environment, the portion of the City. This section presents a general jurisdiction must prepare an EIR and submit it in draft description of the Specific Plan area; special form for public review. The need for an EIR in a characteristics and existing conditions which make particular case is determined by the local government. this area unique have been identified. y In this case, since an EIR has been prepared for the Zr City's adopted General Plan and the Specific Plan is Section Two presents the Implementation process and �0 included within the umbrella of the General Plan and discusses how individual projects and tenant o associated Certified EIR, the environmental assessment improvements will be reviewed and approved. This c (to be completed at the site plan review/approval section outlines the project approval procedures and o stage) for The Crossings at Huntington Beach Specific describes the process for project appeals and the Plan will be limited to the effects peculiar to the methods by which the Specific Plan can be modified or project (Public Resources Code Section 21083.3(b)). amended. Q y The preparation, adoption and implementation of The Section Three describes the Development Concept. The ;A Crossings at Huntington Beach Specific Plan by the design concept evolves from the objectives identified y y City of Huntington Beach is authorized by the and existing conditions discussed in Section One. This o 0 IV N O CD The Crossings at Huntington Beach Specific Plan 7 4 � o August 7, 2000 section also presents the circulation, public facilities, infrastructure and landscaping which will support the development concept and reinforce the design theme. Section Three also includes the Design Guidelines. This section identifies and describes the intended character ' for the area and provides a framework for project implementation. Section Four establishes the Development Regulations for the Specific Plan area and for individual project development. Section Four presents a detailed description of the Development Standards which are necessary to guide and control new projects and carry out the goals and policies of the Specific Plan and the City's,General Plan. V1ewoPRolnano' fnoni EdingerAvenue An Appendix (printed under separate cover) contains �'� ; .• " all the special studies and reports which have contributed to the formation of the Specific Plan. The Appendix (Volume Two) includes the Legal ' Description of the site, a General Plan Consistency Analysis, identifies the Mitigation Measures and p Conditions of Approval desired in the Environmental Analysis and includes the proposed Sign Standards. 4 'n ..r•-,.;,s�,s..,=.,W:.�✓�.�n. n°.a���a.r� �'`°t '.:+•Y -'4 •_f:Y` ..R. ',��� a 4`.'0.,`..:d�?.�`.".:,!.5.y+:::.i+3e•._. W%1k l�Eih'?IiiA,4',tCrfE�Y!t4�^:ii.^�•�:laJf.r:r..,x.,.r,,•,., ,r. , .r'`:, ,,..�c.. "!�i.'isb,SV'�'�7rin^`"',, .v.` .: 'SYi., .iS•cr..;^n'•' .,:t., � �'?` F wj .j, :x f 4FYrf a !i«.i�"ki"•C.S �, 4 ,.u';r !hw"��J'.siwlsu.t...w...:�"....��tt+!.., ;.c.3:..,: .. .1..�.Mil....}r.;.)r•.',..,'.•4.y..l4fi".'u-4aidatia.ri. X The view of The Crossings at Huntington Beach from Center Avenue 0 0 N N O O The Crossings at Huntington Beach Specific Plan 8 cao August 7, 2000 D 1.3 PROJECT AREA DESCRIPTION •PASADENA , The Crossings at Huntington Beach Specific Plan LOS ANGELES covers 63 acres located in the northern portion of the SANTA City of Huntington Beach. The area is generally MONICA bounded on the north by Center Avenue, on the east by Beach Boulevard, on the south by Edinger Avenue, LOS and on the west by Southern Pacific railroad right-of- INTERNGAETI0MAL AIRPORT way' LONG o, TORRANCE BEACH ANAHEIM A legal description of properties in the Specific Plan AIRPORT GARDEN • GROVE project area has been included in the Appendix. +LONG n BEAC SANTA• LONG BEACW� A LOS ANGELES HARBOR SITE. IRVIN HUNTINGTON BEACH 1L Regional Location Solsa Ave. /- S/� 6 The project area is surrounded by a variety of land tm uses and activities. The San Diego Freeway (405) and McFadden Ave. ! an office retail complex create the northern boundary. 64 Golden To the south, office and retail uses are located across t`n' we:l °•"a,A.. Edinger Avenue. To the east, commercial uses are College located across Beach Boulevard. To the west, is the o a Southern Pacific Railroad Line. The property across c from the rail line is designated commercial: Edinger m The Crossings Cl) o $o at Huntington �p 0 Beach fn Vicinity AUPS y. Exhibit 1 Site Location o 0 N N O O The Crossings at Huntington Beach Specific Plan 9 00 Go o August 7, 2000 •� F• �� a � .� 9 t�: k � j"e.. `� ".w _13LJr04-:�1...(,:::,,.._. t ;Jib.. � I I :Ti i � � Y►i dl _ ;��}ry. ,.. r,,. ec+r,.t� .:.�'.s�l,'(�4' � • =; r v,x.,,1!;,T1l,.�'�=� 1�C ',� w ' ,, � ••: � �.}, --fir, �liUr/9e: ill I �.Rl�•'M�1..MT{l1wf 'I,-,:.; - rr '.n.:,:/1`. fi i .�.�.,,v .+rv....4au «i.+..:.,d.e.n..-...-��w 'Kc,; •'4yv., �, �`•fi� � "'� ., i'*,'v. ` IJy.A° ,i..4-�r,r• � 7 � 1' /ti�.`�lI.'NV c h;y:` iy' ��....� \� 1"'4tr.• � 'Z f:�,, Ir •�` +: 1, '';Se.:;.,:'. 1t "3+'Z ASJ I. • >f jrr T? Z� ., � +.,�.y�. TI%1 1i:.•, 'w':,. •^.' .� ��:�. �:Y 'r�. Ilr� _. '}i:: yY 71 � ! •� r�.�:;r k� ,.Vs':.;f vr',a.''� ,�•i; -1 Il� 'rr• •1 t±^:�:2.'d'. �?a. � �.�ty 'S '�$. L.�� 3 �S °i'.' :\ �;,:k. 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B.�.yr, '1, A1, �.'/J• >r., tpa,d► '� Yi'ej r'1� 1a i`/ ..r: :.� ,.r•'+o �..1. ..1'1 ',i. y ;t •.v ",' O` •,f.%�::1 ••}.:Ira „/..,r i" "S'Y i i"�,." j A i `.� .i{,' fiF: ��.• ' c"1,2' i; a'::r':".• iii4ff44t ', �•:` girl � +; �f:� :�':: ?7i•�;"'�. �{� I, �;F I: rl �•' q�+,.��yN�^y,��sit:� �/� 'rjn" `i i f+ �I -,�y .,y,. t',' ;���. :i` ,.,�.. 1,� is ;lx, 'L n,`+;�'.. �l�ri:�' .i,� � i„ .�/,.�.r T" t� -.'ri.�'G �a �:'. :��j���•�.1': :�;�; i �t, { {Yiy {��,1 1 ,T17 Y, r1x.-r' p +�•y .� , Z� .:f. 1, ,a:,.:f.. ?' J' ir ,, J 2.�� r.17, 1. I:, a'' ISw /> f. ,51a;: \r:;•�, ul�: rF, _ "p �/.{: •. ',rf=r,. �' i3'::, :;s_ !s3.�• i..f '�'', �ij.' r i/+ •: }. �,,,., .a'� 1:i%' '�y�' ., :•.�.,y .. '' '11M"•'� r. .1 r i '9 p.i, r' ,t r�4a•„ i •!.. R': [� `I 7." il�ll, �y $ '�;' I _ `�i,. :,`ni?•t;�r e .r ,.f. ::t 1e,'a`7.' t d .4 � 4 � _ � ?. a3; �y:!: ',fi 'S:°;t•... zy pr � :tp 5 :tit',. ��t c. r .�i, I 1 '� .4� NI-., �+�,' 1� f ••..,.�,o�.. ':'f °.i /<:.�;.�:.J�:, if".i t .rr ,�= � r,.,;,i�r" ;, s� �� �L� .�„ .rt;• �;•:.. .:_:l ;r.0 .a. r. .FF' .tF• :6�� �: !L:• k;(.::.``i- .P ,f h,>�';�'.' �Y; ,.�+ i4 .`Fr:.,... �'i � 'rF •��:.� f;. ;tsi, r� 4 "fir+.: :1 rr A1.;.. i; ' 7 : 1..,•. f, _ •"�S;r�` .ry..,'•��I�'.i/ 1,, '� ,�:7'�1�r. �1t1'� t7:f�' 'i.+::' � :�y i �'v •�'' V� �' i._..� .J 7�.%F -4. •d„ 1q, rt c.' :Li.1.�l,�i{�,�r,';;� { 4,� .i f i1� •��1.'k,Y.•. :•T r:�1���r1'� �"�''�- �1''1i:t. :M.,�•.��.,i�,,� �Y<!,3 3..r �� y,�,i' :'{fi.' .rt i7'•4, 1:' {,�\.•" 4+�d /.4 ..1rrrt:. •J• y� -.�,rtti *r-r! fl f. it' ii '7"�-''':,•Y.t�l* ',i! �,s :t;'+Y�t;Y' d'S��'w��'��>�rr r +...-......�.:, __ yif���11�,•r'."r7.•'.f;:'� ���!'_': i°\:i:,t .. -+k•`i'1��+�'"1 i��rjr;,`:�,.�w..k wr' i' -f�ri J ^� i S' ,� ,r•�: �, r, r, �+S.,x..a 7 1� ::..ter-':: jr�f.:jtir yv�:i':/:'.:,'1jF%'Y IT .f:• +YlyAir ..'1r%7'..;t ti��'�' ./ ���fy����� %,':J�.N .i'Y a(�1 � 'iiRr, .,jf'^ t�.{Mr1�Qi'�:�i �..,.. �m Q! .1�' ..-... »• - 1`l. I n �y J •�/ .�1 A�'r t' r ,!k '� r 'i i � ti.r i JA• 'y,a'`{��1• � .i Ir �} � l ��•w �i,J� spat 0 ' c ct `o' y Aerial Photograph N Q 1997 Aerial Photograph AM Exhibit 2 :o N N O O O O The Crossings at Huntington Beach Specific Plan 10 0, 6 August 7, 2000 1.4 GENERAL PLAN DESIGNATION The entire Crossings at Huntington Beach is currently c. Siting of a portion of the buildings in designated as CR-F2-SP-MU(F9)-Commercial Regional proximity to their primary street frontage - 0.5 FAR-Specific Plan Overlay-Mixed Use Overlay- to convey a visual relationship to the street 1.5 (MU-0.5 (C)/25du/acre in the City's General and sidewalks; Plan. The site has been designated for commercial land uses since the mid 1960s. The commercial regional c. Design of the exterior periphery of the designation anticipates anchor department stores, structures to contain shops, restaurants, promotional retail, restaurants, entertainment, and display windows, and other elements that similar region-serving uses. The site has been provide visual interest to parking area and designated within General Plan Subarea 5A requiring the street elevation; that a Specific Plan with special regulations and standards be established for "Huntington Center." The d. Inclusion of a "public square" as a following Design and Development policies are gathering place of public activity in multi- described in the General Plan for the.mall property: tenant regional centers; Design and Development e. Clear identification of building entrances; LU 10.1.15 f. Use of landscaping that provides a three- Require that regional commercial developments be dimensional character; designed to convey the visual sense of an integrated center by consideration of the following principles: g. Encourage the provision of public art; a. Use of multiple building volumes and h. Inclusion of consistent and well-designed y masses and highly articulated facades to signage integrated with the building's Dil reduce the visual sense of large scale architectural character; including "boxes"; pedestrian-oriented signage;and c b. Use of roofline of height variations to i. Design of parking structures to be visually y visually differentiate the building massing integrated with the commercial buildings. and incorporation of recesses and setbacks (I-LU 1, 1-LU 4, I-LU 5, 1-LU 7, 1-LU10 and on .any elevation above the second floor 1-LU 13) E above grade; : X fD N z Z O O N N O O O O The Crossings at Huntington Beach Specific Plan 11 coo August 7, 2000 1.5 ZONING PROVISIONS i The Crossings at Huntington Beach is presently zoned ra -ii, R' " u : General Commercial ("CG") to accommodate a.full r9. �'"-•,, •:' a',�I',' range of retail and service businesses. The site is also t:,,:. E:•:.ri' ;t;;;f:;;':"- �`� ai'';, r; e merged Redevelopment within a sub-area of the Project Areas. The adoption of this Specific Plan will i supersede the existing zoning and establish a new set of development regulations. urn r♦.,., . The Crossings at Huntington Beach site currently consists of a number of activities. The site contains ,,, �--- approximately 960,000 square feet of retail commercial space, some of which is currently ?y unoccupied. This site has been developed in numerous �', n i .Ly♦•`7 r ,,. _ ���:--;�: ��;: '���s phases over the past 3 ears. t p o e p s 0 y Curren market pressures and extent of adjacent competing retail View of StrirGucks and Barnes R Noble from Center Avenue activities are driving the need to develop a new exciting commercial center for the City. 1.6 STATE MANDATED REQUIREMENTS To comply with the State of California legislated mandates, the City of Huntington Beach has adopted a several plans to deal with regional issues including Air Quality, Congestion Management, Growth ��pp maw Management and Transportation Demand Management Plans. All development within the o .; Specific Plan area shall comply with the applicable ' p p Y . pp y provisions of the following plans: N N Z Z View o!'Mervyn:Ffrom Center Avenue o 0 N N O O O O The Crossings at Huntington Beach Specific Plan 126) 16 aD o August 7, 2000 South Coast Air Quality Management Plan The South Coast Air Quality Management, Plan program, and a capital improvements program for (AQMP) requires measures to reduce traffic traffic and transit. congestion, improve air quality, and requires that cities develop Air Quality components within their Growth Management Plan General Plans. These measures include Regulation XV, a program which requires employers of more than one A Growth Management Plan (GMP) is required to hundred (100) persons to prepare trip reduction implement the passage of Orange County Measure M plans, and a requirement for jurisdictions to prepare approved in the 1990 election. Its purpose is to ensure an air quality component in the General Plan. that the planning, management, and implementation of traffic improvements and public facilities are The City of Huntington Beach is subject to all local adequate to meet current and projected needs. The jurisdiction requirements set forth by the AQMP. The City has an approved Growth Management Element, City has adopted an Air Quality Element and which meets the requirements for Measure M Transportation Demand Management Ordinance, funding, and an adopted Transportation Demand which incorporates AQMP measures. Management Ordinance. Congestion Management Plan Transportation Demand Management The Congestion Management Plan (CMP) is required Transportation Demand Management (TDM) by Assembly Bill 471 (Proposition 111), subsequently measures are generally directed at increasing auto modified by Assembly Bill 1791. This Bill requires occupancy, decreasing peak hour usage, and every urbanized county to adopt a CMP; the County of managing demand for transportation facilities. The y' Orange has prepared a CMP which includes the City City's TDM Ordinance is part of its compliance with of Huntington Beach. The CMP requires mitigation of the Growth Management Plan. Development owners, traffic impacts of development, as well as trip operators and tenants will be required to implement c reduction programs. The City of Huntington Beach has the City's TDM Ordinance. completed the mandated components of the CMP including level of service standards, trip reduction y Q y . CD M 4�1 N OO N N O O The Crossings at Huntington Beach Specific Plan 13 o, o August 7, 2000 Fl,2114 7M,- 1R N774 ■ M 701 ; .......... Fum,gnu P, Ila io, IMPLEMENTATION 2.0 ADMINISTRATION The City's Planning Director shall administer the Text Amendment and action by the Planning provisions of the Crossings at Huntington Beach Commission and City Council. Specific Plan in accordance with the State of California Government Code, Subdivision Map Act, the 2.1 DEVELOPMENT CONSTRUCTION PHASING Huntington 'Beach Municipal Code, and the City's PLAN General Plan. The Specific Plan development procedures, The proposed Specific Plan project is anticipated to occur in one (1) phase. The existing Village Retail regulations, standards and specifications shall (Barnes & Noble, Staples, and Circuit City) and any supersede the relevant provisions of the City's Zoning remaining Department Stores (such as, Burlington Code (Huntington Beach Zoning and Subdivision Coat Factory, Montgomery Wards, or Mervyns) will Ordinance) as they currently exist or may be amended receive major exterior renovation, new enhanced in the future. Any development regulation and paving, and landscaping. The demolition, building requirement not addressed in the Specific infrastructure and utility work of the new Plan shall be subject to the City's adopted regulations construction,will be scheduled and built such that the in place at the time of an individual request. remaining center remains in operation with minimum The Specific Plan may be amended. The Planning inconvenience to the remaining tenants. Construction Director shall have the discretion to determine if is anticipated to take 18-24 months from start ofdemolition. requests for modification to the Specific Plan are minor or major. 2.2 METHODS AND PROCEDURES y Minor modification is a simple amendment to the exhibits and /or text which does not change the The methods and procedures for implementation of e the Specific Plan shall be on a project by project basis. meaning or intent of the Specific Plan. Minor o The adoption of the Specific Plan alone will not modifications may be accomplished administratively require infrastructure improvements to the project c by the Director with a report to the Planning area. Physical improvements will only coincide with cD Commission. Major modifications are amendments to the commencement of the first project and approval of Q the exhibits and/or text which are intended to change a Site Plan Review. The Specific Plan is a regulatory y the meaning or intent of the Development Concept, document and is not intended to be a Development X Design Guidelines,or Development Regulations. Major Agreement. y y modifications require a Zoning o 0 N N The Crossings at Huntington Beach Specific Plan 15 00 coo August 7, 2000 2.3 SITE PLAN REVIEW All new projects within the Crossings at Huntington this service shall be established by a separate Beach Specific Plan project area shall be implemented resolution of the City Council. through a Site Plan Review process. A Site Plan Review shall be required for all new development activity, The Planning Director has the authority to approve, with the exception of interior improvements, general conditionally approve, or deny a Site Plan Review. A maintenance and repair or other minor construction Site Plan Review application may also require analysis activities that do not result in an intensification of the and comments from various departments of the City. use. These exceptions may be subject to other Building In order to approve a Site Plan Review application, the and Public Works permits and approvals prior to Planning Director shall make the following findings: commencement. • The request is consistent with the City's Application to the City for a Site Plan Review shall General Plan and all applicable requirements include a narrative of the proposed activity along with of the Municipal Code;and preliminary development plans and drawings. The narrative shall consist of a project description The requested activity will not be detrimental identifying the intended services offered with square to the general welfare of persons working or feet, hours and days of operation, number of residing in the vicinity nor detrimental to the employees, and other information as appropriate. value of the property and improvements in the Supplemental to the application submission, project neighborhood;and plans shall be prepared including the following preliminary plans: site plan, floor plans, elevations, The requested activity will not adversely affect landscaping,grading, fencing and signage plans; other the Circulation Plan;and plans may be required depending on the complexity of y the project. The entire parcel shall be plotted with The requested activity will comply with the y dimensions and all pertinent data and include provisions of the Crossings at Huntington a dimensions to the nearest intersecting public street Beach Specific Plan and other applicable o and identify all street names. In addition, all existing regulations or special conditions required of ir and proposed physical features and structures on the the project. subject property and abutting properties shall be CO plotted. The action of the Planning Director shall be final unless appealed to the Planning Commission by the The application shall also include a legal description of applicant submitting a Site Plan Review application y the property, identification of the uses for each room within ten calendar days of action. Such Appeals for a ;0 ; on the floor plans and a list of all the building Site Plan Review shall be subject to the procedures y materials and exterior colors. An application fee for outlined in the City's Zoning and Subdivision o 0 Ordinance. 00 The Crossings at Huntington Beach Specific Plan 16 ao 0 August 7, 2000 • The proposed Tentative Map is A Site Plan Review approval shall be valid for a period consistent with the General Plan, of one year. Additional -one year extensions may be Specific Plan, and all other applicable requested for a maximum of two years. Such an provisions of the City's adopted codes extension request must be made in writing by the and regulations;and original applicant, property owners, and/or authorized designee,.a minimum of thirty days prior to . The site is physically suitable for the the expiration of the current approval. If construction type and density of development activity does not commence within the approval or proposed;and extension period,the entitlement shall be terminated. All final decisions on site plan review proposals shall • The design of the subdivision or the be the responsibility of the Planning Director. proposed improvements will not cause serious health problems or substantial 2.4 PARCEL MAPS environmental damage or substantially and avoidably injure fish or wildlife or The project area may be subdivided through a Parcel their habitat;and Map process. Parcel Maps shall be prepared . The design of the subdivision or the consistent with the Mater Plan Concept to facilitate type of improvement will not conflict development. These maps shall identify the . with easements acquired by the public infrastructure and improvements necessary to at large, for access through or use of, support the anticipated projects, subject to review by property within the proposed the City's Public Works and Fire Departments. subdivision unless alternative Upon recordation, Parcel Maps may be further easements, for access or for use, will be y divided and/or adjusted by filing a subsequent provided. y Parcel Map or a Lot Line Adjustment, pursuant to the provisions of the Subdivision Map Act. A o Tentative and Parcel Map may be approved, or M conditionally approved by the Planning Director and the City Engineer providing the proposal is found to a be in compliance with the Specific Plan CX In order to approve the Tentative Map the Planning 2 . Director shall make the following findings: z !� M ZZ 0 0 N N O O The Crossings at Huntington Beach Specific Plan 17 coo August 7, 2000 2.5 REUSEXIIANGE OF USE REVIEW 2.7 REQUEST FOR DEVIATION Any proposal to reuse and/or change the use of a The Crossings at Huntington Beach Specific Plan previously approved and constructed development, Development Regulations are intended to encourage within the project area, will be subject to additional projects which create an aesthetically pleasing review by the Planning Department. The additional appearance, enhance the environment, and facilitate review will follow the same procedures outlined in the innovative quality architectural design with an Site Plan Review process. A "like for like" change of adaptation to the surrounding environment. use shall only be subject to the requirements for a new certificate of occupancy; however any new Deviations pertain only to the Development construction beyond that shall require a new Site Plan Regulations of the Specific Plan and may be granted at Review. In addition any proposed physical the time of Site Plan Review for special circumstances modifications to the existing structure and/or site and/or unique architectural features. shall be subject to additional review and approval of the Planning Director prior to the issuance of building Requests for Deviation may include but are not limited permits. The Planning Director may refer individual to building height, setbacks, open space, parking, and projects to Design Review Board for review and as landscaping. Deviation requests, up to ten (10) final arbiter of compliance with the Specific Plan. Any percent of any single standard, may be considered by decision by the Planning Department may be appealed the Planning Director. Deviations greater than ten within ten calendar days to the Planning Commission. (10) percent must be approved by a Variance application before the Zoning Administrator, subject 2.6 ENVIRONMENTAL DETERMINATION to the procedures outlined in the City's Zoning and Subdivision Ordinance. Development and construction The 2-oning and Development Standards of all phasing of selected provisions and features may be anticipated development activity for the Crossings at approved by the Director concurrent with a Site Plan Huntington Beach area have been identified in the Review and shall not require a Request for Deviation Specific Plan. Development project requests shall be or Variance to the Specific Plan. o subject to environmental review as mandated by the California Environmental Quality Act (CEQA). The Deviations shall be allowed when, in the opinion of o Planning Director shall impose any applicable the Planning Director, significantly greater benefits v, environmental mitigation measures, as specified in the from the project can be provided than would occur if 9 environmental analysis, as conditions of approval on all the minimum requirements were met. Some y individual Site Plan Reviews. Such conditions of additional benefits which may make a project eligible Q approval shall describe the time period and manner in for consideration include: greater open space, greater .� which the mitigation measure must be satisfied. setbacks, unique or innovative designs, public open yin space, and the use of energy conservation or Z z innovative technology. The Planning Director may N N 0o 00 The Crossings at Huntington Beach Specific Plan 18 coo August 7, 2000 approve the Request for Deviation in whole or-in part 2.9 SEVERABILITY upon making the following findings. If any section, subsection, sentence, clause, phrase, or • Promotes better design, environmental and land portion of this title, or any future amendments or planning techniques and contribute to the additions hereto,is for any reason held to be invalid or economic viability of the community, through unconstitutional by the decision of any court of aesthetically pleasing architecture, landscaping competent jurisdiction, such decision shall not affect and site layout; and the validity of the remaining portions of this title, or any future amendments or additions hereto. The City • Will not be detrimental to the general health, hereby declares that it would have adopted these titles welfare, safety and convenience of the and each sentence, subsection, clause, phrase, or neighborhood or City in general, nor detrimental portion or any future amendments or additions or injurious to the value of property or thereto, irrespective of the fact that any one or more improvements of the neighborhood or of the City sections, subsections, clauses, phrases, portions or any in general;and future amendments or additions thereto may be declared invalid or unconstitutional. • Is consistent with objectives of.the Specific Plan in achieving a project adapted to the area and compatible with the surrounding environment; and • Is consistent with the goals and policies of the City's General Plan, and comply with State and Federal Law. 2.8 SPEVIC PLAN AMENDMENTS 1 S y Specific Plan Amendments, other than a Minor Modification as previously described (Section 2.0), o shall be made through the Zoning Text Amendment process; subject to consideration and approval of the a Planning Commission and City Council in accordance CD with the provisions of the Huntington Beach Zoning and Subdivision Ordinance. Such Amendments may .� include changes to the Development Concept, Design y Guidelines policies and the introduction of alternative z Z Development Regulations. ° ° N N O O O O The Crossings at Huntington Beach Specific Plan 19 o August 7, 2000 rx •"'.r� F d �u ('!'7 i+(CC� l {yr iN Y _"=iM•�J..t' •.L •��• 1 7�¢{+" lkwF�C�M +.�.r� - s'a�l yuEEer,;.�t'�`a� r ��H' ?i.:., w C tiw 1' ..� J ' ., r.Jt.,,9vf fY,.�.'h.'t+✓ "VeY,nF i-.. 4sfi..i�.t+s4w��r5.�Y ���� • 1••"1 �L . � .�. �i'G":■ ."ri � •1.•� / � t i °• ��t �I r� ii ' w r��. "F �T►�,1�,f.�Srfr't'"'�J�'�•� �r...t.t�'iw ttF.» rY •s .+. .f ,+l rl,r+I�M VA ria l r�� 1 ,,i S •w+ M a u ..} � ��.� ���'�. t^+.,� Jay;.r ytr. 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' I:V:l I+I'II I: l-l_VV.lZ.!31'I�. \.1'A/: '� ,'�_1 IiLl�!:�r".�1.':1�..Ufki�•a'.I. I :7: i� 'r - teJtr��'•1•i's;� a"� it - - - .n. •�P �; - c....•--� I '. I• �1 '' N ER,;. -.YEN .r , . t:{.r ,fit>t�',ti ' C :>i'S:t`t'• ,f,z.i rr 1 �t• l 1+:1 ! iI ,k' •�IJK .1 il.• •4..4w^I.1.Il Ir.Wt1.�.1.111.•w11nm:II.N.II 4n..I.IIJ uIN+IV JIl tlI:11n.Y• �t Illustrative Conceptual Master Plan m Exhibit 3A o 0 Note: This Musa-zitive shows a!hypothetical development scenario on the project site. tV N O O The Crossings at Huntington Beach Specific Plan 21 CO O August 7, 2000 _.. - 11 -'� . 77 7. ,ri, � yv,' - :_1saGY..1�• -�';)_x',{�:"`i. �3jiK w e�ea CCi` �\�\ "'<.a rw•�;�:,� ••f� - '-r•ff((f I�, - _ - :.zap' -.q, dp. :�' �' .��1�'. ,/� - -[ � /� �b AVt , X} 7 1 1 d�' i' = 1 1 I 1 Itln.tn;•n a luii"ti`i � �?. `�< =- _ - - =_ _ - __ - •r � F 1• .yjFy #iir'r?r r�,t�i�f/ :-•.� - _ - _ _ _ _ .r, .�A.,.- �d 1 L(-1 l�•.•�7.�i�. 1 r � - i' 'i. ti ► 4 Nt. s... �., ��;..•�\� �j` ;:uu+�i.�'� ,`; .. '✓� Ode Ir4 I�1{.yi�r�pp ,,,a 'I 1". 'i�, .J'.,' i.:: �' //. frt,::•//If ,,,:}•t? ��II ��I+1IIT� ."(/�//�� _'dam I 1.:.7 �� .::a.t:'.�1'. I� 1�1'�����'•it //�f�J/C� H xJ;.v �7°.,.; i�I III i - �`y;`._ ;S"'�'�45��'� � •.1,•;c:;�i'/Gtr •fi,atf/!'`, lam• :3. >, � �fdl,/1' •, Ifi �� _ '�' "Ib" =.i. =1.. -_ _ .,+}!� %,r � ;1G4'.�..7'.1'e:l`'� ,r!' '�n3v �7� _ �•y�r� e7�S'_ rIJ ,•,1.,,,g, �'i i`i = "" �� _ �•J�i� ."f "^:�%� .!: ;iMjtgr't"fi�;.. �� y� +.�,-�� -1,!,=��=�r:i� �7;i: •I`�;,.. - - ,rtia; ( i n .17 - - _ ,y��'" - -t ll:: �r.7. _ — ��!•J �,,'�,/J, rsaali y�,•r - G7 t 'i 7 L _ 70 ����� _ _ 1 _ :zi�� _ -� ,� ILl11! ll 11�11�1.1�' 1' � ,.�.'- �•Y11 �.��`�- �, rEDI,NGER, ` •m,n:rm.a�Mur.n tin:«.rro.xa ne nvuen.rueaarx _-- t ___ �.- — —\ n/� -- —• -- 1��,. O J C Illustrative Conceptual Master Plan y a Exhibit 3B N Note. This illustrative shows a hypothetical development scenario on the project site. 2 z o O - N N O O The Crossings at Huntington Beach Specific Plan 22 coo August 7, 2000 DEVELOPMENT CONCEPT 3.0 GENERAL DEVELOPMENT PLAN The Crossings at Huntington Beach Specific, Plan The Crossings at Huntington Beach provides for a development concept provides for a planned retail, range of employment opportunities in professional, dining, and entertainment complex in the northern retail, service, food service, and entertainment; and portion of the City of Huntington Beach. The Specific will broaden the employment base of the community. Plan establishes the general type, location, The Specific Plan establishes a clear development architectural style and character of all development concept to assure the facilitation of a cohesive regional within the site's boundaries, while allowing for shopping center. Design measures encompassing site creative design ideas on individual projects consistent planning, area landscaping, building architecture, with an overall concept. streetscapes, pedestrian linkages, setbacks and signage have been established. Adherence to these details and The Crossings at Huntington Beach will be a 63 acre to the established Design Guidelines will create a master planned regional commercial retail, dining, unique and integrated development. and entertainment facility with supporting services. The Specific Plan is designed to allow for development The illustrative conceptual master plans (Exhibit 3A & in a manner that is compatible with the surrounding 3B) depict scenarios utilizing the various guidelines community and City of Huntington Beach. The described in the Specific Plan. The plans provide Crossings at Huntington Beach Specific Plan provides potential layouts identifying building orientation and an opportunity for a variety of quality regional serving placement, parking design and access, roadway commercial uses, consistent with the City's General configuration, entryways and landscaping. . The plans Plan. are not intended to reflect an ultimate design situation y because a large variety of other development patterns ? The Crossings at Huntington Beach Specific Plan and activities may evolve which are also consistent provides the framework and guidelines necessary to with the Specific Plan policies, guidelines and o create a unique, high quality, visitor serving, regulations. ir retail/dining/entertainment complex. The site's proximity to regional transportation systems makes The Specific Plan recognizes that although the main e the area ideal for a variety of compatible uses and construction of the project will occur at one time, the activities. The development concept is designed in ultimate buildout of the property may not occur concert with the area's history of commercial activities immediately. In fact, building pads may be established y and the community's need for a strong self-sufficient without associated building construction but shall be economy. landscaped in a park-like setting until such time as y development is proposed. Therefore, this zoning o 0 document anticipates future. expansions of the o 0 The Crossings at Huntington Beach Specific Plan 23 4 coo August 7, 2000 development site. In order to address this concern, flexibility has been incorporated into the Specific Plan Development Regulations (Section Four). This flexibility in development guidelines is intended to accommodate future market trends and tenant needs, i without sacrificing the intended high-quality character of the project area. The objective of the Specific Plan is to implement the goals and policies of the Huntington Beach General Plan by defining the physical development of the Crossings at Huntington Beach site. Included in this approach are the establishment of land use, circulation, infrastructure, landscape and architectural design characteristics for the project area. .The Specific Plan consists of a number of major components which will guide the development process including the Circulation Plan, Design Guidelines, and Development Regulations. Any reuse, subdivision, or new development shall be subject to the provisions of the Specific Plan. Refer to Section 2.3 Site Plan Review. The Specific Plan identifies and requires sufficient y infrastructure and public facilities to adequately and ti efficiently support any and all anticipated uses and activities. These improvements will coincide with any upcoming development project. This upfront effort will allow for buildout of the Specific Plan in an expedited manner, subject to compliance with the Specific Plan and the Environmental Analysis. y The Crossings at Huntington Beach Specific Plan . identifies effective land planning and design X M regulations techniques in a flexible format which can take advantage of ideas and opportunities presented by o 0 future tenants and users. CD o 0 00 The Crossings at Huntington Beach Specific Plan 24 cc August 7, 2000 3.1 REGIONAL COMMERCIAL USES financial institutions, and similar regional-serving uses. However, regional commercial uses do not . The Crossings at Huntington Beach Specific Plan include some commercial businesses, such as auto recognizes unique development opportunities within repair, which is typically a local serving commercial the project area. The purpose of the Specific Plan is to use. Future activities for the area will depend on create a distinct cluster of activities and allow for market conditions and may include a variety of individual project development and tenant occupancy activities consistent with the City's General Plan. These to occur in a timely manner, within an overall Master development activities may be either an expansion of Plan Concept. This approach recognizes development existing facilities and/or independent new projects. patterns, market conditions and establishes sufficient The project area can accommodate a total flexibility to provide for the.opportunity of a variety of development of 1,100,640 square feet of regional activities within the Specific Plan area. commercial uses. The City of Huntington Beach General Plan identifies typical permitted uses under the Commercial Regional land use category. These uses include, but are not limited to, anchor department stores, outlet stores, promotional ("big box") retail, retail commercial, restaurants, entertainment, professional offices, a N. 0 c y 'o m y ID ' 4 �n . Inco N OO N N ' O O O O The Crossings at Huntington Beach Specific Plan 25 coo August 7, 2000 tER-nVE - F111i(IIiFIiF(1fTiFfi.I I I t I I I III 11 I II t1 Irl • • N ' ypp�y)./r,/, 77 t ) •�.,,���.71��nrtl�n.-t!1�f11�1�1:Ti.nlr.[ �•f••-..•�.;t-.. �\ '��. �TimmRRTTTITRTIIRTmtTRflTmmIMI;l -.� (a1111N�IIIINIIiI(riiii '; !;-,� •:,: •.'' �'+ '.:,r •—J - - ;:a�..''• •�\ \.-..,. '`. .. hIIIIIIIINIIIIII�III I11iINHiINI tl11,:L �4111111111111lIlli}3 �: _ , _ - - =_ -- I .'.t''-� I�A , - -'•' :; �`.;'�\ `\ '.�•� ••. I 1 r t: )�- 7 )- lr d t7lF1'lll� I .I `'_ c,;. :.J:, ,..,r :�i ��.: - �1 `\\`.�•�/ \s^.\+ v �IIl O. 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EDINCEFL_AVENUE -. .... ,mw,mww,uu)--L.�=w:.i..W +r _—. m..n....m.w uvuu.r--..".'�'�-.�.f�.....__�•�- -_—__._ _ ._• _ I mrrvwuxn,rr+onnn,uwwrotrawrr w,raol�worhsr)) . , y :70 O N O C O Z1 co O Pedestrian Plaza / Walkways Plan Exhibit 4A y 00 N N O O O O The Crossings at Huntington Beach Specific Plan 26CIO o August 7, 2000 I r.l I. �fJ1Tl(1131t1*�;III71�11!�I7t11Il�ll� ••••�.•-• -': -• `\•. ��- •`\ ;a...... rm>K rmttmlrrrfnnnnrrmrm tJ111111�jlllllllllfling ':� •. a a :r �'�`'I \•�. \�`� rel level = - -- - - _ h}iHiHIHIfiQf1�f1IlefllHikHfHlkl 11UI,C °�iik}IHIIIIIIIfIIi(9 -� AVC` `\\ ` t/+1 - - - - - -- -- - - -- - �\ s ji IMUL 1 II11= - �` �eo;rnd leiii• ��. = N• Nu.N 1 1= =�_ _ _ _ - - - o / � �=Ise ,} � . + �� �IIIIIII111111111 III IIllll lllllllllil�l ,�. � ..�'-�� �����'i.'y i it .'III• l lwi war• 7"=,��_�� ��i E v. III :III I _� \-�-� — 1 i / �/% * •.l�HH .'. -1 ' , . _� 1J. I II II - - . �� �} /e.y,�yy�/ {' X��� //' � .lRMIR�R�M •••N• .,^,. �k'", ' I II I' o / /•�• � :..- »4.a1,='✓� }. _�r�/t 1/� w ll i I��l I II III � ^2�{Y �.,�+�yv"v�,/F'y, � •�}�•'r�•>v".k...� x�(Y .i� '`ry1�I 11Iu t f I.1 - f!' \ � _—. . :'�: ,_--_ y�i i"`�III_[�1''�"', rc,.r»,t�.{YA1.nf�":�`.+i'y 17�7�.i%• +`i � �r7 U�f�ll Il if I(I I� - •I .eta -��•r.._._ .....- ' II II N•N••N••N•••N %.h:• i.,'�`' l, ht-�} r�/ L I.:T .'L i /� i `.� �''•/ l Yw ow •''� •1 �( ..i _ i'Iw•� •Iw,,,l `�I�NkffNkllfHk� _ 'AA(I -t- -� '•� �I 1�. - Sa.. L••c i :1 /rnl<.y. 'i/. �•".rr -f��Y �X/�.r.�,� re<x., �rer I v er 11, = `i_cr — sj _ _ — �,J %/(•fig/�1 _ /.///`//%'::E 'LfG 4e+�' —; ee„ r• �- � r................ ...,1•.�.. .. ......�...u....... ... d LI HIM air {; _ _ ('" =, +reef�, 1%✓r,. I l o = rn' f]e r i - -- _ _- - - - - _- INI(1,IILIII -- -- -- -- - -- - - - 11W1111 -_ -c �e,.l - atuv _ _ _ fit`- - - _ - - t..� •I 70 ~ irO1 I IIL - L] G7 EIES 42S _� •N��� 7 LL ''rr.._.... _: ., .. �. :. •. �'.. _ J IC,II(`'' ��1�L�77,j�;;.. c � y III I I I 1 n I II I 11 III I •1.!• . 111�1►�Y1�Yl�•Yi�'� ' �� _ l'.'�I17 7'h!�'T�►7• I 1•.. - Y•116Y�JYW1d1�i,�llYil�i�i'71'1�l' ._. , I III Je 1 _G_..___>f.l-----...----•--4. k. EE)IN ERr._A NUE� _ —— II\ ._...... ----_- lr•-n ............. __.. _.._._. _____.- --- .... .... vn erwcle IY w.la,WluWlwUll YV a ne YMINA r10U IwJt _............: 0 co Pedestrian Plaza / Walkways Plan a Exhibit 4B q! fA OO N N O O The Crossings at Huntington Beach Specific Plan 27 � o August 7, 2000 REGIONAL COMMERCIAL USE POLICIES: Strada, the Plaza and the Colonnade. A pedestrian 3.1.1 Any expansion beyond the initial site plan walkway system is also used to connect the Crossings approval, shall be through the site plan review process at Huntington Beach with public transportation (see section 2.5). facilities and surrounding network of public streets (see Exhibit 4A and 4B). 3.1.2 Retail, dining, entertainment, and related uses PEDESTRIAN PLAZA AND WALKWAYS POLICIES: drawing from a regional commercial/market area shall be the primary intended activity within the project area. 3.2.1 Individual developments and activity areas within the specific plan area shall be linked through a 3.2 PEDESTRIAN PLAZA AND WALKWAYS series of pedestrian walkways which culminate in an interconnected system of pedestrian plazas creating it The Crossings at Huntington Beach Master Plan variety of open spaces. identifies open space areas which can accommodate 3.2.2 A pedestrian walkway system will link or outdoor commercial activities, seasonal recreation and connect all future development pads to the central entertainment activities, and casual pedestrian portion of the Crossings at Huntington Beach. meeting places. These pedestrian plazas become the central focus of a number of commercial nodes within the project area. in addition to the major plaza areas, 3.2.3 All pedestrian walkways shall be designed and there are a number of entry nodes which serve as the landscaped consistent with the overall theme of the interfacing links between the vehicular and the Crossings at Huntington Beach. pedestrian areas. 3.2.4 Pedestrian walkways as shown on Exhibit 4A and y The clustering of open space plazas are connected 4B shall be incorporated on the Landscape and through pedestrian walkways. These walkways also Technical Site Plans and shall comply with American : serve as a link between the variety of Village Disabilities Act requirements. The walkways shall o commercial facilities and the Entry Plaza,the Village include shade trees, seating every 200 feet, decorative pavers,and lighting (see cross section on page 34). C4 o y fD A H U! 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OF wW.nw..•,d„... 1 IIyY4•.44rM i •.~~~•a44:.y4rw.,�.._,_,..., o Circulation Plan Q • .u+.r w....r.r� H Proposed Off-Ramp y.N Exhibit 5B o 0 N N O O The Crossings at Huntington Beach Specific Plan 32 coo August 7, 2000 3.3 CIRCULATION PLAN The Circulation Plan illustrates the major and minor enhanced by a number of signalized entry drives and driveway entrances to the site,signalized intersections, public transportation facilities (Exhibit 5A and 513). bus stops and bus pads supporting the development and surrounding areas, and the public street system The circulation plan relies on a hierarchy of within the Specific Plan boundaries. The Circulation circulation features ranging from major arterials to Plan is consistent with the Huntington Beach General local streets. The system is designed to accommodate Plan's Circulation Element and the Edinger Avenue customer, employee, and delivery traffic to and Precise Plan of Street Alignment. around the project area while discouraging through traffic from bisecting the project site. Primary access to the City of Huntington Beach and the Crossings at Huntington Beach is provided by A traffic study shall be required to analyze on-site and Interstate 405 (San Diego Freeway). The City's General off-site circulation patterns and necessary Plan designates the intersection of Beach Boulevard improvements. and Edinger Avenue as an internal no and a primary entry node to the City. Access to the project site is Alternative forms of transportation should also receive provided by a system of arterial highways including: careful consideration. The current OCTA bus route passes the project area on Edinger Avenue and Center • Beach Boulevard, a north-south principal arterial Avenue. The project Circulation Plan identifies street (120 foot right-of-way), designated as a state existing and proposed bus turnout locations along highway, a primary path/image corridor, major . Edinger Avenue and Center Avenue. As a supplement urban scenic corridor,and transit service route. to vehicular access to the project area, potential future access such as a light rail system and stop shall be • Edinger Avenue, an east-west major arterial street pursued if available, from the existing rail line on the y 0 20 foot right-of-way), designated as a truck route, western boundary of the site. y primary path/image corridor, and minor urban scenic corridor and transit service route. In addition, the Development Concept encourages the o creation of a pedestrian walkway system. Asa means • Center Avenue,an east-west secondary arterial street of achieving a strong landscape image, pedestrian 3 (80 foot right-of-way), designated as a transit walkways are required and shall be provided a service route. throughout the development to facilitate pedestrian y access from adjacent developments to the project site. a Internal circulation is currently provided by a network The pedestrian walkway system shall include y of private drives/streets serving as access to individual walkways around the perimeter of the site in the street ;YJ H portions of the project area. Circulation is further right-of-way. 0 0 1V N O O O O The Crossings at Huntington Beach Specific Plan 33 4P a o, o August 7, 2000 CIRCULATION PLAN POLICIES: Transportation Authority and pursued by the Crossings at Huntington Beach should a light rail 3.3.1 Primary access to the project area shall be from urban transit system be developed in the future. the existing signalized intersections along Edinger Existing bus stops shall be relocated as needed to Avenue and Center Avenue. New access location8 into conform to pedestrian patterns. New bus turnouts are the project area shall occur only where traffic patterns planned along Edinger Avenue and a new bus stop and median openings allow, subject to review and . along Center Avenue. approval of the Directors of Public Works and Planning and the Fire Chief. Parking Area 3.3.2 A new primary access into the project shall be s'Planter Island pursued where the San Diego Freeway on and off ramps intersect with Center Avenue, subject to Cal- Trans, Department of Highways approval and approval of the Directors of Public Works and :e.. Planning and the Fire Chief. ` •r +t i 3.3.3 Additional new driveway access points from the street system adjacent to the project area shall be limited and allowed only when the project size, location or type of use warrants such access, subject to review and approval of the Director of Public Works !b and Fire Chief. No new driveways along Edinger 1 Avenue or Beach Boulevard will be permitted. y 3.3.4 Deceleration and acceleration lanes for a'Crosswalk driveway access points may be required, depending on o the location of the proposed access point. Pedestrian Walkway Section 3.3.5 Shared access facilities and reciprocal vehicular c access to and between individual on-site activities may .be requested and/or required by the Director of a Planning for adjacent uses and parcels. V zX MM 3.3.6 Alternative transportation forms such as a light Z z rail stop shall be coordinated with Orange County o 0 N N O O O O The Crossings at Huntington Beach Specific Plan 34 co O August 7, 2000 3.3.7 Pedestrian sidewalks shall be incorporated into the 3.4 PUBLIC FACRXI'IES project as a component of the landscape plan. Sidewalks shall be installed throughout the The Public Facilities section discusses infrastructure, development to facilitate pedestrian access front storm drain, sewer, and water facility improvements adjacent developments to the project site.•' The necessary to serve development within the Specific pedestrian walkway system shall include walkways Plan area. around the perimeter of the site in the street right-of- way and through the parking lot to the project area. PUBLIC FACILITIES POLICY: 3.3.8 Public landscape areas .within the right-of-ways All public facilities infrastructure necessary to serve shall require a separate Parkway Landscape development within the specific plan area shall be Agreement for continued maintenance of the area. completed concurrent with initial project development, subject to review and approval of the 3.3.9 A traffic impact analysis/traffic signal warrant Director of Public Works. analysis shall be required, in association with a development proposal for the site. Future traffic impact analyses may be required due to unanticipated project developments not previously anaylzed. All traffic studies shall be subject to review and approval by the. Directors of Planning and Public Works. 3.3.10 Circulation system improvements will be master planned to accommodate ultimate buildout of the Specific Plan. However, since the majority of the y project is anticipated to be constructed during the y initial development stage, all on-site and off-site circulation improvements shall be completed prior to 0 the first occupancy request. Future expansions M permitted under the Specific Plan may generate 2� additional circulation improvements as determined by future traffic impact analyses. N N 3.3.11 A Delivery and Fire Truck circulation plan, H. depicting on site access routes and manuverability, � ; shall be subject to review and approval by the Director y y of Public Works and the Fire Chief, in association with o 0 a development proposal for the site. c o The Crossings at Huntington Beach Specific Plan 35 Q Q CO O August 7, 2000 3.4.1 WATER SYSTEM Domestic water for the property will be provided Proposed architectural site changes will be reviewed by the Public Works Water Division of the City of by the Fire Department for code compliance and may Huntington Beach. require additional fire hydrant installation. These hydrants (if any) will be connected to the existing or The Water Division has use of both underground and proposed water line loop. The number of hydrants on imported water sources to service the area. The the system is not relevant to the flow delivered and, underground supply comes from nine existing wells, therefore, does not affect the system. The required fire and imported water is delivered to the City of suppression sprinkler flow rate is approximately Huntington Beach by the Metropolitan Water District 2,500 gpm. The existing and proposed fire sprinkler (MWD) at three locations. The Specific Plan area is systems will be required to meet this standard. It is not part of the City's Master Plan for Water Service and anticipated that. the proposed modifications to the the ultimate development anticipated will be Crossings at Huntington Beach will require water flow adequately served by the City's existing systems. for fire protection above that which the existing system can deliver. MWD is the major wholesale water purveyor to the City of Huntington Beach which, in turn, is the retail All on-site water improvements will be designed to the provider to all water users in the City, including the City of Huntington Beach water standards. Water subject property. system improvements from the public right-of-way to the on-site meter shall be designed for future City The existing center has a looped water system. Water acceptance and maintenance. Locations of fire is delivered to the site by the City of Huntington hydrants and apparatuses will be reviewed by the Fire Beach's 12-inch line located in Edinger Avenue and a Department and Water Division of the City of 12-inch water main on Beach Boulevard. Huntington Beach to ensure adequate fire flow and a pressure. A final design analysis will be performed during the site engineering stage to properly size the The proposed modifications to the center will require stem determine final alignments, and determine if o that a portion of the looped system be reconstructed. system, The required hydrant flow for fire sprinklers is 4,000 additional water improvements are necessary. o gallons per minute (gpm) at 20 pounds per square Construction of the redesigned water system shall be : inch (psi). The existing and proposed upgraded fire completed prior to first occupancy. e hydrant systems will be required to comply with this standard. y N Z Z O O IV N O O O O The Crossings at Huntington Beach Specific Plan 36CO o August 7, 2000 3.4.2 SEWER SYSTEM The City of Huntington Beach is responsible for The existing 10-inch sanitary sewer line exiting the the review and approval of the collection of site is adequately sized to carry the anticipated flows wastewater within the project area. The Orange from the reconstructed center. However, final design County Sanitation District (OCSD) is responsible for analysis will be performed during the site engineering the treatment of wastewater. The City system stage to properly size the system, .determine final ultimately is collected by the Sanitation District via alignments, and determine if additional sewer their trunk and distribution lines to convey sewage to improvements are necessary. Construction of new District Plant #5, located in Fountain Valley, and sewer lines shall be completed prior to first District Plant #2 in Huntington Beach. occupancy. Sewage from the subject property is collected via a private on-site collection system with a singular outfall point at the southwest corner of the site. A 69 inch sanitation district trunk line runs beneath the concrete channel located along the west property line. No changes to this existing connection are anticipated. An existing on-site private system consists of a series of 4, 6, 8, and 10-inch lines collecting into one 10- inch line which is proposed to connect with the county system referenced above. Due to the reconfiguration of the development, it will be necessary to remove or abandon-in-place several o sanitary sewer lines and replace them. 0 a co v N 4 ;UX m N C O N N O O O O The Crossings at Huntington Beach Specific Plan 37 COo August 7, 2000 3.4.3 STORM DRAINAGE The City of Huntington Beach and the Orange and may include water storage in underground pipes.. County Flood Control District are the agencies As a result, no ponding will occur at any point on site responsible for the flood control system in the project during a 100 year event. vicinity. A regional flood control channel exists along the western boundary of the site. The existing detention pond will be removed and be regraded as an additional parking area. The existing drainage system consists of two main lines, "A" and "B". Secondary line "C" drains a small There will be a need to add various new lines to drain area westerly of the existing Montgomery Ward store the open air section of the Crossings at Huntington in addition to secondary line "D", and numerous Beach. However, final design analysis will be connecting laterals. All lines drain westerly into a City performed during the site engineering stage to of Huntington Beach Flood Control Channel properly size the system, determine final alignments, (Huntington Beach Storm Channel C5-5C2). Drainage and determine if additional storm drain improvements area boundaries have been identified based on existing are necessary. inlets and catch basins. Construction of storm drainage improvements shall be There is a small drainage area located at the northerly completed prior to first occupancy. perimeter of the Crossings at Huntington Beach which drains into a small basin located in the northwest corner of the site. Hydraulic calculations performed on the existing storm drain system revealed that ponding in a 100 a year event will be as follows: average depths of 1 foot and a maximum depth of 2.8 feet were determined for o the ponding over line "A." Average depths of 9 inches c and a maximum depth of 1.4 feet were determined for the ponding over line "B." c The storm drainage discharge rates from the remodeled Crossings at Huntington Beach will remain a similar with the exception of the discharge from the ; ;U enclosed shopping area. This area will now become an y open air shopping complex. Drainage areas will be o 0 redistributed to reduce ponding throughout the site N N 00 00 The Crossings at Huntington Beach Specific Plan 38 M o August 7, 2000 3.4.4 WATER QUALITY Water quality in California is regulated by the use of oil and grease traps, detention basins,vegetation U.S. Environmental Protection Agency's (EPA) National filter strips,and other common techniques in order to Pollution Discharge Elimination System (NPDES), preclude discharge of pollutants into local storm which controls the discharge of pollutants to water drains and channels. bodies from point and non-point sources. A NPDES permit or other EPA review will be required for 3.4.5 UTIIMES individual construction projects. There are several public utility service providers Prior to issuance of any grading permit or demolition in the Specific Plan area. Adequate facilities exist for permit (including removal of any hazardous materials the current service needs of the area, however, such as, asbestos) the developer shall submit a "Notice additional facilities may be required as additional of Intent" (NOI), a Storm Water Pollution Prevention development occurs. Plan (SWPPP), and any required fees to the State Water. Resources Control Board. These documents 3.4.6 EUCIR M Y shall be filed under the terms covered by the State NPDES General Construction permit. The SWPPP shall Electrical service to the area is provided by the be on file with the Public Works Department prior to Southern California Edison Company. Existing any demolition or removal of hazardous materials. transmission and distribution lines are adequate to Through the NPDES Permit process, the City currently service current and potential future needs. Any newor existing overhead utilities (excluding 66kv) shall be requires contributors to non-point runoff pollution to undergrounded per the City's undergrounding establish Best Management Practices (BMP's) to ordinance (Chapter 17.64 HBMC). minimize the potential for pollution. Under this a program, the developer is responsible for 3.4.7 NATURAL GAS identification and implementation of a program of y BMP's which can include special scheduling of project Natural as service in the Specific Plan area is activities, prohibitions of certain practices, $ establishment of certain maintenance procedures, and provided by the Southern California Gas Company.Adequate management practices to prevent or reduce the Adequate facilities exist for current and projected a future needs. Relocation of existing facilities shall be pollution of downstream waters. Typical elements of Zi such a BMP program would include addressing the concurrent with project development. C y . �O M fD M 41 N OO N N O O O O The Crossings at Huntington Beach Specific Plan 39 o COo August 7, 2000 3.4.8 COMMUNICATIONS Telephone service in the Specific Plan area is provided by General Telephone (GTE). Relocation of existing facilities and new installation shall be concurrent with project development. Provisions for fiber optic communications shall also be included in the overall site planning for the project area and shall be provided prior to the first occupancy request. Cable television service within Huntington Beach is provided by Time Warner Communications. Installation of new services shall be concurrent with project development. 3.4.8 SOLID WASTE DISPOSAL Rainbow Disposal Company currently provides solid waste disposal services for the area. Based on service projections and anticipated demand increase, an adequate level of service will be maintained. No solid waste disposal facilities are planned to be located in the Specific Plan area. a c� y O C O W a a co y ;0 M N �71 CO N N O O O O The Crossings at Huntington Beach Specific Plan 40 0 610 August 7, 2000 4 r�A IIII '� III i�,rl.vr.M•�.p��w�. ��rr�r� �ur�K►►reu,�+w\l��. Ago I �IW �I Design Guidelines y 0 BFD RA7111 Q OO h1 N O O O O The Crossings at Huntington Beach Specific Plan 41 Co August 7, 2000 3.5 DESIGN GUIDELINES Huntington Beach as part of the Site Plan Review process. The Design Guidelines are general and may 3.5.1 PROJECT AREA CHARACTER be interpreted with some flexibility in their application to specific projects. Variations may be considered for The project character and theme for, the projects with special design characteristics that still Crossings at Huntington Beach is that of the Italian meet the objectives of the Guidelines. Village. Italian Villages derive their character and The Design Guidelines shall be used to promote a high classic charm from the ancient Roman and Greek level of design quality while at the same time provide architecture that was infused during the initial some flexibility, necessary to encourage creativity on construction of these villages. As the years and the part of individual/tenant designers. The Design centuries passed on, additional construction and Guidelines have been prepared to articulate the reconstruction occurred in these villages, adding even intended development standards of the Specific Plan. a more layered architectural identity. The styles of The Guidelines establish a framework for Classical, Neo-Classical, Baroque Rococo and even developers/designers of individual projects and design Modern and Post Modern Designs influenced these criteria, which the City will use to evaluate proposed villages over time. It is the intent to utilize this developments. montage of designs to tastefully develop a specific vernacular of architecture that best represents that of 3.5.2 SITE PLANNING GUIDELINES an Italian Village. positive shopping The Design Guidelines establish the character and The p os pp in$ experience begins at style for the development of this retail, dining and landscaped entrances to the site, which lead to entertainment complex with buildings and convenient and ample parking. The center's open-air streetscapes that have a distinctive visual identity. The spaces of plazas, courtyards and passageways will be Guidelines accommodate individual project identities arranged in a non-linear pattern. Attention to lighting a and promote interrelationships between and low level landscaping shall be given along non- A complementary building storefronts and exterior linear passageways and pedestrian walkways to allow spaces. The major elements of the Design Guidelines pedestrians to see ahead and around the walkways c include: site planning, overall project/tenant clearly. Additionally,the main plazas will be accented architecture, exterior pedestrian amenities, by water features. A pedestrian walkway will connect y landscaping, and signage. All development projects east to the existing adjacent Village Retail center. a within the Specific Plan area shall conform to the Italianate themed graphics add to the continuity of all y Design Guidelines and shall incorporate appropriate the linked spaces. To facilitate the development of The theme elements. Crossings at Huntington Beach into a unique resource W for the community the following site planning policies ; H The Design Guidelines shall be used by the Crossings shall apply: o 0 at Huntington Beach owner and the City of N N 00 The Crossings at Huntington Beach Specific Plan 42 Q 0 0o O August 7, 2000 SITE PLANNING POLICIES. 3.5.2.1 Site layout for the project shall be designed to route people and vehicles through the site in a clear, identifiable, efficient and effective manner byre, .Rip:' �. N+. •', t�. j: .;+✓t�,f �/. ,''.F i:F!."i:ryl incorporating unique pedestrian walkways and ,•>9� s"�i ::R;� ,4�'ji , 1' "• 66�6 ,3T iavo .... highlighting main drive aisles with landscaping and ,xF� :� ��.p>;,,��-� �- �-> �'+';.;�,.r,.7: :• `�" specially treated paving. 3.5.2.2 A minimum of six public open space .,a Y { amenities shall be provided on site. Of the six total - public amenities to be provided, at least two water t' features and two public art elements are required and shall be incorporated into the common project area. The remaining two public amenities may be located anywhere on site. Potential Ent,ysignage 3.5.2.3 Loading and storage areas facing public streets shall be designed to resemble a facade. The facade 3.5.2.5 Parking shall be provided onsite in a manner that shall include architectural details and design is convenient and compatible with the layout and elements to ensure integration into the project design of the overall project and consistent with the environment and shall appear as a typical tenant standards in Exhibit 13. Satellite pad buildings are storefront. Loading areas at the rear of the Village encouraged to provide a minimum setback without Retail center shall be updated with facade parking between the building and the street (see improvements and shall be screened from view from General Plan Policy 10.1.15.0. a the surrounding street system. 3.5.2.E Security provisions, including lighting, building o 3.5.2.4 Entry drives shall be a minimum of thirty (30) feet entrance visibility, and, drive locations, shall be wide, not including landscaped medians. carefully considered. Landscaped medians, a minimum of four (4) feet c wide, shall be incorporated into three (3) main entry CD drives along Edinger for a depth of 100 feet. n ;a ;U fD N OO IJ IJ 00 The Crossings at.Huntington Beach Specific Plan 43 0 0 ao 0 August 7, 2000 3.5.2.7 Public Restroom Facilities shall be designed to minimize the corridor distance leading to public restrooms. The length of the corridor from the mall exterior to the door of the restroom shall not exceed thirty (30) feet. Restrooms shall be designed utilizing a single door to enter into the facility. Stall doors shall have purse hooks installed in both men's and women's restrooms. All hallways leading to the restrooms shall have surveillance cameras installed that shall be tape recorded.24 hours a day. a tn• Xp] N O C O CO a N fD f�D H• ;rj ;U O . y H Z Z O O N N O O O O The Crossings at Huntington Beach Specific Plan 44 coo August 7, 2000 3.5.3 COMMON AREA GUIDELINES The Crossings at Huntington Beach is divided into several unique spaces. The Italian Village setting will be carried out through distinctive architectural design elements including towers, domes and arches, cobblestone streets and walks, water features and site amenities that reflect the quaint and harmonious lifestyle of an Italian Village. A wide color palette with contrasting accent elements will create a lively exciting experience for visitors to the Crossings at Huntington Beach. (See section 4.5.3). . - _ �-ctr�l:tR•nvE*m .... ------ _ _ _ �. -••prY�r;rnrllllnrTlil u!. nunnunnnnirllu,rl - _ -""-""�•"'^`�`�_..__ •�,• L,,•l ��;`.L� 1 rrrrrnnmrlTrrmlrrrrnnnrlmmnrrrrrrrrr., - ��-•` . \ �llnnnnunnnumntl wnr ....,._.. '•'� ER AV6i�� ur: uugglnnllilil'i'ilYillTiPlrll --;;:�' .. I ! f�111111I�IfINNik{iiiil r i ,. .::,�:.. `,:,. �` h• �\ \: .� -. _ I11i411iIHNIHH�i}I ffIH111Nllll r:,nn,r:: 1711HIIf{illlif{Nii9 -- ° - ,a _ _ L•�: (-r'` _ � _r_ �� � ' `:�� - li II - _1� I _ '_�inlhlu NllllllllllL!lllll ` `^6O r-l•'' " "�" � '"�' __" _` '�, 'f'.?, �'��\ �`'''\i, 'S• 11 ry _ fk r ry 01 II =��� - �'.�•��N.Y.Sl.;�.:,: 1-� �1_ '.:i:� 7 '.r:.. _ _- _ ..1_ _ �_.�_ __ _ _— F I i j fl - - I ,I.1 III Lut H.•.ulLe :7 c:�. wall" •I I I w• - - :I :I _ Lt„ .: „,r:,, .,'. ,. .. -:' I' �Ilu,•r- ..`... 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J Y 'Al r�l.•x .+;7•"/"�� i:. ,r}l: Incrtrt'.yy.•'-,y'�'71��,i/J,,!'Ftr,.X'"d�.rf fi"5,:.'c 1.�; '" ,\,. I :) 1 �,.i7. JIti.,S �/�a1L+.:oJ,rl r' ,• t P u t '}'. !//.:+'�`+,::F +�4"'�+n 1ibAM>�.?#Fk�J�r•.'++� .:f.. .y';F.v� ((�"`7\ �� s. {ar�,'�.J.:,. ra��� •t v.�Ltr�.aJ.1_iY51 i � ::•u -r�i�,`w t.w,ur..:...•, ' r---.tr . v.��'It� r .r' , f ..�',1i'�+. r ;., .•.'. 1 t v,���.� -.\;t d:t7 I,:k.e'" J. y,� Y,<;I r+A+ rr :, 1" �'W, `a�o•]..v y t r r f', �t'! r f:' :71 I r.� f � /1 ✓ .u?� .�+,. �.. 1 �..y.Y'/.! e��i; V%�s ri: .'::s,`Lu e�.� �� r��i wHtr n��h rt.0 t � � ;':. t. S r ••i. ' �,� � � �'f . 1 • 111 THE VHIAGE STRADA Acting as the "Main Street" of The Crossings at Huntington Beach, the Village Strada will have pockets of landscaping, outdoor dining tables, children's play areas, and seating for a respite from a long day of shopping. -The buildings will have varying architectural style, while still complementing and not contrasting with each other. The intent of the Village Strada is to insert modern uses in old buildings as is done in an authentic Italian Village. •.i+t� �F%, a,,e `3 4.. �.5 r .5'h•. n r "Y�'�..: r!'.. a A; <)'t'i!.t'• `f% Y 1• •13 ly •I Ir. 1 C' Yt,'1 1 I 'fA•: ] r' "l. e e I' 'f - AW 'y P; �{ M d; y a• + ,''-�4�x'�!.'- - '"'.'�.. •.,r.:.a,r?I „�!C.j 11�4.-�,,, rsr,:i��� 5 T� k+ •N4�� _ t;i'�lj.1;r.'d� a'fY.o?'.5{'••��"i...v l�:'i„: _ � •' - .�:,.',7_?,;`i,':; 'f:r .l:`s,+,^i c;^�<.:7:.'';�,f•,. ; r54'.. �1%;�''t '�' F''' .i r;i)�'- F I 'a:- - z�d�rim�':..:,c3+;'��;'i.:r x•..'',;rr:llt""'';i';.I,; ...xt,J'tY�r �t,Lµ;7,'��.s�;i,F:r',��' �,. .F :b�.;•' ram.�:' .,F� r:.'.�°:i� i�v�f„';!!::. T .k. F� :;a iA r:t':S:xrt: rir ."f„�" k"�' '{ix`; 9 ii `'•ir rij:`�.-',q�'h. Myj`•:, i;i,: 's1ia::-�::1�'� ^�Pt'I ��� A .a�- `:7 .,Xt1`~ .� ,;Sr;S-i "'a.j 4 �•�!` „z •,�' 1 �'c,;.• <. •pma,�li�� ,,.' �1; •.�: � 'i� t '�y!t� 'i1 E. �:'�{".`'.;. q - id:t"It"::�i.J.��Li•�C:L� ItY �!,?r.�N� ' li M-,t. 4' �� - 4 ;!. .,�$it�., ;�� - - .�-�u•=!;?.� -x ,i��„�'--���«�., r -_rt;';L�,��i�*����I!_.1�ri`i :`;:�C�'r� � ':� I_,;., :e'_• �.fT,.`I'S '��.. ::,L f^.:f'7.7!h71t_1rh'121'..._ ...;':i.A�::' ::Fr.n•i"j:/,..:-r - _,=tiF:w��:Ofv.:.•12�.- •^,.� .'.. ..r...� _ _ w- 1r 141. '" ..Fiir+ ,•!7::'P. .FAt*,!:^,3.-r't'j�p�' .� ' .,y u;k^5'�c:h :n•v�[r,:t:�'41,. �F�AA��',�{$. ! i:l .wi.L �A61 �� .'•.•• �= ?�;L<yu�i'*x,?-,.A.•1'i.�.:WTI,:,: :1 �w... j,� .»r'w;Y:t"',,"r.`^:1..,.....:. ''.�ri�'�TM7'a.'i:+':•�,�..-.:�.�:^I'" w,' ��„",jrf �''"_ t.:� t 1 �h, I • I �itF'' M1','.� 'i) ',t '�� �+tl� r � y — •a• �t f' 1.•� /� v� +'u... !�. .1.71::.. ,T:'•'IFtL;SL... r „ , .u•" r : F""u.r .,.,:,.r'i�,:;�i�''%c....�A,'.t...4,.:.G:•�(�:�::'k! tw..«, wr. .:.:i:'�,A�'F.s':^i.i.....r......_..:.�ta;u::Y:..;;:�.ii eS;�''�i,;1:lt,'1u;,±,'.',_:t.wnd,4r'arLc:.,uw'A.•,.,. .v.i i.*�lxSlY:il;:;x"w"i2:::tW1:a•„+:,aL.tSI,,04 ,.io.'•. n. wl. C N N Q fD y :O :U N (D OO N N O O O O The Crossings at Huntington Beach Specific Plan 48 co August 7, 2000 THE PLAZA The Plaza (or Town Square) is the center of the Italian Village. It creates the foreground for the theater entry and is the central pedestrian access from the Strada, and the South and North passages into the Villages. Accented by cobble streets, water features and the arched entry and donee of the theater, the Plaza is the hub of the Village. Major design concepts were developed by great Italian Architects such as Brunelleschi, Bramante, and Alberti that are evident in the Crossings at Huntington Beach. The theater dome, arched windows, doorways, and passageways, and decorative stone windows,corner and eave moldings are prime examples of traditional Italian Architecture. r'` � i'�'.+����� ���(�.'4ut,;rkr 'f�:".0..�. .r5!�.+.�'•.'r:tVcii.;�%.1�,.;,"I:«w7t:,i i%:N;�,,'1,� `r+ �'!, '�i;���t,C(x��,�� .,y„ '�, � � :i '' .t.�((��{�r�•.�!'J�(/"''�.''"'`' -'65' w:.;,'T,;: {'°- ;::' i,�,� t�. �t'�'. :.p ;"„"," 1�'�`W rr�l. ,i, " , }��ttt},"`��Z�:, '�i+ti�,1.�,�f!„ .. .1 1 1 ( � .{,l..j'.T,�'F�.'.�'...::+1. A�'��!:'y �;(]�( '{ . ,7 '•y'. "' � '1. I5♦�,1. ..1.,�'�i _;t5 tJ 5�' i�t;. .,HyC. .}:i:`r,� 1.:,�}..Rri�,:.�i)[+/ �i'nC.h, ' �` 'L. .T ��w :\' �� ,�y�`' ��1::��1'•�';���t�`.'�,:�:.f�_�`1 ..d� ;�:>>., .,... 'f...'*. L '���'�. ,4'� yy'y"�p" r tl�',`,+,'t'�Yt+•q,. ...Urra.;* },��•1 •( f Mf---.gyp-t'.r,L �i .r i �i '«" �Ts'..j,� w 'y"�• �'� ',ri��'!r ,.,-,n,;ty re"i�! +`' r,^` ',4;�� ����a} - � y y. �..: :7a O� co C a ro THE COURTYARD AND COLONNADE to Once past the arched entry to the theater, the Courtyard expands to provide smaller shops and merchants along with kiosks and the ; queuing area for the theater. Beyond the domed theater entry is the entrance to the Colonnade, which continues the retail `� H experience for the visitor. The continuation of the Italian Village theme will follow throughout the Courtyard and Colonnade with o 0 alleys of trees, intimate dining and seating areas,and an architectural flare reminiscent of old Florence. o 0 00 The Crossings at Huntington Beach Specific Plan 49 CD August 7, 2000 11 ire Aghp 14 o'..0 :N$51. IFAld 5m-- !0:2 lqr�m 31"EW---- Sm _10 ................ JR; Ejmlt� PAM " iTM oil "t -Ave 4 yI' > M A Ir r E ,.3r R FL a' ( i•''s� ,r:lF{ih: r "li ''q#,'�7 `r^I I,!.� l.w.. .:Y.. •s pk, -�`�''kn',. ... ,r t e` ) ' •a+jW9� �;�� � �•� � �'�,+sl:v, ti''+"' '� ,�. '.^�ii�k3i iti S i, .r,;•�..�.4? (. 'tt `fib K' 'jirr t t .. Y,v _':4;�`.ti."J! �t.�.}•gip. !i,,,.. ry �t 7%S:!R:r..y;.i^• ^j fY �:s "^kr, .. � ;�,,�......,,('-�,�'=:`� jtrjia, '�"}}tti f,'!`.4y�;?�•`"�'(yl!��{;=Lf�f�1 :�t3;`�>rs:§Ffj�,(s':'i � 'r i y/V.!�' �'^ i,.:. ..�.:;.",.:l-.e,.• 'Ir '�'�L' ('.�r•�tfi4� %r,'11�4 i_j 1.7'.,t �4A!•':lr.�k:f•�• IV {/�F �N,. k5�s i,:,:.:'�':KG;r,,l.�=r1 ,,•,t:' d w,i:l,,..:V�1 I,.}1•. S,ijf,Jp.�>..�..fy���Lry�i � .�. ��a:: rl:�ii!{;I,;.Yi .�`J+'fdy'qJlft;•i jK Pi 't(tS �� <,,;'' �:i '•a r •,�,, "yj;': l�Styf+t.•r;'u.1:• ..'t(. �•�n„M,.. k! .�.L' � �. .,.._,. ,,. i'�sei;.:>s'lS:;)'„s.: � �..' .!ii1E)1j.f'l°�Li' 1%J}a':r�'kr.w(nL?e'S'•,wri ��. '�(;. %;i� "r�;(( N` �,�,i _ r�i.;.,Fr/�• -;iTiiFa - i'L;:.'';i.�; t;f;:.'.:c'r:�:':,.,y: i• �ai� � / ! '�4'., .t£�� ] 1'.1�':i'e:�i:,,=i...>1e„;�.�t S.t 1'}'. ':& •.5:,:••-.'j 1. ,',l" `f.l`'� ".} .,}".'+ 1�i£�rti•ri ,A !. {, i;C:{, it.�;i��'':,`::!':.'„"' ':,, q�'''.(' svr• ��•I. 1� ^`=a;`i.;�:.� 's g:'.;»," •,� i(d'h4."a r. '?:�"t�b:.=' ¢¢ J ;+s ;r.,`r.,t ��?:;,��,;, _,� ,`';;-r•r.;".�:::., „�,� :':�:.Ur.t,�tti •'•�`. .,,v .a,>.+S•.r.,,.,.1. it .ft,��,;ii���.` y-'Jii•,;hl,l)�cr?{I( ia5sr� "�::%�I:(.;,�"„� :'*�:.: !:•� °{if.��s,��•v/7✓.ba} .. �.'1";�srK'/.:-rxl1.'�:I,�.'F - I,f��.:i:t', i�.L1 .��1+'• ,1Er?ft"'r'i«;�'cu •�ftsl„� .ti�•i, 2. f., �• `dpr.i.:':�.,ril:til ;i .:n1;n,;Ii•#Sal �'-r,`'t ^t`iq: t+,: t:,;i1t""'71,j:"!i ii� �e y��. ;<.�,.r.. :14'i'.t•;: .�.��.1[IH ;: r.�,,.;";.t7=F`,,.r.:'�.. 'I�i 1 ;"�;+J�'i:.. ''I. G: .A>.f':N Nl.�. ?•�r,� .. '.u:,. ..t+,.id-`''�}:.;)'� 'r. ,�14Y„T'',2{!',�Sil'' :'rp.�...:,.. y r �Ilj':ji%J!1.{s''F{y���,`- .�}r71f`�i+�l:�l�'K�,. H'�"1'.',ij��fr:i:4•.�;lti�� 1 `I,t;, r. y. ',...i�,::«al _'sa:a� .. qS„i; ^.r��,r,5i+.a.•SSCm w:i'�w�{�.,.r.r,:`t:�'•i�':. +. .�... Z] �n •.+"{sfdjl�gfy��: 'S+`v1r �`',:::1�'.'Eii�32�`trr:::::..� .Z Q Color and Materials of Common Areas y y Exhibit T o 0 N N O O The Crossings at Huntington Beach Specific Plan 51 Q CD coo August 7, 2000 COMMON AREA POLICIES: 3.5.3.1 Common Area Lighting will create a strong, attractive night identity for the project. Selected ' elements will be highlighted with illumination. •� M1'� ��brHk These elements are selected for their ability to enhance the dimension and add character to theFy building architecture, to promote the appropriate degree of prestige to the project, as well as to provide lbs` a safe and secure environment for visitors and merchants. R� "�3• �'"'rC',�r �. r; .1, ;�,''' �•. r Y ` . Parking lot fixture rfl #� ,y.:5.h'r;1'.9'?:. `•:;w furl^.�--'{ G•:u'`a' 7. 1 ? 3.5.3.3Exterior lighting shall be located and designed to evenly illuminate the parking areas including the , parking structure. Particular attention shall be paid to ; the illumination of all sidewalks, connecting walkways �.:, :, ;•' and alcoves. All light standards shall be consistent with respect to design, materials, color and color of ' light, and with the overall architectural style of the project. All lighting shall be confined within the p•a, project and shall not project beyond the project boundaries. `' ,+Lj"�4'��: r�•F^"I .`.;�,1:�•��C tGt'i'Cd>' ;tis??�z'`,',;1itw::r.�oF�.. u -.tT Lighting at passagcw•ry 3.5.3.2 Illumination of buildings and landscaping ° Stair fixture will be indirect to create a strong positive image. ' c Concealing light fixtures within buildings and ° c> t ryi fn landscaping can highlight attractive features. Usehow =e ` of a variety of lighting levels at entries, plazas, y. parking lots, and other . areas where evening activity is expected, will create an exciting night y Walkway fixture Accent fixture 2 Z time environment. o 0 N N O O The Crossings at Huntington Beach Specific Plan 52 cc O August 7, 2000 3.5.3.4 Hardscape in the common areas will consist of 3.-5.3.6 landscaping-in the common area will consist of non grid-like patterns, which recall the historical espaliered vines on columns and trellis elements, cobble stone walks and streets of an Italian Village. potted planters to add detail near storefronts, and Water elements shall be creatively incorporated to large and small planting beds throughout the plazas provide visual delight and interest. and passageways. Landscaping may consist of groundcover, grasses, shrubs, vines and trees and �►. shall constitute a minimum of 10% of the common a�, �'�,:�• _;. area (excluding Village Retail). "� •a�.3,...1;i :;7 k�:r( _ ':��td ; i"I"''.��H',�(�td%�,�•tr•,C1-`::�"x•'xt'.:t "•r,ry, ram; .::R'a?: 4'�s��°. ^ii;::i �-,', {'�2r.;�1t;;.`ca;3:5'�4 '� `.y��v*��i±'bf5?!�L�'liisd^`r ' ?+1-• :N •�' `� i r''Ur':,fir `r%C,�ii l:'fi':';4S 3s,'%;^';,r'-'r a y},��.td r�'r.hy,`;t'p •r-: vi t. �I•f/� C�J ,;V� ,..� .!'%"� _ �:i•tv, t't>i,?tit��Ys�::i'�'✓'�,JF�` 'x,:W!���'"�:�'i,in7A1'� gip, t..}+' ;,r s„+f; li, .};rj. eV ., .: i _ iL f:,,�1. �.rre;��$j�7'„5,,.t3 •,; 1"G� ( N ,>fi•'-fah %�i'.� 'r ,x �:, `•��'�':. �' ,',,; .�ai'�"1,��°tiC�:":'4`r,.�;,'v".,t�h` ,1�}G: i una.hcJ c�;i''�" rRill $ �r �i. ?f�:����� 'i; .:jr.l". 1•G� .',•... t'.-:s.r' t.,f{..i.,�,(;,1N,Jp,:���,;.i',�•'{{f:i n, Y".�:� ,i "�`�. L� �k�lr�i .f�::;; Y';'•'�.`'-r=.,::;'�„•__ty� 'H�;; 3; 7���q¢t;,r:�.ifi�'•7 'I.. "� ':3ri'..:r.4+av?'�:�^A?�yf"�"•:N `�nS,�S'!r ' �y,; �-;.ti•!^c r,;raSgJ. R„�". }y"•R':If'14: ;' ;•F �r,�y�fiew;�4rR+"� '�,,�{q�,. � ',�f r �ry1e t2f' 'w.� N fir! yy���;)lni.�"..{ R+;u°,� t �...., ;�:_'�•�r�f��.f�i. '�,�?'�!J 7drG�•}�ty!;�": 'ir, a ,� . ►�ryi. ':�l�ei .:,':'Fe:�j:r;;��—.,. ..&�,,�li�'. :� -� I1J�4�• •,+q r '�ly' t i, <�j,.;�J^�. •,,". :"1.' ..P!i+.{�,:•.,r AI Kt:'TvrY .r.�,i�: i+•e., � . , .F► v�,;':'j •^.::`, ", „�... ;.,.3r,YP�:'n,,.:...f�•�i:�,::�'h�'RF�y,�'�'t' -�.::: ,M•�..,.t,.q.,' .� :k V':",. +r 3.5.3.5 Mechanical equipment shall be screened from YY view from the surrounding public streets and T shall not be exposed on the wall surface of a .:� R!it�"k-{.t!�ta7,' +:�j�- -.,r:'P.'.+,gr�t°.�.•q:'>t�t'I,d v''""�',�'*?1r.•:">f',:: .rj•..r�:;`'• - ,]vi-` ,�',i `? S•N�. J'�Y•yK.F�..[.`+' ,0.�.tii.S;7 t:iu•::;; t.�'�f{�;:.r.•,_;'�.� ,' building. Screening material and color "'a}. ` ,`' .ay' .���s,�,�., Y:+i;;::;:;:.. �r. �s,,,r :.•. .a":,> >Yu; .,. shall be ������'���v�.t�., ,,, ,t� �:,�� �}:,;. °•�,.,,!;;s,._,:.�';�,� r;�. �" ,-,�,�:; compatible with h rr axe"°`,+ t ; .+I°�.i:. � , 4= :.. s,,^;;rs- it. ' ,..:,�•,�;-,: ..:.,,; p the overall building design and �' '' '-�'�iF��� `�tw`� '" �''�•'��'•^''r'��' , '��''"-��' ,�•,i,,,...",',�s t4..;t 13.re. �,:� r.;' to M o-.`f: i..sv.yJrr's._ !D ',s,= ,",i+tnr:.it�.s w'1�z" , , .P..'�:; .;r_ ,l;:r'' H colors. Backflow devices electrical transformers >-•." :, �� ''�,;.: ' ° 7 �rRl,M;iN'�t �`.V�:t "iT'F•�J4.y +h rr�y;��:i�"inuu:l�!'L+� ' ' rwn.�c��am'.,1•G.;,.`' `.'i and other mechanical equipment, located on o grade, shall not be located within the front or 3.5.3.7 Trash enclosures shall be concealed with screen y streetside setbacks, and shall be screened from walls and ornamental gates. Loading docks shall be a public view or undergrounded. screened from view from the surrounding public streets through the use of architecturally detailed C fagade building walls. The facades shall be 2 integrated into the overall architecture of the H project. Landscaping screening shall be provided z Z where possible. o 0 N N O O O O The Crossings at Huntington Beach Specific Plan 53 o, o August 7, 2000 i 3.5.4A New Stores and Theaters 3.5.4 ARCHITECTURAL GUIDELINES Implementation of the Specific Plan will Many of the elements of the Crossings at Huntington generate construction of numerous new in-line retail Beach architecture reflect that of an Italian Village and anchor stores and will likely include a multi- living environment. The Architectural Guidelines are screen movie theater. Design and site layout of any intended to establish a character, style and qualify for newly proposed structures shall comply with the each architectural category. The categories are: following policies. • New Anchor Stores and Theaters NEW ANCHOR STORES AND THEATERS General Tenant Storefronts POLICIES''Nonconforming Buildings and Uses The description of these guidelines is not intended to 3.5.4A.1 Building massing and articulation shall discourage individual innovation and creativity, but to- possess a balance in form and composition; large simply provide a framework within which an overall flat unarticulated building elevations shall not be sense of place will be reinforced. Building design shall permitted. The large planes of the theater and comply with the following architectural policies. major tenant walls should be enhanced with patterns and graphics consistent with the overall, design theme of the center. � Gf, • L r.�.�•awrmon...•.vr:re.«•-tiw_+n M•m..v.v,r> M. 1!. l:..lid . N• L �.Y•a� A;. 'c �! t• :r .e i', 1`i� + ,f ?I?'?�,\tt'^�. t` �•�'i�. 't—'i'=�r � ,`yLy{{yI,L{�i{t/ `�}} ''~•L,NI♦<�.1' 1••1(1Y. IM 11 57�' '!... 'y _ �:,1. 19K. A:: ♦ 'Q:•iNWC� � •1l .' `Jli,}• __ y!Cr' •A': 4 �� —77::J Q . I 4 r tYi _- .... ....J:. . .. it y N N N O O The Crossings at Huntington Beach Specific Plan 54 Q CD 0o O August 7, 2000 try •�/�yy gyp'• � _ 4a View of North elevation 3.5.4A.2 Building entries shall have a clearly defined There are two basic types of General Tenant primary pedestrian entry. Storefronts: Storefronts facing the 'exterior' toward Edinger Avenue and Center Avenue, and storefronts 3.5.4A.3 Building materials and colors shall be guided facing the 'interior' toward the Common Areas. Both by, but not restricted by, the approved Common storefront types may be one or two levels. Area palette. To achieve this Italian Village concept, general 3.5.4A.4 Architecture of all structures on the property tenants in relation to each other shall have varying shall be reflective of the quality of building colors, parapet heights, window openings, heights andrhythms,canopies and signage. materials, design, and presence as depicted in the sample artist's renderings throughout this The basic objectives of tenant storefront guidelines document. are to ensure high quality design' and use of materials consistent with that of the project and to 3.5.413 General Tenant Storefronts will conceptually be produce a variety of three-dimensional storefront treated as an Italian Village. Tenant storefronts may designs, each uniquely different from its neighbors o be _designed choosing from a design vernacular of but tied together with common theme materials. various architectural elements. Then, linking each 0 individual tenant storefront to another creates a CO shopping experience of boutiques and shops similar to a walking street in an Italian Village. Arches, columns, tower elements, domes and canopies shall be . mixed in with display bays, balconies and ;0 balustrades for a distinctly up-scale look garnered In y from many European styles and themes. o 0 ►V N O O The Crossings at Huntington Beach Specific Plan 55 4P CD CO O August 7, 2000 GENERAL TENANT-STOREFRONT POLICIES: 3:5.4B.3 Tenant storefront materials may include but are not restricted to: 3.5.4BA All storefront designs and plans shall be subject to the approval of the property owner and the City O a ue: Translucent: of Huntington Beach. Polished metals Glass block 3.5.4B.2 Storefronts are encouraged to have multiple Smooth brick Etched glass planes to create a variety of volumes and spaces Smooth and Rough plaster Clear glass and to maximize each store's visibility. Glass Fiber Reinforced Concrete Crackle glass Porcelain and Clay tile Metal grillwork Painted or Stained wood Glazed ceramic tile Smooth, Rough or polished stone Powder coated or anodized metal Cast concrete or plaster (i.e. columns,cornices) '��.'e,a' .4�„ ';,.i'.t%•�..��?,i:n°ix�i{.::!». .�w„�:x:3�'F�Y`*{F'=fil;;� ''+�.i:' - '\;4'"'^:=:. '.aTAq '.i":�.-,:-=%:,,-rSi ,:w"S,•`r'i.:t^'f� tti.:,� +X�!.. �.. INS � � c.•..�'�fy�a:���'�i•# �•:;.ur., se i` Q txn y O C PZ Elevation of typical storefronts showing varying heights, window rhythms and heights and canopies. v m y O Q O W. M fD M • fD N N Z Z O O N N O O O O The Crossings at Huntington Beach Specific Plan 56 � coo August 7, 2000 � X•s fR.s.{.;. �I'44,��7'�,{s1.�?2'n{'�rn?!.°`�.''<n$'. P'�G.'1 P%�"� 1 u.ae' tXp°' '4-- S-•::�,�.•:'6�s.'�X",u•r, t+ P'«+�: S?M�::�`r Fa�y.�fp1�6:,"yt' � 'i' Ya. i ., .�'� r' .'fig' zr��a:<,w•..�:y,.5 w:3-,1;„.p :�t,.�•?t.{ �`r tt -�A�i"t'�,#NwR. ,+ '� ?� ( .i{'.:e i','^•�'�.�,"•�+r:�, `� 'if�t '�i`' i'E;.t?i...1;tr'!.,s�,�. 't. �aT.s�„�,,:�:,.tip:i��r5{,;t�:�t��tC$, s•'a� P(, i ,r3,_w�• ��• :'.a',-. .�:} ^;,r:rr,:��,°,.�v,.s•.�`La.jr, t4?�;`�•t',�;�;'d',a.'�°„ F� 2: ,r.,��i-=.§rt.•j•' r,. t 1'• v .�.�y;rY;,�. ,•"t:t.:1+J:,t'*.,y�ti�a_'.x_,:'F,�;+ii:.',.1Fi:':....�p..,�t•xi•.a.•+6;�:;`rtii.z:':J.{:i,'}{y,;i^:- �i::a,.w q ¢; r^n�x�.,.�,,iv,'•::�'.`.'a+k...i��FtS.i,..sr:,+r, ,.c.. .,i.@.:.F y .:i. .->n�'1., ,;,,iy.,;2•. *,r,:il�:�.�, ?:�T"9,�si"�' ,�+� ,l t rtw.•�.'t.. ..,i'f,:. ->.•a..:.t... .ri.'.:�:::,`t�-:!;i":: �sr::' ':$Yi`:, °„;'..r. .rt. .1.+• _ 4 +Fs-HH`yy��''��.., .a r.5`1Yx�1r' "��`t)p} 'f',r��r,.i... • L�:l�:..::a� I.'.i�. -'i"- ;)'1.•� •�`�"�;�.t?;s . � ..IVLL�F' S'+'�F�'fl�i•-•rC1:4 t.. � ,�T -... � � }� £_, �j? •.�. f1F,� +rf�+fit.' .f i -_ ...'Yf• an Tp'�+ :fir"{.P�n�t��-��ly g,•.�.�,�', Fxamples ofstreet£wnt collection concepts 3.5.4B.4 Tenants' storefront may project from the face of w ` the building as long as this does not extend beyond the face of the upper level overhang and maintains r? �" 1PJ' � iG 5."1 /.'M J•+�a:61.+I{��l�•t II��'��:n:�"^� the required mall clearances. ���r�1{ah'P'°"°ti ;' r',"A " '�f•,, *.. t e•; y ,tr t � �'a i?5'�i•a r.yii .,'� •.i L,�,d':''� ,r•i�ilit'd+�..t'.t�r..�li.y�N �;J,iq r r .",ri ���^�';'}?�,riyl.l,�y`4 k1',IL3�'':'y,;„r,'.1•[�r'lly'F�ia�,n';�:.'ujS'�;.'v'.;::i 't'ii 3.o.4B.o Storefront designs shall comply with the design � r ��� � � h�((►�y7 j ',t _�] � ' O-- Y J O '� tyrV�I��i•F, , guidelines and may require modification in the event that they are too similar to a neighboring - — ' ` ±''` .. E4 a store. Themes evident in the Italian Village shall be ,-.. used to base all storefront designs �a' °� "' Y y o .lu! 3.5.413.6 Tenants are encouraged to vertically extend their facade design from leaseline to leaseline and "q' c from slab to top of parapet or bottom of upper floor above. a y 3.5.413.7 Tenants are encouraged to have awnings or Examples of awnlnS use canopies at their storefronts. y y Zz 0 0 N N O O O O CD The Crossings at Huntington Beach Specific Plan 57 &1 & 00o August 7, 2000 i k�� i ��'Y',,h, �, ',ylY•� �'�':1�ti �7:�'•... u1,,111 � �i%�Y: } IX' �i � � �),rk, t�,Yl�'a,, 'Rf I�;� F ��. •�".i�,�� ':{ }i J,� a t71t�•�"jj•7�:{ i� -: r 2, ,,1 :r rl of I ,;r % , : +� {Ib.-. .•�'i, ...1:^K.�f�R;�ia�. •'�,��'I;�'t`��i-r4� tiii4 � ...��r,.. � ,y�j"!. �� i '� ro•� �.: - "�4 t'i:• ^a�f.1�f59y, y M:-.k•i',du.4''N x13:i•• k: ^c•r. ��•S �i tA. � ti}t: r tr;.Itir4:,.,M;'S3§�.�,;�a y..._.".. ::i�i.�Y: '! �i'lr�l�,^�'1 ���.1��1`Y,:j�iiii;�� a .� �,�, �.....� p ����� g •`�:i,�i..•. • ,_ .. dry ;i a. .. �: i••"�`y ,I .,�• - - - � � I��YJ .tar Ott• �g�: ': �'�i� .�.r , rN..rk -- - � -.. Typical Tenant Storefronts y Exhibit 8 0 o• CO a y fD 4 ;0 X <D fD Z Z O O Q CD N N O O The Crossings at Huntington Beach Specific Plan 58 CO O August 7, 2000 MAC Nonconforming Buildings and Uses land, buildings or structures used in conjunction with a nonconforming use or a Purpose — It is the .intent of these regulations to building or structure nonconforming due to provide for the termination of nonconforming uses use and/or standards,except: and the remodel/ renovation of nonconforming buildings in order to promote the public health, a. Exterior building alterations to a building safety , and general welfare and to bring •such or structure nonconforming due to buildings and uses into conformity with the goals standards when the exterior alterations and policies of the City of Huntington Beach General comply with the design, architectural, and Plan and The Crossings at Huntington Beach Specific development policies and standards Plan No. 13. This section is intended to prevent the contained within the Specific Plan. expansion of nonconforming uses and buildings, establish the circumstances under which they may be b. To the extent required by a subsequently continued and provide for the removal, correction, enacted or subsequently adopted law, remodel,or change of such uses and buildings. ordinance or regulation, and the Director so finds. Such additions as are permitted by 3.5.4C.1 Regulations Applicable. The following the subsection shall not be construed to regulations shall apply to all nonconforming uses extend the termination date of the subject and to all buildings or structures nonconforming nonconforming use, or a building or a due to use and/or standards as specified herein: structure nonconforming due to use or standards. 1. Continuation. A nonconforming use or a 3. Natural Act. A nonconforming building or building or structure nonconforming due to structure that is damage or destroyed by fire, use and/or standards may be continuously earthquake,or other calamity, or by act of God, maintained provided there is. no alteration, or by act of war, or by the public enemy, may enlargement, or addition to any building or be re-constructed provided that each of the y structure; no increase in occupant load; nor following conditions is met: any enlargement of area, space or volume occupied by or devoted to such use, except as otherwise provided in this Section. a. Such re-construction is permitted by the o Uniform Building Code. o' 2. Additions to a Nonconforming Use, Building, cn b. Re-construction is commenced within one � or Structure. This section does not authorize year of the date of damage, unless the extension,expansion,or enlargement of the otherwise allowed by the Planning area of land or the area within a building or Commission, and be pursued diligently to H. structure devoted to a nonconforming use, or completion. z z the alteration, enlargement of or addition to a y y building or structure nonconforming due to 0 0 use and/or standards, or permit the addition of o 0 The Crossings at Huntington Beach Specific Plan 59 � o August 7, 2000 remodeled and renovated to comply with the 3.5.4C.2 _Termination Conditions and Time .Limits standards enumerated in this Specific Plan The . following regulations shall apply to all within the time frame specified in this section, nonconforming uses and buildings and structures except when extended or revoked as otherwise nonconforming due to use, and to buildings and provided in this section. structures nonconforming due to standards as specified in this section. In the case of nonconforming uses and buildings or structures nonconforming due to 1. Termination by Discontinuance. use, and those buildings or structures Discontinuance of a nonconforming use or of nonconforming due to standards enumerated the use of a building or structure in this Specific Plan: nonconforming due to use and/or standards as indicated herein shall immediately terminate a. Where a nonconforming use is carried on the right to operate or use such nonconforming in a conforming structure — three years use, building or structure, except when from the date of adoption of the Specific extended as otherwise provided in this Section: Plan. a. Changing a nonconforming use to a b. Where a nonconforming use is carried on conforming use; in a nonconforming structure due to standards enumerated in this Specific Plan b. Removal of a building or structure — three years from the date of adoption of nonconforming due to use and/or the Specific Plan. standards;or c. Where a conforming use is carried on in a c. Discontinuance of a nonconforming use or nonconforming structure due to standards use of a building or structure enumerated in this Specific Plan — three nonconforming due to use and/or years from the date of adoption of the standards as indicated herein for a Specific Plan. y consecutive period of one or more years. 3.5.4C.3 Review of Amortization Schedule or o 2. Termination by Operation of Law. Substitution of Use Nonconforming uses and buildings or structures nonconforming due to use, shall be 1. Request for Review—An application may be discontinued and removed from their sites filed with the Planning Commission requesting within the time specified in this section, except extension of the time within which a o. when extended or revoked as otherwise nonconforming use or building or structure provided in this section. Buildings or nonconforming due to use, or due to standards y structures nonconforming due to standards where applicable, must be dicontinued and Z z enumerated in this Specific Plan, shall be N N 00 The Crossings at Huntington Beach Specific Plan 60 0 Q cc o August 7, 2000 removed from its site or remodeled and 3. jeopardize,endanger or otherwise renovated as specified in Section 3.4.5C: constitute a menace to the public health, safety or general welfare. The Planning Commission may accept such filing either before or after the date of 4. Findings and Decision—The Director of expiration of such nonconforming use, Planning shall recommend and the Planning building or structure. Commission shall approve an application for a nonconforming use,building or structure 2. Application and Procedure—Except as review,provided the burden of proof set forth specifically provided in this section, the above has been met by the applicant. application and all procedures relative to notification, public hearing and appeals shall 5. Conditions—The Planning Commission, in be the same as for a conditional use permit. approving an application for a nonconforming use and structure review may impose 3. Burden of Proof— In addition to the conditions it deems necessary to insure that the information required in the application, the approval will be in accord with the findings applicant shall substantiate to the satisfaction required. Conditions imposed by the Planning 'of the Planning Commission the following Commission may involve any pertinent factors facts: affecting the establishment,operation,and maintenance of the uses,buildings or a. That to require cessation of such use, structures requested. building or structure would impair the property rights of any person to such an extent as to be an unconstitutional taking of property;and/or b. That such use,building or structure does y not now and will not during the extension period requested: o 1. Adversely affect the health,peace or welfare of persons residing or working in the surrounding area, and, 2. Be materially detrimental to the use, enjoyment or valuation of the property of other persons located in the vicinity y of the site,and, o 0 N N O O O O The Crossings at Huntington Beach Specific Plan 61 CO o August 7, 2000 i °�:.'Y;), to �F'` :� W •;.r.�;�r�a;.;' ^i i:� .rr% A�. kri}.' I a,l :I' .�_:�.. ,�. to ;r., '� '�I 2�� �'�� i �� d�' r �''; ��� 1•..�� .'�r4Mi' .. AL I a yv �p7 N Conceptual Facade Improvement for Village Retail 2' a m y y . m N 2z O O N N O O ' O O The Crossings at Huntington Beach Specific Plan 62 � o August 7, 2000 J , i ='tom�,_�4''.:Si�':.. . :4�• .f:.l... '{:�."`. -w:_,,,» �:�' \ yhl 't'. .1�Irl r t 1•� 1 �:il� 111•illlll ,I 1. ,1�::i:.,,1 i:II. �� ':'• •-•�'Fn: L1 _ III � � .'7;,r� "1''•'-(:;. ' 12 I 1 ,'.Ih. III �I, .I I: d ..1 I d + r�``•-r:6 �'•�. \\ , ra,rm•rntlI IWI'Mrmrrm- MUMI,2_ 1 i yard Icrd - IfT'!J `--J_..'.'f:J'•'4''":�": .. �,+►P. '•. ��. t——1 ltfirT+ 9U:7 - - _r�. ' {'U its _23 1.1 w3 V. .iJ {i f( ��L . I( �1.\� s 77 4): �� AFC I• cr - - �' p F�i n ':a _ .� 1Naiili�i. r n _ 1 c +,:_ ,rIC : ,. -m L \ O h �7 11 I r: 1 I' I� C7�' C' -ti7 � u� (raj /V�i/� - 19� � �" �, f1f l^••/ \ ...�:.-f�'I I Illl11111 i�•IWl�.:ll:�.'p.l'�µ , ... (' ::i) :f=: 1:J - U %-'- .ti/. 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':u�� •'�3� •1";. i- ii i:t '{ �'r .a _II -----.^-_ _--ca�L.. •�,r:-=-'- .� _ I.l�', .. >,®d�.�l, ''l y �1�....:�:1..-S �3,d. �r;�f7�'..._.:l'�:::.:i.:..1.�1J..;i!_•t�'.:��,•''o i.«.x.no.r.u�wu:.W.n u..N^..uw•w r•aww•..•a.w......... , H a Landscape Concept Plan 41 4f Exhibit 9A N N O O O O The Crossings at Huntington Beach Specific Plan 63 coo August 7, 2000 ' G _ I � 1 fill �tlnftlttn ViliNf1N111TIIlITfiD ��e `'�r' � �'•:� \ '� ••"•. .41111110011% - tivm - -_ _'.{•1 F.. - - ntnrlji_ !1 ltll 111 I � :{�: ��,'.- .�'T,�.• \�L�'` N ♦., •.. I. I .l;i,T .{(,-' yj' .x„�. 1G��li�:{F.k•,? 't�•P, = - - _ d :��\\'� V' � ': - ''';r. 5z i.i6iE z'""e ./'d"`a•7;''�.� _ _ - -- - -- - \•,�`CR A LNuf:. �) I — 1N. t :I.�: •li ;�I"�'.�'.ty' �•��.`. ''S,: ` �:" 'I�. :.i� - - �_'�iE. ��.,'� 'ti,1 ''t'1 J I'�" +I�il lei l,• III�'lll,11�'il��l�•I��'li•il+ll t�ll'T :X ix;ixtt � 1 --__ _ _ ____ _ Iyy�,� ,di✓ — —_ _ — y—' ! I' , •1 . III I •.. ., .I '`. — — I .I. - ..Ilaoi~•v'_,:Y ( ;;�;�.Ae ,v1. .�u(n l/ ,IlRtll,Tifl(Tir :,�-•.i::�l.,, ( .. I� I �1"+�t�� lily .s Y':: f :i�l',� tf,:,•.'/i,;1i > —� .r , ,;f.: '.\ >>' I;' r ILI I 111 iaN I I I I I imul ft €a� I�I - -- - i+=`�P�i., 'Y.r�J""•' a �' 6'K�'�s1 �I, r� '-i':..:`Sfl:'u.'{ J.�,.. i I •.�... � 1 ��l ny, � rR. J��. rn Il I - -. ,�. .•ti� r ,t, .. ,Jf 1 I I . '�' '�: '�'' -.."�• 't't' srpr• !'91 — ----. syt' •� :� ut�r - - - ~'' ,.� ,� Ysa:��w'.,,,,,, ,n•,r,l n I I I h il; a' - :�:;,. - =�=astir" •i��;' ==1:_ - - - - - '•.� - - � r. 00 r - ,�r:• - - - i1i I i - t 1- - 11 �- uul •Y - - I — .Z1 lit CO - �� _�ii1�='YIJ`- �_ - ""�Y�� }o' �1� ,�i. �.t� "i I•iii' �A 1 �� y -- F INGE qE ' e� a us -- c--' -- —. �.- •._.,�— _ �� r7�.—_ -- ---- -- --' ��—e-='LL.__I_^ ,. y a m y Landscape Concept Plan y � m N Exhibit 9B o 0 Q N O O The Crossings at Huntington Beach Specific Plan 64 �, Cal O August 7, 2000 3.5.5 LANDSCAPE GUIDELINES The landscape for The Crossings at Huntington Beach 3.5.5.2 Existing healthy trees, where feasible, shall be is an integral component of the overall project design. preserved or relocated on site. If healthy trees are This design concept is urban in nature and has strong removed, replacement shall be as follows: Each elements of an Italian Village. These elements include existing Rhaphiolepis "Majestic Beauty" removed the use of strong vertical elements such as Italian shall be replaced with one (1) thirty-six (36) inch cypress,and Palms at the main entrances in strategic box tree or palm equivalent. All other healthy tree areas for emphasis and continuity. Some of the other species with a ten (10) inch diameter trunk at elements that fit well with an Italian Village breast. hieght or larger shall be replaced with two environment include the following which are (2) thirty-six (36) inch box trees or the palm indigenous to the California coast. i.e.: Bougainvillea, equivalent for each tree removed. Should the Ivy Geraniums, Hibiscus, Lupine, Azalea, Indian foregoing substitution of two (2) 36" box trees be Hawthorn and tree varieties such as Silk tree, Alder, impractical, the ratio may be modified to one (1) Strawberry tree, Deodar Cedar, Carob, Carrotwood, 36" box tree with the approval of the Directior of Crepe Myrtle and the like. The Landscape Concept is Public Works. Palms may be substituted for trees at composed of these elements as well as other elements, the ratio of half (1/2) foot of brown trunk height such as decorative paving, water features, public art, , for each one (1) inch of box size. If the situation and lighting which are complementary to and assist in occurs where there is not enough planting area for the implementation of an integral landscape design. the trees required, the accumulative box inches of These Landscape Guidelines establish the design trees may be utilized, For example, two (2) thirty character and visual qualities for development within six (36) inch boxed trees could be combined into the Specific Plan. one seventy two (72) inch box tree. For palms, the requirement of eighteen feet of brown trunk for LANDSCAPE GUIDELINE POLICIES: each thirty six (36) inch tree would work as follows: two (2) thirty six (36) inch box trees could 3.5.5.1 Site layout shall respect and preserve as much of be combined into one (1) thirty six (36) foot the existing site features, including trees where (brown trunk) palm. All tree replacement shall be N' possible. A professional consulting arborist shall subject to review and approval and may be o determine whether existing trees can be saved modified by the Director of Public Works. tZ during construction. m y cD Q X7 � fD N (A N $ O O N N O O The Crossings at Huntington Beach Specific Plan 65 o, o August 7, 2000 3.5.5.3 Landscape design shall provide formal or 3.5.565 Street tree planting in the parkway areas shall informal groupings of deciduous and evergreen include a minimum of one (1) thirty six (36) inch trees, flowering shrubs, and groundcover. Trees box tree for each forty five (45) feet of lineal shall be of even size and shape at the time of frontage. At the discretion of the Director of Public installation. Replacement trees shall be compatible Works, this planting may be modified to one (1) with the new landscape plan. A minimum of eight twenty four (24) inch box every thirty (30) feet. (8) percent of the net site area shall be landscape Tree planting shall be grouped in informal drifts and shall be provided on the perimeter of the site and tree quantities shall be determined by the and the parking lot. Additional landscaping is length of the property adjacent to the street divided requred in the Common Area (see policy 3.5.3.6). by the recommended spacing of each tree variety. Shrubs shall be planted flush to the walls, when All parkway planting shall be subject to review and feasible, thus not allowing a hiding place for an approval of the Director of Public Works. offender or privacy for transients between the shrub and wall. 3.5.5.4 Plant materials shall be selected to create an informal pattern of landscaping to reinforce the character of the tree plantings. A formal pattern of landscaping shall be created on-site at the project entries. Trees shall be selected based upon the size of the planting area to allow for mature growth without causing future damage to the improvements. A consulting, certified ISA arborist y shall review and approve final tree planting plans a for compliance. All trees shall be a minimum twenty-four (24) inch box size. Shrubbery o (evergreen and flowering) shall be low to medium c in height; minimum size shall be five (5) gallon. All grass selections shall be made from the City's approved water efficient materials list. y tD a y ;a M fD M . to 2Z O O N N O O The Crossings at Huntington Beach Specific Plan 66 c, O August 7, 2000 PLANT PALETTE - SITE , I /,',.',;M;)7': ,';1 j!„*"•1', a:SY?'^3'.Sa" :�1L"7 _ _ _ DFSCRIPI701V 'BOTA NICAL �NA7l%L�-..;•: FRONTAGE TREE PYRUS KAWAKAMII EVERGREEN PEAR LAGERSTROEMIA FAUREI CRAPE MYRTLE METROSIDEROS EXCELSUS NEW ZEALAND CHRISTMAS TREE FRONTAGE[-LEDGE LIGUSTRUM J.'TEXANUM' TEXAS PRIVET JUNIPERUS CHINENIS `PARSONII'JUNIPER FRONTAGE ACCENT SHRUB BOUGAINVILLEA SP. BOUGAINVILLEA HIBISCUS ROSA-SINENSIS HIBISCUS FRONTAGE GROUNDCOVER GAZANIA SP. GAZANIA ZOYSIA TENUIFOCIA KOREAN GRASS ENTRY DRIVE THEME TREE OLEA EUROPAEA OLIVE ENTRY DRIVE TREE JACARANDA MIMOSIFOLIA JACARANDA PINUS CANARIENSIS CANARY ISLAND PINE PYRUS CALLERYANA'BRADFORD' BRADFORD PEAR ENTRY DRIVE ACCENT SHRUB AZALEA SP. AZALEA ENTRY DRIVE EDGE SHRUB PHORMIUM TENAX FLAX ENTRY DRIVE LOW SHRUB TRACHELOSPERMUM JASMINOIDES STAR JASMINE END ISLAND TREE LAGERSTROEMIA FAUREI CRAPE MYRTLE RHAPIOLEPIS'MAJESTIC BEAUTY' INDIA HAWTHORN TREE FORM CND ISLAND LOW SHRUB ASPIDISTRA ELATIOR CAST-IRON PLANT TRACT IELOSITRMUM JASMINOIDES STAR JASMINE ROSMARINUS OFFICINALIS SPREADING ROSEMARY END ISLAND ACCENT SHRUB ROSA SP. SHRUB ROSE PARKING LOT TREE PLATANUS ACERIFOLIA TLOODGOOD' LONDON PLANE TREE ULMUS PARVIFOLIA TRUE GREEN' TRUE GREEN ELM ZELKOVA SERRATI'A SAWLEAr ZELKOVA ULMUS PARVII'01.1A CHINESE ELM SCREEN TREES EUCALPTUS SP. EUCALYPTUS PINUS SP. PINES a AGONIS FLEXUOSA PEPPERMINT TREE y' PARKING GARAGE SCREEN TREE TRISTANIA CONFERTA BRISBANE BOX PARKING GARAGE PLANTING BOUGAINVILLEA SP. BOUGAINVILLEA o TRACT IELOSPERMUM JASMINOIDES STAR JASMINE M PITFOSPORUM TOBIRA `MINT JULIP' SCREEN TREES MELALEUCA QUINQUENERUTA CAJEPUT TREE y TRISTANIA CONFERTA BRISBANE BOX a FICUS RUBIGNOSA RUSTYLEAF FIG Plant Materials Palette Exhibit 10 ; !a 00 IV N O O The Crossings at Huntington Beach Specific Plan 67 0 0c O August 7, 2000 3.5.5.6 Pedestrian walkway systems shall be designed Perimeter parking lots adjacent to arterial streets to unify the entire ' project area and provide shall be provided with additional landscape pedestrian site access to buildings, parking and site treatment to ensure that the parking areas are activity areas from the perimeter project area and adequately screened from adjacent street views, from within the site. Pedestrian walkways shall be a however, not hidden from the view of passersby minimum of five (5) feet clear in width with no and police on the adjacent streets. Berming in these vehicular overhang. areas is encouraged and shall be a maximum of three (3) feet high and have a natural appearance 3.5.5.7 Perimeter landscaping around the project areas in form. However, the fact that a successful retail shall provide a consistent edge treatment using a shopping center must be seen from the adjacent limited variety of plant materials. streets will be the determining factor in the selection and placement of all perimeter 3.5.5.8 Parking lots shall be planted at the rate of one (1) landscaping. tree for every ten (10) parking stalls. Parking lot Shrubbery shall be planted in areas where berms trees shall be twenty-four (24) inch box trees. All are not practical. Shrub planting shall be provided tree,planting areas shall be a minimum net width of in a minimum five (5) gallon size and spaced a four'(4) feet in one direction and a net width of six maximum of three (3) feet apart. Shrubbery shall (6) feet in the other direction. Small trees (at not exceed three (3) feet in height. Hedges shall be maturity) shall be utilized in these planting areas. trimmed from the ground and maintain an eight Parking lot treatments shall be consistent and (8) inch clearance from the ground. contribute to the project landscaping unity. Parking Where cars overhang the curbs, ground cover lots shall be planted with trees in such a manner as planting shall be required;a maximum overhang of to provide maximum shade. An alternative which two (2) feet shall be permitted. The overhang area y clusters or groups parking lot trees may be shall not be considered as part of the required y considered. Larger trees may also be considered as minimum percentage of on-site landscaping or substitutes for a number of smaller trees, subject to review and approval of the Director of Public minimum planter width. c Works. o a v m y 4 m N Z7 .Z7 N Op N N O O The Crossings at Huntington Beach Specific Plan 68 �, � o August 7, 2000 3.5.5.9 Perimeter landscaping shall preserve or Exhibit 5, shall incorporate enhanced materials construct a minimum ten (10) foot wide landscape from the property line to the back of the adjacent buffer between the arterial highway and private landscape planter or a minimum of 15 feet. Minor project improvements, including buildings, walls, driveway entrances shall provide a minimum of ten parking areas, etc. Landscape improvements within (10) feet of enhanced treatment. the public right-of-way, adjacent to private improvements, shall be constructed by the project Pedestrian connections consisting of enhanced developer and maintained by the property owner paving materials shall be provided along the front consistent with the overall landscape theme. The of the satellite buildings (Barnes and Noble, Circuit design shall be consistent with the approved City, and Staples) and within the pedestrian Edinger Corridor concept. walkway connecting these outlying buildings to the main mall. Enhanced paving materials shall also be 3.5.5.10 Entry drives shall be constructed in conformance provided throughout the public plazas and from with the Specific Plan (Policy 3.5.2.4) and City Edinger Avenue at the main project entrance design standards (Public Works Standard Plans) (across from Sher Lane) along a pedestrian path to subject to the review by the Directors of Public the main plaza. Works and Planning. Project access points shall be designed to provide entering and exiting drives 3.5.5.11 Interior plaza areas and courtyards shall be with adequate views of approaching pedestrians provided as focal points. These areas shall be an and vehicles. integral part of the building architecture and be connected by a walkway system to the public Entry drives shall provide convenient access to pedestrian walkways. parking lots at various locations approved by the Director of Public Works. In addition to street trees 3.5.5.12 Irrigation systems shall comply with the City's and on-site landscaping, each entry shall be "Water Efficient Landscape Requirements." a designated by grotuul cover-planti►►g, sluvbs, ► nd (Ucduurncc #I 45L). large specimen trees on each side of the entry. o These trees shall be located a minimum of ten (10) 3.5.5.13 All landscaping shall conform with the feet back from the intersection of driveways and. requirements of the Landscape Improvement ; property lints to avoid line-of-sight conflicts. chapter of the Huntington Beach Zoning and c Subdivision Ordinance, the City Arboricultural and Enhanced paving (pavers, interlocking bricks, Landscape Standards and Specifications, and City stamped concrete, or other similar material) shall Standard Plans, in addition to the Specific Plan y be provided at all driveway entrances from the policies. public right-of-way to the project. Major driveway F entrances, as identified on the Circulation Plan, o 0 N N O O O CD The Crossings at Huntington Beach Specific Plan 69 � o August 7, 2000 3.5.5.15 Landscape screening is intended to soften and 3.5.6 SIGNAGE GUIDELINES blend the connection of the'building areas with the landscape of the parking lots. Trees shall be The Signage Guidelines identify a framework to provided to soften,and visually relieve, parking and advertise a place of business and provide directions or utility areas and to provide summer shade. information specific to that business. Attractive and, effective signage can be designed without detracting Trash enclosure areas, where appropriate, shall be from the overall design quality of the project area. The provided with tree and shrub planting screens to Signage Guidelines also contribute to the overall soften the enclosure. Mechanical equipment and project area urban retail design theme. Design, color, transformer areas shall have landscape screening materials and placement are all important in creating and/or low-level screen walls. Valves, meters, back signs that are architecturally attractive and integrated flow preventers, etc., shall be screened by shrub into the overall project area design. The intent is to plantings and/or low level screen walls. create and promote a quality visual environment by allowing only signs which are compatible with their 3.5.5.16 Landscape lighting shall be provided in selected surroundings and which effectively communicate areas to aesthetically enhance the site. Pedestrian their message. walkways shall include adequate night lighting for public safety and crime prevention purposes. Signs shall be designed to be architecturally Courtyard lighting shall be a minimum maintained compatible with the colors and materials of the level of one foot-candle. adjacent building. All signing shall be consistent with the Crossings at Huntington Beach's sign standards 3.5.5.17 Conservation water measures shall be (Appendix C). incorporated in the landscape design. A minimum of seventy-five (75) percent of the required landscape area shall be planted with ground cover a and the balance (a maximum of 25 percent) with turf. The use of shrubs, hedges, and berming shall o be provided to screen cars in the parking lots from ZF street view. 2' a y CD ' Q N UI �O M M N fA N Z Z O O Al N O O O CD The Crossings at Huntington Beach Specific Plan 70 o O 4Mo August 7, 2000 DEVELOPMENT REGULATIONS 9 A ARA API m� WPA ------------- �......�p_i - ®® li_ II ;au q - . a'i'ys �sni.� r�,��• i7W. ►� ww --- ,- o ^w O;k - ' i m fA N Section Four N N O O O O The Crossings at Huntington Beach Specific Plan 71 � o August 7, 2000 DEVELOPMENT REGULATIONS 4.1.0 DEVELOPMENT REGULATIONS POLICIES: 4.1.1 Not withstanding provisions to the contrary, all 4.0 PURPOSE grading shall be approved by both the Planning Director and Director of Public Works,or designee. The purpose of this section is to provide specific 4.1.2 Construction may commence only after the development regulations and standards that will be Planning Director finds that the project is consistent applied to development projects in the Specific Plan. with the regulations and applicable policies and Upon adoption by the City of Huntington Beach, the guidelines of the Specific Plan. Crossings at Huntington Bcach Specific Plan will be the zoning document for the project area. 4.1.3 All structures in existence at the time of Specific 4.1 GENERAL PROVISIONS Plan adoption shall be deemed legal, non-conforming. All policies regarding Site Plan Review process and The provisions contained herein shall govern the facade improvements shall apply. design and development of the Crossings at 4.2 DEFINITIONS Huntington Beach Specific Plan area. Standards and/or criteria for development and activities not specifically addressed in this Specific Plan shall For the purposes of the Specific Plan, words, phrases require referral to the current provisions of the and terms shall have the meanings as defined below. Huntington Beach Zoning and Subdivision Ordinance Terms not specifically defined in the Specific Plan shall and Municipal Code. have the same definition as used in the City of Huntington Beach Zoning and Subdivision Ordinance Whenever a use has not been specifically listed as in effect at the time of any individual request. being a permitted use, the Planning Director shall determine if the use is consistent with the intent of this When not inconsistent with the context,words used in a Specific Plan and compatible with other permitted the present tense include the future tense; words used uses. In addition, all projects must comply with the in the singular number include the plural number; following policies: and words of the masculine gender include the o feminine and neutral gender. The word "shall' is always mandatory and the word "may" is permissive. °a The word "encouraged" shall mean every effort shall a be made to conform to the policy but alternatives may be acceptable. o. 4.2.1 Architectural Features. Architectural features M M include elements that compliment the building Z z architecture such as, but not limited to, walls, c N N O O The Crossings at Huntington Beach Specific Plan 72 co O August 7, 2000 architectural towers and domes (with The Crossings at Design Guidelines,or Development Regulations. Major Huntington Beach logo), spires, and arches. modifications require a Zoning Text Amendment and Architectural features may include signage as depicted action by the Planning Commission and City Council. in the attached signage guidelines. 4.2.9 Private drive. A privately owned and maintained 4.2.2 Communication Antenna. All types of receiving roadway used to provide vehicle access through the and transmitting antenna,except satellite dish antenna property. and wireless communication facilities. 4.2.1 o Renovation. Any request to remodel, improve, 4.2.3 Deviations. An adjustment in one or more renovate,upgrade, or refurbish the interior or exterior Development Regulations in order to accommodate of an existing building, including minor special circumstances and/or unique architectural improvements to accommodate new tenants or an features. Deviation shall be limited to ten (10) percent upgraded look for an existing tenant. of any single development regulation. 4.2.11 Site plan. A plan prepared to scale, showing accurate 4.2.4 Drive-Through Bakery. A shop where only bread, and complete dimensions of all buildings, structures, cake,,pastries, doughnuts,and similar goods are baked landscaping, parking, drive aisles, uses, etc. and the (and/or) fried and sold on the ,premises and is exact manner of development proposed for a specific designed to serve patrons who remain in their cars. parcel of land. Tables and chairs may also be provided indoors or within an outdoor patio but a minimum of one drive- 4.2.12 Street. A public or approved private thoroughfare or through lane and one outdoor pick-up window for road easement which affords the principal means of vehicle service of bakery goods must be provided. access to abutting property. 4.2.5 Entryway. The point of ingress and egress from a 4.2.13 Structural alteration. Any change in, or alterations public or private street to the individual project. to, the structure of a building involving: the bearing a wall, column, beam or ceiling joints, roof rafters, roof H 4.2.6 Final Approval. Ten (10) days after approval by the diaphragms, foundations, retaining walls or similar N discretionary body and no appeal of that decision has components. ° c been filed. o 4.2.14 Ultimate Right-of-Way. The adopted maximum y 4.2.7 Modification (Minor). An amendment to the width for any street, alley or thoroughfare as exhibits and/or text which does not change the established by: the general plan, a precise plan of y meaning or intent of the Specific Plan. street, alley or private street alignment, a recorded a parcel map, or a standard plan of the Department of 4.2.8 Modification (Major). An amendment to the Public Works. Such thoroughfares shall include any exhibits and/or text which is intended to change the adjacent public easement used as a walkway and/or c c meaning or intent of either the Development Concept, utility easement. 00 00 The Crossings at Huntington Beach Specific Plan 73 000 August 7, 2000 4.2.15 Use. The purpose for. which land or building is 4.3.1 Permitted Uses. Permitted uses shall be required to arranged, designed, or..intended, or for which it is meet all applicable provisions of the Huntington Beach occupied or maintained. Zoning and Subdivision Ordinance Code. A list of permitted uses is provided in Exhibit I IA. 4.2.16 Wall or Fence. Any structure or devise forming a physical barrier. This definition shall include: 4.3.2 Intensity. The maximum intensity shall be consistent concrete, concrete block, brick, stone or ' other with the City's General Plan. masonry material, metal, and wrought iron,etc. 4.3.3 Building height. The maximum allowable building 4.2.17 Zone. A district as defined in the State Conservation height shall be seventy-five (75) feet and a maximum and Planning Act, shown on the official zoning maps of 4 stories. Rooftop mechanical equipment and and to which uniform regulations apply. parapet walls may exceed the maximum permitted building height by fifteen (15) feet, however 4.2.18 Zoning Maps.The official zoning maps of the City of mechanincal equipment shall be screened from view. Huntington Beach which are a part of the Special themed architectural structures or elements comprehensive zoning ordinance. such as towers or domes may be allowed up to one .. hundred-twenty (120) feet. 4.3 DEVELOPMENT STANDARDS 4.3.4 Setbacks. Refer to Exhibit 12. The Development Standards shall serve as the 4.3.5 Landscaping. Landscaping shall be permanently mechanism for the implementation of the Crossings at maintained in an attractive manner in all setback and Huntington Beach land uses.The standards set forth in parking lot areas fronting on, or visible from, adjacent this section will assure that future development within public streets. The Crossings at Huntington Beach is implemented in a manner consistent with the intent of the project area 4.3.6 Signs. All signs in the project area shall conform to Master Plan. The standards contained herein provide the provisions of the sign standards in Appendix C. y' flexible mechanisms to anticipate future needs and achieve compatibility between land uses and the 4.3.7 Lighting. All illumination of interior circulation surrounding community. Standards and guidelines are streets, parking areas, and project sites, shall be o designed to be compatible with the existing land use coordinated to provide consistent illumination y categories of the City. The primary land uses in the intensity. Emphasis shall be placed on areas of high Crossings at Huntington Beach shall be regional vehicular and pedestrian activity. Light fixtures and commercial, retail, dining,and entertainment. standards shall be consistent with building architectural style. Public streetlights shall comply y with the City of Huntington Beach guidelines for street M M lighting. z z 0 0 1V N O O The Crossings of Huntington Beach Specific Plan 74 p wo August 7, 2000 New building construction of the following uses and fagade improvements to existing buildings shall be permitted within the Crossings at Huntington Beach Specific Plan subject to review and approval of a Site Plan Review by the Planning Director. Other changes in occupancy, such as, like for like tenant changes, new tenants established within existing buildings, and/or intensification of tenant uses shall be subject to building permit plan check review to verify compliance with parking and the Specific Plan review. - ,�• ::y,. <'+ .tL' :+.'::"`�: ,:.'ai` ,;k; y .i... - '{ ':10,;,•ahtn",,,T •�pn:, ::h`• :J:;'yr,.p;+r ai',at.:�a' .y" tl .,. ,py�4'. .a�. )''�i;:,?+'r `s� :i�, ,.L•d',^:•'`::f„4;:.,y,ry 7 "•Ytt yy. :'t f,� �i+�. S. :.�., Si�,A '4`• C.r,• , . ,x .,£'�,.,,;•....��att- .h� •1"'`i �'. >?: P e,P � i•' R - �7�'1' '�.y. �'• S'•4,>nV'�Mrr+�',d`Q;y .`)) ; , ,.y a—j.: M��y,// r'T.1..ISVn•. cf GY .:J .r,4 tt.aa:y,T >L:J'ii k'4.'f:l=�r'.:k'a.(.•L'r yn e'f ,q¢ /'aS N 1. ! "�TI•.FIFY,tA1 Ciw..':..Alk:�ll,i,fir_ ,- . .r, ..X.. ,r{'i';_,�,e•s—:,r.F .n.> .<,t,r;t. .• w.,a.�F.v.Y,t,.kirnt< �. .r;av.,,w. .<y�.3 „ sry,'i7.'r;Li..xtG.aB.. "f :iw., h.,�' ;. �%'fA. •s r' +A. .• n. .ii�� ,.•L..,C^,tj.'�i I ...s. Aquarium Day Care Facilities Batiks and other financial institutions Government Offices * Commercial recreation and live entertainment Public Safety Facilities Food Markets (Specialty Markets-max. 10,000 s . ft.) Utilities and Communication Facilities General Retail Parking Day Spa -surface Hotels Motels -structured Movie Theaters -valet Restaurants -with outdoor dining - with alcohol sales -* with live entertainment and dancing drive-through bake (limited to one location) Personal Services OFFICE Business and Professional a OTHER PERMITTED RETAIL Car stereo and alarm installation,if integrated into an anchor/major retail building and located within a building Portable carts and kiosks Cn Note: Other similar uses may be permitted subject to review by the Planning Director. y fp "Requires an entertainment permit Q Permitted Uses Chart 4! N Exhibit 11A o 0 N N O O ' O O The Crossings at Huntington Beach Specific Plan 75 cc August 7, 2000 The following temporary and seasonal events may*.be permitted outdoors within the mall's interior common areas only. The following teniporaiy and seasonal events located within the parking lot shall follow permit procedures described in the Huntington Beach Zoning and Subdivision Ordinance. -A- RN �.�4.,.,..Y,�.•xi,��.,�• Y.•,',Nti.s 1.�c�r`'f.:�u.;r+ �:1h.:���:;t•.`�X r�Fd..,}�.� r tr r 'f� T,� �J i , r�.t{i.'r•.. -✓w:v'3't..� ,+� e � rrq!'�c`•; ._ �� � �i. ,t .I" �y '��.. � ..�' � '�:'����+ 9 ,�.g*%;�:n.,,S��y��ry�..�•Y; "•4.,• �'f.3r %'�.'�• '�d�;j�j.,:�d�•r...i',a�,1T�. ..���'�' jD�D\.'Y��'A � � S�.,+•.e�'�- •O.,' f $ .c� pj •-�, r � A�,. ���•�. r„b:.`1;"=K'! F-.!^.�,?+�a..°-.:� a'4' d: w.;.-1;,�, alr`�, u. _.";!(""'•.<Mf;!+`, i7,M.T, j;/,�>4;.... •-"'• yN ja p, p]]j�� L�[yj� 'r'f.• i :� ( k .- '.t �!'� ..r;rl. ..Q: 1..�:i•Y. .f 1. r.t, .h.:t:-':1C�..7:t.):•;#N....4ti,s�Yr. x'2 ?;�►,•QMr 1 .!" IJ.�ti.,�'•, Art Shows Auto shows Carnivals Circus Commercial Filming Concerts Contests Farmer's Market Fund Raisers Health Fairs Live Entertainment Miscellaneous Exhibitions Outdoor Retail Sales Pet Shows Seasonal Displays and Events Theatrical Performances a y� Z11 Note: Other similar temporary uses may be permitted subject to review by the Planning Director. o c a y (D y ID Temporary and Seasonal Events Chart Q. � M Exhibit 11 B o 0 N N O O O O The Crossings at Huntington Beach Specific Plan 76 0 � o August 7, 2000 '!'',l.C J J,Z .1� r„,•�.. � . rf}I 'y,' ;4r.. .�,. rj�'i, 'h.et,.i.i`;'it:�;'w i'f Jyf,t�' 'Viy.� r, h f. .,r., .�„. �.....i. y •.;^r ;�.' �t ec�y� .,��C}w�' `3 wr ��.7 4Y v �y, Yl y ?• � � �JY✓,V' R7 t ,i C �������J'� ) 1,,5,r�ii/nPf ;� .�., J .'7�•4�!►1p�D Ifr f:. '.r. Y'tii:. k'r. ,a .,t 17r. rt.SlY�, .,1� •.n.r. I L�, Minimum Pro-ect Area (AC) 50 Minimum Lot Size (AC) None Minimum Lot Frontage None Maximum Building Height 75 feet Maximum Number of Stories 4 stories Maximum Additional Height for parapet walls, mechanical 15 feet equipment, communication antennas etc. Maximum Architectural Feature Height 120 feet Maximum Lot Coverage 50% Maximum Floor Area Ratio 0.5 Minimum Setback Street side (Edinger Ave., Beach Blvd. and Center Ave.) 50 feet,or 25 feet if setback is fully landscaped Interior side (West Property Line) 10 feet Minimum Landscaping 8% of total site; 10% of common area Minimum Perimeter Landscaping Street side (Edinger Ave., Beach Blvd. and Center Ave.) 10 feet Interior side (West Property Line) 5 feet Minimum Standard Parking Stall Size 9 feet x 19 feet Minimum Compact Parking Stall Size 8 feet x 18 feet Minimum Drive Aisle Width 25 feet for 90 degree stalls Minimum Parking Required Shared parking based upon joint use of parking analysis with Site Plan Review Maximum Compact Spaces 20% of total spaces Handicapped Parking Comply with Uniform Building Code and Title 24 -~T Parking Structure Design Comply with Zoning and Subdivision Ordinance Public Amenity Requirement Minimum of six public amenities required;At least two public art o elements and two water features within common area Wireless Communication Facilities Comply with Zoning and Subdivision Ordinance Trans ortation Demand Management Comply with Zoning and Subdivision Ordinance y * Buildings exceeding fifty (50) feet in height shall increase the set back by one (1) foot for each one (1) foot of building height above fifty (50) feet. Development Regulations Chart y y Exhibit 12 N N O O The Crossings at Huntington Beach Specific Plan 77 coo August 7, 2000 toward the required landscape percentage or TYPICAL PARKING LAYOUTS minimum landscape width. • A compact parking stall size of eight (8) feet, zero (0) inches wide by eighteen (18) feet deep may be c71 o proposed for up to a maximum of twenty (20) percent of the total proposed parking spaces. All compact parking stalls shall be concentrated around the perimeter of the site and shall be prohibited within the parking structure. �,�• ,r� Total parking required by the Huntington Beach Zoning and Subdivision Ordinance (see below) �►• .� shall be installed for each project prior to final �a' 1s' �e' S' �s' 2s �a' �s building inspection. STANDARD PARIONG SPACE ACCESSIBLE PAIWIVG SPACE STANDARD PARaNO SPACE . Parking shall be provided in accordance with an approved Shared Parking Study. A shared parking program may allow for a reduction of the code required parking by up to twenty five (25) Parking Standards & Detail percent,based upon a shared parking analysis. It is estimated that the New Shared Parking Study will Exhibit 13 suggest a ratio of 4.5 spaces for every 1,000 square feet of development. 4.3.8 Parking. All developments will be required to meet Handicap accessible parking spaces shall be the minimum on-site parking standards as provided in provided as required by the Uniform Building this Specific Plan document. The following shall Code and Title 24. apply' y • Standard parking stall size shall be nine (9) feet wide by nineteen (19) feet deep and may be reduced to provide a landscape curb or wheel stop a (in parking structure) at seventeen 0 7) feet with a �^ two (2) foot overhang to expand the landscaping. .� This additional landscape area will not be credited Z 0 0 N N O O O O The Crossings at Huntington Beach Specific Plan 78 0 � o August 7, 2000 I 4.3.9 Parking structures shall be designed utilizing the Drive-through aisles shall provide adequate on- massing and basic design characteristics and Italian site queuing distance to accommodate five cars Village architectural guidelines found in this Specific 0 50 feet) before the first stopping stop (e.g. menu Plan. The structures shall be screened from view board, ordering speaker). No portion of the using trees and landscaping. queuing aisle should serve as a parking aisle. Parking structures shall include exterior, open-air Drive-through lanes shall not exit directly to the stairwells in the design of the parking structure. site's main entrance. Drive-through aisles shall Stairwells shall be built to allow pedestrians to be seen provide at a minimum 25-foot interior radius for in the stairwell from out of the structure, and any curve. allowing the same pedestrians to see out. • The main structure should be sited so as to Parking structure lighting shall be a minimum level of maximize the distance for vehicle queuing while three foot-candles; preferably metal halide. Use screening the drive-through operations. lighting in the center of the parking structure aisles that throws light to the side, thus lighting pedestrians All building elevations shall comply with the and parked cars. Design the structures to allow as architectural guidelines as specified herein. much natural light into the structures as possible. All interior wall surfaces in the structures shall be painted Buildings shall incorporate a full roof with built-in white to reflect ambient light. roof top wells for mechanical equipment screening. The structures shall follow the City of Huntington Beach Police Department Crime Prevention through A canopy shall be provided over the drive-through Environmental Design Guidelines. lane at the pick-up window. The canopy shall be architecturally compatible and fully integrated as y 4.3.10 Drive-Through Bakery shall comply with the part of the building design. , following Design and Development Standards: • No individual freestanding or pole signs shall be o • The building shall be the predominant visual permitted for drive-though uses. element along street frontages, not parking lots or drive-through lanes. A maximum of one drive-through bakery shall be c permitted on the 63 acre site. • Drive-through aisles shall be screened from streets a and from adjacent parking areas. y. `A 0 0 N N O O The Crossings at Huntington Beach Specific Plan 79 au O August 7, 2000 :iXe'r`..v' •. ''�kfi6'k,7.u:-'^2"j»:y;' y,+:' r.'-' :.+ts •.: "w_ ,:.g s -'e`. v-_ \, ..,.... ,�..<. , +, a „r jyr:, r;: „ ti '" . L{ .,S�.� � :�;�,xr. , R� ,IJI� �D:sa t;. PRO.POSED y t.d f�., � .t ��f�j 9�E'':Y� � A s .O:M�ri+�+��^y.t +��.ql. �.L'wi 3 •5' � i t�t� ��ti _ .* , •. s.a+....^�,..,5^ ..f.., as�q`��Nj ��i4�,. Intensity (F.A.R.) Building Height Architectural Feature Height Parapet, Mechanical Equipment Height Lot Coverage Setback Front Interior Side Exterior Side Landscape Percentage Perimeter Landscape Front Interior Side Exterior Side Parking Spaces y' Parking Structure Design Public Amenities Public Art Elements y Water Features a y �D Development Regulations Check List 2M N Exhibit 14 0 0 N N O O The Crossings at Huntington Beach Specific Plan 80 cod August 7, 2000 Res. No. 2000-80 This Resolution Supersedes Res.No. 2000-68 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 A. Legal Description The following provides the legal description for the entire Crossings at Huntington Beach Specific Plan Area,which is bounded by Center Avenue on the north,Pacific Railroad on the east,Edinger Avenue on the south and Beach Boulevard on the west. Refer to Exhibit 1 in the Specific Plan. Perimeter Legal Description Parcels 1 through 3,5 though 9 and that portion of Parcel 4,Parcel Map No.'S6-200, in the City of Huntington Beach,County of Orange,State of California as per map filed in book 225 pages 40 through 45,inclusive,of parcel maps,in the office of the county recorder of said county,described as follows: Commencing at the intersection of the centerline of the Southern Pacific Railroad Right of Way(30 feet wide)v6th the centerline of Edinger Avenue(variable width),as said intersection is shown on said Parcel Map No.86-200;thence Saute 89 32'12"Fast 45.00 feet along the centerline of said Edinger Avenue to the southerlyy prolongation of the westerly line of parcel 1 of said parcel map;thence North 00 15'57"East 50.00 feet to the southwest corner of said parcel 1 also being the True Point of Beginning:thence North 00 15'57"East 1120.67 feet along the westerly line of said parcel I to the northwest corner of said parcel 1;thence South S9 32'12"East 1803.57 feet along the northerly Line of said parcel 1 and the northerly line of parcels 2,3 and 4 of said pareeI map to the northeasterly line of said parcel 4;thence along a non-tangent curve in the northeasberly line of said parcel 4,concave southwesterly and having a radius of 504.00 feet,a radial line to said point bears North 43 06;37"East;thence southeasterly along said curve through a central angle of 12 11'46"an arc distance of 107.28 feet; thence along the northeasterly line of said parcel 4 the following 5 courses:South 34 41'37--Fast 207.33,South 31 44'1VI Fast 229.95 feet to the beginning of a non- tangent curve,concave northeasterly and having a radius of 300.00 feet;a radial line to said point bears South 75 10153"West;thence along said curve through a central angel of 50 58'39'an arc distance of 266.92 feet,South 65 47'46"East 233.09 feet and South 35 19'06"East 70.61 fee#thence South 00 16'50'West 273.62 Feet along a line that is parallel with the easterly line of.said parcel 4 and 9.00 feet%%=terly,thence South 42 16"20"West 41.42 feet along a line that that is parallel with the southeasterly line of said parcel 4 and 6.00 feet northwesterly to a point in the north line of pa--x11 of an easement to the city of Humbgton Beach recorded November 9, 1972 in book 10418,page 968 official records in the office of the county recorded November 9, 1972 in book 10418,page 968 official records in the office of the county recorder of said county;thence North 89 32112-1 West 583.76 feefalong said north line to the southeasterly corner of parcel 2 of said easement•,thence North 44"32'12"West 41.01 feet along the northeasterly Zinc of said parcel 2 to the northwest corner of said parcel 2;thence North 89 32'I2"West 32.50 feet along the north line of said parcel 2 to the northwest corner of said parcel 2;thence South 00 27'48"West 37.00 fet along the west line of said parcel 2 and said parcel T to the southerly line of parcel 4 of said parcel map; thence North 89 3211 Zy West 1874.1-5 feet along the southerly lines cf parcels 1,2,3 and 4 of said parcel trap to True Point of Begin. i . Note: This description was prepared as a convenience only and is not for us in the division and/or conveyance of land in violation of the subdni5ion map act of the State of California Res. No.2000-80 This Resolution Supersedes Res. No. 2000-68 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 B. General Plan Consistency Analysis California State law requires that all cities and counties have a long-range general plan for their physical development. Once a local government has adopted its General Plan, it must be implemented, and local governments have a range of implementation tools from which to select.Most mechanisms for implementing a City's general plan derive from local government's corporate and police powers, such as: construction of streets, acquisition and development of parks, zoning, subdivision regulations, school dedication requirements, code enforcement, environmental and design review procedures and redevelopment. A specific plan is an effective implementation tool that is often used to address a single project or a master planned project such as the Crossings at Huntington Beach. The Specific Plan provides a bridge between the broad General Plan policies and individual project submittals (site plans, subdivision proposals, etc.) in a more area-specific manner than is possible.with community wide zoning ordinances. Asa result, a specific plan's emphasis focuses on establishing guidelines and concrete development standards to supplement those of the general plan. Specific plans must be consistent with all facets of the general plan, including the policy statements contained within the general plan document. In turn, zoning, subdivisions, and public works projects must be consistent with the Specific Plan. The Crossings at Huntington Beach Specific Plan contains detailed regulations,guidelines and implementation measures that will serve as a guide, providing consistency with the City's General Plan and standards and guidelines by which future development will be approved. This section explains how the Crossings at Huntington Beach Specific Plan achieves consistency with the City of Huntington Beach General Plan. The four (4) points listed below provide the basis for the consistency analysis contained in this section. 1. California Government Code Section 65450-65553 permits adoption and administration of Specific Plans as an implementing tool for the General Plan. 2. The current General Plan designation for the site is "Cortunercial Regional" with a Floor Area Ratio (F.A.R.) of 0.5, a specific plan overlay, and a mixed-use overlay. The mixed-use overlay would allow 0.5 commercial FAR and 25/units/acre.The site is currently zoned "CG" General Commercial with a 1.5 FAR The more restrictive 0.5 General Plan FAR takes precedence. The adoption of the Specific Plan will supersede the existing zoning and adopt a new set of zoning regulations. Adoption of the Specific Plan is consistent with the General Plan;therefore,a General Plan amendment is not required. 3. The Specific Plan must be consistent with the General Plan and serve to implement all aspects of the General Plan as it applies to the designated area. 4. The City of Huntington Beach's General Plan Update, adopted in 1995, is comprised of 16 separate elements: 1) land use, 2) urban design, 3) housing, 4) historic and cultural resources, 5) econonuc development, 6) growth management, 7) circulation, 8) public facilities and public services, 9) recreation and community services, 10) utilities, 11) environmental resources/ conservation, 12) air quality, 13) environmental hazards, 14) noise, 15) coastal and 16) hazardous materials. The following provides a brief discussion of these August 7,2000 1 Res.No.2000.80 This Resolution Supersedes Res.No.2000-68 Elements, which are applicable to the project including a listing of applicable goals and policies. Although the General Plan identifies objectives within each element, the policies actually implement the objectives and therefore provide more specific criteria of how the identified goals will be achieved. The discussion below indicates how the Specific Plan project meets the applicable policies. 1. LAND USE ELEMENT The land Use Element (LUE) for the City of Huntington Beach General Plan provides for the types, density/intensity, design, and distribution of commercial, residential, industrial, and agricultural land uses as well as public and private open space. The LUE includes goals designed to serve as a general guide for the future development of Huntington Beach in terms of location of uses,allowable residential densities,and other criteria. The LUE designates the 63-acre Crossings at Huntington Beach project site as Commercial Regional (CR) with a maximum building height of four (4) stories. Typical permitted uses of the Commercial Regional designation are anchor department stores, outlet stores, promotional ("big box") retail, retail commercial, restaurants, entertainment, professional offices, financial institutions, automobile sales facilities, and similar region-serving uses. The site is also designated as sub-area 5A in the General Plan with specific design and development standards for the mall property. The primary goal of the Land Use Element is to provide guidance regarding the manner in which lands are to be used in the City of Huntington Beach.Applicable goals include: • Achieve development that maintains or improves the City's fiscal viability and reflects economical demands while maintaining and improving the quality of life for the current and future residents of Huntington Beach. • Ensure that development is adequately served by transportation infrastructure, utility infrastructure,and public services. • Achieve and maintain a high quality of architecture, landscape,and public open spaces in the City. • Ensure that significant environmental habitats and resources are maintained. • Achieve a diversity of land uses that sustain the City's economic viability, while maintaining the City's environmental resources and scale and character. • Achieve a pattern of land uses that preserves, enhances, and establishes a distinctive identity for the City's neighborhoods, corridors,and centers. • Achieve the development of a range of commercial uses. • Achieve new development that enhances the City's quality of development and sense of place,goals for community character, and preserves significant historical resources. The following applicable Land Use Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. August 7,2000 2 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Correlation of Land Use Development with Market Demands Policies LU 1.1.1 Establish incentives for the development of uses to support the needs and reflect the economic demands of City residents and visitors. The majority of the Specific Plan area will be developed in a single phase as outlined in Section Z.1 of the document. However, individual building pads may be developed in later phases along with expansions to the initial phase of construction. This approach wilt ensure that future economic development opportunities will be implemented dependent upon market conditions Additionally, the Specific Plan allows for flexibility in the Specific Plan Development Regulations This flexibility in development standards is intended to accommodate future market trends and tenant needs, without sacrificing the intended high- quality character of the project area. During the formulation of the Specific Plan, staff identified uses to be permitted and prohibited within the document. "Future permitted uses"have the incentive of a 'fast track"entitlement process since their approval shall be determined via the Planning Director vs the Planning Commission or City Council. LU 1.1.2 Promote development in accordance with the Economic Development Element. The Specific Plan will encourage future development by promoting a comprehensive planned commercial project and allowing for future "fast-track" entitlement. This Specific Plan will promote development in accordance with the Economic Development Element. Additionally, the landowner is promoting development through its internal marketing strategies and real estate brokers. Correlation of Land Use Development with Supporting Public Infrastructure and Services Policies LU 2.1.1 Plan and construct public infrastructure and service improvements as demand necessitates to support the land uses specified in the Land Use Plan (as defined in the Circulation and Public Utilities and Services Elements of the General Plan). The Specific Plan area will be developed in a manner that would allo w for priva te development to occur m a timely manner with an overall Master Plan concept. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Circulation Plan, and Public Facilities Plan for water, wastewater and stornn drainage will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Sections 3.3 and 3.4 of the Specific Plan). These plans hill be approved by.the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. August 7,2000 3 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 Additionally, once a defnii ve site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an en virorrmental impact report was certfied with respect to that general plan, the application of this division (CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report" Based upon Public Resource Code Section 21083.3 and the fact that the Speciffc Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is subnutted for approval by the City. LU 2.1.2 Require that the type, amount, and location of development be correlated with the provision of adequate supporting infrastructure and services (as defined in the Circulation and Public Utilities and Service Elements). Development will be correlated with infrastructure needs: Section 3.0 of the Specific Plan presents several conceptual development plans and discusses the circulation, public facilities and infrastructure improvements which will support the Land Use Plan and reinforce the design concept. Implementation of the proposed project will occur in a single phase, and it will be consistent with the intent of the Master Plan Concept. LU 2.1.3 Limit the type, location, and/or timing of development where there is inadequate public infrastructure and/or services to support land use development. Development will be correlated with infrastructure needs. Section 3.0 of the Specific Plan presents several conceptual development plans and discusses the circulation, public facilities and infrastructure improvements which will support the Land Use Plan and reinforce the design concept. Implementation of the proposed project will occur in a single phase, and it i-vill be consistent with the intent of the Master Plan Concept. Quality of the Ciby s Built Environment Policies LU 4.1.1 Require adherence to or consideration of the policies prescribed for Design and Development in this Plan,as appropriate. Design Guidelines and Development Regulations are included as Sections 3.5 and 4.0 of the Specific Plan. Sectioli 3.5 establishes a comprehensive set of design guidelines for the entire project area and for individual project development, while Section 4.0 presents a detailed description of the development regulations and standards which are necessary to guide and control new development and carry out the goals and policies of the Specific Plan and the City's General Plan. August 7,2000 4 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 LU 4.1.2 Require that an appropriate landscape plan be submitted and implemented for development projects subject to discretionary review. Landscape standards which require development proposals to submit and Implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. LU 4.1.3 Require property owners to maintain landscaping, remove and abate weeds, and replace unhealthy or dead landscape. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Speck Plan. The landscape standards will apply to all development within the Specific Plan. LU 4.1.4 Encourage developers to incorporate mature and specimen trees and other significant vegetation, as defined by the City, that may exist on a site into the design of a development project for that site. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. The Landscape Plan also requires incorporation of mature and specimen trees that may exist on a site into the design. LU 4.1.5" Consider creating incentives for the use of drought-tolerant species in landscape design. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. Policies for the use of drought-tolerant species in landscape design is also addressed in Section 3.0.of the Specific Plan and will be reviewed with the plans for development of individual parcels. LU 4.1.6 Require that commercial and industrial development incorporate adequate drought-conscious irrigation systems and maintain the health of the landscape. Landscape standards which require development proposals to implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. August 7,2000 5 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 The incorporation of adequate drought-conscious irrigation systems and maintenance of the health of the landscape is also addressed in Section 3.5.5 of the Specific Plan and will be reviewed with the plans for development ofindividual parcels LU4.1.7 Require that all commercial and industrial landscape be adequately irrigated with automatic irrigation systems. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Speck Plan. The incorporation of automatic irrigation systems is also addressed in Section 3. . of the Specific Plan and will be reviewed with the plans for development ofindividual parcels LU 4.1.8 Use reclaimed water for the irrigation of public and private landscape,as feasible. The City does not currently have a reclaimed water supply system available. As indica fed in Section 3.5.5 of the Specific Plan, reclaimed water shall be utilized where and whenever feasible and shall comply with the City's "Water Efficient landscape Requirements" (Ordinance #1492). Usage will be addressed with future individual requests for development if such a s}-stem is available at that time. LU 4.2.1 Require that all structures be constructed in accordance with the requirements of the City's building and other pertinent codes and regulations; including new, adaptively re-used, and renovated buildings. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building speccations related to new, adaptively reused, and renovated buildings not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the lime of an}-individual request. Addilionalh; once a site plan is proposed for development, an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), `If a development project is consistent with the general plan of a local agency and an en viromnental impact report was certified with respect to thatgeneral plan, the application of this division[CEQAJ to the approval of that development project shall be limited to effects on the en viromnent which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or ii hich substantial new information shoivs will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 August 7,20�%) 6 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 and the fact that the Speck Plan project fags within the development envelope analyzed in the General Plan EIR the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. LU 4.2.4 Require that all development be designed to provide adequate space for access, parking, supporting functions,open space,and other pertinent elements. Section 3.5 Design Guidelines and Section 4.0 Development Regulations of the Specific Plan include requirements for parking,access requirements,supporting functions, open space, etc. LU 4:2.5 Require that all commercial, industrial, and public development incorporate appropriate design elements to facilitate access and use as required by State and Federal Laws such as the Americans with Disabilities Act. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations M place at the time of any individual request. Appropriate design elements to facilitate access and use shall be incorporated in accordance with State and Federal La ws (refer to Section 3.5 Design Guidelines of the Specific Plan). LU 4.2.6 Monitor the conditions of buildings in the City and enforce pertinent building, municipal and zoning codes to ensure their maintenance and quality. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or may be amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time of any individual request. Types and Densities of Land Use to be Permitted Policies LU 7.1.1 Acconunodate existing uses and new development in accordance with the Land Use and Density Schedules (Table LU-2 - see below). August 7,2000 7 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 Table LU-2 Land Use Density and Intensity Schedule Land Use Category ical Permitted Uses COMMERCIAL Anchor department stores,outlet stores,promotional ("big box") REGIONAL retail, retail commercial,restaurants,entertainment,professional offices, financial institutions,automobile sales facilities,and similar region-serving uses. The Specific Plan area will accommodate the development of a balance of land uses that maintains the City's fiscal viability and integrity of environmental resources. The proposed permitted land uses are consistent with the CiVs General Plan for the site. Individual building pads may be developed in later phases along with expansions to the initial phase of construction. This approach will ensure that future economic development opportunities will be implemented dependent upon market conditions Additionally, the Specific Plan allows for flexibility in the Specific Plan Development Regulations This flexibility in development standards is intended to accommodate future market trends and tenant needs, without sacrificing the intended high-quality character of the project area. LU 7.1.6 Accommodate the development of additional jobs-generating land uses that improve the 1992 jobs to housing ratio of 0.82 to 1.0 or greater; to meet objectives of the Regional Comprehensive Plan (Southern California Association of Governments) and Air Quality Management Plan. These should capitalize upon existing industrial strengths and emphasizing the clustering of similar or co2nplementaiy industries. The Specific Plan permits and encourages jobs generating land uses that will assist in improving the 1992 jobs to housing ratio. Additionally, during the formulation of the Specific Plan, staff identified uses to be permitted and prohibited within the document. "Future permitted uses"have the incentive of a "fast track"entitlement process since their approval shall be determined by the Planning Director vs the Planning Commission or City Council. Distribution and Pattern of Development Policies LU 8.1.1 Accommodate land use development in accordance with the patterns and distribution of use and density depicted on the Land Use Plan Map, and in accordance with the principles discussed below. a. Enhance a network of interrelated activity centers and corridors by their distinct functional role,activity,and/or form and scale of development. b. Increase diversification of community and local commercial nodes to serve adjacent residential neighborhoods. C. Intermix uses and densities in large-scale development projects. August 7,2000 8 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 d. Site development to capitalize upon potential long-terin transit improvements. e. Establish linkages among community areas, which may include pedestrian and vehicular paths, landscape, signage, other streetscape elements, open space, transitions in forms, scale,and density of development,and other elements. The Specific Plan area will accommodate the development of a balance of land uses consistent with the patterns and distribution of use and intensity depicted on the Land Use Plan Map, specifically,regional commercial uses Commercial Regional Permitted Uses Policies LU 10.1.14 Encourage the incorporation of community-oriented facilities in regional commercial developments, such as teleconrrnunications centers, public meeting rooms, daycare facilities, and cultural uses. The Crossings at Huntington Beach Specific Plan development concept outlined in Section 3.0 of the Specific Plan provides for a planned Commercial Regional complex in the City of Huntington Beach allowing for a variety of uses, consistent with the goals and policies of the Huntington Beach General Plan. During the formulation of the Specific Plan, _staff also identified uses to be permitted and prohibited within the document. Future permitted uses include telecommunication centers, public meeting rooms, daycare facilities,and cultural uses. Design and Development LU 10.1.15 Require that regional commercial developments be designed to convey the visual sense of an integrated center by consideration of the.following principles: • use of multiple building volumes and masses and highly articulated facades to reduce the visual sense of large scale "boxes"; • use of roofline or height variations to visually differentiate the building massing and incorporation of recesses and setbacks on any elevation above the second floor above grade; • siting of a portion of the buildings in proximity to their primary street frontage to convey a visual relationship to the street and sidewalks; • design of the exterior periphery of the structures to contain shops, restaurants, display windows, and other elements that provide visual interest to parking areas and the street elevation; • inclusion of a "public square" as a gathering place of public activity in multi-tenant regional centers; • clear identification of building entrances; • use of landscape that provides a three-dimensional character; August 7,2000 9 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 • encourage the provision of public art; • inclusion of consistent and well-designed signage integrated with the building's architectural character, including pedestrian-oriented signage;and • design of parlang structures to be visually integrated with the commercial buildings. Section 3.5 Design Guidelines and Section 4.0 Development Regulations of the Specific Plan address these issues The Crossings at Huntington Beach Specific Flan provides the framework andguidellnes necessary to create a unique high quality regional commercial development. Development Poligr. Community Subareas LU16.1.1 Accommodate development of the City's neighborhoods,boulevards, and districts according to the Community Districts and Subareas Schedule (Table LU-4). Table LU-4 Community District and Subarea Schedule Subarea Characteristic Standards and Principles 5A Permitted Uses Category: Commercial Regional (CR) - Region-serving Huntington commercial uses permitted by the "CR" land use category and Centermixed-use structures vertically-integrating housing with commercial uses permitted by the "-mu"overlay. Density/ Category: "F2"—Maximum FAR of 0.5 Intensity • Height: four (4) stories Design and Category: Mixed Use (-mu); Specific Plan (-sp) Development . Require the preparation of an development in conformance with a specific or master plan • Design and site development as a cohesive and integrated center and a stipulated by Policy LU 10.1.16. • Locate buildings around common courtyards and pedestrian areas. • Locate a portion of development along the Beach Boulevard frontage. • Improve the signage and sense of entry from the Interstate 405 Freeway, Beach Boulevard,and other major access points. • Implement extensive streetscape improvements along the Beach Boulevard and Edinger street frontages. • Promote the economic enhancement and revitalization of the Center. 777e Crossings at Huntington Beach Specific Plan development concept outlined in Section 3.0 Of the Specific Plan provides for a planned Commercial Regional complex in the City of Huntington Beach allowing for a variety of uses, consistent with the goals and policies of the Huntington Beach General Plan. August 7,2000 10 Res. No.2000-80 This Resolution Supersedes Res. No. 2000-68 Section 3.5 Design Guidelines and Section 4.0 Development Regulations of the Specific Plan address design and development issues. The Crossings at Huntington Beach Specific Plan provides the framework and guidelines necessary to create a unique high quality regional commercial development. 2. URBAN.DESIGN ELEMENT The Urban Design Element focuses on the quality of the City's physical and visual character, which is determined by the organization, scale, density and pattern of the community's built environment and open spaces. The primary goal of the Urban Design Element is to establish and strengthen community identity.An applicable goal includes: • Enhance the visual image of the City of Huntington Beach The following applicable Urban Design Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Nodes Policies UD 1.2.1 Require public improvements to enhance the existing setting for all key nodes and pedestrian areas through the consideration of the following: a. provide pedestrian connections and visual continuity between the node and surrounding neighborhoods; b. incorporate shade trees to shelter pedestrians; C. incorporate the use of enhanced paving materials at the pedestrian crosswalks; d. widen the sidewalks at intersections where feasible to minimize the length of pedestrian crossings;and e. enhance the connections where feasible between the public sidewalk and private commercial interior open spaces/courtyards as described in the Land Use Element by using: • decorative paving materials; • landscape materials;and • street furniture. Landscape standards which require development proposals to implement a landscape plan consistent with the overall Speck Plan standards are included as Section 3.5.5 of the Specific Plan. Tlie landscape standards will apply to all development within the Specific Plan. Section 3.5 Design Guidelines and Section 4.0 Development Regulations of the Specific Plan address design and development issues The Crossings at Huntington Beach Specific Plan provides the framei-vork and guidelines necessary to create a unique high quality regional commercial development. August 7,2000 1 I Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 UD 1.2.2 Require that the nodes incorporate the public improvements specified in UD 1.2.1 and other elements that may be listed in the table,as feasible. Landscape standards which require development proposals to implement a landscape plan consistent with the overall Speck Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan Corridor Identity Policies UD 1.3.1 Require a consistent design theme and/or landscape design character along the community's corridors, reflecting the unique qualities of each district. Ensure that streetscape standards for the major commercial corridors, the residential corridors, and primary and secondary image corridors provide each corridor with its own identity while promoting visual continuity throughout the City. Landscape standards which require development proposals to implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5 5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. UD 1.3.2 Provide for the implementation of streetscape and landscape improvements along the major commercial corridors, through public capital improvement programs, business district improvements,or other techniques as funding is available. a. Develop or enhance the pedestrian environment in those parts of the corridors where thefe is existing or the potential for pedestrian activity,this includes the use of: • sidewalk furniture; • shade trees; • shade structures • special paving;and • pedestrian walkway linkages. b. Consider using special corridor oriented public signage, public art, or inedian monuments at prominent intersections. C. Discourage the excessive use of temporary signage including bunting and commercial banners. Section 3.5 Design Guidelines, Section 4.0 Development Regulations,and Section 3.5.6 Signage Guidelines of the Specific Plan address design and development issues. ?he Crossings at Huntington Beach Specific Plan provides the framework and guidelines necessary to create a unique high quality regional commercial development. August 7,2000 12 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 3. HOUSING ELEMENT The Housing Element, adopted in February 1999, is intended to direct residential development and preservation in a way that coincides with the overall economic and social values of the community. The Housing Element is an official municipal response to a growing awareness of the need to provide housing for all economic segments of the community, as well as legal requirements that housing policy be made a part of the planning process. As such, the Element establishes policies that will guide City officials in daily decision making and sets forth an action program designed to enable the City to realize its housing goals. The City of Huntington Beach has adopted three goals for its housing program which are consistent with State and Regional housing policies.These goals are: • The attainment of decent housing within a satisfying living environment for households of all socioeconomic,racial and ethnic groups in Huntington Beach. • The provision of a variety of housing opportunities by type, tenure, and cost for households of all sizes throughout the City. • The development of a balanced residential environment with access to employment opportunities,community facilities,and adequate services. These goals relate to issues, which are not directly applicable to the Crossings at Huntington Beach Specific Plan,since the Specific Plan is not designated for residential uses. The Housing Element objectives and policies are also not applicable. 4. HISTORIC AND CULTURAL RESOURCES ELEMENT The overall intent of the City of Huntington Beach Historical and Cultural Element is to identify the historical resources of the community, their current designations and community status, and the issues affecting their future. Goals include: • To promote the preservation and restoration of the sites, structures and districts which have architectural, historical, and/or archaeological significance to the City of Huntington Beach. • Develop avenues for communication and participation in arts and cultural activities and programming to bring together diverse segments of the community. • Highlight the City's unique cultural heritage and enhance its visual appeal. • Expand opportunities for the City's children to receive quality experiences of arts and culture. • Establish a wide range of arts and cultural programs and facilities that address the needs and interest of residents,workers,and visitors. These goals relate to issues, which are not directly applicable to the Crossings at Huntington Beach Specific Plan, since the Specific Plan area does not contain any significant historic and cultural resources. the Historic and Cultural Resources Element objectives and policies are also not applicable. August 7,2000 13 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 5. ECONOMIC DEVELOPMENT ELEMENT The Economic Development Element is specifically concerned with the identification of a strategy to address development potentials that will broaden and stabilize the City's economic base. Its goals and policies are formulated to provide new policy direction for the City and the planning area. The primary goal of the Economic Development Element is to provide for the economic opportunities of City's residents; business retention and expansion; and land use plan implementation.Applicable goals include: • Provide economic opportunities for present and future Huntington Beach residents and businesses through employment and local fiscal stability. • Aggressively retain and enhance the existing commercial, industrial and visitor serving uses while attracting new uses to Huntington Beach. • Enhance Huntington Beach's economic development potential through strategic land use planning and sound urban design practices. The following applicable Economic Development Element policies are identified below, followed in Italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Economic Growth Policies ED 1.1.1 Maintain and expand economic and business development programs that encourage and stimulate business opportunities within the City. The Specific Plan iWI stimulate business opportunities within the City by allowing for and encouraging Regional Commercial development under an expedited entitlement process Additionally, the Specific Plan provides for a range of employment opportunities in the professional retail and service fields; thus stimulating business opportunities and strengthening the employee base of the community. Refer to Section 4.0 Development Standards for a list of permitted uses. Commercial Use Policies ED 2.4.1 Encourage and assist existing and potential commercial owners to update, modernize, and expand their commercial properties. The Specific Plan ii ll encourage future commercial development by promoting a comprehensive planned retail center and allowing for future "fast-track" entitlement. This Speciffc Plan will promote development in accordance with the Economic Development Element. Additionally, the landowner is promoting development through its internal marketing strategies and real estate brokers August 7,2000 14 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 ED 2.4.2 Seek to capture "new growth"businesses such as,but not limited to: • telecommuting; • "shop for value"or"big box" stores; • entertainment-commercial developments; • knowledge-based retail and entertainment-information retail uses;and • high sales tax producing businesses. The Crossings at Huntington Beach Specific Plan seeks to capture "rlewgrowth"businesses by allowing for and encouraging Regional Commercial development under an expedited entitlement process Additionally, the Specific Plan provides for a range of employment opportunities in the professional retail and service fields;thus stimulating business opportunities and strengthening the employee base of the community. Refer to Section 4.0 Development Standards for a list of permitted uses ED 2.4.3 Encourage the expansion of the range of goods and services provided in Huntington Beach to accommodate the needs of all residents in Huntington Beach and the market area. The Crossings at Huntington Beach Specific Plan encourages the expansion of the range of goods and services provided in Huntington Beach by allowing for and encouraging Regional Commercial development under an expedited entitlement process. Additionally, the Specific Plan provides for a range of employment opportunities in the professional retail and service fields;thus stimulating business opportunities and strengthening the employee base of the community. Refer to Section 3.0 Development Standards for a list of permitted uses. ED 3.1.4 Encourage the development of a "big box," "shop for value" businesses, especially along Edinger Avenue. The.Crossings at Huntington Beach Specific Plan encourages the expansion of the range of goods and services provided in Huntington Beach by allowing for and encouraging Regional Commercial development consistent with the Specific Plan under an expedited entitlement process 6. GROWTH MANAGEMENT ELEMENT The Growth Management Element, adopted in April 1992, is a pre-requisite to establish and continue eligibility to receive monies generated by the sales tax which was approved by Orange County voters in November 1990 as Measure M (Revised Traffic Improvement and Growth Management Ordinance). The purpose and intent of the Growth Management Element is to establish goals, policies and programs that will promote growth and development based upon the City's ability to provide an adequate circulation system and public facilities and services. August 7,2000 15 Res. No.2000.80 This Resolution Supersedes Res.No. 2000-68 The applicable goals of the Growth Management Element are to: • Reduce traffic congestion. • Ensure that adequate transportation and public facilities and public services are provided for existing and future residents of the City. The following applicable Growth Management Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Land Use Policies 5.8.1 Promote balanced growth of residential and non-residential land uses and supporting public facilities and services. The Specific Plan prepared for this project area promotes the development of a comprehensive planned regional commercial area, consistent with the CiVs land use designation. 7. CIRCULATION ELEMENT The purpose of the Circulation Element is to evaluate the transportation needs of the City and present a comprehensive transportation plan to accommodate those needs. The Circulation Element focuses on the City's arterial streets and highways; public transportation anodes and services;water transportation;and air transportation. The primary goal of the Circulation Element is to provide amulti-mode h ansportation system that ensures the safe and efficient movement of people and goods.Applicable goals include: • Provide a balanced transportation system that supports the policies of the General Plan and facilitates the safe and efficient movement of people and goods throughout the City while minimizing environmental impacts. • Provide a circulation system which supports existing, approved and planned land uses throughout the City while maintaining a desired level of service on all streets and at all intersections. • Develop a balanced and integrated multi-modal transportation system. • Encourage and develop a transportation demand management (TDM) system to assist in mitigating traffic impacts and in maintaining a desired level of service on the circulation system. • Provide sufficient, well designed and convenient on and off street parking facilities throughout the City. The .following applicable Circulation Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. August 7,2000 16 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Streets and High Policies CE 2.1.1 Maintain a city-wide level of service (LOS) not to exceed LOS "D" for intersections during the peak hours. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities to serve the proposed project. A Circulation Plan (refer to Section 3.3 of the Specific Plan) for the project will be prepared consistent with the City of Huntington Beach's Circulation Element. This plan will be approved by the City and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CECA] to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section, 210833 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. CE 2.1.2- Maintain a city-wide level of service (LOS) for links not to exceed LOS "C" for daily traffic with the exception of Pacific Coast Highway south of Brookhurst Street. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities to serve the proposed project. A Circulation Plan (refer to Section 3.3 of the Specific Plan) for the project will be prepared consistent with the City of Huntington Beach's Circulation Element. This plan will be approved by the City and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and de veloprnent project is proposed, an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agencv and an en vironmental impact report was certified with respect to that general plan, the application of this division [CECA] to the approval of that development project shall be linuted to effects on the environment which are peculiar to the parcel or to the project and which a ere not addressed as significant effects in the prior enviromnental impact report, or which substantial new information shows will be more significant than described in the prior en virorunental impact report" Based upon Public August 7,2000 17 Res. No.2000-80 This Resolution Supersedes Res. No. 2000-68 Resource Cale Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an en vironmental assessment until a site plan is submitted for approval by the City.. Public Transportation Policies CE 3.1.1 Encourage and support the various public transit agencies and companies, ride sharing programs,and other incentive programs,that allow residents to utilize forms of transportation other than the private automobile. The project Circulation Plan identifies bus stop locations along the project frontage on Edinger Avenue and on Center Avenue. The Circulation Plan (Section 3.3) describes the various public transportation alternatives proposed In addition, the Specific Plan re-iterates any future project's obligation to comply with the City's adopted Transportation Demand Management ordinance. CE 3.2.1 Require developers to include transit facilities, such as park-and ride sites, bus benches, shelters, pads or turn-outs in their development plans, where feasible as specified in the City's TDM Ordinance. The City of Huntington Beach has adopted a TDM ordinance.As discussed in Section 1.6 of the Specific Plan, the development within this Specific Plan project will comply with City . requirements and bus pads and turn outs must be provided at the site. Transportation Demand Management/Transportation Systems Mana eg ment Policies 4.1.1 Encourage non-residential development to provide employee incentives for utilizing alternatives to the conventional automobile (i.e., carpools, vanpools, buses, bicycles and walking. The Specific Plan indicates that alternative forms of transportation should also receive careful consideration. The future development within the Specific Plan will be required to address this issue. In addition, the Specific Plan re-iterates any future project's obligation to comply with the City's adopted Transportation Demand Management ordinance. CE 4.1.5 Promote ride sharing through publicity and provision of information to the public. The Specific Plan indicates that alternative forms of transportation should also receive careful consideration. The future development within the Specific Plan will be required to address this issue. In addition, the Specific Plan re-iterates any future project's obligation to comply with the City's adopted Transportation Demand Management ordinance. August 7,2000 18 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 CE 4.1.6 Encourage that proposals for major new non-residential developments include submission of a TDM plan to the City. The City of Huntington Beach has adopted a TDM ordinance.As discussed in Section 1.6 of the Specific Plan, the development within this Specific Plan project will comply with City requirements and bus pads and turn outs must be provided at the site. Parking Facilities Policies CE 5.1.1 Maintain an adequate supply of parking that supports the present level of demand and allows for the expected increase in private transportation use. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate supply ofparking that supports the present level of demand and allows for the expected increase in use to serve the proposed project. Section 4.3 Development Standards of the Specific Plan states that parking shall be provided based on the results of a shared parking analysis to be approved by the Directors of Public Works and Planning. Additionally,once a definitive site plan and development project is proposed, an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an en vironmental impact report was certified with respect to that general plan, the application of this division (CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. CE 5.L2 Provide safe and convenient parking that has minimal impacts of the natural environment, the conununity image,or quality of life. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate supply of parking that supports the present level of demand and allows for the expected increase in use to serve the proposed project. Section 4.3 Development Standards of the Specific Plan states that parking shall be provided based on the results of a shared par hng analysis to be approved by the Directors of Public Works and Planning. Additionally, once a definitive siteplan and developmentproject is proposed, an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project August 7,2000 19 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 is consistent with the general plan of a local agency and an environmental Impact report was certified with respect to that general plan, the application of this division (CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more sign cant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan Ells the Crossings at Huntington Beach Speck Plan is currently exempt from preparation of an en wronmental assessment until a site plan is submitted for approval by the City. Scenic Highways Policies CE 7.1.1 Require the roadways, as shown in Figure CE-12, to be improved and maintained as local scenic highways, major urban scenic highways, minor urban scenic highways, and landscape corridors with key entry points. Section 3.3 Circulation Plan identifies the roadways to be improved and maintained. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. CE 7.1.4 Establish landscape and urban streetscape design themes for landscape corridors, minor scenic ' urban corridors, and major urban scenic corridors which create a different character enhancing the corridor's surrounding land uses. For example, the design theme for corridors adjacent to residential neighborhoods should be different than the design theme for industrial or commercial uses. The Landscape Plan for the Crossings at Huntington Beach (Section 3.5 5 of the Specific Plan) has been prepared to establish the design character and visual qualities of the interior and perimeter of the project area. CE 7.3.1 Require that new development include landscaping that is compatible with the visual character of the designated scenic'highways and corridors. Landscape standards which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan. 8. PUBLIC FACEMUS AND PUBLIC SERVICES ELEMENT The Public Facilities and Public Services Element discusses public facility service provision for Huntington Beach residents and businesses. The services discussed in this element include: law enforcement, fire protection, marine safety, education, libraries, and governmental administration. August 7,2000 20 Res.No.2000-80 This Resolution Supersedes Res.No. 2000-68 Applicable goals include: • Protect the community from criminal activity, reduce the incidence of crime and provide other necessary services within the City. • Ensure. adequate protection from fire and medical emergencies for Huntington Beach residents and property owners. • Promote a strong public school system which advocates quality education. Promote the maintenance and enhancement of the existing educational systems facilities, and opportunities for students and residents of the City to enhance the quality of life for existing and future residents. The following applicable Public Facilities and Public Services Element policies are identified below,followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Police Policies PF 1.3.1 Ensure that project development site designs provide "defensible space". The Specific Plan includes policies for future development to reduce crime. Crime prevention guidelines are included in Section 3.S Design Guidelines of the Specific Plan, and they will apply to all future development within the Specific Flan. The Police Department will review the development plans/site designs once proposed. PF 1.3.2 Ensure,that new development and land use proposals are analyzed to determine the impact their operators, occupants, visitors or customers may have on the safety and welfare of the community. The Specific Flan includes policies for future development to reduce crime. Crime prevention guidelines are included in Section 3.5 Design Guidelines of fire Specific Flan, and they will apply to all future development within the Specific Flan. The Police Department will review the development plans/land use proposals once proposed. Fire/Paramedic Policies PF 2.3.2 Ensure that new construction is designed with fire and emergency access and safety in mind. 77ie Specific Flan includes fire safety measures in Section 3.4.1, which will apply to all future development ii thin the Specific Flan. The Fire Department will review the development plans once proposed. PF 2.3.3 Ensure that existing buildings are maintained ui a manner which is consistent with fire safety. August 7,2000 21 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 The Specific Plan includes fire safety measures in Section 3.4.1, which will apply to all future development within the Specific Plan. The Fire Department will review the development plans once proposed. 9. RECREATION AND COMMUNrlY SERVICES ELEMENT The Recreation and Community Services Element has been adopted to identify, maintain and enhance local parks and recreational services and facilities. Applicable goals include: • Enrich the quality of life for all citizens of Huntington Beach by providing constructive and creative leisure opportunities. • Provide adequately sized and located active and passive parklands to meet the recreational needs of existing and future residents, and to preserve natural resources within the City of Huntington Beach and its sphere of influence. • Develop park sites to provide diverse recreational and sports facilities that meet the residents'and visitors'active and passive recreational needs. • Ensure recreation facilities are renovated and upgraded to meet the current recreational interests of adults and youth. • Provide parks and other open space areas that are efficiently designed to maximize use while providing cost efficient maintenance and operations. These goals relate to issues, which are not directly applicable to the Crossings at Huntington Beach Specific Plan, since the Specific Plan is not designated for residential or open space uses by the.City General Plan. The Recreation and Community Services Element objectives and policies are also not applicable. 10. UmTIES ELEMENT The Utilities Element discusses water supply, sanitation treatment (wastewater), storm drainage,solid waste disposal, natural gas, electricity,and telecommunications. Applicable goals include: • Provide a water supply system which is able to meet the projected water demands; upgrade deficient systems and expand water treatment, supply, and distribution facilities;and pursue funding sources to reduce the costs of water provision in the City. • Provide a wastewater collection and treatment system which is able to support permitted land uses; upgrade existing deficient systems; and pursue funding sources to reduce costs of wastewater service provision in the City. • Provide a flood control system which is able to support the permitted land uses while preserving the public safety; upgrade existing deficient systems; and pursue funding sources to reduce the costs of flood control provision in the City. • Maintain solid waste collection and disposal services in accordance with the California Integrated Waste Management Act of 1989 (AB939), and pursue funding sources to reduce the cost of the collection and disposal services in the City. August 7,2000 22 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 • Maintain and expand service provision to City of Huntington Beach residences and businesses. The following applicable Utilities Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Water Policies U1.2.1 Require that new and. existing development contain safeguards and mitigation measures preventing degradation. The Crossings at Huntington Beach Specific Flan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Flan for water, wastewater and storm drainage will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.4 of the Specific Flan). These plans will be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and developmentprojectisproposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an en vironmental impact report was cerlifed with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant tlian described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Flan project falls within the development envelope analyzed in the General Flan EIR, the Crossings at Huntington Beach Speck Flan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. U 1.2.2 Require new development to connect to the sewer system. The Crossings at Huntington Beach Specific Flan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Fublic Facilities Plan for water, wastewater and storm drainage will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.4 of the Specific Plan). These plans ii ll be approved by the City, and the landowner iirll be constructing public infrastructure as required by the Cityin.order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed August 7,2000 23 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 210833(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an en vironmental assessment until a site plan is submitted for approval by the City. U1.3.4 Require the use of reclaimed water for landscape irrigation, grading, and other non-contact uses in the new developments,where available or expected to be available. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Plan for water, wastewater and storm drainage will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 34 of the Specific Plan). These plans will be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and de velopmentproject is proposed, an Environmental Assessment will be pertbrmed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(h), "If a development project is consistent with the general plan of a local agency and an en vi vnmental impact report was certified with respect to that general plan, the application of this division ICEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Man project falls'within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an en vironmental assessment until a site plan is submitted for approval by the City. Wastewater Treatment and Facilities Policies U2.1.6 Require that sewer capacity is available before building permits are issued for new development. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Man for water, wastewater and storm drainage will be prepared for the project consistent with all standards August 7,2000 24 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 and.requirements of the applicable service agencies (refer to Section 3.4 of the Specific Plan). These plans will be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and development project is proposed, an En vironmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report" Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. Storm Drainage Policies U3.1.5 Limit new development, when necessary, until adequate flood control facilities are constructed to protect existing development and accommodate the new development runoff, or until mitigation is provided in accordance with the Growth Management Element. The Crossings at Huntington Beach Speck Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Plan for water, wasteivater and storm drainage will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.4 of the Specific Plan). These plans will be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed .for. the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21O833(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects oil the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior en vironmental impact report" Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls wrtllln the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. August 7,2000 25 Res. No.2000-80 This Resolution Supersedes Res. No.2000-68 Solid Waste Policies U 4.1.1 Maintain adequate solid waste collection for commercial, industrial, and residential developments in accordance with state law. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Plan for water, wastewater and storm drainage wUl be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.4 of the Specific Plan). These plans ii U be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally,once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21O83.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects m the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report.." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Flan is currently exempt from preparation of an en vironmental assessment until a site plan is submitted for approval by the City. Gas Supply,Telecommunication,Electricity Policies 5.1.1 Continue to work with service providers to maintain current levels of service and facilitate improved levels of service. The Crossings at Huntington Beach Specific Plan shall ensure the provision of adequate public facilities and utilities to serve the proposed project. A Public Facilities Plan for water, wastewater and storm drainage 4411 be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.4 of the Specific Plan). These plans w411 be approved by the City, and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. Additionally, once a definitive site plan and de veloprnent project is proposed, an Environmental Assessment will be perfonned, which iWI analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose nut4gation measures, as necessary. According to Public Resources Code Section 21O83.3(b), "If a development project August 7,2000 26 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 is consistent with the general plan of a local agency and an en vironmenhd impact report was certified with respect to that general plan, the application of this division (CEQA1 to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report:" Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan Ells the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is subndtted for approval by the City. 11. ENVIRONMENTAL RESOURCES/CONSERVATION ELEMENT The Environmental Resources/Conservation Element addresses the City of Huntington Beach's environmental resources.Applicable goals include: • Improve and enhance the overall aesthetic value and appearance of the City of Huntington Beach through the provision and maintenance of local public and private open space. • Protect and preserve significant habitats of plant and wildlife species, including wetlands,for their intrinsic values. • Conserve the natural environment and resources of the community for the long-term benefit and enjoyment of its residents and visitors. The folloNving applicable Environmental Resources/Conservation Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Open Space Policies ERC 1.1.1 Encourage the provision of open space elements within the larger-scale development projects including but not limited to public plazas, entry courts, and planned development common areas. As indicated in Section 3.5.5 Landscape Concept of the Speciffc Plan, each project development shall prov7de sufficient landscaping to continue the Landscape Plan concept and the Specific Plan identifies an open space exhibit with plazas and pedestrian walkways throughout the project. Aesthetic Resources Policies ERC 4.1.8 Include conunercial, residential, industrial, and natural areas in the electrical undergrounding program. August 7,2000 27 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 The Specific Plan requires undergrounding of utilities in association with development of future projects per Specific Plan Policy 3.4.6. Water,Electricity,and Gas Conservation Policies ERC 5.2.1 Require,the use of reclaimed water in common areas and landscape treatments of all proposed developments. .The City does not currently have a reclaimed water supply system available. As indicated in Section 3.5 5 of the Specific Plan, reclaimed water shall be utilized where and whenever feasible and shall comply with the City's "Water Efficient Landscape Requirements" (Ordinance #1452). Usage will be addressed with future individual requests for development Ysuch a system is a variable at that time. ERC 5.2.2 Create standards for landscaping and irrigation, which are in compliance with State requirements. Landscape standards, which require development proposals to submit and implement a landscape plan consistent with the overall Specific Plan standards and in compliance with State requirements, are included as Section 3.5.5 of the Specific Plan. The landscape standards will apply to all development within the Specific Plan 12. AIR QUALITY ELEMENT The purpose of the Air Quality Element is to address air quality factors affecting the City, and establish goals, policies and programs in order to help achieve the goals of the Air Quality Management Plan adopted by South Coast Air Quality Management District. An applicable goal includes: • Improve regional air quality by a) decreasing reliance on single occupancy vehicular trips, b) increasing efficiency of transit, c) shortening vehicle trips through a more efficient jobs-housing balance and a more efficient land use pattern, and d) increasing energy efficiency. The following applicable Air Quality Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Vehicle Work Trips Policies AQ 1.1.2 Require all businesses and multiple tenant centers with 100 or more employees to participate in a Transit Management Association or Organization. August 7,2000 28 Res.No.2000-80 This Resolution Supersedes Res.No.2000-68 The City of Huntington Beach has adopted a TDM ordinance, which addresses appropriate trip reducing activities.As discussed in Section 1.6 of the Specific Plan, the development within this Specific Plan project will comply with City requirements. AQ 1.1.5 Encourage all new commercial, industrial, and residential structures to accommodate appropriate trip reducing activities such as alternative work schedules, on-site day-care facilities, on-site automated teller machines, "mail-in" applications, or telecommuting and/or teleconferencing facilities as technology becomes available. The City of Huntington Beach has adopted a TDM ordinance, which addresses appropriate trip reducing activities As discussed in Section 1.6 of the Specific Plan,all developments within this Specific Plan project will comply with City requiremenIs. Transit Trips Policies AQ 1.2.2 Require developers of employment centers with 100 or more employees and major activity centers to include transit amenities and transit access as an integrated part of their projects. The City of Huntington Beach has adopted a TDM ordinance, which addresses appropriate trip reducing activities As discussed in Section 1.6 of the Specific Plan, developments within this Specific Plan project will comply with City requirements AQ 1.2.3 Encourage property owners in existing employment and activity centers (such as the Pier, Downtown, Huntington Beach Mall) to include transit amenities at their sites when these projects apply for additional planning permits or services. A Circulation Plan wig be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.3 of the Specific Plan). The circulation plan specifies locations for public transportation bus pads and bus turnouts and also includes a potential location fora light rail transit stop. This plan will be approved by the City and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. AQ 1.2.4 Encourage major commercial and industrial development projects located along transit routes to include integrated transit access points in the project design. A Circulation Plan will be prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.3 of the Specific Plan). The circulation plan specifies locations for public transportation bus pads and bus turnouts and also includes a potential location fora light rail transit stop. This plan will be approved by the City and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. August 7,2000 29 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Carpool and Vanpool Trips Policies AQ 1.3.2 Require that employment centers with 100 or more employees increase the availability and the "attractiveness"of parking spaces for vans and carpools. The City of Huntington Beach has adopted a TDM ordinance, which addresses appropriate trip reducing activities. As discussed in Section 1.6 of the Specific Plan, developments within this Specific Plan project will comply with City requiremen ts. Vehicle Trip Distances Policies AQ 1.5 Encourage residential and commercial growth to occur in and around existing activity centers and transportation corridors in accordance with the Land Use Plan Map. A Circulation Plan has been prepared for the project consistent with all standards and requirements of the applicable service agencies (refer to Section 3.3 of the Specific Plan). This plan will be approved by the City and the landowner will be constructing public infrastructure as required by the City in order to support the land uses proposed by the Specific Plan. AQ 1.5.2 Continue to encourage job growth by maintaining the supply of commercial and industrial designated land in accordance with the Land Use Map. Consistent with the General Plan and in accordance with the Land Use Map, the Specific Plan permits job generating land uses that will assist in improving the 1992 jobs to housing ratio. The majority of the Specific Plan area will be developed in a single phase as outlined in Section 2.1 of the document. However, individual building pads may be developed in later phases along with expansions to the initial please of construction. Particulate Emissions AQ 1.8.1 Continue to enforce construction site guidelines that require truck operators to minimize particulate emission. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the Cify's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they can ently exist or may be amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in.the Specific Plan shall be subject to the City's adopted regulations in place at the time of any individual request. Additionally,once a definitive site plan and development projectis proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed August 7,2000 30 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the en vironrnent which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation ofan environmental assessment until a site plan is submitted for approval by the City. AQ 1.8.2 Require installation of temporary construction facilities (such as wheel washers) and implementation of construction practices that minimize dirt and soil transfer onto public roadways. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or may be amended in the future. Section 4.0 Development Regulations of the Speck Plan provides specific development regulations and standards that wiU be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time ofanyindividual request. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the'Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this &vtsion 10EQA1 to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an en wronmental assessment until a site plan is submitted for approval by the City. Energy Conservation AQ 1.10.1 Continue to require the utilization and-installation of energy conservation features in all new construction. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the August 7,2000 31 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or may be amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Speck Plan shall be subject to the City's adopted regulations in place at the time of any individual request. Additionally, once a defMiti ve site plan and development project is proposed,an En vironmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary: According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was cerdflied with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be linvted to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EI9, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. AQ 1.10.3 Encourage energy use audits, and identify conservation measures, for all existing commercial and industrial structures. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time ofanyindividual request. 13. COASTAL ELEMENT The Coastal Element, Amended in 1992, includes information sufficiently detailed to indicate kinds, location and intensity of land use and applicable resource protection and development policies. The Coastal Element designates different categories of land uses which will be permitted within the coastal zone and specifies the areas where each land use map, categories and additional policies together constitute the Coastal Element, which is intended to reflect local conditions and needs while meeting the Coastal Act policies and requirements. The Coastal Element is organized around the following issue areas, which have been identified as relevant to the City's coastal zone: - • Recreation and Shoreline Access • Visitor-Serving Facilities • Visual Resources August 7,2000 32 -- Res.No.2000-80 This Resolution Supersedes Res.No.2000-68 • Water and Marine Resources and Diking,Dredging,filling and Shoreline Structures • Environmentally Sensitive Habitats • Energy • Community Facilities • Coastal Land"Use Plan • Next Steps in Coastal Planning The goals and policies within the Coastal Element provide guidance and direction for development in the coastal zone. The goals of the Coastal Element relate to issues, which are not directly applicable to the Crossings at Huntington Beach Specific Plan, since the Specific Plan area is not within the coastal zone. The Coastal Element objectives and policies are also not applicable. 14. ENVIRONMENTAL HAZARDS ELEMENT The Environmental Hazards Element addresses flooding as it pertains to geologic, seismic and soils hazards. This Environmental Hazards Element and the referenced materials together satisfy the,geologic and seismic portion of the Section 65302 (g) requirement. Applicable goals include: • Ensure that the number of deaths and injuries, levels of property damage, levels of economic and social disruption,and interruption of vital services resulting from seismic activity and geologic hazards shall be within levels of acceptable risk. • Ensure the safety of the City's businesses and residents from methane hazards. • Eliminate, to the greatest degree possible, the risk from flood hazards to life, property, public investment and social order in the City of Huntington Beach. • Ensure the safety of the City's businesses and resident from peat hazards. The following applicable Environmental Hazards Element policies are identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Geologic/Seismic Safety Policies EH 1.2.1 Require appropriate engineering and building practices for all new structures to withstand groundshaking and liquefaction such as stated in the Uniform Building Code (UBC). Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time of any Jt7 i dual request. August 7,2000 33 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 EH 1.3.5 Encourage property owners to take adequate steps to protect their property against economic risks resulting from seismic and geologic hazards. Upon the CiVs adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or may be amended in the future. Section 4.0 Development Regulations of the Specific Plan provides speck development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed m the Speclf c Plan shall be subject to the City's adopted regulations in place at the time of any individual request. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "lf a development project is consistent with the general plan of a local agency and an en vironmental impact report was certified with respect to that general plan, the application of this division (CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior en vironmental impact report" Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed m the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation ofan environmental assessment until a site plan is submitted for approval by the City. F Objective EH 4.1 Ensure that the City's flood prevention standards and practices provide satisfactory safeguards for public and private development. The. Public Facilities Section of the Specific Plan (Section 3.4) addresses this policy. Additionally, upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or may be amended In the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the tune of any individual request. August 7,2000 34 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 15. NOISE ELEMENT The purpose of the Noise Element is to identify and appraise noise problems in the community. The Noise Element recognizes the guidelines adopted by the Office of Noise Control in the State Department of Health Services and shall analyze and quantify to the extent practicable, as determined by the legislative body, current and projected noise levels for all of the following sources: • Highways and freeways; • Primary arterials and major local streets; t • Passenger and freight on-line railroad operations and ground rapid transit systems; 0 Aviation and airport related operations;and • Other ground stationary noise sources contributing to community noise environment. An applicable goal includes: • Ensure that all necessary and appropriate actions are taken to protect Huntington Beach residents, employees, visitors and noise sensitive uses from the adverse impacts created by excessive noise levels from stationary and ambient sources. The following applicable Noise Element policies are identified below,followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Ambient Noise Impacts on the Community Policies N 1.2.2 Require new industrial and new commercial land uses or the major expansion of existing land uses to demonstrate that the new or expanded use would not be directly responsible for causing ambient noise levels to exceed an Ldn of 65 dB(A) exterior on areas containing "noise sensitive"land uses as depicted on Figure N-1. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specifications of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time of any individual request. The City Noise Ordinance addresses this policy. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an en viromnental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the August 7,2000 35 Res. No.2000-80 This Resolution Supersedes Res.No.2000-68 approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in . the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. N 1.2.5 Require development that generates increased traffic and subsequent increases in the ambient noise levels adjacent to noise sensitive land uses to provide for appropriate mitigation measures in accordance with the acceptable limits of the City noise ordinance. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specif cations of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision Ordinance), as they currently exist or maybe amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Land Use Plan of this Specific Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time of any individual request. The City Noise Ordinance addresses this policy. Additionally, once a site plan is approved, an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose rtutigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division /CEQAJ to the approval of that development project shall be linvted to effects on the en vironment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior en vironmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. Traffic and Mechanical Equipment Related Noise Impacts Policies N 1.31 Require all new non-residential development to design and configure on-site ingress and egress points diverting traffic away from nearby "noise sensitive" land uses to the greatest degree practicable. Upon the City's adoption of the Crossings at Huntington Beach Specific Plan, the development procedures, regulations, standards and specd cations of the Specific Plan shall supersede the relevant provisions of the City's zoning code (Huntington Beach Zoning and Subdivision August 7,2000 36 Res.No.2000-80 This Resolution Supersedes Res.No. 2000-68 Ordinance), as they currently exist or may be amended in the future. Section 4.0 Development Regulations of the Specific Plan provides specific development regulations and standards that will be applied to the Ladd Use Plan of this Speck Plan. All development regulations and building specifications not addressed in the Specific Plan shall be subject to the City's adopted regulations in place at the time of any individual request. The City Noise Ordinance addresses this policy. Additionally, once a definitive site plan and development project is proposed,an Environmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified: with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Speck Plan is currently exempt from preparation of an environmental assessment until a site plan is submitted for approval by the City. N 1.3.7 Provide for the development of alternate transportation modes such as bicycle paths and pedestrian walkways to minimize the number of noise generating automobile trips. Section 3.3 of the Specific Plan indicates that alternative forms of transportation should receive careful consideration. The future development within the Specific Plan will be required to address this issue. The City of Huntington Beach has adopted a TDM ordinance, which addresses appropriate trip reducing activities as discussed in Section 1.6 of the Specific Plan, the development within this Specific Plan project will comply with City requirements N 1.3.8 Ensure that commercial and industrial uses, as required by the Air Quality Management Plan, implement Transportation Demand Management (TDM) programs such as incentives for car pooling,van pools, and the use of public transit. The City of Huntington Beach has adopted a 7DAT ordinance, which addresses appropriate trip reducing activities. as discussed in Section 1.6 of the Specific Plan, the development within this Specific Plan project will comply with City requirements. 16. HAZARDOUS MATERIAIS The City of Huntington Beach adopted the Hazardous Materials Element as part of the overall General Plan. This Hazardous Materials Element identifies goals, objectives, policies, and programs related to hazardous materials, August 7,2000 37 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Applicable goals include: • Reduce, to the greatest degree possible, the potential for harm to life, property and the environment from hazardous materials and hazardous waste. The following applicable Hazardous Materials Element policy is identified below, followed in italic typeface by an explanation of how the Crossings at Huntington Beach Specific Plan achieves consistency. Policy HM 1.1.4 Implement federal, state .and local regulations for the handling, storage and disposal of hazardous materials. Once a definitive site plan and development project is proposed, an En vircnmental Assessment will be performed, which will analyze impacts peculiar to development proposed for the Crossings at Huntington Beach Specific Plan, and propose mitigation measures, as necessary. According to Public Resources Code Section 21083.3(b), "Ifa development project is consistent with the general plan of a local agency and an en wronmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the Parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report.n Based upon Public Resource Code Section 21083.3 and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of an en vironmental assessment until a site plan is submitted for approval by the City. 0 August 7,2000 38 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Res. No.2000-80 This Resolution Supersedes Res. No. 2000-68 THE CROSSINGS AT HUNTINGTON BEACH HunfingEon Beach, California Signage Standards The Crossinzs at Huntington Beach SignaZe Standards August 7,2000 1 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 I. WENT This sign program has been established �3 for the purpose of assuring that all signage and graphic elements within The Crossings at Huntington Beach are - consistent with the project development .: plan and established architectural standards. This program shall serve as the singular guideline for all signage P - - design on or around the exterior of the project and visible from public right-of- m_: F ways. A project sign criteria program is a requirement of the City of Huntington Beach. IL APPROVALS&COMPLIANCE l A. All signage plans, permanent or ,temporary, must be reviewed and 10'-0"X4'-0 approved by an authorized agent of The Crossings at Huntington Beach Management prior to submittal to the City of Huntington Beach Planning Staff per Section 233.04.A2 of the City of Huntington Beach Zoning Ordinance. B. All signage, permanent or temporary, must comply with the approved signage plan for The Crossings at Huntington Beach and have the required City of Huntington Beach Building Permits prior to installation. C. Where interpretation of these guidelines is not clear, The Crossings at Huntington Beach shall make a decision for clarification subject to the City of Huntington Beach Planning Staff approval. ' = D. Where unique site or building design dictates, the City of Huntington Beach Planning Staff will review and make a " decision upon The Crossings at Huntington Beach recommendations for exceptions to these guidelines. E. The sign area shall be defined as the area including all figures which is an integral part of the sign. Decorative or structural sign supports shall not be included in the calculation of sign area. >� F. Actual quantities may vary, specified 6'-0"X4'-0" quantities are maximums. G. All signage shall conform with sight- distance and visibility design requirement to avoid impeding the ability of commuters to view oncoming traffic. The Crossings at Huntington Beach Silage Standards August 7, 2000 2 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 III PROJECT IDENTIFICATION A. Freeway Monument Sign(EMa) 1. Quantity. 1 location (refer to site plan exhibit). 2. Height:: Maximum 60ft. to top of lettering,50ft.to top of structure above freeway grade. 4- 3. Area:800 sq.ft.maximum per side. 4. May include sculptural design elements, - which will not be calculated as part of the allowable sign area. 5. Creative use of lighting, including =' exposed neon and colored lights,will be 'J permitted. B. Primary Project Gateway Sign(EMS) 1. Quantity-Up to 3 locations (refer to site Y' plan exhibit). 2. Height: Maximum25ft. above entry -' road grade 14ft. minimum clearance if I;. - : irt:. spanning across drive aisles. �v" " _- 3. Area: 300 sq.ft. maximum (project •::" - ,•�: :' :.-„a.�s-;_- "- name only included in calculation). 4. May include sculptural design elements r on each side of entry, as part of the i support column structure, which will not be calculated as part of the L allowable sign area. C. Secondary Project Monument Signs 4L ti 1. .Quantity:Up to 4 locations (refer to site plan exhibit). 2. Height: Maximum 15 ft. above entry it road grade. 3. Area: 200 sq.ft. maximum per side (total for project I.D. and optional tenant name listings). 4. Sign may include project name and up to three tenant names. 5. Project name and non-sign elements (base,columns,etc.) should relate to the design motif and use of materials as established in the primary project identification signs. 6. Tenant name listing panels must be integral parts of overall sign design. Materials, lighting technique and placement must be consistent for all tenant panels. The Crosshhzs at Huntington Beach Si naze Standards August 7, 2000 3 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 D. Primary Project Wall-Mounted Sign (EWa) 1. Quantity. 3 locations (refer to site plan exhibit). 2. Height: 15ft. above garage parapet or above finished grade. " - 3. Area: 250 sq.ft. maximum (project name only included in calculation). 4. Sign to be attached to retail buildings or parlang structure 5. Sign to be designed to relate directly to primary project gateway sign 6. Additional theater signage may be included at or adjacent to this project sign and must be designed as an integral part of the parking structure entrance. w E. Secondary Project Wall-Mounted Sign _ 1. Quantity. 7 locations (refer to site plan exhibit). 2. Height: Not to extend above building parapet. 3. Area: 200 sq.ft. maximum (project name only included in calculation). x t =$ 4. Sign to be attached to building or gateway structure directly above entrance. « F. Directional Signs(EDa,EDb,EDc) 1. Quantity:EDa-10;EDb-9;EDc-4 2. Height:Eft.maximum above grade. 3. Area: 15 sq.ft. maximum per side (sign panel only included in calculation). ' 4. Sign may be internally or indirectly illuminated. _ 5. Sign may carry tenant names and logos in a standardized color. ;}:�."�''-�r mot:_.-�,1•�.it�•y_ .. _- - The Crossinzs at Huntington Beach Si nage Standards August 7, 2000 4 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 IV. THEATER SIGNAGE A. The theater will be allowed one identification sign on the north, south y and east elevations. These signs are not to exceed 400 sq.ft. each. The ='�== maximum height of the sin is not to ,-- exceed 80ft.above the first floor level. B. An additional three signs for theater - will be allowed on the theater structure. These signs shall not exceed 300 sq.ft. of area per sign. C. Reader board signs are allowed at the north,south and east elevations,up to a maximum total of 500 sq.ft. Maximum height of sign not to exceed 60 ft.' - above the first floor level. D. The theater will be allowed one wall- mounted sign, not to exceed 130 sq.ft. to be integrated into the parking structure entrance signage design. E. Neon accents,animated signs,and fiber optics sign features will be permitted. :.;, - Z.If<:-'3ty 5 `�-�-Y"saw-`� +_:a:. •-^ ..�'- I �\-`- -:-��, -".-.��_��"'*'- � .-�� The CrossiniZs at Huntington Beach Signaze Standards August 7, 2000 5 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 V.RETAIL TENANT IDENTIFICATION SIGNS A. Creativity,uniqueness and high quality materials shall characterized signage elements used to identify retail tenants " �•s,_w,`r� Lam` in The Crossings at Huntington Beach. - �. rC"._ -...r- ;'y�:- r( t`^u:iT _ •mot Each storefront will be a custom design with graphics appropriate to the - �-. individual storefront's design vocabulary. B. Sign area for tenant signage will be �a 4= calculated around the sign copy only,as contained by a box of up to 8 F continuous straight lines (with right angles) formed around the extreme outer limits of the sign message and will not include elements integral to the storefront design. C. These criteria apply only to tenant signage visible from public right of way. D. Building Mounted Storefront Signs 1. Allowable signage area: a Individual letters: 1.5 sq.ft./linear =+ K :•_"'_': - foot of building frontage. b. Cabinet sign: 1.25 sq.ft./linear ;• 1�',Q r foot of building frontage. c. Tenants with stores greater than - > 35,000 sq.ft.will be allowed 1.75 .ft./linear foot frontage for both individual letters and cabinet type --., signs. d. Tenants occupying more than 1 story shall have signage allowances doubled. 2. Retail tenant signage may occur on each elevation of]eased floor area. 3. Sign may be individual letters or other type if cabinet is designed as an integral part of the overall storefront designs. ik. 4. Creative use of lighting sources is encouraged,internal or indirect. ` 5. Lighting fixtures must be designed as an integral part of the signage and storefront design. ✓'s 6. Exposed neon will be permitted only if submitted as part of an overall storefront design scheme and must meet all U.L. and local building code standards. Where used other than in letters, neon will not be considered a sign , but will be subject to all general -- - - storefront design criteria. 7. Logo marks and corporate identity elements (such as mascots, symbols, special shapes,etc.) are encouraged,but will be considered signage and are subject to all regulations contained in these guidelines. The CrosshiQs at Huntington Beach Signage Standards August 7, 2000 6 Res.No.2000-80 This Resolution Supersedes Res.No.2000-68 SIGN STANDARDS-COMPARATIVE STUDY 7 � MUM ,��} 11T1Yy1-�t�A�ii EMa Freeway Monument 25 ft.above Lettering 60ft./ Freeway Top of Sign 50 ft. 60 sq.ft. above freeway grade 00 sq.ft. (logo&legend) if Reader board 115 sq.ft.: 90 sq ft.message 800 sq.ft. 25 sq.ft.other info EMb Primary Project 25 ft.tall 25 ft.tall Monument (Gateway) 130 sq.ft. 300sq.ft. (logo&legend) 1 per street frontage EMc econdary Project of Addressed 15 ft.tall Monument 200sq.ft. (logo&legend) Tenant listings (3 names) 2 per street frontage EDa Vehicular Directional ft.tall 6 ft.tall EDb edestrian Directional 2 sq.ft. 15 sq.ft. EDc Project Directory 1 per entry Tenant names incl. o business names Up to four per tenant EWa Prirnary Project Not addressed 15 ft.above grade Wall Sign 250sq.ft. (Gateway w/Cinema (I.D.) EWb Secondary Project 1.5 sq.ft.per 200 s.f. Wall Sign 1 ft.of wall Height not to exceed Building parapet hannel Letters 1.5 sq.ft.per 1 ft.of wall 1.5 sq.ft.per 1 ft.of wall lus 15% lus 15% One per street or One per street or parking lot frontage Parking lot frontage" Cabinet Type Sign Not addressed 1.25 sq.ft.per 1 ft.of wall Must be integral part of torefront design" ** unless tenant is grater than 35k sq.ft. or a 2 story configuration The Crossings at Huntington Beach Signaze Standards August 7, 2000 7 a N O SIGNACAE LEG CND IYPC UCS(:NIIgK1N T1PC UtSCRII'IIUN TYPE DESCRIPTION TYPE OLSCNM'1Kb1 EMa fKIEYVAI'AJt)Nt(@/CNT EMC SECONDARY PROJECT MONUMNT >(May) EDb 1tUESTRIANOIRCGTQNAL E W) (11'"t00JMWK-A W PRWIRY PROJECT WALL SIGN lQlmsywiOn(mat.U.) a VD EDc PROJLCTDIRECTORr EWb SECONDARY PROJECT WALL SIGN o �_- --- EMccr--- Mc EDb I � . I � IIr r�JlltrrtrtitTiitr :nmm�lmiJ! EDa :- -_= \ s " minnnnmrrnJJ, nnnmJ uiitfiifi' '_"^�*,.; ;,, �'i!i!flillflH11�5�I �f EDa !zllilif� }}}Iff+fl :._ = - l �I •r:; ;1. :I� _ �EWb _ :1 y1411 luli I: % „�`� rr L�\ �S I _ -T- ER. ED ,,r F:-. F;_r •tYa» f - - \,. r.�w:�\\� 'Y "r ~ ,II•� r _i_ r: ,�. I I I:-= Yl EDa L. '1_' \ AVEN �'`�"� lJ/ ti �iI I ( I 'i:: :y - a:r� =-�� TAir CIO � ED L•: EDb r- l o :rl = 'i '1' ,-M�..; -+�--1l "�;i; f;�.';.�, �` _�'— a �' ,�-t •y�, ,, _.-�., j ,I�I�_ it 'I _ _I _t ✓ EDb - ( la*1 b _ EWb r" EWb EDb •i'r -�!{'. _ 7T 1-.yr n'!;,•- �+:e it �:rir ;+' ;2"f X;illd:larJ- �` r'' 1+ r`� l ii r✓ :1 1 t.: •�;. �O All itllT ' �n % !'r' %' r!i''':, :r%i,'" ED i^* :: t'`�� M1 , 'r. ;%,�,','i, c �%1;� EDb II+ `/.. EWa �;I �' :k :; •r " EWb ED I, ..:I I•r�'^t.a J,ll.lJlltllL!!Ul1J11 ♦ �,;, EDa� :•. . JM�•�-,,r�/ L f•,.,�1�',r..•_....._a.� �• +. I TT I ��,� � •��'. I r .��,��;. A ;r„I:I :i ' Y1.• EDc EDc EWb E Wbr'�A ��, �•r,-,✓ I ,. CL%1"1/,:x�1�:.r J iIS }]'ir •i !'"r%' �a ,..� Itiwin ':' y _ _ EMa I r I � c... �!�- -}.'. .. __ ,....... �';.�. --_%•':f•.':a�.. :�.- ... I {�1.idp ,,,1 "71ii17t•�' •'•'A,�,`^ ��IT•. i Ii ,Ili ._ __.---=-�:i:�•i�=-- — ....,.�._,.,.... �...,.•.�.� ---.-.J Y '� '�_ jl III I �'.�_ `rn '•y:' Y 'a L:i EWa EDb \v EDb a ED .Y' f.� A"_' tl:J".S ':• 1RI / ,% rm( IT n II w� �4r P �_- �.. __) _ _I,_ ,_I,! _!.- _i L_� C_��-.•._.... EDYI•� -1' riT.. '�"�✓�F'%� n�o cr `rif '! �•'1 I _- �__ :; - is ri '1' ::f � __ >y /•> �.�;�''- qj ';i ! I_�. -1'�' :�I�: ... � �.•_ EDa 'I- rill `rJ O I _ rl jj 1 tl ••,( } _ _ t••. r E.;.111{rJ r_"� _ _ -__ , ��fyij�'•1 _�!j r :.l. 00 I I • k: EDb r .. :..r� :rj _ If: t�a;•ntir I f�D I;I �- re' I: r- :;-.�u. � .� v•i I I i , ''I'.. :-1 l_. ( .. ia' '1.'i: ;I'i i I :.1:' '. EDa ".ii r "` `':!;:'II(illlalllll;I!!Illlill:ilii'a!i:!.iGli:!!IU+_!.11llll!Ilf'�`' �� - xYYAr c2_o c r� t__1 C..I osr��JtiJ' I I Ytl I I ,..-,,, ...11 �1.__—_ " '- F- :;•)II,II,Il illllllllllllllll)lljlllll tlllllllll.l llll!Cil.l,I _-_-., _ '/ •)F!I;Ulllla.I•,Illlllllllllllll.11l!i:;S'!iJlll!'�•' _ .._j `%i+�;il� _ EMIC --�- — —:... DING ER, AVENUE -- r O E EMb t . •n.rKr.lrr.:rr•.,✓w.�nr.rxr'r�'.M..v\f6r♦r.Y unri�W.r M,:R4in4..._...._.-...___..___..-...... - ._ .., .-..- .,.. .._�.. - .... � -. • .._ EMb �, . ...... EMc J . Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 Res. No.2000-80 This Resolution Supersedes Res.No. 2000-68 A. Legal Description The following provides the legal description for the entire Crossings at Huntington Beach Specific Plan Area,which is bounded by Center Avenue on the north,Pacific Railroad on the east,Edinger Avenue on the south and Beach Boulevard on the west.. Refer to Exhibit 1 in the Specific Plan. Perimeter Legal Description Parcels 1 through 3,5 though 9 and that portion of Parcel 4,Parcel Map No.'S 6-200, in the City of Huntington Beach,County of Orange,State of California as per map pled in book 225 pages 40 through 45,inclusive,of parcel maps,in tine office of the county recorder of said county,described as follows: Commencing at the intersection of the centerline of the Southern Pacific Railroad Right of Way(30 feet wide)-writh the centerline of Edinger Avenue(variable width),as said intersection is shown on said Parcel Map No.86-200;thence South 89 32112"East- 45.00 feet along the centerline of said Edinger Avenue to the southerly prolongation of the westerly line of parcel I of said parcel map;thence North 00 15'57"East 50.00 feet to the southwest corner of said parcel 1 also being the True Point of Beginning:thence North 00 15'57"East 1120.67 feet along the westerly line of said parcel 1 to the northwest corner of said parcel 1;thence South 89 32'12"East 1803.57 feet along the northerly line of said parcel 1 and the northerly line of parcels 2,3 and 4 of said parcel map to the northeasterly line of said parcel 4;thence along a non-tangent curve in the northeasterIy line of said parcel 4,concave southwesterly and having a radius of 504.00 feet,a radial line to said point bears North 43 06;37'East,thence southeasterly along said curve through a antral angle of 12 11'46"an arc distance of 107.28 feet thence along the northeasterly line of said parcel 4 the following 5 courses:South 34 41'37"East 207.33,South 31 44'17" East 229.95 feet to the beginning of a non- tangent curve,concave northeasterly and having a radius of 300.00 feet,a radial line to said point bears South 73 10153"West;thence along said curve through a central angel of 50 58139'an arc distance of 266.92 feet,South 65 4746"East 233.09 feet and South 35 19'06"East 70.61 fccf;thence South 00 16'50'West 273.62 Feet along a line that is parallel with the easterly line of said parcel 4 and 9.00 feet nvesterly;thence South 42 16"20"West 41.42 feet along a line that that is parallel with the southeasterly line of said parcel 4 and 6.00 feet northwesterly to a point in the north line of pa-rcel i of an easement to the city of Huntington Beach recorded Nov=-ber 9, 1972 in book 10418,page 968 official records in the office of the county recorded November 9, 1972 in book 10418,page 968 official records in the office of the county recorder of said county,thence North 89 32112"Wcst 533.76 feet'along said north line - to the southeasterly corner of parcel 2 of said easement•,thence North 44"32'12"West 41.01 feet along the northeasterly line of said parcel 2 to the north west corner of said parcel 2;thence:jerth 89 32'12"West 32.50 feet along the north line of said parcel 2 to the northwest corner of said parcel 2;thence South 00 27'49" West 37.W fee:along the west line of said parcel 2 and said parcel I to the southerly line of parcel 4 of said Parcel map;thence North 89 32'12"West 1874.15 feet along the southerly lines of pastels 1,2,3 and 4 of said parcel map to True Point of Beginning. Note: This description was prepared as a convenience only and is riot for us i3 the division and/or conveyance of land in violation of the subdiN ision map act of the State of California Res. No.2000-80 pU7j�Resolution Supersedes Res.No.2000-68 - •NNIN SING � , I' SECTIONAL DISTRICT MAP 14-5-11 ro CM OF HUNTINGTON BEACH © — =`~r• o- ----_ ORANGE COUNTY, CALIFORNIA (2' _ _ RI i - •a _ i- SUBJECT PROPERTY Ott Tu At Q mea•v<wr CF-E cz a ' C4 I C Y C 4 t C0 / c2 1 C4 mi C2 C2 cs . IR03 t - R] R1 43 R3 R] � as R] "�` EXISTING ZONING fill MI _ MI R, a ^CF-E +� DESIGNATION_ _ its Rl Its itt _ ...._ RI _ Its R2 a .. Rt Its >a " R= SUBJECT PROPERTY = Its R' R"InCG AND CG—FP2 a n � p M1 1� a A A c4 . m a a MI , to (CHANGE PROPOSED TO ] CFE Rt C2 THE CROSSINGS AT _ HUNTINGTON BEACH `� MI SPECIFIC PLAN NO.13) a h11 R3 R CF-R u MI C4 o C2 R2 � •� 13Z1 2 = ., MI R3 C4 Res. No. 2000-80 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at a regular meeting thereof held on the 7th day of August, 2000 by the following vote: AYES: Julien, Sullivan, Green, Bauer NOES: Dettloff ABSENT: Harman ABSTAIN: Garofalo City Clerk and ex-officio Cferk of the City Council of the City of Huntington Beach, California A COMPLETE SPECIFIC PLAN S PREVIOUSLY ADOPTED BY C Y COUNCIL ON JULY 5, 2000 IS ON FILE IN THE CIT CLERK'S OFFICE AND THE PL ING DEPARTMENT 200 AIN STREET HUNTINGTO BEACH, CA 92648 THE FOLLOWING XCERPTS FROM SPECIFIC PL NO. 13 INCLUDE THE DEFINITIONS S TION AND THE PERMITTED USES CH RT WHICH WOULD BE AMENDE ,CIF THE CITY COUNCIL APPROVES AN AMENPMENT TO THE PREVIOUS APPROVAL DEVELOPMENT REGULATIONS 4.1.0 DEVELOPMENT REGULATIONS POLICIES: 4.1.1 Not withstanding provisions to the contrary, all grading shall be approved by both the Planning 4.0 PURPOSE Director and Director of Public Works,or designee. The purpose of this. section is to provide specific 4.1.2 Construction may commence only after the development regulations and standards that will be applied to development projects in the Specific Plan. Planning Director finds that the projec/is consistent with the regulations and applicable Upon adoption by the. City of Huntington Beach, the policies and guidelines of the Specific Plan. Crossings at Huntington Beach Specific Plan will be the zoning document for the project area. i 4.1.3 All structures in existence at the time of Specific Plan adoption shall be eemed legal,non-conforming. 4.1 GENERAL PROVISIONS All policies regarding Site Plan Review process and The provisions contained herein shall govern the fagade improvements shall apply. design and development of the Crossings at Huntington Beach Specific Plan area. Standards 4.2 DEFINIT,IONS and/or criteria for `development and activities not Foret u ses of the Specific Plan words phrases specifically addressed in this Specific Plan shall i p Y'p° > > require referral to .the current provisions of the and terms shall have the meanings as defined below. Huntington Beach Zoning and Subdivision Ordinance Terms not specifically defined in the Specific Plan shall and Municipal Code. have the same definition as used in the City of Huntington Beach Zoning and Subdivision Ordinance Whenever a use. has not been specifically listed_-s in effect at the time of any individual request. being .a permitted use, the Planning DirectorAall determine if the use is-consistent with the intent'of this When not inconsistent with the context,words used in Specific Plan and compatible with othgxxlpermitted the present tense include the future tense; words used uses. In addition, all.projects must cofnply with the in the singular number include the plural number; following policies: and words of the masculine gender include the feminine and neutral gender. The word "shall" is always mandatory and the'word "may" is permissive. The word "encouraged" shall mean every effort shall be made to conform to the policy but alternatives may be acceptable. 4.2.1 Architectural Features. Architectural features include elements that compliment the building architecture such as, but not limited to, walls, The,Crossings at Huntington Beach Specific Plan 75 . June 20;,'2000 architectural towers and domes (with The Crossings at 4.2.9 Renovation. Any, request to remodel, improve, Huntington Beach logo), spires, and arches. renovate,upgrade,or refurbish the interior or exterior Architectural,features may include signage as depicted of an existing - building, including minor in the attached signage guidelines. improvements to accommodate new tenants or an upgraded look for an existing tenant. , 4.2.2 Communication Antenna. All types of receiving and transmitting antenna,except satellite dish antenna 4.2.10 Site plan.A plan prepared to scale,showing accurate and wireless communication facilities. and complete dimensions of all buildings./structures, landscaping, parking, drive aisles, uses;etc. and the 4.2.3 Deviations. An adjustment in one or more exact manner of development propose'( for a specific Development Regulations in order to accommodate parcel of land. special circumstances and/or unique architectural . . Z. features. Deviation shall be limited to ten (10) percent 4.2.11 Street. A public or approved private thoroughfare or of any single development regulation_ road easement which%ffords the principal means of �/►�Q,1(k DIA of PY\ve *YDVgh'W.W� as lis{e d iv+ A '� access to abutting property. 4.2.4 Entryway. '1'lie point of ingress and "egress from a 1Jo•Z Zalteration.'Any public or private street to the individual project. Q' 7'CD4.2.12 Structural change in,or alterations RC` to, the str icture of a building involving: the bearing 4.2.5 Final approval. Ten (10) days after approval by the wall;�column, beam or ceiling joints,roof rafters, roof discretionary body and no appeal of that decision has diaphragms, foundations, retaining walls or similar been filed, components. 4.2.6 Modification (Minor). An amendment to the 4.2.13 Ultimate right-of-way. The adopted maximum exhibits and/or text which does not change the width for any street, :alley or thoroughfare as meaning or intent of the Specific Plan. established by: the general plan, a precise plan of street, alley or private street alignment, a recorded 4.2.7 Modification (Major). An amendmztoe parcel map, or a standard plan of the Department of exhibits'and/or text which is intended"it'o change the Public Works. Such thoroughfares shall include any meaning or intent of either the Development Concept, adjacent public easement used as a walkway and/or Design Guidelines,or Development Regulations.Major utility easement. modifications require a Zoning Text Amendment and action by the Planning,05mmission and City Council. 4.2.8 Private dri ,e`A privately owned and maintained roadway ed to provide vehicle access through the property. The Crossings at Huntington Beach Specific Plan 76 June 20, 2000 4.2.14 Use. The purpose for which land or building is 4.3.1 Permitted Uses. Permitted uses shall.be require. ` arranged, designed, or intended, or for which it is meet all applicable provisions of the Huntington Beach occupied or maintained. Zoning and Subdivision Ordinance Code. A list of permitted uses is provided in Exhibit 13A. 4.2.15 Wall or fence. Any structure or devise forming a physical barrier. This definition shall include: vrmd,. 4.3.2 Intensity.The maximum intensity shall be consistent concrete, concrete block, brick, stone or other , with the City's General Plan. masonry material, metal, and wrought iron,etc. 4.3.3 Building height. The maximum allowable building 4.2.16 Zone. A district as defined in the State Conservation height shall be seventy-five (75) feet and a maximum and Planning Act, shown.on the official zoning maps of 4 stories. Rooftop mechanical equipment and and to which uniform regulations apply. parapet walls may exceed the maximum permitted building height /by' fifteen (15) feet,, however 4.2.17 Zoning maps. The official zoning maps of the City mechanincal equipment shall be screened from view. of Huntington Beach' which are a part of the Special themeid architectural structures. or elements comprehensive zoning ordinance. such as ewers or domes may be allowed up to one hund -twenty (120) feet. 4.3 DEVELOPMENT STANDARDS 4.3.4 etbacks. Refer to Exhibit 14. The Development Standards shall serve as the /4.3.5 Landscaping. Landscaping shall be permanently mechanism.for the implementation of the Crossings at / maintained in an attractive manner in all setback and Huntington Beach land uses.The standards set forth/// parking lot areas fronting on,or visible from,adjacent this section will assure that future development vv thin public streets. The Crossings at Huntington Beach is implemented in a manner consistent with the intent of the�project area 4.3.6 Signs. All signs in the project area shall conform to Master Plan. The standards contained herein provide the provisions,of the sign standards in Appendix D. flexible mechanisms to anticipate,-future needs and achieve compatibility betwe�en,11and uses and the 4.3.7 Lighting. All illumination of interior circulation surroundingcommunity..Standards and guidelines are h'�� g streets, parking areas, and project sites, shall be designed to be comps ible with the existing land use coordinated to. .� provide consistent illumination categories of the City. The primary land uses in the intensity. Emphasis shall be placed on areas of high Crossings at�ifcntington Beach shall be. regional � � vehicular and pedestrian activity. Light fixtures and commercial;retail,dining,and entertainment, standards shall be consistent 'with building .architectural style. Public streetlights shall comply with the City of Huntington Beach guidelines for street lighting. The Crossings at Huntington Beach Specific Plan 77 June 20, 2000 New building construction of the following uses and fagade improvements to existing buildings shall be permitted within the Crossings at Huntington Beach Specific Plan subject to review and approval of a Site Plan Review by the Planning Director. Other changes in occupancy, such as, like for like tenant changes, new..-tenants established within existing buildings, and/or intensification of tenant uses shall be subject to building permit plan check review to verify compliance with parking and the Specific Plan review. ,i :V�rfiZ;=iv�;J�,�:�r:�{��;'•,�(n ;'2-.': :ri1.•�•' •;r .;�•�•L:,�.t;;.;�F .p' 1.�;�;: .t,.. .:r•• GIONAL:�G`OMM�RCIAL.. >��.,st:,y� _ ..:��►•l..� ��s.,t. , °i;:;,,.,a$�,,. PUB,EtIG'�A1VD SF1l�II PUBLI�.�.�. ' �:4.•�4,�.F ��� .. . -•:: Aquarium Day Care Facilities Banks and other financial institutions Government Offices * Commercial recreation and live entertainment Public Safety Facilities Food Markets (Specialty Markets-max. 10,000 sq. ft.) Utilities and Communication Facilities General Retail Parking Day Spa -surface Hotels Motels -structured Movie Theaters -valet Restaurants -with outdoor dining -with alcohol sales -'with live entertainment and dancinst_ *lough' Igoe'vy We loc�D_vt Personal Services OFFICE Business and Professional OTHER PERMITTED RETAIL Car stereo and alarm installation,if integrated into an anchor/major retail building ati&located within a building Portable carts and kiosks 1-11, Note.•Other similar uses mays permitted subject to review by the Planning Director. 'Requires an entertainment permit ,� Ptcf d dY�ve.- •iiAKou g V, &f2�3 0 "CA daa,�� g� a,«.,-�s Permitted Uses Chart ah \is�ed iVl.�ti#�uClnwtp.Vlt 1do• 2 q 8 7•W �ZCA Exhibit 13A The Crossings at Huntington Beach Specific Plan 78 June 20, 2000 THE LEGAL DESCRIPTION IS ON FILE IN THE Cl CLERK'S OFFICE AND THE P NNING DEPARTMENT 20 0 MAIN STREET HUNTING N BEACH, CA 92648 EXHIBIT B RCA ROUTING SHEET INITIATING DEPARTMENT: Planning SUBJECT: Reconsideration of Zoning Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 (The Crossings at Huntington Beach Specific Plan No. 13) COUNCIL MEETING DATE: August 7, 2000 ,RCA ATTACHMENTS S 3 w .,,;il1yylo331311�11�1a,.:.:.... Ordinance (w/exhibits & legislative draft if applicable) Not Applicable Resolution (w/exhibits & legislative draft if applicable) Attached Tract Map, Location Map and/or other Exhibits Not Applicable Contract/Agreement (w/exhibits if applicable) (Signed in full by the City Attorney) Not Applicable Subleases, Third Party Agreements, etc. (Approved as to form by City Attorney) Not Applicable Certificates of Insurance (Approved by the City Attorney) Not Applicable Financial Impact Statement (Unbudget, over $5,000) Not Applicable Bonds (If applicable) Not Applicable Staff Report (If applicable) Not Applicable Commission, Board or Committee Report (If applicable) Not Applicable Findings/Conditions for Approval and/or Denial L Attached EXPLANATION FOR`MISSING ATTACHMENTS REVIEWED RETURNED FORWARDED Administrative Staff 7 2-C, ( ) ( ) Assistant City Administrator (Initial) ( ) ( ) City Administrator (Initial) ( ) ( gyp ) City Clerk ( ) EXPLANATION;fpR:RETURN OF'ITEM: (BelowOnly) RCA Author:HZ:HF:JJ:kjl PROOF OF PUBLICATION STATE OF CALIFORNIA) ) Ss. County of Orange ) am a Citizen of the United States and a resident of the County aforesaid; I am over the age of eighteen years, and not a party to or interested in the below entitled matter. I am a principal clerk of the HUNTINGTON BEACH INDEPENDENT, a newspaper of general circulation, printed _ and published in the City of HuntingtonPERSONS are'INTER ' No. 13.zrA:Adopt Spe- to I NOTICE OF cific Plan No. 13, which attend said hearing and Beach, County of Orange, State of PUBLIC HEARING establishes zoning, de-I express opinions or BEFORE THE velopment standards,, submit evidence for or California, and that attached Notice is a CITY COUNCIL OF site design, and' against the application THE CITY OF architectural guidelines' as outlined above. If you true and complete copy as was printed HUNTINGTON to govern future de- challenge the City Coun-. BEACH velopment, requires Re- cil's action in court, you and published in the Huntington Beach and Commercial uses may those limited to raising NOTICE IS HEREBY and creates an only those issues you or and Fountain Valley issues of said GIVEN that on Monday, amortization schedule someone else raised at August 7, 2000, at 7:00 for non-conforming uses the public hearing de- PM in the City Council and structures at the 63 scribed in this notice, or, newspaper to wit the issue(s) of: 'Chambers, 2000 Main acre property. Location: in written cor- Street, Huntington 7777 Edinger Avenue respondence delivered Beach, the City Council (bounded by Beach to the City at,or prior to, will hold a public hearing Boulevard, Edinger Ave- the public hearing. If' on the following planning nue, Center Avenue, there are any further July 27 , 2000 and zoning items: and the Southern Pacific 1. RECONSIDERA- Railroad Project Plan- questions please call the, TION OF ZONING MAP ner: Jan) I Planning Department to James 536-5271 and refer to AMENDMENT NO. NOTICE IS HEREBY the above items. Direct 00-01/ZONING -TEXT GIVEN that the above your written communica- AMENDMENT NO. item is covered under,'tions to the City Clerk. 00-02 (THE CROSS- the General Plan Connie Brockway, INGS SPECIFIC PLAN): Environmental Impact City Clerk, Applicant: The City of Report _certified and City of Huntington Beach and adopted by the Hunt- Huntington Beach, I declare, under penalty of er ur that the Redevelopment ington Beach City Coun- 2000 Main Street, p y, Agency of the City of cil on May 13, 1996,pur- 2nd Floor, the foregoing is true and correct. Huntington Beach Re- suant to the provisions Huntington Beach, quest: Reconsideration of the California, California 92648 of a zoning map amend- Environmental Quality (714) 536-5227 ment and zoning text Act. Published Huntington amendment to adopt ON FILE:A copy of the' Beach-Fountain Valley Specific Plan No. 13 for proposed request is on Independent July 27, Executed on July 27 2000 the Huntington Beach file in the City Clerk's Of- 2000 If i Mall property. ZMA: fice, 2000 Main Street, _ _ _ 074-772_ at Costa Mesa, California Amend zoning from CG Huntington Beach, Cali- . — _ - -(General Commercial) fornia 92648, for inspec-; and CG-FP2 (General tion by the public.A copyi Commercial-Flood of the staff report will be ,Plain) to Specific Plan available to interestedi parties at City Hall or the; Main City Library (7111, Talbert Avenue) after, August 3. 2000. ALe4� Signature (ON 1p)�j ���c CITY COUILMEVELOPMENT AGENCY PUBLIC HEARING REQUEST ,sa4-i-v�-- o f 'Lout" � A'VK"AA h "tk N D• DD-D l/ SUBJECT: ZOIM1tiA T � f�;VVNQ 1Jo• -OZ.- (SpP.Ca �ICI.Iti IJo . l3> DEPARTMENT: MEETING DATE: -7- L CONTACT: PHONE: 1p N/A YES NO ( ) () ( ) Is the notice attached? ( ) ( ) Do the Heading and Closing of Notice reflect City Council (and/or Redevelopment Agency)hearing? ( ) ( ) Are the date, day and time of the public hearing correct? ( ) ( ) 'If an appeal, is the appellant's name included in the notice? ( ) ( ) If Coastal Development Permit, does the notice include appeal language? ( ) ( ) Is there an Environmental Status to be approved by Council? ( ) ( ) Is'a map attached for publication? ( ) ( ) 1 Is a larger ad required? Size ( ) (>C) ( ) Is the verification statement attached indicating the source and accuracy of the mailing list? Are the applicant's name and address part of the mailing labels? ( ) ( ) 'Are the appellant's name and address part of the mailing labels? PO ( ) ( ) If Coastal Development Permit, is the Coastal Commission part of the mailing labels? ( ) ( ) If Coastal Development Permit,are the resident labels attached? Is.the Report 33433 attached? (Economic Development Dept. items only) Please complete the following: 1. Minimum days from publication to hearing date 2. Number of times to be published 3. Number of days between publications hk 21 fto�� NOTICE OF PUBLIC HEARING BEFORE THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH NOTICE IS HEREBY GIVEN that on Monday, August 7, 2000, at 7:00 PM in the City Council Chambers, 2000 Main Street, Huntington Beach, the City Council will hold a public hearing on the following planning and zoning items: ❑1. RECONSIDERATION OF ZONING MAP AMENDMENT NO. 00-01/ZONING TEXT AMENDMENT NO. 00-02 (THE CROSSINGS SPECIFIC PLAN):: Applicant: The City of Huntington Beach and the Redevelopment Agency of the City of Huntington Beach Request: Reconsideration of a zoning map amendment and zoning text amendment to adopt Specific Plan No. 13 for the Huntington Beach Mall property. ZMA: Amend zoning from CG(General Commercial) and CG-FP2 (General Commercial-Flood Plain)to Specific Plan No. 13. ZTA: Adopt Specific Plan No. 13, which establishes zoning, development standards, site design, and architectural guidelines to govern future development, requires Regional Commercial uses and creates an amortization schedule for non-conforming uses and structures at the 63 acre property. Location: 7777 Edinger Avenue (bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad) Project Planner: Jane James NOTICE IS HEREBY GIVEN that the above item is covered under the General Plan Environmental Impact Report certified and adopted by the Huntington Beach City Council on May 13, 1996, pursuant to the provisions of the California Environmental Quality Act. ON FILE: A copy of the proposed request is on file in the City Clerk's Office, 2000 Main Street, Huntington Beach, California 92648, for inspection by the public. A copy of the staff report will be available to interested parties at City Hall or the Main City Library (7111 Talbert Avenue) after August 3, 2000. ALL INTERESTED PERSONS are invited to attend said hearing and express opinions or submit evidence for or against the application as outlined above. If you challenge the City Council's action in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the City at, or prior to, the public hearing. If there are any further questions please call the Planning Department at 536-5271 and refer to the above items. Direct your written communications to the City Clerk Connie Brockway, City Clerk City of Huntington Beach 2000 Main Street, 2nd Floor Huntington Beach, California 92648 (714) 536-5227 (gAegals:00cc0807) SUSAN W. CASE, INC. OWNERSHIP LIS77NG SERVICE , 917 Glenne yr+e Street,Suite 7,'Laguna Beach, CA 92651 PHONE(949)494.6105•FAX(949)494-7418 CERTIFICATION OF PROPERTY OWNERS LIST THE ATTACHED LIST REPRESENTS THE NAMES AND ADDRESSES OF ALL PROPERTY OWNERS LOCATED WITHINEoQq_FEET OF THE EXTERIOR BOUNDARIES OF THE - PROPERTY LOCATED AT 1 tjG J 6PiQC/� THIS INFORMATION WAS OBTAINED THROUGH TRANSAMERICA INTELLITECH, A DATA -SOURCE" UTILIZING THE..COUNTY ASSESSMENT ROLLS -AND OTHER DATA SOURCES. THIS INFORMATION IS GENERALLY DEEMED RELIABLE, BUT IS NOT GUARANTEED. SUSAN W. CASE, INC.. ML r baUU -- Tv k1r, �C� �i 6l, i CROSSINGS LABELS—UPDATES AND INTERESTED PARTIES 5/31/00 Mr. Douglas Gray Mr. Scott Dinovitz Mr. Jonathan C. Curtis The Ezralow Company The Ezralow Company Sheppard, Mullin,Richter, &Hampton 7545 Irvine Center Dr., Suite 200 23622 Calabasas Road, Suite 100 333 South Hope Street, 14"'Floor Irvine, CA 92618 Calabasas, CA 91302-1549 Los Angeles, CA 90071-1448 Mr. Aviv Tuchman Mr. Bruce Hackel Ms. Caren Manchester Tuchman and Associates Burlington Coat Factory Sheppard, Mullin,Richter, &Hampton 3435 Wilshire Boulevard, 30`"Floor 7777 Edinger Avenue 333 South Hope Street, 14"'Floor Los Angeles, CA 90010 Huntington Beach, CA 92648 Los Angeles, CA 90071-1448 Mr.Lauren Hohman Ms. Jayna Morgan Mr. Richard A. Harlow Montgomery Wards EDAW Inc. Richard A. Harlow and Associates Wards National Office 17875 Von Kannan Ave., Suite 400 211-B Main Street 535 West Chicago Ave.,24'h Floor Irvine, CA 92614 Huntington Beach,CA 92648 1 Wards Plaza Chicago,IL 60671 Ms. Maureen Sloan-James Mr. Larry Slonim Mr. Dave Hall 18593 Main Street 19792 Gloucester Lane 16291 Kim Lane Huntington Beach, CA 92648 Huntington Beach, CA 92646 Huntington Beach,CA 92647-4114 Mr. Terry Contrucci 7777 Edinger Avenue Suite 114 Huntington Beach,CA 92647 i I i 07 212 06 1 107 220 58 2 107 220 59 3 Jan Gerald Chapin HUNTINGTON VILLA ASSOC Jean Patierno 30 Box 25189 1800 Avenue Of The Stars 17 Hermitage Ln os Angeles CA 90025 Los Angeles CA 90067 Newport Beach CA 92660 07 771 01 4 107 771 06 5 107 771 07 6 erry&Barbara Luzzi Janet Moore Elsa Wong 1022 Jordan Rd 9222 Caladium Ave 8821 Baywood Dr Vhittier CA 90603 Fountain Valley CA 92708 Huntington Beach CA 92646 07 771 08 7 107 771 09 8 107 771 10 9 ferry& Barbara Luzzi Kory y� g0� Kory&Jacque Tydon 1022 Jordan Rd 509 eaux Ave 16082 Malaga Ln Vhittier CA 90603 Irvine CA 92604 Huntington Beach CA 92647 107 773 01 10 107 773 02 11 107 773 03 12 =ve Smiley Kramer Douglas Bowles YACOEL PT R- RI EX FA 153 Lake Shore Dr 16121 Malaga Ln#A 16111 a a Ln Rancho Mirage CA 92270 Huntington Beach CA 92647 Hu mgton Beach CA 92647 107 773 04 13 107 773 05 14 107 773 08 15 J Richard Foster Joseph Caldwell Billy Martin Garrett II 16101 Malaga Ln PO Box 8191 24605 Mosquero Ln luntington Beach CA 92647 Fountain Valley CA 92728 Mission Viejo CA 92691 107 773 09 16 10777310 17 n,� 10778103 18 Concepcion Valenzuela M aria Y Sa'o'V4 -�'_ AU TOM UB SC,,�,i dAu 8181 San Angelo Dr Gr 260 F' eroa St Huntington Beach CA 92647 Ne port Beach CA 92663 Los Angeles CA 90007 107 781 04 19 1'L0,zk 1 781 05 20 1 7 781 06 21 HUNTINGTON EXECUTIVE PARK HUN GTON EX TIVE PARK H INGTON CUTIVE PARK 16168 Beach Blvd#200 16168 Be Blvd #200 16168 h Blvd 0 Huntington Beach CA 92647 Huntington Bea CA 92647 Huntington B CA 9 47 107 781 07 22 107 782 08 23 107 881 10 24 HUNTINGTON EXECUTIVE PARK HUNTINGTON BEACH PROPERTIES Steven Oliver 16052 Beach Blvd 920 Foothill Blvd 15902 Monroe St Huntington Beach CA 92647 La Canada CA 91011 Westminster CA 92683 107 881 11 25 107 881 14 26 107 881 15 27 Gee Lui Nancy Sakioka Kenneth Chappell 15922 Monroe St 8292 Worthy Dr 8202 Rockview Cir Westminster CA 92683 Midway City CA 92655 Westminster CA 92683 107 881 16 28 107 881 17 29 107 881 18 30 Barbara Meyer Christopher Ramirez Sandra Starr 8192 Rockview Cir 8182 Rockview Cir 8172 Rockview Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 19 31 107 881 20 32 1u7 661 'L1 33 4nthony Puglia Hoa Benson : Gregory Hardy 8166 Rockview Cir 8162 Rockview Cir,-,-, ; 8156 Rockview Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 I i 107 881 22 34 107 881 23 35 107 881 24 36 David Bender Shula Slaughter Thomas Hudson 8152 Rockview Cir 8142 Rockview Cir 8141 Rockview Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 25 37 107 881 26 38 107 881 27 39 James Maryea Mario Quitoriano ! Philip Flores 8161 Rockview Cir 8171 Rockview Cir ; 3307 Hollypark Dr Westminster CA 92683 ; Westminster CA 92683 Inglewood CA 90305 I 107 881 28 40 107 881 29 41 107 881 30 42 Robert Keaton j Armando Parra Jr. Quang Dinh 8179 Rockview Cir j 8181 Rockview Cir 15881 Monroe St Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 31 43 107 881 32 44 107 881 33 45 Robert Paul Dutton Thomas&Sally Schmidt Donald &Annette Kloos 15861 Monroe St 15851 Monroe St 15841 Monroe St Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 34 46 107 881 37 47 j 107 881 38 48 Minh LeTam Mary Lemond Craig &Janet Monroe 15831 Monroe St 8192 Ingram Cir I 8182 Ingram Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 39 49 107 881 40 50 107 881 41 51 Jeffrey&Sharon McKeown Tommy Francis Haney Quang Ly 8172 Ingram Cir 8162 Ingram Cir 8152 Ingram Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 I 107 881 42 52 107 881 43 53 107 881 44 54 Brian &Julie Flesch Victor Jimenez Minoru &Jane Yoshisato 8142 Ingram Cir ! 8131 Ingram Cir 8141 Ingram Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 ! i i 107 881 45 55 107 881 46 56 107 881 47 57 Patricia Goplen Eric&Lynn Furuya j Diane&Deborah Spangler 8151 Ingram Cir 8161 Ingram Cir 8171 Ingram Cir Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 1 881 58 107 881 59 59 ( 107 881 60 60 ORA E CO TY FLOOD CONTR Holly Hoang Dana& Debra Hadley 8262 Crown Ct i 8242 Crown Ct Westminster CA 92683 Westminster CA 92683 ! !07 88161 61 107 881 62 62 107 881 63 63 Zobin &Stella Wang Sharon Dietz William Wally 3222 Crown Ct 8212 Crown Ct 8202 Crown Ct Nestminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 64 64 107 881 65 65 107 881 66 66 '_ouann Watkins TRAN LOAN THI George Baldwin 3192 Crown Ct 8186 Crown Ct 8182 Crown Ct Nestminster CA 92683 Westminster CA 92683 Westminster CA 92683 107 881 67 67 107 881 68 68 107 881 69 69 Jerry Maras Larry Forbes Henry Quenin 8172 Crown Ct 8166 Crown Ct 15931 Monroe St Westminster CA 92683 Westminster CA 92683 Westminster CA 92683 142 071 53 0,?3,�7, i8,82 142 071 54 71 42 071 72 MACERI TIN LIMITED ORANG TY TRANSI ISTRI CI OF HUN TON BEACH 233 h' Blvd#700 g�', _- PO 5 Est City AK Sa onica CA 90401 �'Y' G Grove CA 92842 Huntingto each CA 9 48 42 071 73 142 071 63 74 142 071 65 751 8 S MA RICH HU TON LIMITED Plaza Ro vi �, FREEWAY INDUSTRIAL PARK 233 Wils ' e Blvd#700 7306 e r Ave ti 2032 La Colina Dr Santa Monica CA 90401 H i on Beach CA 92647 Santa Ana CA 92705 i 142 071 66 76 142 071 80 7 1 142 071 85 78 FREEWAY INDUSTRIAL PARK MAZER4QH HUNTIN N LIMITED ERICH H GTON LIMITED 212 High St 233 Wilshire #700 233 i ' Blvd#70 Pottstown PA 19464 Santa Monica CA 401 Santa Monica 90401 i 142 071 87 79 142 071 91 80 142 071 92 81 Plaza R v' �1a( MONTGOMERY WARD DEVELOPM REDEVELOPMENT AGENCY CITY 0 7400 en Ave 5 1 Montgomery Ward Plz 2000 Main St Hu in n Beach CA 92647 Chicago IL 60671 j Huntington Beach CA 92648 i tl�til� �.b puYLL,�► 142 071 93 82 142 071 97 83 142 071 98 84 MAC RICH TINGTON LIMITED �Mon UNTINGTON LIMITED MA H HU GTON LIMITED 233 Wi a Blvd 233B 700 233 Wilshire v-d#7 Santa Monic 90401 SanCA 90401 Santa Monica C 90401 142 71 9 85 142 072 02 86, 57 142 072 03 87 MACE TINGTON LIMITED COAST COMMUNITY COLLEGE DIS COA OMMU COLLEGE DIS 233 Wilshire vd 0 2701 Fairview Rd 2701 Fairvi Rd Santa Monica CA 90401 Costa Mesa CA 92626 Costa Mesa CA 92626 142 072 0 88 142 072 08 89 142 072 09 90 F EWAY I �Dr RIAL PARK INC FREEWAY INDUSTRIAL PARK FREEWAY INDUSTRIAL PARK%JOJ 2032 Colin PO Box 10446 2701 Alton Pkwy Santa Ana 92705 Newport Beach CA 92658 Irvine CA 92606 14207901 91, `t L 142 079 092 142 061 U1 y3 -1UNTINGTON BEACH CO H TINGTO CH CO HUNT TON H CITY OF PO Box 285 PO B 85 2000 Main -iouston TX 77001 Houston 7001 Huntington Bea CA 92648 142 081 02 94 142 081 03 95 142 081 06 96 Deter Cha �� Peter Ch i y R VELOP NT AGENCY FOR Cl 7942 r Ave 7900 i er Ave 2000 M ' St dun ' n Beach CA 92647 Hu in on Beach CA 92647 Huntington ch CA 2648 142 081 09 97 j 142 081 1 98 081 11 99 RED EL ENT AGENCY OF CIT I R VELOP T AGENCY OF CIT RED LOP T AGENCY OF CIT PO Bo 740 i PO Bo 40 PO Box 40 Huntington ach CA 92647 Huntington h CA 92647 i Huntington ach CA 92647 142 08 2 100 142 081 16 101 142 081 17 102 R VEL ENT AGENCY OF CIT Harold Bragg Didier Camilleri PO B 740 5540 E 6th St 8172 Starr St Huntington each A 92647 Long Beach CA 90814 Stanton CA 90680 142 081 18 103 142 081 25 104 142 081 26 105 Elisabeth Lewis Cooper Leon DePicciotto Elisabeth Lewis Cooper 16000 Ventura Blvd#1000 140 N Fuller Ave 16000 Ventura Blvd#1006 Encino CA 91436 Los Angeles CA 90036 Encino CA 91436 I 142 081 27 106 I 142 081 28 107 142 082 02 108 Ruth Eleanor Wolman LINDON LEGIN CO Viola Murray 25 Healey St 28815 Grayfox St 8081 Bolsa Ave Cambridge MA 02138 Malibu CA 90265 Midway City CA 92655 41208204nin 109 142 082 07 110 142 082 09 111 , 1 l Z. Doa H ya Galitzen�y Samuel Shu Chuan Wu ALDRICH ASSOCIATES 977a s River Cir S 11 Aguilar 575 20th St F Valley CA 92708 Irvine CA 92614 Hermosa Beach CA 90254 142 0 0 112 142 082 11 113 142 082 12 114 ICH OCIATES Katherin at son Kimberly Walsh � 5752 _ 1120 ar Ave 80 Huntington St#407 Hermosa Beach CA 90254 I D Grove IL 60515 Huntington Beach CA 92648 I I I 142 082 15 115 ! 142 082 16 116 142 08217 117 Adel Salam STARK ASSOCIATES Elliott Kallick 8942 Baywood Dr 575 20th St 16261 Spartan Cir Huntington Beach CA 92646 Hermosa Beach CA 90254 Huntington Beach CA 92649 142 082 19 118 142 082 20 119 142 082 2 120 q Alan &Kathi Gussin Haig &Alice Dulgarian Shurle it erg sQy W1 18512 Santiago Blvd 826 E 62nd St 237 0 crest Dr Villa Park CA 92861 ! Los Angeles CA 90001 Palm prings CA 92264 142 082 26 121 142 082 27 122 142 082 28 123 TARBELL INVESTMENT CO Max Lp Georges Tsai& Hilary &Yah Chu 1403 N Tustin Ave#380 9595 Wilshire Blvd #204 20352 Everglades Ln Santa Ana CA 92705 Beverly Hills CA 90212 Huntington Beach CA 92646 142 082 29 124 142 082 30 125 142 082 31 126 Richard Edwin Parks Ming Lee Ming Lee PO Box 568 1902 Clark St 1902 Clark St Cypress CA 90630 Galesburg IL 61401 Galesburg IL 61401 14208233 127 142 082 34 128 142 082 35 129 Gilbert& a Bazan Sung Hong Choi Ronald Beard 16132 ar ide Ln 6861 E Avenida De Santiag 3208 Ocean Blvd Hun ' g Beach CA 92647 Anaheim Hills CA 92807 Corona Del Mar CA 92625 142 083 05 130, 1 142 0 06 131 i 142 083 07 132 Ching Yuan Lin C Yu Lin William G III a Ott ' 6042 Kenwick Cir 6042 is it 7922 t Huntington Beach CA 92648 Huntington Beac CA 92648 HurftiWon each CA 92647 142 083 08 133 142 083 09 134 142��gto 83 10 135 Tommy Garland Eldon Willard Bagstad Tit 8886 Plumas Cir#1125b 901 Catalina Ave 15 son Ln Huntington Beach A 2 4 al h 74 Hunt] n Beach A 2 C 9 6 6 Se Beach CA 90 0C 9 647 142 083 24 136 142 083 27 137 142 1��t 138 FIRESTONE TIRE & RUBBER CO Adel&Soad Salam Ronala-Marie Sher S�J' 50 Century Blvd 8942 Baywood Dr 76 ger Ave Nashville TN 37214 Huntington Beach CA 92646 Huntington Beach CA 92647 142 111 27 139 142111 28 140 142 111 32 141 MCDONNE GLAS WEST FED HUNTINGTON PARTNERSHIP Ronald Sher PO Box )y PO Box 19528 320 108th Ave NE#406 Torr A 90510 y �' ' Irvine CA 92623 Bellevue WA 98004 142 111 33 142 111 143 142 111 37 144,14S Abby Sher ME Y&L AS,5,N BRIDGES AMERICA SHER LANE 320 108th Ave NE#406 18837 Brookhurst St#303 Bellevue WA 98004 Fountain Valley CA 92708 142 111 145 142 1 9 146 142 111 42 147 BRI S AM A S H E R LANE ONN DOUGLAS WEST FED AMERICAN & L ASSN 18837 Bro—Ckkurst S 303 PO 4244 PO Box 1048 Fountain Valley CA 92708 Torrance A 90510 Stockton CA 95201 142 112 05 148 142 112 08 149 142 112 09 150 Ismael Silva Jr. HUNTINGTON BEACH#1 %SKAGG HUNTINGTON BEACH#1 16101 Santa Barbara Ln 2716 Ocean Park Blvd 2716 Ocean Park Blvd Huntington Beach CA 92649 Santa Monica CA 90405 Santa Monica CA 90405 142 112 10 151 142 321 01 `152 142 321 02 153 HUNTINGTON BEACH#1 PEDIGO PRODUCTS INC PEDIGO PRODUCTS INC 2716 Ocean Park Blvd 4000 SE Columbia Way 4000 SE Columbia Way Santa Monica CA 90405 Vancouver WA 98661 Vancouver WA 98661 142 321 15 154 142 331 12 155 + 142 331 13 156 FREEWAY,INDUSTRIAL PARK Maria Elizab ans Roger Stollenwerk 2032 La Colina Or 7562 Vo r 5'� 10635 Angel Ave Santa Ana CA 92705 Hunti t n Beach CA 92647 Fountain Valley CA 92708 142 331 14 157 142 331 15 158 142 331 16 159 Michael Dresnick Catherine sen 5� Michael�Aa SlJt 12 Calle De Princesa 7602 r 217 2 Coto De Caza CA 92679 Hu mg on Beach CA 92647 Hun in gton Beach CA 92648 142 331 Ily 160,� i 142 331 18 161 142 331 19 Cathy rg �� Theodore Gallo Charles ¢ th Grant 761 o Dr 5302 Berkeley Ave 76Yin( Ig r H ti on Beach CA 92647 Westminster CA 92683 Hun Beach CA 92647 142 331 20 163 142 331 21 164 142 331 43 165 Doris W r gyp- GOLD ay Roy Batelli PO BVesa 3 ` 767 ga Dr S PO Box 599 Costa CA 92628 Hun mgton Beach CA 92647 Newport Beach CA 92661 142 331 44 166 142 332 01 167 142 332 02 168 Norman Bender James&Susan Klutnick Haril Whetsell 10091 Beverly Or 17582 Bedark Cir 629 Frankfort Ave Huntington Beach CA 92646 --Huntington Beach CA 92649 Huntington Beach CA 92648 142 332 03 169 142 332 04 170 142 332 05 171 Stratton Matinas Kaly Warren Hazel Boeddeker 17081 Greentree Ln 864 Vallecito Or 7621 Volga Dr#1 Huntington Beach CA 92649 Ventura CA 93001 Huntington-Beach CA 92647 114233206 172�, 142 332 07 173 142 332 08 174 Earl Be n �" Richard Setian Stephen Chase 7611 0l Or 6202 Pacemont Or 25 Eastlake H tin on Beach CA 92647 Huntington Beach CA 92648 Irvine CA 92604 142 332 09 175 142 33210 176 142 332 11 477 Stephen Chase Nahoko Tyone Wendall pe Meadows 25 Eastlake 7561 Volga Or 7702 sne PI s Irvine CA 92604 Huntington Beach CA 92647 j Westminster CA 92683 142 332 12 178 142 332 13 179 142 3321 180 5 Michael Dresnick Nsky Der�,2R ansky ' 12 Calle De Princesa 752 of Or `' 16nges Ln Trabuco Canyon CA 92679 H ti on Beach CA 92647 Huntington Beach CA 92647 / 142 33215 181 142 33216 182 1423322S 183 William Susman Family Trust Commons-Long C OF H INGTON BEACH 3035 Country Club Dr 6352 Reubens Dr PO B 190 Costa Mesa CA 92626 Huntington Beach CA 92647 Huntington each C 92648 142 34103,10k 184, tVw,101 142 341 10 185 42 34 186 PERRY LTD LIABILITY CO Charles Palmer P Y LTD %92 Y CO THE 15621 Beach Blvd 1701 Kings Rd 15621 ach Westminster CA 92683 Newport Beach CA 92663 Westminst r C3 142 341 18 187 142 34212 1 142 342 14 189 PEN E Y L BILITY CO SPIEKER P IES LP MEMORIAL HEALTH SERVICES 15621 ch BI 17320 d Ave#16 2801 Atlantic Ave Westminst CA 92683 Irvine CA 92614 5 V Long Beach CA 90806 142 34215 190 142 34216 191 142 342 17 192 CAVAN ATES LTQ ' U S L L C Bentall BENTALL U S PARTNERS 7767 nt Ave y 7755 Center Ave#670 1551 N Tustin Ave#845 Hu ng Beach CA 92647 Huntington Beach CA 92647 Santa Ana CA 92705 142 34218 193 142 34219 194 142 472 02 195 FIMSA IN Sty ONE PACIFIC PLAZA TWO SEAWIND VILLAGE 245 S les Ave#7t PO Box 428 PO Box 579 Pas a CA 91101 Dana Point CA 92629 Dana Point CA 92629 I 142 472 03 196 142 472 04 197 142 473 01 198 OLD WORLD OWNERS ASSN WEST COAST SOCCER LEAGUE IN CI OF HtB-sqch GTON BEACH 1685 E Lincoln Ave 7561 Center Ave PO Bo Orange CA92865 Huntington Beach CA 92647 Huntington CA 9 48 I i 142 474 01 199 142 474 02 200 142 474 03 201 Bern Bischof Josef Bischof Josef Bischof 8165 Prestwick Cir 7561 Center Ave#3 7561 Center Ave#3 Huntington Beach CA 92646 Huntington Beach CA 92647 Huntington Beach CA 92647 t 142 474 04 202 142 474 05 203 142 474 06 204 Bill DeCarr Richard Lewis Gisela White 25572 Saddle Rock PI 7561 Center Ave#31 16835 Algonquin St#321 Laguna Hitls CA 92653 Huntington Beach CA 92647 Huntington Beach CA 92649 i 142 474 07 205 142 474 08 206 142 474 09 207 Kent Schlick Verna Wise James Burgard 11622 Kathy Ln 7561 Center Ave#22 7521 Danube Dr Garden Grove CA 92840 Huntington Beach CA 92647 Huntington Beach CA 92647 142 47410 208 142 47411 209 I 142 474 12 210 Wen-Ping Chang Cheng Pin ,1y Horst&Anna Zobel 765 Oakcrest Ave 3430 e ook Ln 5 V� 3337 Wyoming Cir Brea CA 92821 Diamon Bar CA 91765 Costa Mesa CA 92626 142 474 13 211 142 474 14 212 142 474 15 213 Garth Murphy Philip Larschan I Elfriede Friesenhan 1767 W Orange Ave 7561 Center Ave#14 7561 Center Ave#15 Anaheim CA 92804 Huntington Beach CA 92647 Huntington Beach CA 92647 142 474 16 214 142 474e15 142 474 18 216 Daryl&Kathleen Wise James semarie Babet H Virgil Batesole 4080 Live Oak Ln 6966 T8 Tremount Way Yorba Linda CA 92886 Hunt• g 92648 Laguna Niguel CA 92677 142 47419 217, 1 474 20 218 142 474 21 219 Manfred Eschenburg Man d Esc burg Erwin Hermanns 7561 Center Ave#19 7561 ter Ave 19 9801 Sunstar Cir Huntington Beach CA 92647 Huntingto each CA 92647 Huntington Beach CA 92646 142 474 22 220 142 474 23 221 142 474 24 222 Verna Wise Mildred & ert rrill III Irwin Weiss 7561 Center Ave#22 5131 V cit ve 5 7561 Center Ave#24 Huntington Beach CA 92647 -- Wes in r CA 92683 Huntington Beach CA 92647 i 142 474 25 223 142 474 26 224 142 474 27 225 Glenn W arter I Frank Drechsler James&Rosemarie Haskett PO B 2 0 c0k,1.11 9140 El Azul Cir 7561 Center Ave#27 HuntKgt96 Beach CA 92647 Fountain Valley CA 92708 Huntington Beach CA 92647 i . i 142 474 28 226 142 474 29 227 142 474 30 228 Humberto Lopez i Howard &Joanne Boulter Dolores Eitleman 622 S Evergreen Ave 16302 Magellan Ln 7561 Center Ave#30 Los Angeles CA 90023 j' Huntington Beach CA 92647 Huntington Beach CA 92647 142 474 31 229 142 474 32 230 142 474 33 231 Richard Lewis David &Yvonne Rofer Renate Quigley 7561 Center Ave#31 18433 Santa Yolanda Cir 5795 N Tropical Trl Huntington Beach CA 92647 Fountain Valley CA 92708 Merritt Island FL 32953 142 474 34 232 i 142 474 35 233 j 142 474 36 234 Ursel Petermann Michele Weiss Ursel Petermann 7561 Center Ave#36 7561 Center Ave#L4 7561 Center Ave#36 Huntington Beach CA 92647 Huntington Beach CA 92647 Huntington Beach CA 92647 142 474 37 235, -.3(e 14<& Lina 236 142 474 39 237 Enuke&Lina Erbacger E acger Ursel Petermann 54235 Vallejo 54 7561 Center Ave#39 La Quinta CA 92253 La92253 Huntington Beach CA 92647 142 474 40 238 142 474 41 239 142 474 42 240 Alois Galbavy Catherine Babic M Cracchiolo Frank 16549 Mount Neota St 7561 Center Ave#5m 19712 Quiet Bay Ln Fountain Valley CA 92708 Huntington Beach CA 92647 Huntington Beach CA 92648 142 474 43 241 142 474 44 242 142 474 45 243 Amer Masri Rios Mercedes DeLos Erwin Hermanns 21 Crockett 7561 Center Ave#44a 9801 Sunstar Cir Irvine CA 92620 Huntington Beach CA 92647 Huntington Beach CA 92646 142 474 46 244 142 474 47 245 142 474 48 246 Atfred Skistimas FIRST GERMAN UNITED METH CHU L A Motors Downtown 7561 Center Ave#46 5274 Mount Royal Dr 3330 S Figueroa St Huntington Beach CA 92647 Los Angeles CA 90041 Los Angeles CA 90007 142 474 49 247 142 474 50 248 142 474 51 249 QQ WEST COAST SOCCER LEAGUE IN Amer Masri Jack Grah itt0- 7561 Center Ave 21 Crockett 7561 pelftpAve#52 Huntington Beach CA 92647 i Irvine CA 92620 Hu ing Beach CA 92647 142 474 52 250 142 511 01 251 142 511 02 252 Werner Stenzel EDINGER ASSOCIATES%TACO BE EDINGER ASSOCIATES 7561 Center Ave#53 PO Box 4349 518 Emerald Bay Huntington Beach CA 92647 Anaheim CA 92803 Laguna Beach CA 92651 142 511 03 253,2,",259 1 511 04 254 142 511 05 255 FREEWAY INDUSTRIAL PARK TOW FR AY INDU AL PARK H &F PARTNERSHIP 2032 La Colina Dr 2032 La lina Dr 412 W Levers PI Santa Ana CA 92705 Santa Ana C 2705 Orange CA 92867 142 511 06 256 142 511 07 257 142 511 08 2581 2t�, 2.41 Wayne Peterson Patricia Hawn LORGE CIRCLE LTD 16102 Gothard St 7409 Lorge Cir ! 2752 Walnut Ave Huntington Beach CA 92647 Huntington Beach CA 92647 Tustin CA 92780 i 142 511 259 142 51 0 260 142 11 11XA 261 F AY I STRIAL PARK RGE C LE LTD LORG CIRD 2032 L lina Dr 27 alnut A 2752 Wal t Santa Ana C 2705 Tustin C 780 Tustin CA 92780 142 511 12 62 ^ ,� 14251113 263 , ^;�,� SMART�It NC 01 �" KILROY tpp- �" 524 C y 2250 m nal Hwy San B ara CA 93101 El Seg do CA 90245 YWX Y-M u u c;u4F-ll T O UP OCCUPANT OCCUPA �f CC 7777 EDINGER AVE#100 7777 E R AVE#101 7777 IN AVE#103 HUNGTINGTON BEACH CA 92647 HU T GTON BEACH CA 92647 H GT GTON BEACH CA 92647 OCCUPFTON O OCCUPANT �k OCCUP Lk 7777EVE#104 7777 EDAVE#107 7777 ER AVE#10S HUN IBEACH CA 92647 HUN - N ON BEACH CA 92647 H GTINGTON BEACH CA 92647 OCCUPANT \\ OCCUP OCCUP� HUN EDNG E N BEACH CA 92647 H 7 GTDI GTON BEACH CA 92647 H GTINGTON BEACH CA 92647 i i OCCUPANT OCCUPANT OCCUP 7777 ED G AVE#113 - 7777 EDI VE#114 7777 R AVE#115 HUNG IN ON BEACH CA 92647 HUNGT GT N BEACH CA 92647 HUNGTINGTON BEACH CA 92647 OCCUPANT OCCUPANT OCCUP 7777 EDI E VE#118 7777 EDI VE#119 7777 �RAVE#11S HUNG G N BEACH CA 92647 HUNG ON BEACH CA 92647 H GTI GTON BEACH CA 92647 OCCUP OCCUPANT OCCUPAN 7777 GER AVE#120 7777 EDINGER AVE#128 7777 AVE#131c H INGTON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 HUNGTIN TON BEACH CA 92647 OCCUPANT OCCUP OCCUP 7777 ED GE E#149 7777 N AVE#151 7777 AVE#16S HUNG-OCCUPANT ON BEACH CA 92647 HU G GTON BEACH CA 92647 H G NGTON BEACH CA 92647 V V Q OCCUP OCCUP T OCCUP T 7777 GER AVE#171 777 GER AVE#173 7777 D R AVE#175 HUN INGTON BEACH CA 92647 H NGTINGTON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 OCCU ANT OCCU OCCU T 7777 EDI ER AVE#176 777 D NGER AVE#178 7777 ED R AVE#182 HUNGTINGTON BEACH CA 92647 H NGTINGTON BEACH CA 92647 HUN INGTON BEACH CA 92647 I� OCCUP T OCC OCCUPAN 7777 EDIN R AVE #1K 7 ED GER AVE#1S 7777 EDINGER AVE#200 HUNGTI TON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 J� OCCUP Jd ` OCCUPANT OCC T 7777 I RAVE#202 7777 EDI #203 7�ER AVE#211 9 HUNGTI GTON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 i OCCUPANT OCCUPANT %�7�GER 7777EDI ER E#213 - 7777 EDI #214 AVE#215 HUNGTINGT BEACH A H CA 2 4 HUNGTINGTON BEACH CA 92647 C 92647 HUNGTINGTON BEACH 9 6 7 OCCUPANT OCCUPAN OCCU4PDIERAVE#57 7777 EDI E#2W 7777 ED G AVE#3K 7777 E HUNGTINGTON BEACH CA 92647 HUN IN ON BEACH CA 92647 HUNGTINGTON BEACH CA 92647 OCCUP OCCUP 7777E G AVE#6W 7777 IN R AVE#91 HUNGTINGTON BEACH CA 92647 HUNG TI TON BEACH CA 92647 I , i i i i it I -_ i I{ I CROSSINGS LABELS UPDATES ROM 1,000 FT RADIUS 20/ 142-071-63 74,79 142 091- Q3 95 142-071-54 71 Rockville Plaza Pete..rhaffl e T- Orange County Transit District C/o David Pick P.O. Be*2603 c)� 11222 Acacia Pkwy 9454 Wilshire Blvd., Ste., 206 Malibu CA 90265 PO Box 3005 Beverly Hills, CA 90212 Garden Grove, CA 92840 142-081-11 113 142-082-33 127 142-111-32 Topercer,Terry J. Bazan,Gilbert Ron Sher TR C/o Patterson, Katherine L. TR 3181 Tigertail Drive 901 Bellevue Way,NE#200 1510 Treeline Ct. Los Alamitos, CA 90720 Bellevue,WA 98004-4207 Naperville,Illinois 60565 142-332-06 172 142-331-19 162 142-331-17 160 Benton,Earl Gerhard Stier TR Kudlik,Donald TR 20271 Meander Lane 849 Del Valle Dr. 7592 Rhone Ln. Huntington Beach, CA 92646 Fallbrook, CA 92028 Huntington Beach, CA 92647 142-332-13 179 142-342-15 190 142-342-18 193 DeBenedetto,Denise One Pacific Plaza Assn. Kou,Ming Shin Lechman TR C/o Bentall Property Mngmt. 1912 E. Vernon Ave. PO Box 6237 7755 Center Ave., Suite 670 Vernon,CA 90058 Anaheim, CA 92816 Huntington Beach,CA 92647 142-474-23 221 142-474-25 223 Morrill,Robert E.III Carter, Glenn W. 7561 Center Ave.,#23 7561 Center Ave.,#25 Huntington Beach, CA 92647 Huntington Beach,CA 92647 142-511-13 263 Ellis, Tracy Westco Real Estate 3100 Bristol St., Ste. 220 Costa Mesa, CA 92626 CROSSINGS LABELS—UPDATES FROM 1,000 FT RADIUS (2000/2001 TAX ASSESSOR ROLLS) 7/21/00 107-771-09 8 107-771-03 12 107-773-10 17 Rich,James Yacoel,Claude A. Yacoel,Maria 802 S.Bayfront 16511 Carousel Ln. 6272 Forrester Dr. Newport Beach, CA 92662 Huntington Beach,CA 92649 Huntington Beach,CA 92648 107-781-03 18 142-071-53 70,73,77,78,82 142-081-02, 03 94,95 Automobile Club of Southern HCA/The Ezralow Company Peter Chamie,RTM Operating CO California Cristina Agra-Hughes Attn Vendor 73353 3333 Fairview Rd.,#A379 23622 Calabasas Rd., Suite 100 5995 Barfield Rd. Costa Mesa, CA 92626 Calabasas,CA 91302 Atlanta, GA 30328 142-082-06 109 142-082-22 120 142-083-07 132 Donald Gaitzer Hirshberg, Shurley Gregory, William III P.O. Box 431 76582 Begonia Lane 4961 Los Patos Ave. Huntington Beach,CA 92648 Palm Desert,CA 92211 Huntington Beach, CA 92649 142-111-27,39 139 142-083-10 135 142-111-18 138 McDonnell Douglas FCU Li,Tit Sang Sher Lane LLC P.O. Box 1220 6181 Gleneagles Cir. Sarin Enterprises Huntington Beach,CA 92647 Huntington Beach,CA 92646 320 180`h Ave.N.E. Bellevue, WA 98004 142-331-12 155 142-331-15 158 ! 142-331-16 159 Evans,Maria Morgan, Cathy Lee Carver,Michelle 7890 E. Spring St. HCR 89033 Box 2777 217 22°d Street, #3 Long Beach, CA 90815 Las Vegas,NV 89124 Huntington Beach,CA 92648 142-331-20 163 142-331-21 164 142-332-11 177 Waterman,Doris Golden,Thu Anne Meadows, Daniel P.O. box 12977 P.O.Box 1114 6131 Chippewa Dr. Marina Del Rey, CA 90295 Stanton, CA 90680 Westminster, CA 92683 142-332-14 180 142-342-12 188 142-474-11 209 DeBenedetto,Denise Spieker Properties Chang, Cheng Ping P.O. Box 6237 Attn: Eileen Yount 2821 Oak Knoll Dr. Anaheim,CA 92816 19600 Fairchild 285 Diamond Bar, CA 91765 Irvine,CA 92612 142-474-17 215 142-474-51 249 142-511-12 262 Haskett,James Merritt,Jack Smart and Final Inc. 4179 Andross Circle 5011 Argosy Ave.,#6 600 Citadel Dr. Huntington Beach,CA 92649 Huntington Beach,CA 92649 Los Angeles, CA 90040 PUBLIC HEARING NOTIFICATION CHECKLIST "B" i _ MAILING LABELS -January 13, 1999 I • President 1 Hua oa Harbor POA 10 FAi�1S 16 H.B.Chamber of Commerce O.Box John Miles 2100 Main Street,Suite 200 Suns each,CA 90742 19425 Castlewood Circle Huntington Beach,CA 92648 Huntington Beach,CA 92648 Judy Legan 2 William D.Holman - 11 ! Sue Johnson 16 Orange County Assoc.of Realtors PLC 19671 Quiet Bay Lane 25552 La Paz Road 23 Corporate Plaza,Suite 250 Huntington Beach,CA 92648 Laguna Hills,CA 92653 Newport Beach CA 92660-7912 %,PresKent i 3 Mr.Tom Zanic 12 Edna Littlebury 17 )STigos a Bolsa Chica New Urban West Gldn St Mob.Hm.Owners Leag. 16N Bo Chica Street,Suite 312; 520 Broadway Ste. 100 11021 Magnolia Blvd. Hun' a Nach,CA 92646 Santa Monica,CA 90401 Garden Grove,CA 92642 S et Beach Community Assoc. :4 Pres.,H.B.Hist Society 13 Pacific Coast Archaeological 18 Pat 'es,President j C/O Newland House Museum Society,Inc. O Box 5 19820 Beach Blvd. P.O.Box 10926 S Be CA 90742-0215 Huntington Beach,CA 92648 Costa Mesa,CA 92627 Alta Jane Gothold • President 5 Community Services Dept. 14 County of Orange/EMA 19 Huntington Beach Tomorrow Chairperson Michael M.Ruane;Dir. PO Box 865 Historical Resources Bd. P.O.Box 4048 Huntington Beach,CA 92648 Santa Ana,CA 927024048 Julie Vandermost 6 Council on Aging 15 County of Orange/EMA 1S BIA OC 1706 Orange Ave. Thomas Mathews 9 Executive Circle#100 Huntington Beach,CA 92648 P.O.Box 4048 Irvine Ca 92714-6734 Santa Ana,CA 92702-4048 R�Zspes-el c icr 7 Jeff Metzel 16 Planning Department 1. Seacliff HOA Orange County EMA 8t 12th Floor 19391 Shady Harbor Circle P.O.Box 4048 Los A 90017 Huntington Beach,CA 92648 Santa Ana,CA 92702-4-48 E.T.L Coaa1100 8 John Roe 16 County of Orange/EMA 1� Mary B i Seacliff HOA Tim Miller 20292 Eastwood Car 19382 Surfdale Lane P.O.Box 4048 Huntington Beach,CA 92646 Huntington Beach,CA 92648 Santa Ana,CA 92702-4048 John Scandura 9 Lou Maanone 16 Planning Dir. 2( Eaviroameatal Board Chairman Seacliff HOA City of Costa Mesa 17492 Valeworth Circle 19821 Ocean Bluff Circle P.O.Box 1200 Huntington Beach,CA 92649 Huntington Beach CA 92648 Costa Mesa,CA 92628-1200 h:lanael:phlbl PUBLIC HEARING NOTIFICATION CHECKLIST "B" MAILING LABELS -January 13, 1999 Planning Dir. 21 Dr.Duane Dishno 29 Country View Estates HOA 37 City of Fountain Valley HB City Elementary School Dist Carrie Thomas 10200 Slater Ave. PO Box 71 6642 Trotter Drive Fountain Valley,CA 92708 Huntington Beach,CA 92626 Huntington Beach CA 92648 Planning Director 22 Jerry Buchanan 29 Country View Estates HOA 37 City of Westminster HB City Elementary School Dist Gerald Chapman 8200 Westminster Blvd. I 20451 Craimer Lane 6742 Shire Circle Westminster,CA 92683 Huntington Beach,CA 92648 Huntington Beach CA 92648 Planning Director 23 James Jones 30 , HB Hampton HOA 37 City of Seal Beach Ocean View Elementary Keystone Pacific Prop.Mangmt Inc. 211 Eight St. School district 16845 Von Karcaaa Avenue,Suite 200 Seal Beach,CA 90740 17200 Pinehurst Lane Irvine,CA 92606 Huntington Beach CA 92647 California Coastal Commission 124 Barbara Wmars 31 I + Sally Graham 38 Theresa Henry i Westminster School District ! Meadowlark Area South Coast Area Office 14121 Cedarwood Avenue I 5161 Gelding Circle 200 Oceaagate,loth Floor Westminster CA 92683 Huntington Beach,CA 92649 Long Beach,CA 92802-4302 California Coastal Commission ;124 Patricia Koch 32 ! Cheryle Browning R South Coast Area Office HB Union High School Disrict Meadowlark Area 200 Oceangate,loth Floor' 10251 Yorktown Avenue 16771 Roosevelt Lane Long Beach,CA 928024302 Huntington Beach,CA 92646 II Huntington Beach,CA 92649 . I Robert Joseph 25 CSA 33 CA Coastal Communities,Inc. 3S Caltraas District 12 730 El Camino Way#200 6 Executive Circle,Suite 250 3347 Michelson Drive,Suite 100 Tustin,CA 92680 Irvine,CA 92614 Irvine,CA 92612-0661 for 26 Goldenwest College 34 Bolsa Chica Land Trust 4: cal 'd Waste En£Agy. Alta:Fred Owens Nancy Donovan O. He Care Agency 15744 Goldenwest St. 4831 Los Patos P.O. a 355 Huntington Beach CA 92647 Huntington Beach,CA 92649 Santa An CA 9 02 New Growth Coordinator 27 OC County Harbors,Beach 35 I Bolsa Chica Land Trust* 4( Huntington Beach Post Office and Parks Dept Paul Horgan,President 6771 Warner Ave. P.O.Boa 4048 207-21,t Street Huntington Beach,CA 92647 Santa Ana,CA 92702-4048 Huntington Beach,CA 92648 Marc Ecker 28 Huntington Beach Mall 36 SEHBNA 4 Fountain Valley Attn:Pat Rogers-Laude 22032 Capistrano Lane Elementary School District 7777 Edinger Ave.#300 Huntington Beach,CA 92646-8309 17210 Oak Street . Huntington Beach CA 92647 Fountain Valley CA 92708 Maagel:phlbl TIVIA 41 S33iHS�� SSi"na�. MEETING DATE: August 7, 2000 DEPARTMENT SUBJECT: REQUESTING: Planning Reconsideration of Zoning Map Amendment No. 00- ' 01/Zoning Test Amendment No. 00-02 (The Crossings Specific Plan No. 13) TODAY'S DATE July 20, 2000 VERIFIED BY ADMININSTRATION: APPROVED BY: Ray Si ver 7/20/00 3:20 PM Connie Brockway, City Clerk City of Huntington Beach Office of the City Clerk (�,. 5 er P.O. Box 190 JU12%'L`0j Huntington Beach, CA 92648 �� %-a �'142-331-16 159 Carver, Michelle /217 22"d Street, #3 �ppTINGTpy Huntington Beach, CA 92648 _ ANDR217 926481014 1599 14 07/31/00 CP ` FORWARD TIME EXP RTN TO SEND ANDREASEN 16721 RACQUET LN HUNTINGTON BEACH CA 92648--1813 �ouNTr LEGAL NOTICE - PS%*.. HEARING Connie Brockway, City Clerk f ( �o City of Huntington Beach ;, ;��' � ii.S Office of the City Clerk P.O. Box 190 -y A1.27''.'0 v *� Huntington Beach, CA 92648 =u_ f.ii._ E': 142 474 16 214 Daryl &Kathleen Wise 4080 Live Oak Ln Yorba Linda CA 92886 �o��VpSINGTpy��9 V WISE060w 928863007 1799 12 07/;3-9/00 - - FORWARD TIME EXP RTN TO SEND CP $ WISE _ Z► 4890 Rogm,,AMP'rON CT y6� � YORBA LINDA CA 92887-2616. x nn O NTY LEGAL NOTICE - %is; ber&%"MI AP I1 I I I I I I I f I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I t Connie Brockway, City Clerk `�"r c City of Huntington Beach Office of the City Clerk P.O. Box 190 SE4pER� u_a: � n Huntington Beach, CA 92648 L„ • - aaQ?-28-00 4;k% WSW& GA '�14 142 081 26 105 Elisabeth Lewis Cooper 16000 Ventura, ,N IN6Tpy�F o ca I;its �0 NTr LEGAL NOTICE--kllLlGyH . .I - .r ,I,i,II,„I„II fit II,,ii,till III III,,I,l„II,,,,,I,il Connie Brockway, City Clerk City of Huntington Beach \����T°M g, U.S.f Office of the City Clerk P.O. BOX 190 _t JJl2;''00 '' ' 't Huntington Beach, CA 92648 ' 0 _r n Ir.rr ST 142-071-54 71 r �x Orange Coun 9✓Q � l`7J ? 11222 Ac 'a Pkwy _ �� PO BoX•3005 E� WNIM6Tpy� Garden Grove, CA 92840 T0 ..•___-_ 1 r OOMTY cam ..;�` r' LEGAL NOTICE — PUBLI HEARINGW . . - - ���� � ..���'�'�� _ � ii�1s,►�I���ifi���l►slitsl�i{,��►t�Ill�i�,il,�:It1��I{,►s��I,I1 -,• Connie Brockway, City Clerk City of Huntington Beach LbIV US.r"T Office of the City Clerk P.O. Box 190 JUL27'00 J" Huntington Beach, CA 92648 142-111-18 138 Ferr�� Sarm Enjerprises ING 320 V4" Ave.N.E. Bellevue,WA 98004 �o��VN 5ARMS20 980043013 l299 19 08/01/00 FORWARD TIME EXP RTN TO SEND O : SARM ENTERPRISES 901 BELLEVUE WAY NE U200 BELLEVUE WA 98004-4207 RETURN TO SENDER LEGAL NOTICE - PUBLIC HEARING Connie Brockway, City Clerk --. City of Huntington Beach Office of the City Clerk P.O. Box 190 Huntington Beach, CA 92648 � DC) 142 111 32 141 VNSING Ronald Sher 320 108th Ave NE#406 Bellevue WA 98004 SHER3aO* 980043010 1299 16 08/02/00 FORWARD TIME EXP RTN TO SEND 901 BELLEVUEUST WAY NE "a00 BELLEVUE WA 98004-4a07 NTY a` RETURN TO SENDER LEGAL NOTICE- PUBLIC HEARING s$vasrS"Ab `ira Ililtitil!�1�1333�!!�i!flllli{I!3111�31Stl�t!f141it�lilt!!141� Jane James The Crossings at Huntington Beach - Specific Plan No. 13 wrM- Ci of Huntington Beach =' City 9 of Huntington Beach '` - '' - +v HUNTINGTON BEACH Zoni�g Map Amendment No. 00-01 and Zoning Text Amendment No. 00-02 • Amend zoning from CG and CG FP2 to Specific Plan No. 13 • Establish zoning, development standards, and architectural guidelines to govern future development • Req Are Regional Commercial uses • No c evelopment proposed at this time The Crossings at Huntington Beach Specific _ Plan No. 13 1 ��� � � -J v Jane James Citv Council Meeting July 5, 2000 • Approved resolution to adopt Specific Plan No. 13 • Did of include drive-through uses as Permitted Use City Council Meeting July 17, 2000 • Council voted to reconsider previous approval and consider allowing one drive-through bakery • New public hearing scheduled for August 7, 2000 The Crossings at Huntington Beach Specific Plan No. 13 2 Jane James • Include one drive-through bakery • Est blish definition of drive-through bakery • Establish design and development standards (Attachment No. 2) zra ow s xequest • Include one drive-through bakery . • Establish definition of drive-through bakery • Establish design and development sta dards as modified by Planning Commission (Attachment No. 3) The Crossings at Huntington Beach Specific Plan No. 13 3 Jane James a ecommen a ion • Do riot include drive-through uses • If drive-through bakery is approved, all c esign and development star dards should be adopted without moc ification (Attachment No. 2) HUNTINGTON BE The Crossings at Huntington Beach Specific Plan No. 13 4 I SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A LIMITED LIABILITY PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS ATTORNEYS AT LAW FOURTH FLOOR 650 TOWN CENTER DRIVE r COSTA MESA, CALIFORNIA 92626-1925 WRITERS DIRECT LINE TELEPHONE (714) 5I3-5I00 OUR FILE NUMBER (714)424-2846 FACSIMILE (714) 513-SI30 42X-76195 soconnor@smrh.com August 7, 2000 Huntington Beach City Council HAND DELIVERED Redevelopment Agency of the RECEIVED FROM City of Huntington Beach AND MADE A PART O&THERECORD AT THE City of Huntington Beach COUNCIL MEETING Ion OFFICE OF THE CITY CLERK 2000 Main Street CONNIE 6ROCKWAY,CITY CLERK Huntington Beach, CA 92648 Re: City of Huntington Beach City Council Hearing on Monday, August 7, 2000/Agenda Item No. D-1/Zoning Map Amendment No. 00-1/Zoning Text Amendment No. 00-2 (The Crossings at Huntington Beach Specific Plan) Honorable Mayor Garofalo and Members of the City Council and the Board of The Redevelopment Agency of the City of Huntington Beach: This firm represents Montgomery Ward, LLC ("Montgorne1y Ward"), which is the owner of approximately 13.47 acres of real property located in what is commonly known as the "Huntington Center Mall" ("Huntington Center"). Montgomery Ward understands that tonight the City Council (the "City Council") of the City of Huntington Beach (the "Ci1y") will again consider Specific Plan No. 13, identified as "The Crossings at Huntington Beach" (the "Specific Plan"), which would govern future development at the Huntington Center.!' The approval of the Specific Plan would be implemented through adoption of proposed City Resolution No. 2000-80 ("Resolution 2000-80"), which would include both the adoption of Zoning Map Amendment No. 00-1 and Zoning Text Amendment No. 00-2.. 1� Each of the correspondence, documents and other materials referenced or referred to herein, as well as all other documents and materials relating to the Specific Plan and/or Huntington Center on file with the City or the Redevelopment Agency of the City of Huntington Beach (the "Agency") or otherwise considered records of the City or.the Agency, are hereby incorporated herein by this reference and made a part of this hearing and the record by this reference. LOS A N G ELE5 0 ORANGE COUNTY 0 5AN DI E G 0 0 S A N F R A N CI SCO SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Huntington Beach City Council August 7, 2000 Page 2 Montgomery Ward has previously submitted numerous letters to the Planning Commission, the City Council and the Agency setting forth detailed objections to, comments on and suggested changes to the Specific Plan, including a letter dated July 5, 2000 from this firm to the City Council. Montgomery Ward again . requests that these objections and comments be addressed and changes.be made to the Specific Plan. In particular, Montgomery Ward's automotive center should be a permitted use under the Specific Plan and the "amortization" provisions for nonconforming uses should be deleted. Montgomery Ward reiterates and restates each and every comment and objection that it has previously made to the Specific Plan, including without limitation those submitted in writing and made at the City Council and Planning Commission hearings on the Specific Plan. In particular, Montgomery Ward has objected to the City Council's adoption of the Specific Plan without conducting any environmental review pursuant to the California Environmental Quality Act("CAE A"). On Friday, August 4, 2000, Montgomery Ward filed a Verified Petition for Peremptory Writ of Mandate (the "Petition") against the City, the Agency and Huntington Center Associates, LLC challenging the City Council's adoption of Resolution No. 2000-68. A copy of the Petition is attached as Exhibit "A" and incorporated herein by this reference. This Petition and Montgomery Ward's previous letters to the City and the Agency explain in some detail how and why the City improperly relied upon the City's Final Environmental Impact Report No: 94-1 for the City's General Plan and Final Environmental Impact Report No. 96-2 for the Redevelopment Plan for the Huntington Beach Redevelopment Project in lieu of conducting CEQA review for the Specific Plan itself. The City Council's adoption of proposed Resolution 2000-80 would violate CEQA for the same reasons. We also note that the City Charter provides at Article 5, Section 500 (d) the following: "The amendment of any section or subsection of an ordinance may be accomplished solely by the re-enactment of such section or subsection at length, as amended." The original zoning map governing Huntington Center was adopted by ordinance. Similarly, most if not all of the provisions of the City's Zoning and Subdivision Ordinance that are being replaced or superseded by the City's Zoning Text Amendment No. 00-02 were similarly adopted by ordinance. Thus, under City Charter Article 5, Section 500 (d), Resolution 2000-80 will be improper because it is an Ak SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Huntington Beach City Council August 7, 2000 Page 3 amendment of an ordinance by resolution which can only be done by "re-enactment" of an ordinance. Chapter 247 of the City's Zoning and Subdivision Ordinance sets forth the requirements for amendments to zoning provisions, standards and maps. Section 247.14 thereof governs the requirements of City Council action for an amendment to zoning text or a map. Section 247.14B expressly contemplates that a City Council action will be by ordinance by requiring that the City Council make findings that any proposed amendment is consistent with policies of the General Plan and the notice and hearing provisions of Chapter 248 prior to "an adoption of an ordinance." As a result, not only would Resolution No. 2000-80 (as well as prior Resolution No. 2000-68) be improper under the City Charter, it would also be improper under the City's Zoning and Subdivision Ordinance. On or about December 16, 1996, the City adopted the Redevelopment Plan for the Huntington Beach Redevelopment Project("Redevelopment Plan") which established the "Huntington Beach Redevelopment Project Area." The Huntington Center is located within the Huntington Beach Redevelopment Project Area. California Health and Safety Code Section 33333 provides that a redevelopment plan must, among other things, include "[1]imitations on type, size, height, number, and proposed use of buildings." In this regard, the Redevelopment Plan provides at Section 701 the following: "[t]he land uses permitted by this Plan shall be those permitted by the General Plan as they now exist or may hereafter be amended." Section 713 of the Redevelopment Plan also provides the following: "[t]he limits on building intensity, type, size and height, shall be established in accordance with the provisions of the General Plan and the zoning ordinances, as they now exist or are hereafter amended." The Specific Plan is a wholesale departure from the existing type, size, height, and proposed use of buildings when compared to the existing plans, policies and regulations under the General Plan and applicable zoning. We now understand, however, that the City does not intend to follow applicable amendment procedures for an amendment of the Redevelopment Plan to account for these changes. Rather, the City and the Agency intend to rely upon the general language within the Redevelopment Plan as to the provisions of the General Plan and the zoning ordinances as may be "amended." SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Huntington Beach City Council August 7, 2000 Page 4 Provisions such as these in a redevelopment plan that purport to automatically amend the redevelopment plan when a General Plan or zoning is changed are ultra vires. The Community Redevelopment Act has specific provisions and procedures for the amendment of redevelopment plans." For example, under Health and Safety Code Section.33450,-an amendment can only be done by ordinance. Second, there are extensive notice and hearing requirements under Health and Safety Code Sections 33452-33455. Under the current circumstances, none of these provisions are being followed, resulting in a violation of the Community Redevelopment Act. Finally we note that the three-year amortization period set forth.in Section 3.5.4C of the Specific Plan with respect to nonconforming uses and structures is unlawful. A city which seeks to eliminate a legal nonconforming use or structure may pursue one of two constitutionally equivalent alternatives: (1) eliminate the use immediately by payment of just compensation or (2) require elimination of the use without compensation following a reasonable amortization period. United Business Com. v. City of San Diego, 91 Cal. App. 3d 156, 179-80 (1979). Among other things, the Specific Plan would convert Montgomery Ward's automotive repair use from a permitted use to a legal nonconforming use and would also convert Montgomery Ward's 18 1,110 square foot department store and 27,000 square foot automotive center into legal nonconforming structures because they do not comply with the detailed design and other requirements set forth in the Specific Plan. By any standard, three years is an insufficient amount of time to amortize Montgomery Ward's investment in the business that it operates at the Huntington Center. Among other things, the useful life of the department store and automotive center significantly exceed three years. The fact that the Planning Commission could, in its discretion, extend one or more of the three-year amortization periods is irrelevant because Montgomery Wards has no assurance that any such extension will ever be granted. Based on the foregoing, on behalf of Montgomery Ward, we request that the City Council incorporate Montgomery Ward's proposed comments and changes to SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Huntington Beach City Council August 7, 2000 Page 5 the Specific Plan, revise the Specific Plan in accordance with state and local law and comply with CEQA and the Community Redevelopment Act. Very tru urs, an . O'Connor ; for SHEPPARD, MULLIN, RICHTER& HAMPTON LLP LA.LCRU,E'A4W70192681.3 cc: Spencer H. Heine, Esquire Mr. Loren H. Hohman Corey E. Light, Esquire Jonathan C. Curtis, Esquire Jack H. Rubens, Esquire r i i I I i i i I EXHIBIT A 1 � I SHEPPARD, MULLIN, RICHTER& HAMPTON u.P SUPERIOR CO R F C LIFORNIA A Limited Liability Partnership CENTRAL USTICE ENTER 2 Including Professional Corporations ANDREW J. GUILFORD, CAL. BAR NO. 66048 AUG 0 4 2000 3 JACK H. RUBENS, CAL. BAR NO. 106240 SEAN O'CONNOR, CAL. BAR NO. 155940 4 650 Town Center Drive, 4th Floor ALM SLATER,Clerk of the Court Costa Mesa, California 62626-1925 nL . 5 �A , 6 Telephone: (714) 513-5100 BY N. Af JR ii J� Attorneys for Petitioner 7 MONTGOMERY WARD, LLC 8 9 SUPERIOR COURT OF THE STATE OF CALIFORNIA 10 FOR THE COUNTY OF ORANGE - CENTRAL JUSTICE CENTER I1 12 MONTGOMERY WARD, LLC, a Case u t; c uj 2 9 2 Delaware limited liability company, — 13 VERIFIED PETITION FOR 14 Petitioner, PEREMPTORY WRIT OF MANDATE 15 V. [Cal. Pub. Res. Code § 21168.5] CITY OF HUNTINGTON BEACH, a JWGE JOHN C. WOOLLEY 16 municipal corporation and political subdivision of the State of California, DEPT. C6 17 acting by and through its City Council, commissions, committees, staff agencies, 18 departments and officials, 19 Respondent, 20 HUNTINGTON CENTER ASSOCIATES, LLC, a Delaware limited liability company; 21 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a 22 public body, corporate and politic; and DOES 1 through 50, inclusive, 23 Real Parties in Interest. 24 25 26 27 28 VERIFIED PETITION FOR PEREMPTORY wRrr OF MANDATE I SHEPPARD, MULLIN, RICHTER& HAMPTON LLP A Limited Liability Partnership 2 Including Professional Corporations ANDREW J. GUILFORD, CAL. BAR NO. 66048 3 JACK H. RUBENS, CAL. BAR NO. 106240 SEAN O'CONNOR, CAL. BAR NO. 155940 4 650 Town Center Drive, 4th Floor Costa Mesa, California 62626-1925 5 - Telephone: (714) 513-5100 6 Attorneys for Petitioner 7 MONTGOMERY WARD, LLC 8 9 SUPERIOR COURT OF THE STATE OF CALIFORNIA 10 FOR THE COUNTY OF ORANGE - CENTRAL JUSTICE CENTER 11 12 MONTGOMERY WARD, LLC, a Case No. Delaware limited liability company, 13 VERIFIED PETITION FOR Petitioner, PEREMPTORY WRIT OF MANDATE 14 V. [Cal. Pub. Res. Code § 21168.5] 15 CITY OF HUNTINGTON BEACH, a 16 municipal corporation and political subdivision of the State of California, 17 acting by and through its City Council, commissions, committees, staff, agencies, 18 departments and officials, 19 Respondent, 20 HUNTINGTON CENTER ASSOCIATES, LLC, a Delaware limited liability company; 21 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH, a 22 public body, corporate and politic; and 23 DOES 1 through 50, inclusive, Real Parties in Interest. 24 25 26 27 28 VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 RELIEF SOUGHT 2 3 Petitioner, Montgomery Ward, LLC ("Montgomery Ward"), respectfully 4 petitions for a peremptory writ of mandate and other appropriate orders to: 5 6 (1) set aside all permits, approvals, contracts, resolutions, ordinances and 7 other actions issued, adopted, executed or taken by respondent City of Huntington Beach 8 (the "Cijy") relating to the development and/or redevelopment of an approximately 63-acre 9 site (the "Project Site") that includes an approximate 13.47-acre site and improvements 10 located thereon (the "MW Property") owned by Montgomery Ward, including without 11 limitation (a) the approval by the Huntington Beach City Council (the "City Council") of 12 Resolution No. 2000-68 on July 5, 2000 ("Resolution 2000-68"), pursuant to which the City 13 Council (i) adopted The Crossings.at Huntington Beach Specific Plan No. 13 ("Specific Plan 14 No. 13") pursuant to Zoning Text Amendment No. 00-02 and (ii) changed the zoning 15 designations for the Project Site from "CG" (General Commercial) and "CG-FP2" (General 16 Commercial - Flood Plain) to The Crossings at Huntington Beach Specific Plan No. 13 17 pursuant to Zoning Map Amendment No. 00-01 (collectively, the "Specific Plan"), and 18 (b) any such action taken by the City or real party in interest Redevelopment Agency of the 19 City of Huntington Beach (the "Agency") relating in any way to the condemnation or other 20 acquisition of all or any portion of the MW Property; and 21 22 (2) immediately enjoin: (a) the effectiveness of any permits, approvals, 23 contracts, resolutions, ordinances or other actions issued, adopted, executed or taken by the 24 City or the Agency relating to the Specific Plan or the development and/or redevelopment of 25 the Project Site (other than a permit, approval, contract, resolution, ordinance or other action 26 initiated, requested and/or agreed to by Montgomery Ward with respect to the 27 MW Property), including without limitation any such action taken by the City or the 28 Agency relating in any way to the condemnation or other acquisition of all or any portion of -I- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I the MW Property, (b) the City and the Agency from issuing, granting, adopting, executing or. 2 taking any further permits, approvals, contracts, resolutions, ordinances or other actions 3 relating to the Specific Plan or the development and/or redevelopment of the Project Site 4 (other than a permit, approval, contract, resolution, ordinance or other action initiated, 5 requested and/or agreed to by Montgomery Ward with respect to the MW Property), 6 including without limitation any such action by the City of the Agency relating in any way to 7 the condemnation or other acquisition of all or any portion of the MW Property, and (c) any 8 and all demolition, grading, construction and/or other development activity with respect to 9 the Project Site (other than demolition, grading, construction and/or other development 10 activity initiated by Montgomery Ward on the MW Property), all until the City has taken 11 such actions as may be necessary to comply fully with the requirements of the California 12 Environmental Quality Act (California Public Resources Code §§ 21000-21177) ("CE A"). 13 14 The City Council's adoption of Resolution 2000-68 was unlawful, and the 15 subsequent issuance, grant, adoption or execution of any further permit, approval, contract, 16 resolution or ordinance in connection with the Specific Plan would be unlawful, because, as 17 set forth in the First Cause of Action, the City failed to conduct any environmental review 18 whatsoever under CEQA with respect to the Specific Plan prior to the City Council's 19 adoption of Resolution 2000-68. 20 21 In support of this Verified Petition for Peremptory Writ of Mandate 22 ("Petition"), Montgomery Ward alleges as follows: 23 24 25 26 27 28 -2- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I GENERAL ALLEGATIONS 2 3 THE PARTIES 4 5 1. Petitioner Montgomery Ward is a Delaware limited liability company 6 who, through its wholly-owned subsidiary of Montgomery Ward Development, LLC, a 7 Delaware limited liability company, owns approximately 13.47 acres of land (the "MW Real 8 Pro a ") and the 18 1,110 square foot department store and 27,000 square foot automotive 9 center located thereon (collectively, the "MW Store" and, together with the MW Real 10 Property, the "MW Property"). The MW Property comprises a portion of the Huntington 11 Center Mall ("Huntington Center"). Montgomery Ward currently operates the MW Store 12 pursuant to a lease with Montgomery Ward Development, LLC. 13 14 2. Montgomery Ward is informed and believes, and on that basis alleges, 15 that respondent City is, and at all times relevant herein was, a charter law city duly incor- 16 porated under the laws of the State of California. Montgomery Ward is further informed and 17 believes, and on that basis alleges, that the City is a political subdivision of the State of 18 California located within the County of Orange, exercising its authority through its City 19 Council and other commissions, committees, staff agencies, departments and officials. 20 21 3. Montgomery Ward is informed and believes, and on that basis alleges, 22 that real party in interest Agency is, and at all times relevant herein was, a public body, 23 corporate and politic, exercising governmental functions and powers, and organized and 24 existing under Chapter 2 of the Community Redevelopment Law of the State of California. 25 26 4. Montgomery Ward is informed and believes, and on that basis alleges, 27 that real party in interest Huntington Center Associates, LLC ("HCA") is a Delaware limited 28 liability company. HCA owns approximately 49.53 acres of land(the "HCA Real Property") -3- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I and approximately 751,890 square feet of shopping center improvements located thereon 2 (collectively, the "HCA Property"). The HCA Property comprises a portion of Huntington 3 Center. 4 5 5. Montgomery Ward is ignorant of the true names and capacities, whether 6 individual, corporate, associate or otherwise, of real parties in interest Does 1 through 50, 7 inclusive. Such fictitious real parties in interest are sued pursuant to the provisions of 8 California Code of Civil Procedure Section 474. Montgomery Ward is informed and 9 believes, and on that basis alleges, that each fictitious real party in interest was in.some way 10 responsible for or participated in or contributed to the matters and things of which 11 Montgomery Ward complains herein, and in some fashion is legally responsible therefor. 12 When the exact nature and identification of such fictitious real parties in interest's respons- 13 ibility for, participation in and contribution to the matters herein alleged is ascertained by 14 Montgomery Ward, it will seek to amend this Petition and all proceedings herein to set forth 15 the same. 16 17 HUNTINGTON CENTER 18 19 6. Huntington Center is located on an approximately 63-acre site 20 (previously defined as the "Project Site"), approximately 13.47 acres of which is the 21 MW Real.Property and approximately 49.53 acres of which is the HCA Real Property. 22 Huntington Center was developed in the 1960s in a typical mall configuration with anchor 23 store buildings and an enclosed mall area, as well as freestanding retail and restaurant 24 structures. The location of Huntington Center is shown on a vicinity map, which was part of 25 a Staff Report prepared for the July 5, 2000 City Council hearing and which is attached 26 hereto as Exhibit 1 and incorporated herein by this reference. 27 28 -4- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 7. Montgomery Ward is informed and believes, and on that basis alleges, 2 that HCA acquired the HCA Property on or about November 16, 1999. 3 4 8. Montgomery Ward has certain easement and other rights over and 5 concerning the HCA Property pursuant to that certain Construction, Operation, and 6 Reciprocal Easement Agreement dated July 19, 1965, executed by, among others, HCA's 7 predecessors in interest, and recorded on August 4, 1965 in Book 7617, Page 539 in the 8 Official Records of Orange County, California, as amended by (a) that certain First 9 Amendment to Construction, Operation and Reciprocal Easement Agreement dated 10 December 31, 1973, executed by, among others, HCA's predecessors in interest, and 11 recorded on March 8, 1974 in Book 11091, Page 983 in the Official Records of Orange 12 County, California, and (b) that certain Amendment No. 2 to Construction, Operation and 13 Reciprocal Easement Agreement dated April 23, 1997, executed by, among others, HCA's 14 predecessors in interest, and recorded on July 17, 1987 as Instrument No. 87-406989 in the 15 Official Records of Orange County, California. 16 17 THE GENERAL PLAN AND GENERAL PLAN EIR 18 19 9. On or about May 13, 1996, the City Council adopted the current 20 Huntington Beach General Plan (the "General Plan") pursuant to General Plan Amendment 21 No. 94-2 and Resolution No. 96-36. 22 23 10. The preamble of the General Plan states that in 1996, the City had a 24 population of almost 200,000 with an area of 27.7 square miles and 8.5 miles of beachfront. 25 26 11. Table LU-4 in the Land Use Element of the General Plan (the "Land 27 Use Element") specifies the land use category for the Project Site as "Commercial Regional 28 (CR)". Table LU-2a in the Land Use Element sets forth the "Typical Permitted Uses" under -5- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I the Commercial Regional (CR) designation, as follows: "Anchor department stores, outlet 2 stores, promotional ("big box") retail, retail commercial, restaurants, entertainment, 3 professional offices, financial institutions, automotive sales facilities, and similar region- 4 serving uses." 5 6 12. Table LU-4 in the Land Use Element also limits the height of any 7 structure on the Project Site to four stories. 8 9 13. Policy LU 7.1.2 in the Land Use Element requires that "development be 10 designed to account for the unique characteristics of project sites and objectives for 11 community character and in accordance with the Development "Overlay" Schedule (Table 12 LU-3)." Policy LU 15.1.1 in the Land Use Element requires "the formulation, adoption, and 13 implementation of Specific Plans for areas designed with a 'Specific Plan Overlay' (--SP)." 14 The Project Site is designated with a Specific Plan Overlay. 15 16 14. On May 13, 1996, the City Council certified Final Environmental 17 Impact Report No. 94-1 for the General Plan (the "General Plan EIR") pursuant to 18 Resolution No. 96-35. The first portion of the General Plan EIR is a Draft Environmental 19 Impact Report dated July 5, 1995 that analyzed the environmental effects associated with 20 buildout under the General Plan on a citywide basis. The General Plan EIR did not evaluate 21 potential environmental effects associated with buildout under the General Plan on a site-by- 22 site basis. The "mitigation measures" set forth in the General Plan EIR consist solely of 23 references to various policies and goals in the General Plan and the future development of 24 new guidelines, policies and standards. None of those "Mitigation Measures" relate to any 25 particular site in the City. 26 27 28 -6- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 PRIOR ZONING DESIGNATIONS FOR PROJECT SITE 2 3 15. Prior to the adoption of Resolution 2000-68, the zoning designation for 4 the majority of the Project Site was "General Commercial (CG)," while the south easterly 5 portion of the Project Site had a zoning designation of "General Commercial - Flood Plain 6 (CG-FP2)". 7 . 8 THE AGENCY'S REQUEST FOR PROPOSALS 9 10 16. On or about December 16, 1996, the City adopted a Redevelopment 11 Plan for the Huntington Beach Redevelopment Project (the "Redevelopment Plan") pursuant 12 to Resolution No. 3343 which established the"Huntington Beach Redevelopment Project 13 Area". The Project Site is located within the Huntington Beach Redevelopment Project 14 Area. 15 16 17. On or about October 7, .1996, the City Council certified Final 17 Environmental Impact Report No. 96-2 for the Redevelopment Plan pursuant to Resolution 18 No. 96-93 (the "Redevelopment Plan EIR"). 19 20 18. On or about March 3, 2000, the Agency allegedly requested that 21 Montgomery Ward, HCA and others submit to the Agency a "Statement of Interest and 22 Request for Proposal for Redevelopment of Huntington Center within the Huntington Beach 23 Redevelopment Project Area" (the "RFP"). 24 25 19. The RFP requested proposals for the redevelopment of the entire 26 Huntington Center. A copy of the RFP sent to Montgomery Ward is attached hereto as 27 Exhibit 2 and incorporated herein by this reference. 28 -7- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 20. The RFP did not reference or describe the Specific Plan. Instead, it 2 requested that any response to the RFP set forth a redevelopment concept for the Project Site 3 that includes a "[d]escription of proposed uses and the arrangement of these uses." In the 4 introduction to the RFP, the Agency explained its intent as follows: 5 "The Agency intends for the [Project] Site to be rehabilitated and 6 repositioned into a high-quality, well-integrated retail and enter- 7 tainment center under unified ownership. The Agency believes 8 unified ownership of the [Project] Site will allow for the over- 9 sight and control necessary to effectively redevelop and maintain 10 the [Project] Site, without the problems often associated with 11 fragmented ownership. The revitalized [Project] Site is intended 12 to serve the region and to provide new jobs and economic oppor- 13 tunities to residents of the region. In addition, the location of the 14 [Project] Site as a major gateway to the City of Huntington 15 Beach, as well as the excellent visibility and accessibility from 16 the 405 Freeway, calls for a superior quality redevelopment that 17 will significantly enhance the image of the community and set 18 the standard desired for future high-quality development in the 19 Edinger Corridor." 20 21 21. Within the time period specified in the RFP, Montgomery Ward 22 submitted to the Agency its "Statement of Interest and Response" to the RFP, which was 23 later clarified and supplemented in a letter dated June 16, 2000 (collectively, the 24 "MW Response"). The MW Response proposed to redevelop the MW Property by 25 renovating the existing MW Store and related facilities. The MW Response included 26 renderings and specifications for the proposed renovation. 27 28 -8- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 22. HCA also submitted a response to the RFP in a May 2, 2000 letter from 2 its attorneys, Whitman Breed Abbott & Morgan LLP (the "HCA Response"), pursuant to 3 which HCA proposed to redevelop the Project Site in accordance with Specific Plan No. 13, 4 which was titled "The Crossings at Huntington Beach". A copy of a draft of Specific Plan 5 No. 13 was allegedly attached to the HCA.Response. Montgomery Ward is informed and 6 believes, and on that basis alleges, that HCA prepared or caused to be prepared, at its sole 7 cost, Specific Plan No. 13. 8 9 23. On June 19, 2000, the City Council, acting as the Redevelopment 10 Agency Board, instructed Agency staff to negotiate an Owner Participation Agreement with 11 HCA for the redevelopment of the Project Site, including the MW Property. 12 13 THE APPLICANTS FOR SPECIFIC PLAN NO. 13 14 15 24. Prior to HCA submitting the HCA Response to the Agency, HCA 16 submitted an application to the City for the establishment of Specific Plan No. 13 as the 17 zoning for the entire Project Site. The HCA Application is dated March 31, 2000, but 18 acknowledged in the "Official Use Only" box as received by the City on March 30, 2000 and 19 distributed by the City on March 16, 2000. The HCA Application was signed only by HCA, 20 and not by any other owner, including Montgomery Ward. 21 22 25. The March 20, 2000 draft of the Specific Plan states that it was 23 prepared by Huntington Property Associates LLC with Greenberg Farrow Architects, Hall & 24 Foreman and Linscott Law& Greenspan. Subsequent drafts of Specific Plan No. 13, dated 25 June 7, 2000, and June 20, 2000, respectively, include the City of Huntington Beach 26 Planning Department in the list of parties that prepared Specific Plan No. 13. 27 28 -9- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 26. Notwithstanding that HCA caused the preparation of Specific Plan 2 No. 13 and submitted the HCA.Application, in a June 5, 2000 memorandum from Ray 3 Silver, the City Administrator and Executive Director of the Agency, to Howard Zelefsky, 4 the City's Director of Planning, Mr. Silver, unilaterally declared that the City and the Agency 5 (and not HCA) was the "applicant" with respect to Specific Plan No. 13 because it was a 6 "city-initiated project". The City Council ratified this action by Mr. Silver on July 5, 2000. 7 8 27. Montgomery Ward is informed and believes, and on that basis alleges, 9 that HCA withdrew as the "applicant" with respect to the Specific Plan, but that the Specific 10 Plan remained, and remains, HCA's development proposal for the Project Site pursuant to 11 the HCA Response. 12 13 28. Neither the City nor the Agency initiated any contact with Montgomery 14 Ward regarding the development or redevelopment contemplated in the Specific Plan. 15 However, when Montgomery Ward received the RFP, it realized that some type of 16 "planning" for Huntington Center must be in process, notwithstanding that the RFP omitted 17 any reference to the Specific Plan. Representatives of Montgomery Ward then initiated 18 discussions with several City and Agency officials regarding the City's plans with respect to 19 the Project Site, but none of these officials disclosed the existence of the proposed Specific 20 Plan. Montgomery Ward did find out about the proposed Specific Plan after reviewing 21 documents obtained from the City and the Agency in response to a Public Records Act 22 request by Montgomery Ward. However, Montgomery Ward did not obtain those 23 documents, which included a draft of Specific Plan No. 13 submitted by HCA to the City, 24 until the approximate date on which it received the official notice of the Planning 25 Commission hearing on the proposed Specific Plan that was scheduled for June 13, 2000. 26 27 28 -10- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 THE SPECIFIC PLAN 2 3 29. Specific Plan No. 13 consists of approximately 133 pages of text and 4 illustrations, including more than 25 exhibits and appendices that set forth the legal 5 description for the Project Site, a General Plan consistency analysis and signage standards. 6 Specific Plan No. 13 serves as the zoning for the Project Site and is intended to provide the 7 regulatory standards for the Project Site for the next 20 years. 8 9 30. Specific Plan No. 13 contains four primary sections: Section 1 - Intro- 10 duction, Section 2 - Implementation, Section 3 - Development Concept, and Section 4 - 11 Development Regulations. 12 13 31. Section 1 of Specific Plan No. 13 (Introduction) includes discussion 14 regarding "Purpose and Intent", "Authority and Procedures", "Scope and Format", "Project 15 Area Description", "General Plan Designation", "Zoning Provisions" and "State Mandated 16 Requirements". 17 18 32. Section 2 of Specific Plan No. 13 (Implementation) sets forth, among 19 other things, requirements for a development phasing plan, site plan review, review/change 20 of use review and environmental review under CEQA. Among other things, Section 2.3 21 provides that "Site Plan Review" is to be undertaken by the City's Planning Director, without 22 any public hearing or notice and is appealable to the Planning Commission only by the 23 applicant submitting the Site Plan Review application. Pursuant to Section 2.6 of Specific 24 Plan No. 13, "[d]evelopment project requests shall be subject to environmental review as 25 mandated by the California Environmental Quality Act (CEQA)" at the time of the Site Plan 26 Review by the Planning Director. 27 28 -11- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I l 1 1 1 33. Section 3 of Specific Plan No. 13 (Development Concept) provides that 2 the character and theme for the redeveloped Project Site shall be "Italian Village". This 3 section includes a detailed development concept that includes permitted regional uses, 4 standards for open space and pedestrian walkways, requirements for a circulation plan, 5 discussions of required infrastructure and detailed design guidelines for site planning, 6 common area, architectural, landscaping and signage. 7 8 34. Section 4 of Specific Plan No. 13 (Development Regulations) sets forth 9 detailed development standards for the Project Site, including without limitation permitted 10 uses, development intensity, building height, setbacks, landscaping, signs, lighting, parking 1.1 and parking structures. 12 13 35. The intent of the Specific Plan is to facilitate (a) the demolition of a 14 significant portion of the existing improvements in Huntington Center, (b) the rehabilitation 15 and alteration of the balance of the existing improvements and (c) the construction of several 16 hundred thousand square feet of new improvements. Specific Plan No. 13 includes two 17 Illustrative Conceptual Master Plans (Exhibits 3A and 3B) which involve (i) the demolition 18 of 646,719 square feet and 517,231 square feet, respectively, of the approximately 960,000 19 square feet of existing improvements in Huntington Center and(ii) the construction of 20 894,233 square.feet and 767,612 square feet, respectively, of new improvements on the 21 Project Site for "The Crossings at Huntington Beach". 22 23 36. Sections 1.0 and 1.1 of Specific Plan No. 13 apparently allege that the 24 Specific Plan is completely exempt from environmental review under CEQA, as follows: 25 26 "According to Public Resources Code Section 21083.3(b), 'If a 27 development project is consistent with the general plan of a local 28 agency and an environmental impact report was certified with -12- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE f i I respect to that general plan, the application of this division 2 [CEQA] to the approval of that development project shall be 3 limited to effects on the environment which are peculiar to the 4 parcel or to the project and which were not addressed as sign- 5 ficant effects in the prior environmental impact report, or which 6 substantial new information shows will be more significant than 7 described in the prior environmental impact report.' Based upon 8 Public Resources Code Section 21083 The Crossings at 9 Huntington Beach Specific Plan is currently exempt from 10 preparation of an environmental assessment until a site plan is 11 submitted for approval by the City. Therefore, it would be 12 "speculative" to provide an assessment of impacts peculiar to the 13 project. Once a site plan is approved, an environmental assess- 14 ment will be performed by the City of Huntington Beach, and 15 site plan mitigations will be applied to the project, as necessary." 16 17 "In this case, since an EIR has been prepared for the City's 18 adopted General Plan and the Specific Plan is included within 19 the umbrella of the General Plan and the associated Certified 20 EIR, the environmental assessment (to be completed at the site 21 plan review/approval stage) for The Crossings at Huntington 22 Beach Specific Plan will be limited to the effects peculiar to the 23 project(Public Resources Code Section 21083.3(b))." 24 25 37. However, Specific Plan No. 13 does not discuss or explain (a) why 26 Section 21083.3(b) applies to Specific Plan No. 13, (b) on what basis, if at all, Specific Plan 27 No. 13.qualifies as a "development project" under Section 21083.3(b), (c) whether or not 28 Specific Plan No. 13 has environmental impacts that are peculiar to the Project Site or the -13- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 11 ` I redevelopment of the Project Site called for-in Specific Plan No. 13, (d) why it would be 2 "speculative" to analyze the environmental impacts associated with the redevelopment 3 project discussed at length in Specific Plan No. 13, (e) whether or not substantial new 4 information has been developed which shows that any environmental impact analyzed in the 5 General Plan EIR is more significant than described therein since the General Plan EIR was 6 prepared over five years ago, (f) how environmental review under CEQA can be delayed 7 until after a "site plan" has been approved for the redevelopment of the Project Site, or 8 (g) how the alleged fact that the Specific Plan falls "within the umbrella of the General Plan 9 EIR" excuses compliance with all applicable CEQA requirements. 10 11 38. Howard Zelefsky, the City's Director of Planning, prepared a Staff 12 Report to the Planning Commission dated June 13, 2000 with respect to the proposed 13 Specific Plan (the "June 13 Staff Report"). The section of the June 13 Staff Report titled 14 "Environmental Status" provides as follows: 15 16 "Adoption or amendment of a Specific Plan constitutes a project 17 under the California Environmental Quality Act (CEQA) and the 18 State's Environmental Impact Report (EIR) Guidelines. In this 19 case, since an EIR has been prepared for the City's adopted 20 General Plan and the Specific Plan is included within the 21 umbrella of the General Plan and associated Certified EIR, the 22 specific plan does not require separate environmental review. 23 The General Plan EIR anticipated approximately 1.4 million 24 square feet of development on the subject property. Specific 25 Plan No. 13 allows up to 1,100,640 square feet of development, 26 which falls below the square footage considered in the General 27 Plan EIR. The Specific Plan, therefore, is considered covered 28 under the previously certified EIR. Subsequent development -14- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I proposals, however, shall be subject to environmental review as 2 mandated by CEQA Guidelines. Any applicable environmental 3 mitigation measures, as specified in the future environmental 4 analysis, will be included as conditions of approval on individual 5 Site Plan Review applications." 6 7 39. In a June 13, 2000 letter from Montgomery Ward's legal counsel to the 8 Planning Commission, Montgomery Ward discussed at length the City's failure to conduct 9 any environmental review required under CEQA with respect to the proposed Specific Plan. 10 The City never substantively responded to any of the analysis in that letter. Instead, a 11 June 20, 2000 Staff Report to the Planning Commission prepared by Jane James, an 12 Associate Planner, with respect to the proposed Specific Plan (the "June 20 Staff Report"), 13 states in conclusory terms that the City Attorney had verbally responded to Montgomery 14 Ward's June 13 letter at the Planning Commission meeting on June 13 and that "the Specific 15 Plan complies with the regulations mandated by CEQA . . .." Furthermore, the City 16 Attorney did not substantively respond to any of the CEQA analysis in the June 13 Letter at 17 the June 13 Planning Commission meeting. 18 19 40. Howard Zelefsky, the City's Director of Planning, prepared a Staff 20 Report to the City Council for its July 5, 2000 hearing with respect to the proposed Specific 21 Plan (the "July 5 Staff Report"). With respect to environmental analysis required under 22 CEQA, the July 5 Staff Report merely restated the "Environmental Status" discussion in the 23 June 13 Staff Report, which is set forth in full in paragraph 38, above. 24 25 41. Neither the June 13 Staff Report, the June 20 Staff Report nor the July 5 26 Staff Report (a) referenced any legal authority that exempted the proposed Specific Plan 27 from environmental review under CEQA or(b) otherwise addressed any of the legal issues 28 discussed in paragraph 37, above. -15- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 THE PUBLIC HEARINGS FOR, AND 2 APPROVAL OF, THE SPECIFIC PLAN 3 4 42. Montgomery Ward is informed and believes, and on that basis alleges, 5 that the City Planning Commission (the "Planning Commission") held study sessions on 6 May 9, 2000 and May 30, 2000 to consider the proposed Specific Plan. Montgomery Ward 7 did not receive written notice of the Planning Commission study sessions. The Planning. 8 Commission conducted a formal hearing on the proposed Specific Plan on June 13, 2000, 9 which was continued to a special Planning Commission hearing held on June 20, 2000. 10 11 43. On June 20, 2000, after the conclusion of the continued public hearing, 12 the Planning Commission recommended approval of the Specific Plan to the City Council, 13 subject to a number of modifications to Specific Plan No. 13. 14 15 44. Prior to the Planning Commission's recommended approval of the 16 proposed Specific Plan on June 20, 2000, neither the City nor the Agency conducted any 17 environmental review under CEQA with respect to the Specific Plan. 18 19 45. Montgomery Ward is informed and believes, and on that basis alleges, 20 that prior to its recommended approval of the Specific Plan, the Planning Commission did 21 not review or consider, and was not afforded a meaningful opportunity to review or consider, 22 the General Plan EIR or the Redevelopment Plan EIR to determine whether their existence 23 should entirely exempt the Specific Plan from CEQA review. 24 25 46. On July 5, 2000, the City Council held a public hearing to consider the 26 proposed Specific Plan. Following the public hearing, the City Council (a) ratified the prior 27 action of Ray Silver on July 5, 2000'to substitute the City and the Agency as the "applicant" 28 for the proposed Specific Plan in place of HCA and (b) adopted Resolution 2000-68 to -16- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE r` I approve the Specific Plan. Attached hereto as Exhibit 3 and incorporated herein by this 2 reference is a copy of Resolution 2000-68 (but which does not include Specific Plan No. 13 3 as an attachment due to the City's inability to provide a final version of the document). The- 4 City Council allegedly made a single finding with respect to the City's failure to conduct any 5 environmental review under CEQA for the Specific Plan (although no such finding was 6 included in Resolution 2000-68): 7 8 "5. The Planning Commission (sic) finds that establishment of 9 the Specific Plan project will not have any significant effect on 10 the environment because the overall development parameters 11 have previously been evaluated in the EIR certified in 12 conjunction with the General Plan update. In addition, future 13 requests for development projects at the site will require 14 environmental analysis as mandated by the California 15 Environmental Quality Act (CEQA) and the CEQA Guidelines." 16 17 47. Prior to the City Council's adoption of Resolution 2000-68, neither the 18 City nor the Agency conducted any environmental review under CEQA with respect to the 19 Specific Plan. 20 21 48. Montgomery Ward is informed and believes, and on that basis alleges, 22 that prior to its adoption of Resolution 2000-68, the City Council did not review or consider, 23 and was not afforded a meaningful opportunity to review or consider, the General Plan EIR 24 or the Redevelopment Plan EIR to determine whether their existence should entirely exempt 25 the Specific Plan from CEQA review. 26. 27 49. Montgomery Ward is informed and believes, and on that basis alleges, 28 that prior to the City Council's adoption of Resolution 2000-68, neither the City, the -17- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I Planning Commission nor the City Council relied in any way on the existence of the 2 Redevelopment Plan EIR to exempt the Specific Plan from environmental review under 3 CEQA. 4- 5 50. On July 7, 2000, the City filed a Notice of Determination (the "NOD") 6 for the Specific Plan with the County Clerk of the County of Orange, which was posted by 7 the County Clerk on July 7, 2000. A true and correct copy of the NOD is attached hereto as 8 Exhibit 4 and incorporated herein by this reference. The NOD stated, among other things, 9 that (a) the Specific Plan will have a significant effect on the environment, (b) an environ- 10 mental impact report("EIR") was prepared for the Specific Plan (referencing the General 11 Plan EIR and the Redevelopment Plan EIR), (c) mitigation measures were made a condition 12 of approval of the Specific Plan and(d) a Statement of Overriding Considerations was 13 adopted for the Specific Plan. However, Montgomery Ward is informed and believes, and 14 on that basis alleges, that (i) no EIR or other CEQA document was prepared with respect to 15 the Specific Plan, (ii) no mitigation measures were made a condition of approval of the 16 Specific Plan, (iii) a Statement of Overriding Considerations was not adopted with respect to 17 the Specific Plan and (iv) the City did not file a notice of exemption to the City Council's 18 adoption of Resolution 2000-68. 19 20 51. Attachment No. 1 to the NOD states that 21 22 "[b]ased on Public Resources Code Section 21083.3(b) and the 23 fact that the Specific Plan project falls within the development 24 envelope analyzed in the General Plan EIR, the Crossings at 25 Huntington Beach Specific Plan is currently exempt from further 26 environmental assessment until a site plan is submitted for 27 approval by the City.','. 28 -18- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I However, the NOD failed to address any of the legal issues set forth in paragraph 37, above. 2 3 52. Montgomery Ward has exhausted all available administrative remedies 4 required to be pursued by it with respect to the Specific Plan and Resolution 2000-68. 5 6 53. Montgomery Ward has no plain, speedy and adequate remedy in the 7 ordinary course of law, other than the relief sought in this Petition, that will prevent the City 8 from acting outside its legal authority.. Montgomery Ward has a beneficial interest in the 9 outcome in this action and has performed all conditions precedent to the filing of this 10 Petition, including delivery by facsimile transmission and overnight courier of the formal 11 written notice attached hereto as Exhibit 5 to this Petition and incorporated herein by this 12 reference. 13 14 FIRST CAUSE OF ACTION 15 (Writ of Mandate - Violations of CEQA Relating to Failure to Prepare, 16 Adopt or Certify Any CEQA Document with Respect to the Specific Plan) 17 18 54. Montgomery Ward repeats and realleges paragraphs 1 through 53, 19 above, and incorporates them herein by this reference as though set forth in full. 20 21 55. The State Office of Planning and Research has promulgated guidelines 22 to implement CEQA. 14 Cal. Code Regs. §§ 15000 et seQ. (the "Guidelines"). 23 24 56. The City did not carry out the environmental review of the Specific 25 Plan that is mandated by CEQA and the Guidelines. 26 27 57. CEQA generally applies to discretionary projects proposed to be carried 28 out or approved by a public agency. Cal. Pub. Res. Code § 21080(a). -19- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 58. A "project" is "an activity which may cause either a direct physical 2 change in the environment, or a reasonably foreseeable indirect physical activity which is 3 directly undertaken by any public agency." Cal. Pub. Res. Code § 21065. The City 4 Council's adoption of Resolution 2000-68 constituted the "approval" of a "project" for 5 purposes of CEQA. 6 n 7 59. A "discretionary project" is one which "requires the exercise of judg- 8 ment or deliberation when the public agency or body decides to approve or disapprove of a 9 particular activity, as distinguished from situations where the public agency or body merely 10 has to determine whether there has been conformity with applicable statutes, ordinances, or 11 regulations. Guidelines § 15357. The City Council's adoption of Resolution 2000-68 was a 12 discretionary action for purposes of CEQA. 13 14 60. The City Council's adoption of Resolution 2000-68 was not exempt 15 from the requirements of CEQA pursuant to any of the statutory exemptions set forth in 16 CEQA or any of the "categorical exemptions" set forth in the Guidelines. 17 18 61. If the lead agency determines that a discretionary project is not exempt 19 from CEQA, the lead agency must prepare an "initial study" to determine whether the pro- 20 posed project may have a significant effect on the environment and therefore requires the 21 preparation of an EIR. Guidelines § 15063(a). Before granting any approval of a project - 22 subject to CEQA, the lead agency must consider a final EIR or negative declaration. Guide- 23 lines § 15004(a). The City failed to comply with these legal requirements because the City 24 did not prepare an initial study in connection with the Specific Plan or otherwise conduct 25 any environmental review under CEQA with respect to the Specific Plan. 26 27 62. The City's allegation that the Specific Plan "is included within the 28 umbrella" of the General Plan and the General Plan EIR, even if true, did not exempt the -20- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE r I Specific Plan from environmental review under CEQA. Neither CEQA nor the Guidelines . 2 include any exemption from CEQA requirements for a project that is consistent with the 3 applicable general plan. 4 5 63. The City Council's adoption of the Specific Plan pursuant to Resolution 6 2000-68 was not exempt from environmental review under CEQA pursuant to Section 7 21083.3(b) of the California Public Resources Code, for the following reasons: 8 9 a. The Specific Plan is not a "development project", as that term is 10 used in Section 21083.3(b). 11 12 b. The Specific Plan is inconsistent with the General Plan, in that, 13 among other things, Table LU-4 in the Land Use Element of the General Plan includes a 14 height limit of four stories with respect to the Project site, while Section 4.3.3 of the Specific 15 Plan includes an exception to the four-story height limit to permit a maximum height of 120 16 feet for "special themed architectural structures or elements such as towers or domes." 17 18 C. The City failed to prepare an initial study or other CEQA 19 analysis with respect to the proposed Specific Plan to determine the extent to which the 20 environmental impacts associated with the Specific Plan (i) are peculiar to the Specific Plan 21 or the Project Site and were not analyzed as significant effects in the General Plan EIR, 22 (ii) involve potentially significant offsite impacts or cumulative impacts that were not 23 discussed in the General Plan EIR or (iii) are previously-identified significant effects in the 24 General Plan EIR which, as a result of substantial new information which was not known at 25 the time the General Plan EIR was certified, are determined to have a more severe adverse 26 impact than discussed in the General Plan EIR. 27 28 -21- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 d. The City's General Plan is not "community plan", as that term is 2 defined in Section 21083.3(e) of the California Public Resources Code. 3 4 e. The Specific Plan will have numerous environmental effects that 5 are peculiar to the Specific Plan or the Project Site and were not analyzed as significant 6 effects in the General Plan EIR, including without limitation the following: 7 8 i. The Specific Plan contemplates the demolition of several 9 hundred thousand square feet of existing improvements and the construction, 10 rehabilitation and alteration of several hundred thousand square feet of new and 11 existing improvements on the Project Site. None of the environmental impacts 12 associated with those significant demolition, construction and rehabilitation activities, 13 including traffic, air quality and noise impacts, were analyzed in the General Plan 14 EIR. 15 ii. The Specific Plan provides for an "expedited" and "fast- 16 'track" entitlements process. Section 2.3 of the Specific Plan provides that the only 17 discretionary approval required for each development proposal on the Project Site is 18 the approval of"Site Plan Review". However, the Planning Director has sole 19 authority to approve, conditionally approve or deny a Site Plan Review, no public 20 hearing is required in connection with the Planning Director's consideration of any 21 proposed Site Plan Review, and the decision of the Planning Director is not 22 appealable by any party other than the project applicant. In contrast, the City's 23 Zoning and Subdivision Ordinance (the "Zoning Code") otherwise requires a public 24 hearing with respect to any application for a discretionary approval relating to the 25 Project Site, and a decision on any such application is appealable to the Planning 26 Commission and/or the City Council. The Specific Plan stripped the Planning 27 Commission and City Council of their respective rights to review such development 28 proposals and severely limits public participation. The General Plan EIR did not -22- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE r r 1 evaluate the potentially significant land use impacts associated with this fundamental 2 change in land use policy. 3 4 iii. The Specific Plan calls for the redevelopment of the 5 Project Site in one phase, which is anticipated to occur over a period of 18-24 6 months, as set forth in Section 2.1 of the Specific Plan. The Specific Plan includes 7 several mechanisms to insure an "expedited buildout" under the Specific Plan, 8 including without limitation (1) the "fast-track" entitlements process described in the 9 preceding paragraph and (2) the "upfront" construction, expansion and relocation of 10 the new and expanded infrastructure and public facilities required in connection with 11 the redevelopment of the Project Site. The General Plan EIR did not analyze the 12 potentially significant environmental impacts associated with the accelerated and 13 concentrated redevelopment of the Project Site planned for in the Specific Plan. 14 15 iv. One of the central purposes of the Specific Plan is to 16 intensify retail and other commercial activities at the Project Site in order to increase 17 sales tax revenue. The General Plan EIR did not analyze the potentially significant 18 environmental impacts associated with that planned intensification at the Project Site. 19 20 V. Sections 3.1.2 and 4.3 of the Specific Plan state that 21 entertainment, dining and related uses shall be "primary intended activities" on the 22 Project Site. In addition, the redevelopment of the Project Site will "likely" include 23 multi-screen movie theaters, as set forth in Section 3.5.4A of the Specific Plan. The 24 General Plan EIR did not analyze the potentially significant environmental impacts 25 associated with the introduction and/or intensification of these uses on the Project 26 Site. 27 28 -23- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE � r I vi. The permitted uses in the Specific Plan include "Hotels, 2 Motels". However, as set forth in Table LU-2a of the Land Use Element, 3 hotel/motels are not a typical permitted use under the "Commercial Regional" land 4 use category. Rather, they are each a typical permitted use under the "Commercial 5 Visitor" land use category. In addition, as set forth in Section 211.04 of the Zoning 6 Code, hotel/motels are conditionally permitted uses in the "CG" Zoning District and 7 require the approval of a conditional use permit by the Planning Commission. The 8 General Plan EIR did not evaluate the potentially significant land use impacts 9 associated with the conversion of hotel/motel use from a prohibited or, at best, 10 conditionally permitted use, to a permitted use without any review by the Planning 11 Commission or City Council. 12 13 vii. Prior to the adoption of the Specific Plan, the zoning 14 designation for the southeastern portion of the Project Site (the "Floodplain 15 Pro a ") was "CG-FP2". As a result, the Floodplain Property was not only located 16 in the "CG" Zoning District, it was also part of the "FP Floodplain Overlay District" 17 established pursuant to Chapter 222 of the Zoning Code. The "FP2" designation 18 means that the Floodplain Property is in an area of special flood hazard, as identified 19 by the Federal Emergency Management Agency. Pursuant to Section 222.12B.I of 20 the Zoning Code, the construction of any new structures or improvements in the 21 "FP2" Subdistrict must comply with detailed development standards and standards of 22 construction set forth in Section 222.14A of the Zoning Code in order to minimize the 23 potential flood hazard. The Specific Plan anticipates the construction of new 24 improvements on the Floodplain Property. However, any such new development will 25 not be required to comply with the development standards and standards of construc- 26 tion set forth in Section 222.14A of the Zoning Code. The General Plan EIR did not 27 evaluate the potentially significant flood hazard impacts associated with the 28 elimination of the "FP2" Subdistrict designation. -24- VERIFIED PETMON FOR PEREMPTORY WRIT OF MANDATE T 1 I viii. The General Plan EIR did not evaluate the potentially 2 significant impact of General Plan buildout on the circulation system in the vicinity of 3 the Project Site. The traffic analysis in the General Plan EIR examined 32 intersec- 4 tions in the City, only one of which, the intersection of Edinger Avenue and Beach 5 Boulevard, is located in the vicinity of the Project Site. 6 7 ix. Section 3.3 of the Specific Plan includes a Circulation 8 Plan that sets forth the onsite and offsite traffic circulation features that will be 9 implemented in connection with the redevelopment of the Project Site. Section 3.3.2 10 of the Specific Plan states that "[a] new primary access into the project shall be 11 pursued where the San Diego Freeway on and off ramps intersect with Center 12 Avenue," subject to approval by Caltrans and City officials. Section 3.3.10 of the 13 Specific Plan states that circulation system improvements will be "master planned" to 14 accommodate ultimate buildout of the Specific Plan, and that all onsite and offsite 15 circulation improvements must be completed prior to the first occupancy request. 16 The General Plan EIR did not analyze the traffic impacts associated with the 17 Circulation Plan or the Circulation Plan policies in the Specific Plan. Section 3.3 of 18 the Specific Plan underscores the lack of traffic analysis, stating that "[a] traffic study 19 shall be required to analyze on-site and off-site circulation patterns and necessary 20 improvements." 21 22 X. Section 3.4 of the Specific Plan requires that all public 23 facilities infrastructure necessary to serve the redeveloped Project Site must be 24 completed concurrent with the initial project development. Section 3.4.1 of the 25 Specific Plan states that the redevelopment of the Project Site will require the recon- 26 struction of the existing looped water system that serves the existing Huntington 27 Center. Section 3.4.2 of the Specific Plan provides that, "[d]ue to the reconfiguration 28 of the development, it will be necessary to remove or abandon-in-place several -25- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE I sanitary sewer lines and replace them." Section 3.4.3 of the Specific Plan states that 2 new storm drainage improvements will be required"to drain the open air section of 3 the Crossings at Huntington Beach." Section 3.4.5 of the Specific Plan anticipates 4 that additional utility facilities will be required in connection with the redevelopment 5 of the Site. Section 3.4.7 of the Specific Plan provides that the relocation of existing 6 natural gas facilities will be required. The General Plan EIR did not analyze any of 7 the potentially significant environmental impacts associated with the construction, 8 reconstruction, replacement and relocation of existing and new onsite and offsite 9 infrastructure improvements required in connection with the redevelopment of the 10 Project Site. 11 12 xi. The Design Guidelines in Section 3.5 of the Specific Plan 13 require the redevelopment of the Project Site with the character and theme of an 14 "Italian Village". The Design Guidelines include detailed guidelines and policies 15 regarding site planning, common areas, the required "Entry Plaza", "Village Strada", 16 "Plaza" and "Courtyard and Colonnade", architectural treatments, tenant storefronts, 17 landscaping and signage. The General Plan EIR did not analyze any of the 18 potentially significant visual/aesthetic or other environmental impacts associated with 19 the implementation of these detailed requirements. 20 21 xii. Section 4.3.8 of the Specific Plan provides that the 22 required parking for the redeveloped Project Site shall be provided in accordance with 23 an approved shared parking study, which would permit a reduction in the code 24 required parking of up to 25%, based on a shared parking analysis. The General Plan 25 EIR did not analyze the potentially significant environmental impact of reducing code 26 required parking on the Project Site by up to 25%. 27 28 -26- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 1 I f. Montgomery Ward is informed and believes, and on that basis 2 alleges, that the City (i) has not adopted any uniformly applied development.policies or 3. standards that would substantially mitigate any of the peculiar environmental effects 4 associated with the Specific Plan, including without limitation those described in 5 paragraph 63e, above, (ii) made no such allegation or fmding during the administrative 6 proceedings with respect to the Specific Plan, and (iii) held no public hearing to determine 7 whether any such standards or policies would substantially mitigate any of the peculiar 8 environmental effects associated with the Specific Plan, including without limitation those 9 described in paragraph 63e, above. 10 11 g.. The General Plan EIR, which was prepared in 1995, did not 12 analyze the cumulative impacts associated with the planned redevelopment of the Project 13 Site pursuant to the Specific Plan. 14 15 64. CEQA requires that environmental review and the formulation of 16 appropriate mitigation measures occur at the earliest feasible stage in the planning process. 17 Cal. Pub. Res. Code § 21003.1. The City unlawfully deferred all environmental review with 18 respect to the redevelopment of the Project Site.contemplated in the Specific Plan and the 19 formulation of appropriate mitigation"measures until a "definitive" site plan has been 20 developed for the Project Site. Without limiting the generality of the foregoing, the City 21 unlawfully deferred (a) the preparation of a traffic study to analyze onsite and offsite traffic 22, impacts and required road improvements with respect to the buildout anticipated under the 23 Specific Plan and(b) the determination of the parking impacts associated with the 24 redevelopment of the Project Site under a shared parking program. 25 26 65. The approval of Resolution 2000-68 by the City Council constituted a 27 prejudicial abuse of discretion because the City failed to conduct any environmental review 28 under CEQA with respect to the Specific Plan, for the reasons set forth herein. -27- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 66. The Court should enjoin (a) the effectiveness of any permits, approvals, 2 contracts, resolutions, ordinances or other actions issued, granted, executed or taken by the 3 City or the Agency relating to the Specific Plan or the development and/or redevelopment of 4 the Project Site, including without limitation the City Council's adoption of Resolution 5 2000-68, (b) the City and the Agency from issuing, granting, adopting, executing or taking 6 any further permits, approvals, contracts, resolutions, ordinances or other actions relating to 7 the Specific Plan and/or the development or redevelopment of the Project Site, including 8 without limitation any such action by the City or the Agency relating in any way to the 9 condemnation or other acquisition of all or any portion of the MW Property, and (c) any and 10 all demolition, grading, construction and/or other development activity pursuant to the 11 Specific Plan, all pending a final adjudication of this Petition. Unless the City and the 12 Agency are so enjoined, Montgomery Ward and the general public will suffer irreparable 13 environmental, economic and social harm for which there is no adequate remedy at law, as 14 described above. 15 16 WHEREFORE, Montgomery Ward prays for relief as follows: 17 18 1. Issue a peremptory writ of mandate: 19 20 a. ordering the City to set aside the Resolution 2000-68 and any 21 other permits, approvals, contracts, resolutions, ordinances or other actions issued, granted, 22 adopted, executed or taken by the City or the Agency relating to the Specific Plan or 23 development and/or redevelopment of the Project Site, including without limitation any such 24 action by the City or the Agency relating in any way to the condemnation or other 25 acquisition of all or any portion of the MW Property; and 26 27 b. enjoining (i) the City and the Agency from issuing, granting, 28 adopting, executing or taking any further permits, approvals, contracts, resolutions, -28- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 ordinances or other actions relating to the Specific Plan or development and/or 2 redevelopment of the Project Site (other than a permit, approval, contract, resolution, 3 ordinance or other action initiated, requested and/or agreed to by Montgomery Ward with 4 respect to the MW Property), including without limitation any such action by the City or 5 Agency relating in any way to the condemnation or other acquisition of all or any portion of 6 the MW Property, and (ii) any and all demolition, grading, construction and/or other 7 development activity with respect to the Project Site (other than demolition, grading, 8 construction and/or other development activity initiated by Montgomery Ward on the 9 MW Property), all until the City has taken such actions as may be necessary to comply fully 10 with the requirements of CEQA. 11 12 2. Issue an order immediately enjoining (a) the effectiveness of any and all 13 permits, approvals, contracts, resolutions, ordinances or other actions issued, granted, 14 adopted, executed or taken by the City or the Agency relating to the Specific Plan or the 15 development and/or redevelopment of the Project Site (other than permits, approvals, 16 contracts, resolutions, ordinances or other actions initiated, requested and/or agreed to by 17 Montgomery Ward with respect to the MW Property), including without limitation Resolu- 18 tion 2000-68 and any action relating in any way to the condemnation or other acquisition of 19 all or any portion of the MW Property, (b) the City or the Agency from issuing, granting, 20 adopting, executing or taking any further permits, approvals, contracts, resolutions, 21 ordinances or other actions relating to the Specific Plan and/or the development or 22 redevelopment of the Project Site (other than permits, approvals, contracts, resolutions, 23 ordinances or other actions initiated, requested and/or agreed to by Montgomery Ward with 24 respect to the MW Property), including without limitation any such action by the City or the 25 Agency relating in any way to the condemnation or other acquisition of all or any portion of 26 the MW Property, and (c) any and all demolition, grading, construction and/or other 27 development activity with respect to the Project Site (other than demolition, grading, 28 -29- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE 1 construction and/or other development activity initiated by Montgomery Ward on the 2 MW Property), all pending a final adjudication of this Petition. 3 4 3. Enter an order awarding Montgomery Ward its reasonable attorneys' 5 fees, interest and costs incurred in this action pursuant to California Code of Civil Procedure 6 Section 1021:5 and all other applicable laws. 7 8 4. For such other and further relief as the Court deems just and proper. 9 10 Dated: August 4, 2000 11 12 SHEPPARD, MULLIN, RICHTER& HAMPTON LLP ANDREW J. GUILFORD 13 JACK H. RUBENS SEAN P. O'CO R 14 15 By • 16 SEAN P. O'CONNOR 17 Attorneys for Petitioner MONTGOMERY WARD, LLC 18 19 LA:LRE\PLD\4M70187115.3 ' 20 21 22 23 24 25 26 27 28 -30- VERIFIED PETITION FOR PEREMPTORY WRIT OF MANDATE --------------- 1 ; i D Meru r.� ..� + PROJECT SITE — — Twims -- sap" ::lf,'i,'.: fr.,.,..}1 :�{{�ffr�r•N:Yr�+rfi 5.•t 'h p ' {rv:uiv ref,. ,r•"•. Ir.•.'JtiY.�tf., • ,I• ' rJ.,A'' p ?. •fr• f .r .+.,r y VICINITY MAP Zoning Map Amendment No. 00-01 Zoning Text Amendment No. 00-02 THE CITYOFHUNTIIYGTONBEACH EXHIBIT 1 -31- t-Aty of Huntington Bcach MA i 20p0 IN STREET CALIFORNIA 92848 - --- - DEPARTMENT OF ECONOMIC DEVELOPMENT Director 7141536-5532 Red:velopm.:n' 714/53&5582 FAX 714/375-5087 714/536,5542 March 3, 2000 Loren H. Hohman,Real Estate Manager f ; Montgomery Ward 535 West Chicago Avenue Chicago,IL 60610 Re: Statement of Interest and Request For Proposal for Redevelopment of Huntington Center Within the Huntington Beach Redevelopment Project Area (Montgomery Ward,7777 Edinger Ave.,Huntington Beach, CA 92647) Dear Property Owner: A. Introduction The Redevelopment Agency of the City of Huntington Beach (the "Agency") is seeking the interest of property owners (defined below) in the redevelopment of the Huntington Center (the "Site'). The Site is part of the Huntington Beach Redevelopment Project, which Redevelopment Plan was approved and adopted by the City Council of the City of Huntington Beach on December 16, 1996 by Resolution No. 3343. The Agency intends for the Site to be rehabilitated and repositioned into a high-quality, well-integrated retail and entertainment center under unified ownership. The Agency believes unified ownership of the Site will allow for the oversight and control necessary to effectively redevelop and maintain the Site, without the problems often associated with fragmented ownership. The revitalized Site is intended to serve the region and to provide new jobs and economic opportunities to residents of the region. In addition,the location of the Site as a major gateway to the City of Huntington Beach, as well as the excellent visibility and accessibility from the 405 Freeway, calls for a superior quality redevelopment that will significantly enhance the image of the community and set the standard desired for future high-quality development in the Edinger Corridor. This Request For Proposal provides property owners located within the Site with the opportunity to participate in the proposed redevelopment of the Site. All participation shall be subject to the approval of the Agency and shall be consistent with the Redevelopment Plan and t EXHIBIT 2 -32- the "Rules Governing Participedin and Preferences by Property Owiic_s an ' Business Occupants for the Huntington Beach Redevelopment Project," dated August 1996 (the"Owner Participation Rules', incorporated herein by'd is reference as though'fully-set forth herein. Pursuant to the Owner Participation Rules, a "property_owner" is any person, persons, corporation, association, partnership, or other entity holding recorded fee title to or a long-term leas- of real property in the,Site for'so long as such property owner holds such title or long-tei-LA lease. A "long-term lease" is a lease of real property with a term of twenty(20) years oi-rrAoic, will, w lest ten (10) years remaining on such tows. Property owners who are interested in redeveloping the Site must file a Statement of Interest.Form(attached)by April 17,2000 and must submit the,.Development Proposal requested in this Request For Proposal by May 2, 2000. All property owners must be qualified to perform theifIdtal obligations within a period of time to be provided by the Agency, and will be required to secure the performance of their obligations in a reasonably satisfactory manner. The Agency is not obligated to accept any Statements of Interest or Development Proposgls; and is not obligated to consider any Statements of Interest or Development Proposals after the dates set forth above. B. Request for Proposal This invitation is the first step taken by the Agency leading to the selection of a developer to rehabilitate,and-reposition the Site located in the Huntington,Beach Redevelopment Project Area This-R;egtiest For Proposal is being sent to property owners within the Site who may file a Statement#of Interest'Form and Development Proposal with the Agency. The Agency has - determined that you qualify as a property owner within the Site, and therefore have an opportunity to participate in the potential redevelopment of the Site through the process outlined in this letter. C. Pumose of Request For Prop The purpose of this Request For Proposal is to ask prospective developers to submit sufficient information regarding development expertise and financial capabilities to enable the Agency to award a developer the right to negotiate an Owner Participation Agreement with the Agency. D. The Site a. Location. The Site is within the Huntington Beach Redevelopment Project Area and is generally bound.by Edinger Avenue on the south,the Southern Pacific Rail Road Right of Way on ,the west, Center Avenue on the north, and the 405 Freeway and Beach Boulevard on the northeast and east b. Characteristics. The Site currently exists,as a.shopping center commonly known as the Huntington Center. The Site is zoned general commercial. 2 EXHIBIT 2 -33- C. Development Costs. Site pic.p^*ation and cl:�F:anc,..: e-li all redevelopment costs for the Site will be the responsibility of the developer. d. Public Improvements. Public improvements such as road improvements, sidewalks, open spaces, and other public infrastructure will be the responsibility of the developer. e. Working Capital. As stated above, the, Agen, y ct jIm-q tl..- Site to be redeveloped under unified pwnershi?. Therefore, ,subject to these, owner par-ticiprsion procedures, the Agency will consider utilizing its.powers to facilitate assembling the Site as necessary to effectuate the redevelopment of the Site. In that event, the Agency may require the developer to advance all or a significant portion of the working capital required by the Agency to assemble tha site, by the advance payment of the purchase price, loans, or other mechanism to be negotiated with the Agency. The Agency has made no determination to acquire any portion of the Site at this time. E. Submissions a. Deadlines. Development Proposals must be receiv at the following address no later than May 2,2000: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach,California 92648 Attention: Gus Duran,Housing and Redevelopment Manager No Development Proposals will be considered unless the Agency has previously received a Statement of Interest Form (attached) from the developer by April 17, 2000. b. Format for Submissions. The format for submitting Development Proposals consists of the following elements: 1. Identification of Develom. i. Name,address,telephone and facsimile number of developer. ii. Organization of developer (i.e., individual, corporation, partnership, etc.); principals of developer (i.e. corporate officers, principal stockholders, general and limited partners, etc.) and manager to be responsible for proposed redevelopment; and relationship of developer with any parent corporation, subsidiary, joint venture,or other entity. 2. j ae sa. Statement regarding any lease commitments developer may have on the Site. 3 EXHIBIT 2 -34- 3. Red,:�veloprntrit Concep�or Site. L Description of proposed land uses and the arrangement of these uses. The proposed redevelopment should be described in sufficient detail to form the basis for the developer's preliminary cost estimates. Architectural drawings/renderings are not required at this time. ii. The numbei and size of sauctures and the of construction to be used iii. A break-out of the estimated total cost of the proposed redevelopment and a statement of any basic assumptions affecting the feasibility of the proposed redevelopment. iv. A schedule of performance outlining the estimated time for each step of the redevelopment process. 4. Financial Capability. i. Copy of certified financial statement of developer, prepared in accordance with accepted accounting practices and dated within six (6)months prior to submission of the Development Proposal. ii. Copies of any annual reports, financial rating reports or other documents indicating the financial condition of developer. iii. Statement indicating how developer proposes to finance the redevelopment of the Site (including proposed source of financing, amount of equity investment, and probable terms and conditions of financing). iv. List of names and addresses of bank or other financial institutions) and references. Letter of recommendation from developer's bank would be helpful. 5. Development Experience. The Agency is particularly interested in the developer's ability to assemble and manage a team of redevelopment participants including architects, planners, engineers, builders, financial consultants,marketing specialists and management personnel. i. List of development projects in which developer and/or proposed associates have participated, including any urban renewal or redevelopment areas, showing the location, type and dollar volume of the work. I Descriptions and illustrations of the proposed architect's work on projects which have been built or are under construction. 4 EXHIBIT 2 -35- iii. If developer plans to retain and manage the completed development, submit description of developer's experience in ownership and management of completed developments. If a management firm is to be employed for this purpose, submit sufficient data on the firm's experience to enable the Agency to determine its ability to manage the completed development. Please feel free to uiclude any other information wi,icL you may feel is appropriate or pertinent. F. Agency Evaluation of Information Submitted. The Agency will evaluate Statements of Interest and Development Proposals which are submitted on time. The Agency will consider factors such as: a. The degree to which the Development Proposal would achieve the redevelopment objectives for the Site, including whether the Development Proposal conforms to and meets the goals and objectives of the Redevelopment Plan. b. The developer's demonstrated ability to complete redevelopments of this type successfully and in a timely manner. C. Whether the Development Proposal is feasible (fmancially and otherwise) or in the best interest of the Site and community. Based on the information submitted, the Agency may select a developer from among those submitting Statements of Interest and Development Proposals to negotiate with towards an Owner Participation Agreement The Agency reserves the right at its sole discretion to reject any and all Statements of Interest and Development Proposals. Please direct any questions to Gus Durum, Department of Economic Development, at (714) 374-1529. Sincerely yours, d C. David C. BiggP Director of Economic Development Enclosure 5 EXHIBIT 2 -36- RESOLUTION NO. 2000-68 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HLNTINGTON BEACH ADOPTING SPECIFIC PLAN NO. 13 TO CHANGE THE ZONING DESIGNATION ON REAL PROPERTY BOUNDED GENERALLY BY BEACH BOULEVARD, EDINGER AVENUE, CENTER AVENUE, AND THE SOUTHERN PACIFIC RAILROAD FROM GENERAL COMMERCIAL(CG) AND GENERAL COMMERCIAL-FLOOD PLAIN (CG-FP2) TO . SPECIFIC PLAN NO. 13 (THE CROSSINGS AT HUNTINGTON BEACH SPECIFIC PLAN) WHEREAS, pursuant to the State Planning and Zoning Law, the Huntington Beach Planning Commission and Huntington Beach City Council have held separate public hearings relative to Specific Plan No. 13, wherein both bodies have carefully considered all information presented at said hearings, and after due consideration of the findings and recommendations of the Planning Commission and all evidence presented to said City Council, the City Council finds that such zoning map amendment and zoning text amendment is proper and consistent with the General plan. NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby resolve as follows: 1. The Crossings at Huntington Beach Specific Plan No. 13, attached hereto as Exhibit A and incorporated by this reference as though fully set forth herein, is hereby adopted and approved. 2. That the real property generally described as bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad and more particularly described in the legal description and sketch collectively attached hereto as Exhibit B and incorporated by this reference as though fully set forth herein, is hereby changed from General Commercial (CG) and General Commercial-Flood Plain (CG-FP2) to Specific Plan No. 13 (The Crossings at Huntington Beach Specific Plan.) Mayork Pro Tem ATTEST: // -- APPROV D AS TO FORM: City Clerk -7-13 City Attorney <";,z3 c i'1vv1 REVIEWED AND APPROVED: INITIA D AND APPROVED: Cit Administrator Director lanning 4/s:4-2000 Resolutions:Crossings at H.B. RLS 00-616 6/22/00 EXHIBIT 3 -37- Res. No. 2000-68 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss: CITY OF HUNTINGTON BEACH ) I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at a regular meeting thereof held on the 5th day of July, 2000 by the following vote: AYES: Julien, Sullivan, Harman, Green, Dettloff, Bauer NOES: None ABSENT: None ABSTAIN: Garofalo City Clerk and ex-officio Cferk of the City Council of the City of Huntington Beach, California EXHIBIT 3 -38- roes. No. 2000-68 Legal Description EXHIBIT 3 -39- 8. Legal Description The following provides the legal description for the entire Crossings at Huntington Beach Specific Plan Area, which is bounded by Center Avenue on the north,Pacific Railroad on the east,Edinger Avenue on the south and Beach Boulevard on the west. Refer to Exhibit 1 in the Specific Plan. Perimeter Legal Description Parcels I through 3,5 though 9 and that portion of Parcel 4,Parcel Map No. 86-2003, in the City of Huntington Beach,County of Orange,State of California as per map filed in book 225 pages 40 through 45,inclusive,of parcel maps,in the office of the county recorder of said county,described as follows: Commencing at the intersection of the centerline of the Southern Pacific Railroad Right of Way(30 feet wide)with the centerline of Edinger Avenue(variable width),as said intersection is shown on said Parcel Ntap No.86-200;thence South 89 32'12"East 43.00 feet along the centerline of said Edinger Avenue to the southerly prolongation of the westerly line of parcel I of said parcel map;thence North 00 15'57"East 50.00 feet to the southwest corner of said parcel 1 also being the True Point of Beginning-thence North 00 15'57"East 1120.67 feet along the westerly line of said parcel 1 to the northwest corner of said parcel 1;thence South 89 32'12"East 1803.57 feet along the northerly line of said parcel 1 and the northerly line of parcels 2,3 and 4 of said pareeI map to the northeasterly line of said parcel 4;thence along a non-tangent curve in the northeasterly line of said parcel 4,concave southwesterly and having a radius of 504.00 feet,a radial line to said point bears North 43 06; 37"East;thence southeasterly along said curve through a central angle of 12 11'46"an arc distance of 10 7.28 feet; thence along the northeasterly line of said parcel 4 the following 5 courses:South 34 41' 37" Past 207.33,South 31 44'17" East 229.95 feet to the beginning of a non- tangent curve,concave northeasterly and having a radius of 300.00 feet,a radial line to said point bears South 75 10153"Nest;thence along said curve through a central angel of 50 58'39"an arc distance of 266.9Z feet,South 65 47'46"East 253.09 feet and South 33 19'06"East 70.61 feet;thence South 00 16'50"West 273.62 Feet along a line that is parallel with the easterly line of said parcel 4 and 9.00 feet westerly,thence South 42 16"20"West 41.42 feet along a line that that is parallel with the southeasterly line of said parcel 4 and 6.00 feet northwesterly to a point in the north line of parcel 1 of an easement to the city of Huntington Beach recorded November 9, 1972 in book 10418,page 968 official records in the office of the county recorded November 9, 1972 in book 10418,page 968 official records in the office of the county recorder of said county;thence North 89 32'12"West 583.76 feet along said north line to the southeasterly corner of parcel 2 of said easement;thence North 44"32112"West 41.01 feet along the northeasterly line of said parcel 2 to the north west corner of said parcel 2;thence North 89 32112"West 32.50 feet along the norrh line of said parcel 2 to the northwest corner of said parcel 2;thence South 00 27'48" West 37.00 fee.along. the west line of said parcel 2 and said parcel 1 to the southerly line of parcel 4 of said parcel map;thence North 89 32'12"West 1874.15 feet along the southerly lines of parcels 1,2,3 and 4 of said parcel map to True Point of Beginrdng. Note: This description was prepared as a convenience only and is not for us in the division and/or conveyance of land in violation of the subdh-Won map act of the State of California EXHIBIT 3 -40- Recorded in Official Records, County of Orang i ' ` Gary GranvillG, Clerk-Recovcies I I!lIII IIIII IIIII il�il I!I�I Illil IIIII Ilnl I{II{ill INII I{�INO FEE [N:O;Y1'1CF, OF DETEk,1111-NkTI&N 170 sz zoz 0085000426 03:30pm 07/07100 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.0o Tr: From: ❑ Office of Planning and Research Cite of Huntington Beach 1400 Tenth Street, Room 121 Planning Department E i Sacramento,Ca 95814 �uiou Main St.,3rd Flr. P S T Huntington Beach,CA 92648 �L�� 0 l ■ Orange County Clerk Recorder's Office 2000 Public Services Division P.O. Box 238 Rwrc rak"t, to-DEPU Santa Ana,CA 92702 SUBJECT:Filing of Notice of Determination in compliance with Section 21108 or 21152 of the Public Resources Code. Project Title: The Crossings at Huntington Beach- Specific Plan No. 13 State Clearinghouse Number: Contact Person: Jane James Phone: (714) 536-5271 Project Location: 7777 Edinger Avenue(approximately 63 acres bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad) Project Description: The Huntington Beach Redevelopment Plan and the following implementing activities: Zoning Map Amendment No. 00-01: Amend zoning from CG(General Commercial)and CG-FP2 (General Commercial-Flood Plain) to Specific Plan No. 13.;Zoning Text Amendment No. 00-02: Adopt Specific Plan No. 13, which establishes zoning, development standards, site design,and architectural guidelines to govem future development, requires Regional Commercial uses, and creates an amortization schedule for non- conforming uses and structures at the 63 acre property. This is to advise that the City Council of the City of Huntington Beach has approved the above described project and has made the following determi"ations regarding the above described project: 1. The project Swill, 0 will not,have a significant effect on the environment. 2. * ■ An Environmental Impact Report was prepared for this project pursuant to the provisions of CEQA (General Plan EIR certified by the Huntington Beach City Council on May 13, 1996 and the Redevelopment Plan EIR certified by the Huntington Beach City Council on October 7, 1996). 0 A Negative Declaration was prepared for this project pursuant to the provisions of CEQA. 3. "Mitigation Measures ■were, 0 were not,made a condition of approval of the project. 4. **A Statement of Overriding Considerations ■ was, O was not, adopted for this project. * See Attachment No. 1 "Completed at the time of certification of Environmental Impact Reports for General Plan and Redevelopment Plan This is to certify that the final ■ Environmental Impact Reports,0 Negative Declaration,with comments and responses and record of the project approval is available to the General Public at: City of Huntington Beach Department of Planning 2000 Me itr,;etB ington Beach,CA 92648 Julv 5.2000 L Eud Saw WL- Date of Final Action JUL 0 2000 Sig ture Associate Planner GARY L.G Cktk•Ro *M0j Title gr OEPUTY EXHIBIT 4 -41- aHBITFPS02\COMMDEVVameskCrossin OD.doc Attachmen- No. 1 -- Notice of Determination The Crossings at Huntington Beach — Specific Plan No. 13 According to Public Resources Code Section 21083.3(b), "If a development project is consistent with the general plan of a local agency and an environmental impact report was certified with respect to that general plan, the application of this division [CEQAJ to the approval of that development project shall be limited to effects on the environment which are peculiar to the parcel or to the project and which were not addressed as significant effects in the prior environmental impact report, or which substantial new information shows will be more significant than described in the prior environmental impact report." Based upon Public Resource Code Section 21083.3 (b) and the fact that the Specific Plan project falls within the development envelope analyzed in the General Plan EIR, the Crossings at Huntington Beach Specific Plan is currently exempt from preparation of any further environmental assessment until a site plan is submitted for approval by the City. EXHIBIT 4 -42- \\HBITFPS02\COMMDEV\James\Crossings\NOD.doc �C ALIFORNIA DEPARTMENT OF FISH AND GAME CERTIFICATE OF FEE EXEMPTION De Minimis Impact Finding Project Title! The Crossings at Huntington Beach - Specific Plan No. 13 Project Location: 7777 Edinger Avenue (approximately 63 acres bounded by Beach Boulevard, Edinger Avenue, Center Avenue, and the Southern Pacific Railroad) Project Description: The Huntington Beach Redevelopment Plan and the following implementing activities: Zoning Map Amendment No. 00-01: Amend zoning from CG (General Commercial) and CG-FP2 (General Commercial-Flood Plain)to Specific Plan No. 13.; Zoning Text Amendment No. 00-02: Adopt Specific Plan No. 13, which establishes zoning, development standards, site design, and architectural guidelines to govern future development, requires Regional Commercial uses, and creates an amortization schedule for non-conforming uses and structures at the 63 acre property. Findings of Exemption: The City of Huntington Beach has prepared the General Plan EIR and the Redevelopment Project Area Merger EIR to evaluate the potential for adverse environmental impacts and has determined the following: There is no evidence before the City of Huntington Beach Planning Department that the proposed project has any potential for individual or cumulative adverse effects on wildlife resources, as defined in Section 711.2 of the Fish and Game Code. Certification: I hereby certify that the public agency has made the above finding and that the project will not individually or cumulatively have an adverse effect on wildlife resources,as defined in Section 711.2 of the Fish and Game Code. P0 Sat ED Howard Zelefsky J U L U i Planning Director L getk-IIeCOttles �► DERM B�, ada F ! L E 0 Associate Planner Title JUL 0 7 2000 City of Huntington Beach LLIU—.0UM Verk-Recorder Lead Agency EXHIBIT 4 July 7.2000 -43- Date \\HBITFPS02\COM M DEVVames\Crossings\NOD.doe SHEPPARD, MULLIN, RICHTER & HAMPTON LLP o.w♦»"I"'i»CLU011:G.,c.CSSI—L- ATTORNEYS AT LAW FOURTH FLOOR 650 TOWN CENTER DRIVE COSTA MESA, CALIFORNIA 92626-1925 WRITERS DIRECT LINE TELEPHONE (714) 513-5100 OUR FILE NUMBER FACSIMILE (714) 513-5130 (714)424-2846 42X-76195 socoi,nor@smrh.com August 3, 2000 VIA FACSIMILE & FEDERAL EXPRESS Ms. Connie Brockway City Clerk City of Huntington Beach 2000 Main Street P.O. Box 190 Huntington Beach, California 92648 Ms. Connie Brockway Agency Clerk The Redevelopment Agency of the City of Huntington Beach 2000 Main Street P.O. Box 190 Huntington Beach, California 92648 Ms. Cristina Agra-Hughes Huntington Center Associates, LLC 23622 Calabasas Road, Suite 100 Calabasas, California 91302 Re: Mont omery Ward. LLC v. City of Huntington Beach, et al. Dear Ms. Brockway and Ms. Agra-Hughes: PIease take notice that Petitioner Montgomery Ward, LLC ("Montgomery Ward")will commence the above-referenced action on or about August 4, 2000, which will include a cause of action challenging all permits, approvals, contracts, resolutions, ordinances and other actions issued, adopted, executed or taken by respondent City of Huntington Beach(the "City") relating to the development and/or redevelopment of an approximate 63-acre site (the "Project Site") that includes an approximate 13.47-acre site and improvements located thereon(the "MW Property") owned by Montgomery Ward, including without limitation(a) the EXHIBIT 5 -44- L 0 5 ANGELES ■ ORANGE COUNTY • S A N 0 1 E G 0 • S A N F R A N C I S C 0 SHEPPARD, MULLIN, RICHTER & HAMPTON LAP Ms. Connie Brockway August 3, 2000 Page 2 approval by the Huntington Beach City Council (the "City Council") of Resolution. No. 2000-68 on July 5, 2000 ("Resolution 2000-68"), pursuant to which the City Council (i) adopted The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Text Amendment No. 00-02 and (ii) changed the zoning designations for the Project Site from "CG" (General Commercial) and "CG-FP2" (General Commercial - Flood Plain) to The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Map Amendment No. 00-01 (collectively, the "Specific Plan"), and (b) any such action taken by the City or the Redevelopment Agency of the City of Huntington Beach relating in any way to the condemnation or other acquisition of all or any portion of the MW Property. This action will be based on, among other things, the City's failure to conduct any environmental review whatsoever under California Environmental Quality Act("CEQA") with respect to the Specific Plan prior to the City Council's adoption of Resolution 2000-68. This notice is in accordance with Section 21167.5 of the California Public Resources Code. Very y ours, an onnor for SHEPPARD, MULLIN, RICHTER& HAMPTON up OCNSO LETN42XI41195T39.1 cc: Bill Lockyer, Esquire (by U.S. Mail) EXHIBIT 5 -45- x####sfi#fii€�tt###t##xYxxE#x�x! xxx MULTI Tl/R% REPORT #xa x#rrxat:tt#sssssss##ax#ss#s#sa T%/Ra NO 2935 INCOMPLETE T%/R% TRANSACTION OR ( 1) 93741557 ( 2) 918182233501 ERROR SHEPPARD9 MULLIN, MCMER&IjiANIPTON L.I.P A LCmn=U AZMMY kAAUCRSW V#MU OCC MWnCJUWUL COR!*Rkr W'A+ ATTORNEYS AX LA W 650 TOWN CFN'PER DRIVE,41H FLOOR COSTA MESA.CALIFORNIA 920&1925 TELEPHONE(714)513`5100 FACSTMILB(714)SIM130 T=(;OPIER COVER LETTER 42X-76195 Oranize Cou=Office TELECOPY NUMBER TARGETED TDJE ATTORNEY/SECRETARY E7CT (714) 513-5130 2846/2949 THIS TELECOPY TRANSMISSION WILL NOT BE MAMED •� DATE: August 3, 2000 TO- Ms. Connie Brockway FAX NO-: (714)374-1557 FIRM; City of Huntington Beach CONY NO: The Redevelopment Agency of the City of Huntington Beach TO: Ms. Cristina Agra Hughes FAX NO: (818)223-3501 FIltM: Huntington Center Associates,LLC CONF. NO: FROM: Sean P. O'Connor,Esquim RECEIPT CONFIRMATION VIA PHONE REQUESTED: YES X NO FAX RECEIPT CONFIRMED BY: TOTAL NUMBER OF PAGES(INCLUDING TMS PAGE): 3 IF ALL PAGES NOT RECEIVED,PLEASE CALL(714)513-5100 eat. 8277 NAME OF SENDER TIME STARTED MESSAGE: EXHIBIT 5 -46- 1 I VERIFICATION 2 3 I, Spencer H. Heine, declare as follows: 4 5 1 am Executive Vice President.of Montgomery Ward, LLC, the petitioner in 6 this action. I have read the foregoing Verified Petition for Peremptory Writ of Mandate and 7 know its contents. The facts alleged in the Verified Petition for Peremptory Writ of 8 Mandate are true of my own knowledge and belief, except as to those matters alleged on 9 information and belief, and as to those matters I believe them to be true. 10 11 I declare under penalty of perjury under the laws of the State of California that 12 the foregoing is true and correct. 13 14 Executed this 3`d day of August, 2000, at Chicago, Illinois. 15 16 17 By: erk(He&d 18 xecutive Vice President 19 Montgomery Ward, LLC 20 21 22 23 24 25 26 27 28 (627677.1-8/2/00 10:56 AM) SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A L-1—D L1181LiTv IAa1HERSHII INCLUDING—OFESSiONAL C0110RATIONS ATTORNEYS AT LAW FOURTH FLOOR 650 TOWN CENTER DRIVE COSTA MESA, CALIFORNIA 92626-1925 WRITERS DIRECT LINE TELEPHONE (714) 513-5100 OUR FILE NUMBER FACSIMILE (714) 513-5130 (714)424-2846 42X-76195 soconnor@smrh.com August 3, 2000 VIA FACSIMILE & FEDERAL EXPRESS Ms. Connie Brockway City Clerk City of Huntington Beach 2000 Main Street P.O. Box 190 r Huntington Beach, California 92648 Ms. Connie Brockway c, Agency Clerk 0J, The Redevelopment Agency of the City of Huntington Beach 2000 Main Street \ P.O. Box 190 Huntington Beach, California 92648 n Ms. Cristina Agra-Hughes Huntington Center Associates, LLC 23622 Calabasas Road, Suite 100 Calabasas, California 91302 Re: Montgomery Ward, LLC v. City of Huntington Beach, et al. Dear Ms. Brockway and Ms. Agra-Hughes: Please take notice that Petitioner Montgomery Ward, LLC ("Montgomery Ward") will commence the above-referenced action on or about August 4, 2000, which will include a cause of action challenging all permits, approvals, contracts, resolutions, ordinances and other actions issued, adopted, executed or taken by respondent City of Huntington Beach (the "City") relating to the development and/or redevelopment of an approximate 63-acre site (the "Project Site") that includes an approximate 13.47-acre site and improvements located thereon (the "MW Property") owned by Montgomery Ward, including without limitation (a) the L 0 S ANGELES 0 ORANGE COUNTY 0 S A N D I E G 0 ■ S A N F R A N C 1 5 C 0 SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Ms. Connie Brockway August 3, 2000 Page 2 approval by the Huntington Beach City Council (the "City Council") of Resolution No. 2000-68 on July 5, 2000 ("Resolution 2000-68"), pursuant to which the City Council (i) adopted The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Text Amendment No. 00-02 and (ii) changed the zoning designations for the Project Site from "CG" (General Commercial) and "CG-FP2" (General Commercial - Flood Plain) to The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Map Amendment No. 00-01 (collectively, the "Specific Plan"), and (b) any such action taken by the City or the Redevelopment Agency of the City of Huntington Beach relating in any way to the condemnation or other acquisition of all or any portion of the MW Property. This action will be based on, among other things, the City's failure to conduct any environmental review whatsoever under California Environmental Quality Act ("CEQA") with respect to the Specific Plan prior to the City Council's adoption of Resolution 2000-68. This notice is in accordance with Section 21167.5 of the California Public Resources Code. Very y ours, a O' onnor for SHEPPARD, MULLIN, RICHTER& HAMPTON LLP OONSOTET\ M41195739.1 cc: Bill Lockyer, Esquire (by U.S. Mail) SHEPPARD, MULLIN, RICHTER & HAMPTON LLP A LIMITED LIABILITY PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS ATTORNEYS AT LAW FOURTH FLOOR 650 TOWN CENTER DRIVE COSTA MESA, CALIFORNIA 92626-1925 WRITERS DIRECT LINE TELEPHONE (714) 513-5100 OUR FILE NUMBER FACSIMILE (714) 513-5130 (714)424-2846 42X-76195 soconnor@smrh.com August 3, 2000 VIA FACSIMILE & FEDERAL EXPRESS Ms. Connie Brockway City Clerk City of Huntington Beach 2000 Main Street P.O. Box 190 Huntington Beach, California 92648 x Ms. Connie Brockway Agency Clerk The Redevelopment Agency of the City of Huntington Beach 2000 Main Street C rl P.O. Box 190 '-y m- Huntington Beach, California 92648 o r Ms. Cristina Agra-Hughes Huntington Center Associates, LLC 23622 Calabasas Road, Suite 100 Calabasas, California 91302 Re: Montgomery Ward, LLC v. City of Huntington Beach, et al. Dear Ms. Brockway and Ms. Agra-Hughes: Please take notice that Petitioner Montgomery Ward, LLC ("Montgomery Ward") will commence the above-referenced action on or about August 4, 2000, which will include a cause of action challenging all permits, approvals, contracts, resolutions, ordinances and other actions issued, adopted, executed or taken by respondent City of Huntington Beach (the "City")relating to the development and/or redevelopment of an approximate 63-acre site (the "Project Site") that includes an approximate 13.47-acre site and improvements located thereon (the "MW Property") owned by Montgomery Ward, including without limitation (a) the L 0 S ANGELES 0 ORANGE COUNTY 0 S A N 0 1 E G 0 ■ S A N FRANCISCO SHEPPARD, MULLIN, RICHTER & HAMPTON LLP Ms. Connie Brockway August 3, 2000 Page 2 approval by the Huntington Beach City Council (the "City Council") of Resolution No. 2000-68 on July 5, 2000 ("Resolution 2000-68"), pursuant to which the City Council (i) adopted The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Text Amendment No. 00-02 and (ii) changed the zoning designations for the Project Site from "CG" (General Commercial) and "CG-FP2" (General Commercial - Flood Plain) to The Crossings at Huntington Beach Specific Plan No. 13 pursuant to Zoning Map Amendment No. 00-01 (collectively, the "Specific Plan"), and (b) any such action taken by the City or the Redevelopment Agency of the City of Huntington Beach relating in any way to the condemnation or other acquisition of all or any portion of the MW Property. This action will be based on, among other things, the City's failure to conduct any environmental review whatsoever under California Environmental Quality Act ("CEQA") with respect to the Specific Plan prior to the City Council's adoption of Resolution 2000-68. This notice is in accordance with Section 21167.5 of the California Public Resources Code. Ve9P. 'C urs, nnor for SHEPPARD, MULLIN, RICHTER& HAMPTON LLP 0CM0\LET142X 41195739.1 cc: Bill Lockyer, Esquire (by U.S. Mail) RUG 03 100 16:42 FR SPENCER HEINE 312 467 3064 TO 917143741557 P.01 I i i Spencer N.Nelne Presldent•Montgomery Ward Properities Executive Vice President,Secretary&General Counsel Wards National Offlee $35 W Chlca90 Avenue,26th Fir. Chico,11113 0is 60671 91.August 3, 2000 Fax- 3iz6i-064 David C. Biggs ` , Director of Economic Development City of Huntington Beach p =M "" 2000 Main St. '"' { P.O. Box 190 7 { ` ' Huntington Beach, CA 92468 Dear Mr. Biggs We have attempted to reach you by phone several times in the last week in an effort to avoid costly litigation for all parties. On July 14th we wrote to Ray Silver, City Administrator, with copies to all parties, including yourself, requesting that a Tolling Agreement be signed between all relevant parties, including the City of Huntington Beach. This agreement would have allowed a short period of time for Montgomery Ward and the developer to agree on a plan for Huntington Center. Apparently a determination has been made b the City to not enter into such a Tolling p Y Y Y 9 Agreement. Because certain statutes will preclude Wards from protecting itself in the future if no amicable agreement is ultimately reached, you have left us no recourse but to pursue litigation. Although this litigation will be limited in scope, it is absolutely necessary under the circumstances. What I find most disconcerting is that elected and appointed officials, by their refusal to sign the Tolling Agreement, have taken an action which will unnecessarily cost the taxpayers money, when in fact a 60 day Tolling Agreement would very likely have mitigated the expense. If there is a change of heart on the part of the participants please call me. Sincerely, enter . ei p n cc: Ray Silver, City Administrator Howard Zelefsky, Community Development Gail Hutton, City Attorney's Office City Council of Huntington Beach c/o Connie Brockway, City Clerk Murray Q. Kane, Esq. Kane, Bellmer & Berkman I E-mail. sheine®wards,wrn ** TOTAL PAGE.01 ** • v '� a Request f®i° I1 edeve opment Agency Acdon Hunfingt®n Ciromngs and Necessity f®i° AcquROi°Rng Piropeirifies :ilf � k.,"9�`Yfi��7e��:�6'H .,�.y�SM - � au;�,'+c �...__ _.�✓�w �'Y_^X�+4'�Y�`v`%1PiW N. ..,+S�O, l .�� • �f.�.s 4" k�,k-,._- Y d _ -'66 -r!.:` "E�'"r, `.�*�9�� 'yr• fit. H®vembei° 20, 2000 fftem D-4 UL d o; o Council/Agency Meeting Held: Deferred/Continued to: ❑Approved ❑ Conditionally Approved ❑ Denied City Clerk's Signature Council Meeting Date: November 20, 2000 Department ID Number: ED 00-44 CITY OF HUNTINGTON BEACH REQUEST FOR REDEVELOPMENT AGENCY ACTION SUBMITTED TO: HONORABLE CHAIRMAN AND REDEVELOPMENT AGENCY MEMBERS SUBMITTED BY: RAY SILVER, Executive Director PREPARED BY: DAVID C. BIGGS, Director of Economic Development SUBJECT: Adopt Resolution No. '515 A Resolution of the Redevelopment Agency of the City of Huntington Beach Finding and Determining the Public Interest and Necessity for Acquiring and Authorizing Condemnation of Certain Real Property Located in the Huntington Beach Redevelopment Project (7777 Edinger Avenue, Assessor's Parcel No.s 142-071-91 and 142-071-93) Statement of issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: On October 2, 2000, the Redevelopment Agency approved an Owner Participation Agreement (OPA)with Huntington Center Associates, LLC, for the redevelopment of Huntington Center. In addition, the Redevelopment Agency authorized the Executive Director or his designee, the Director of Economic Development, to initiate and conduct negotiations with Huntington Center Associates, LLC, a Delaware limited liability company, Burlington Coat Factory Warehouse of Huntington Beach, Inc., a California corporation, and Montgomery Ward Development, LLC, a Delaware limited liability company,for the acquisition of certain interests in real property located within the Huntington Beach Redevelopment Project Area. Those negotiations have not resulted in purchase and sale agreements to acquire those interests in real property. The issue before the Redevelopment Agency at this time is whether to authorize, by the adoption of a resolution of necessity, the filing of one or more actions in eminent domain to acquire those interests in real property. Funding Source: Huntington Center Associates, LLC, has already advanced $10 million towards the acquisition of the interests in real property at Huntington Center. Under the OPA, Huntington Center Associates, LLC, are required to advance any and all funds necessary by the Redevelopment Agency to acquire the real property interests not already owned by them to cause the redevelopment of the Center. Any funds advanced will be repaid by revenues generated from the redeveloped shopping center. HBCentCondRCA — 11/06/00 4:50 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 Recommended Action: Motion to: Adopt Resolution No. 315 A resolution of the Redevelopment Agency of the City of Huntington Beach finding and determining the public interest and necessity for acquiring and authorizing condemnation of certain real property located in the Huntington Beach Redevelopment Project (7777 Edinger Avenue, Assessor's Parcel Nos. 142-071-91 and 142-071-93). Passage of a resolution authorizing the filing of an eminent domain action requires the approval of two-thirds (five affirmative votes) of the members of the Redevelopment Agency's governing body. Alternative Action(s): 1. Do not approve Resolution No. 315 authorizing the filing of eminent domain actions. 2. Direct the Executive Director or his designee, the Director of Economic Development, to continue to negotiate with Huntington Center Associates, LLC, a Delaware limited liability company, Burlington Coat Factory Warehouse of Huntington Beach, Inc., a California corporation, and Montgomery Ward Development, LLC, a Delaware limited liability company, for the acquisition of the interests in real property at issue. Analysis: Pursuant to the Redevelopment Agency's prior direction and authorization, on October 3, 2000, the Economic Development Director extended written offers to purchase the real property interests in question. Those offers were in the form required by Government Code § 7267.2. The Economic Development Director has engaged in discussions and negotiations with the owners of those real property interests. The timetable of those discussions and negotiations has been as follows: October 3, 2000 Written offers to acquire the Montgomery Ward property and the Burlington Coat property were faxed and mailed via certified mail to Montgomery Ward, Burlington Coat and Ezralow. October 9, 2000 Loren Hohman of Montgomery Ward responded to Agency's offer letter. David Biggs called Mr. Hohman to discuss the offer letter and response. October 12, 2000 Bob Grapski of Burlington Coat was contacted regarding offer letter. Aviv Tuchman, attorney for Burlington Coat was contacted. A meeting was scheduled for October 24, 2000 at 3:00 p.m. at Mr. Tuchman's office. October 13, 2000 David Biggs spoke with Loren Hohman to schedule a conference call with David Biggs and Murray Kane, Agency's Special Counsel. October 16, 2000 David Biggs and Murray Kane had a conference call with Loren Hohman to discuss relocation, appraisal and the offer letter. October 24, 2000 Gus Duran, the Housing and Redevelopment Manager, Murray Kane and June Ailin of Kane, Berkman and Ballmer met with Aviv Tuchman to answer any questions about the offer letter, relocation and alternative locations for Burlington Coat. HBCentCondRCA -2- 11/08/00 3:46 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 October 31, 2000 Second offer letter on items pertaining to the realty was mailed to Aviv Tuchman, representing Burlington Coat Factory. Also a telephonic call and a written letter were sent to Aviv Tuchman in an attempt to meet with him to discuss the offer letter. Mr. Tuchman responded with a letter indicating that he did not have time to meet until next week. November 3, 2000 David Biggs went to Chicago to meet with Warren Hohman to discuss the offer letter and related issues. In addition, Agency staff hired the firm of Orduno and Ibarra, a relocation consultant, to inform Montgomery Ward and Burlington Coat Factory of their relocation rights and benefits under State Redevelopment Law and Guidelines promulgated by the California Department of Housing and Community Development, which are adhered to by the Redevelopment Agency. Ms. Irene Ibarra, the principal of the firm has spoken with Mr. Loren Hohman and faxed him information on relocation issues, compensation and possible relocation sites. She has also met with Mr. Aviv Tuchman, legal counsel to Burlington Coat Factory and was able to obtain Burlington's requirements for a possible new location as well as to brief Mr. Tuchman on eligible relocation expenses. Ms. Ibarra has also indicated that during the first week of November she will be sending, both, Montgomery" Ward and Burlington Coat a list of possible alternative relocation sites. While negotiations can and will continue after the initiation of an eminent domain action, it is appropriate to take the recommended action in order to ensure the redevelopment of the mall proceeds in a timely manner. In order to authorize the filing of an eminent domain action, the Redevelopment Agency must make the following findings: (a) That the public interest and necessity require the proposed project; (b) That the project is planned or located in the manner that will be most compatible with the greatest public good and the least private injury; (c) That the real property to be acquired is necessary for the proposed project; and (d) That the offer required by Section 7267.2 of the Government Code has been made to the owner or owners of record of the property to be acquired. The following is offered as support for the findings referenced above. Huntington Center in Redevelopment Since 1984 - The Huntington Center Commercial District Redevelopment Plan was established on November 4, 1984, as a means to improve deteriorating and substandard commercial properties. When the plan for the Huntington Center Area was adopted the area included 160 acres of offices and retail uses. The Huntington Beach Mall was, and still is, the principal property anchoring the Project Area. It is comprised of 58 acres and covers over 1/3 of the total acreage of the Project Area. In 1996, the Huntington Center Redevelopment Project Area was merged with four others in the city. HBCentCondRCA -3. 11/08/00 3:46 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 HB Center Mall One of the Poorest Performers - In 1982 the Mall was found to be one of the poorest performing regional malls in the Los Angeles basin. At that time, the Mall generated taxable sales as much as 64% below shopping centers of comparable size. Since then, the mall has further deteriorated and taxable sales have continued to decline. In 1990, taxable sales at the mail were approximately $1.5 million. In 1998, taxable sales were approximately $850,000. Since 1998 additional retailers have left the mall. One of the Mall's existing major anchors has seen its sales decline by more than 30% since 1995. The decline of Huntington Center has been well documented in press reviews, by the City and the Agency's economic analysis, including the 1996 Plan Amendment (Attachment No. 2 is an excerpt from the Report on the Plan) and the Edinger Corridor Economic Study (Attachment No. 3). The Agency's Five-Year Implementation Plan has also documented the need to redevelop the mall as one of its principal goals (Attachment No. 4). HB Center Mall Assessment Values Continue to Decline - The Huntington Center Sub-Area has also seen a dramatic decline in assessed values over the years. In 1996 when the Project Area was merged into the Huntington Beach Redevelopment Project, the area had already seen a 23% drop in assessed values. Further, the Center has become increasingly obsolete and deteriorated. Since 1996, the previous owners of the Center have made numerous assessments appeals and have successfully obtained lower assessments. Two additional assessment appeals are still pending, causing the continued decline of property taxes received from the Center. To illustrate this decline, the City has observed that in 1993/94 assessed values were $94 million. Iri fiscal year 1999/2000 the Center's assessed values dropped to $45 million. Shoppers Continue to Abandon the Center — A 1995 attitude survey conducted by the Orange County Register on mall shopping frequency demonstrated that Huntington Center ranked at the bottom of shopper frequency. The survey also indicated that Huntington Center experienced a 7.1% net loss of patrons between 1994 and 1995. Community Clamors for the Redevelopment of the Center — Over the past ten to fifteen years City Council members and City staff have received numerous calls and personal comments about the sad state of affairs at the Center. All have led to the same conclusion, namely, that the City should do something about the mall. Towards that effort, the Economic Development Department, as the implementing body of the Redevelopment Agency of the City, attempted to work with both previous owners of the Mall to initiate its redevelopment. Both attempts proved unsuccessful. In 1999, the ownership of a majority of the Center changed. The Redevelopment Agency now has the opportunity to be the catalyst in the long-sought upgrade of the City's most significant economic retail center. Owner Participation Process in the Redevelopment of the Center — In 1999 the Ezralow Company purchased the Center. This event triggered the Owner Participation process initiated by the Redevelopment Agency. As part of that process the Agency Board indicated and again reaffirmed its desire to redevelop and reposition the Center into a high-quality, well-integrated retail/entertainment center under unified ownership. The Agency determined that, in order to revitalize the economic vitality of the Center and to best achieve the redevelopment goals of the Agency and Redevelopment Plan adopted in 1984 and subsequently amended in 1996, the Agency needed to encourage comprehensive changes to both the structural and tenant composition of the Huntington Center. The Agency believes that unified redevelopment of the Huntington Center will allow for the oversight and site control necessary to effectively redevelop and maintain the center as a superior quality development, and will advance the Redevelopment Plan's stated goal of implementing design and use standards to assure high aesthetic and environmental quality and HBCentCondRCA -4- 11/08/00 3:46 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 providing unity and integrity to developments within the Project Area (Huntington Center Redevelopment Plan, Section 500). Broad Criteria and Objectives for the Center OPA — In 1998 when the Redevelopment Agency- was considering the redevelopment of the Center and negotiating with the Macerich Company, the Agency established a set of broad criteria and objectives by which proposals were to be measured and shaped. These criteria are outlined in Attachment No. 5. It is by these criteria and objectives that all proposals submitted by Ezralow, Montgomery Ward and Burlington Coat were evaluated. Implementation of the OPA with Huntington Center Associates, LLC., achieves the goals that guided the negotiations. Redevelopment Agency Issues Request For Proposals — On March 3, 2000, the Redevelopment Agency issued a Statement of Interest and Request For Proposal (RFP) letter to all the major property owners and long-term tenants in the Huntington Center redevelopment site. The letters requested proposals for the redevelopment of the entire Huntington Center. Three proposals were received (Burlington Coat Factory, the Ezralow Company and Montgomery Ward). The only proposal that completely responded to the RFP was that submitted by the Ezralow Company. Redevelopment Agency Staff Negotiates an Owner Participation Agreement with Huntington Center Associates, LLC — At the June 19, 2000, Redevelopment Agency Board meeting, the Board by a vote of 6 to 0 directed staff to enter into negotiations with Huntington Center Associates, LLC, a unit of the Ezralow Company and Owner of Huntington Center, for an Owner Participation Agreement (OPA). The reasons for such action were: (1) Ezralow's submission was the only proposal that addressed and proposes to fulfill the. Agency's stated goal of comprehensive redevelopment of the Center; (2) Ezralow submitted complete financial information and project pro- formas; and (3) Ezralow's proposal offered detailed plans prepared by experts for the extensive redevelopment of the Huntington Center in its entirety. The submissions by Montgomery Ward and Burlington Coat Factory, however, did not address the Agency's stated goal of comprehensive development. Montgomery Ward only addressed the renovation of its two individual buildings, and Burlington Coat Factory only addressed its desire to continue leasing property within the Huntington Center. Their proposals did not include the financial information requested by the RFP, including financial capability, development experience and project estimates of costs. Their proposals also did not explain the development experience of the two companies or how they were going to partner with a developer to accomplish the redevelopment of the Center. In essence, their proposals were inadequate. The Request for Agency Action and related exhibits are included as Attachment No. 6. Since the June 19, 2000, directive from the Board, staff has engaged in detailed discussions with Huntington Center Associates, LLC, on several alternative scenarios for the possible redevelopment of the Center. The Owner Participation Agreement entered into on October 2, 2000, is the result of these negotiations. Furthermore, on October 2, 2000, the Redevelopment Agency of the City of Huntington Beach and the City Council adopted Resolution No. 314 and Resolution No. 2000-95 approving the Owner Participation Agreement between the Redevelopment Agency of the City of Huntington Beach and Huntington Center Associates, LLC. for the redevelopment of the Center (Attachment No. 7). The Agency also authorized the Executive Director or his designee, the Director of Economic Development, to initiate and conduct negotiations with a) Huntington Center Associates, LLC, a Delaware limited liability company and Burlington Coat Factory Warehouse of Huntington Beach, HBCentCondRCA -5- 11/08/00 3:46 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 Inc., a California corporation, for the acquisition of the real property currently occupied by a Burlington Coat store and located within the Huntington Beach Redevelopment Project Area, and b) Montgomery Ward Development, LLC a Delaware limited- liability company, for the acquisition of Montgomery Ward's real property located within the Huntington Beach Redevelopment Project Area. ° Agency Economic and Market Consultants Recommend Unified Development - In addition, Agency expert economic and financial consultants confirm that unified development and maintenance of the Huntington Center in the highest standards will enable the Center to attract the combination and caliber of tenants, as well as the necessary financing to reposition it into a first- rate retail and entertainment center. Because of the Huntington Center's location as a major gateway to the City and because of its being criss-crossed by three significant regional thoroughfares (Interstate 405, Beach Boulevard and Edinger Avenue), it is vital to the interests of the City that the Huntington Center be redeveloped in a manner that will significantly enhance the image of the community and set the standard desired for future high-quality development in the City. The Agency believes that the unified, comprehensive development and maintenance of the Center as envisioned by the Agency will accomplish these purposes as well as those set forth in the Huntington Beach Redevelopment Plan. An Evaluation of Huntington Center Redevelopment Alternatives by the Sedway Group (Attachment No. 8) reviewed various alternative development scenarios for the Center. The report indicates that in order to achieve the redevelopment of the Center and eliminate blight, there must be a major transformation of the Center. The Redevelopment Agency can only accomplish this through the acquisition of certain key parcels. As such, the Agency Board authorized the Executive Director, or the Economic Development Director, to negotiate the acquisition of the Ward's property and the Ezralow property on which Burlington Coat Factory store is located. To date those negotiations have not produced agreements for the purchase and sale of those key parcels. On November 3, 2000, staff faxed and mailed to Ward's, Ezralow and Burlington Coat notice that, on November 20, 2000, the Agency Board would consider adopting a resolution of necessity authorizing the filing of an eminent domain action to acquire the property interests for the redevelopment of Huntington Center. Environmental Status: The environmental impacts of the Owner Participation Agreement have been evaluated as an implementation of the Huntington Beach Redevelopment Project in Environmental Assessment No. 00-10 (Attachment No. 9). The Owner Participation Agreement is in accordance with and subject to the Redevelopment Plan Environmental Impact Report (Attachment No. 9) for the Huntington Beach Redevelopment Project (the "Merged Redevelopment Project"), which was adopted on December 16, 1996 by Ordinance No. 3343, in accordance with Public Resources Code ("PRC") Section 21090. The Environmental Impact Report for the Huntington Beach Redevelopment Project was certified by Resolution 96-279 and certified by the City Council on October 7, 1996 by Resolution No. 96-93. The Environmental Impact Report (Attachment No. 10) contemplated the redevelopment of the Huntington Center Mall with square footage of larger amounts than the square footage proposed by the current project identified by Specific Plan No. 2000-13 adopted by the City Council on July 5, 2000 and further amended on August 7, 2000. Within EIR No. 96-2 a Summary of/and Statement of Overriding Considerations For Environmental Impact Report No. 96-2 was also adopted and enacted by the City Council on November 18, 1996 by Resolution No. 96-100 (Attachment No. 11). HBCentCondRCA -6- 11/08/00 3:46 PM REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: November 20, 2000 DEPARTMENT ID NUMBER: ED 00-44 On October 2, 2000, the Redevelopment Agency of the City of Huntington Beach and the City Council via Resolutions No. 313 and Resolution No. 2000-94 made certain environmental findings related to the Owner Participation Agreement between the Redevelopment Agency of the City of Huntington Beach and Huntington Center Associates, LLC. Furthermore a Notice of Determination was filed on October 3, 2000, with the County of Orange Recorder (Attachment No. 9). Attachment(s): City Clerk's Page Number No. Description 1. Resolution of Necessity for the Acquiring and authorizing Condemnation IES- tvo. 3 15 2. 1996 Plan Amendment Excerpts from Report on the Plan 3. Edinger Corridor Economic Study 4. Agency's Five Year Implementation Plan 5. Broad Criteria and Objectives 6. Request For Agency Action 6/19/2000 7. Agency Resolution No. 314 and City Council Resolution No. 2000-95 8. Evaluation of Huntington Center Alternatives by Sedway Group 9. Huntington Beach Redevelopment Project Environmental Assessment No. 00-10 and Redevelopment Agency Resolution No. 313 and City Council Resolution No. 2000-94, Notice of Determination filed on October 3, 2000. 10. Redevelopment Plan Environmental Impact Report for the Huntington Beach Redevelopment Project (EIR No. 96-2)-July 19, 1996. Resolution No. 96-279 and Resolution No. 96-93 11. Included as part of response to public comments, Statement of Overriding Considerations for Environmental Impact Report No. 96-2 and Resolution 96-100, November 18, 1996. RCA Author: Gus Duran x 1529 HBCentCondRCA -7- 11/08/00 3:46 PM i Resolution of Necessity for the Acquiring and Authorizing Condemnation ATTACHMENT # 1 RESOLUTION NO. A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH FINDING AND'DETERMINING THE PUBLIC INTEREST AND NECESSITY FOR ACQUIRING AND AUTHORIZING CONDEMNATION OF CERTAIN REAL PROPERTY LOCATED IN THE HUNTINGTON BEACH REDEVELOPMENT PROJECT (7777 EDINGER AVENUE, ASSESSOR'S PARCEL NOS. 142-071-91 and 142-071-93) The Redevelopment Agency of the City of Huntington Beach (the Redevelopment Agency), by vote of not less than two-thirds of its members, does hereby resolve and determine as follows: . 1. The hereinafter described real property is located within the Huntington Beach Redevelopment Project (the Project Area). The Redevelopment Plan for the Huntington Beach Redevelopment Project, which is the redevelopment plan for the Project Area and which was adopted on December 16, 1996, by Ordinance No. 3343, is incorporated herein by this reference and made a part hereof as though fully set forth herein. 2. The hereinafter described real property is to be acquired for the public uses of redevelopment and the elimination of blight in the Project Area. The Redevelopment Agency is authorized to acquire the hereinafter described real property pursuant to the Community Redevelopment Law of the State of California (Part I of Division 24, Health & Safety Code, including without limitation, Health & Safety Code Section 33391(b)) and the Eminent Domain Law of the State of California (Code of Civil Procedure, Title 7, Chapters 1-12, including, without limitation, Section 1240.010-1240.700). 3. On the basis of the information contained in that certain staff report to the Chairman and Members of the Redevelopment Agency dated November 20, 2000, which is incorporated herein by this reference, and all other written and oral information, evidence and testimony presented to the Redevelopment Agency, the Redevelopment Agency declares, finds and determines: (a) That the public interest and necessity require the proposed project; (b) That the project is planned or located in the manner that will be most compatible with the greatest public good and the least private injury; (c) That the hereinafter described real property is necessary for the proposed project; and (d) That the offer required by Section 7267.2 of the Government Code has been made to the owner or owners of record. 1 dw/2000resol/7777Edinger/l 1/6/00 4. The Redevelopment Agency is hereby authorized and empowered to acquire by condemnation the fee title to the hereinafter described real property, unless a lesser estate is expressly described. The real property to be acquired is described in Exhibit 1 attached hereto and incorporated herein by this reference. 5. The Redevelopment Agency's General Counsel and the law firm of Kane, Ballmer & Berkman is hereby authorized to prepare and prosecute in the name of the Redevelopment Agency, such proceeding or proceedings in the proper court having jurisdiction thereof, as are necessary for such acquisition, and to prepare and file all pleadings, documents, briefs, and other instruments, and to make such arguments and to take such actions as may be necessary in their opinion to acquire the real property. The Redevelopment Agency's General Counsel and the law firm of Kane, Ballmer & Berkman are specifically authorized to take whatever steps and/or procedures are available to it under the Eminent Domain Law of the State of California(Code of Civil Procedure, Title 7, Chapters 1-12, Sections 1230.010-1273.050). PASSED AND ADOPTED by the Redevelopment Agency of the City of Huntington Beach at a regular meeting thereof held on the day of , 2000. ATTEST: Chairman Agency Clerk APPROVED AS TO FORM: REVIEWED AND APPROVED: 4, Agency General Counsel Executive Director 2 r w/2000resol/7777Edinger/11/6/00 EXHIBIT 1 LEGAL DESCRIPTION OF PROPERTY ASSESSOR'S PARCEL NO. 142-071-91 PARCEL A: Parcel 1, in the City of Huntington Beach, County of Orange, State of California, on Parcel Map No. 86-200 as per map recorded in Book 255 Pages 40 through 45 inclusive of Parcel Maps in the office of the County Recorder of said County. EXCEPTING THEREFROM the buildings,structures and improvements'(including sub-surface structures and foundations but not including storm sewer and area drains) as excepted in a conveyance from Montgomery Ward Development Corporation, a Delaware corporation, dated November 14, 1972 recorded November 30, 1972 in Book 10448 Page 685 of Official Records. ALSO EXCEPT that portion thereof lying below a depth of 500.00 feet measured from the surface of said land, as reserved in the deed from Huntington Center, a partnership composed of Huntington Beach Company, a California corporation and Coral Realty Corp., a Nevada corporation, qualified to do business in the State of California, recorded August 14, 1965 in Book 7617 Page 534, of Official Records. PARCEL B: All buildings, structures and improvements (including sub-surface structures and foundations but not including storm sewer and area drains) situated on the following: Parcel 1, in the City of Huntington Beach, County of Orange, State of California, of Parcel Map No. 86-200 as per map recorded in Book 255 Pages 40 through 45 inclusive of Parcel Maps in the office of the County Recorder of said County. PARCEL C: Easements for ingress, egress, automobile parking,pedestrian uses, installation, operation and maintenance of separate and common utility lines, structures support, signs and other shopping center uses, all as more particularly defined and described in that certain Construction, Operation and Reciprocal Easement Agreement recorded August 4, 1965 in Book 7617 Page 539 together with amendments recorded in Book 11087 Page 1770, in Book 11091,Page 983 and as Instrument No. 87-406989 all of Official Records. 1 g/2000resol/condemn7777Edinger/11/6/00 ASSESSOR'S PARCEL NO. 142-071-93 PARCEL A: Parcel 6 of Parcel Map No. 86-200, in the City of Huntington Beach, County of Orange, State of California, as shown on a map recorded in Book 255 Pages 40 through 45 inclusive of Parcel Maps in the office of the County Recorder of said County. EXCEPT that portion of Parcel A lying below a depth of 500 feet,measured from the surface of said land. ALSO EXCEPT from a portion of Parcel A(being Parcels 4, 5, 6, 7, 8 and a portion of Parcel 2) an undivided 55%interest in all the land lying more than 500 feet below the surface, but none of the land lying above a depth of 500 feet below the surface of the lands with no right of surface access or use of the lands lying more than 500 feet below the surface,hereinafter refereed to as said land for the purposes of exploring and prospecting for(by geological, geophysical and all other means whether nor known or not), drilling for,producing, savings, taking and owning oil, gas, asphaltum and other minerals, whether similar or dissimilar to those herein specified and including fissionable materials collectively hereinafter referred to as said substances in, under or that may be produced from said land, together with all rights, privileges and easements useful or convenient for operations in said land, in adjacent or contiguous lands, and in other lands in the same vicinity, including,but not limited to: (1) Subsurface rights of way for drilling, repairing, redrilling, deepening,maintaining, operation, abandoning,reworking and removing wells to, in, into and through said land. (2) The right to conduct operations by methods now known or unknown which are reasonably designed to benefit or facilitate the drilling for, or production of said substances from said land. (3) The unrestricted and exclusive right,power and authority to produce said substances beneath or recoverable from said land, and to exercise all other rights and privileges herein set forth by means of any well or mines which are slant drilled from surface drill sites located on such other lands and the producing intervals of which are bottomed in said lands; and (4) The right to drill a well or wells or use any existing wells, to, in, into or through said portion of said land, for the purpose of injecting into said portion of said land, or into other lands, oil, gas, air, water or other liquid or gaseous substances, including the right, from time to time to ignite or otherwise activate any or all of such substances so injected or any or all of said minerals and materials described herein within said portion of said land or other lands,reserved in deed recorded April 4, 1986 as Instrument No. 86-136183 of Official Records and re-recorded August 13, 1986 as Instrument No. 86-360236 of Official Records. 2 g/2000resol/condemn7777Edinger/11/6/00 PARCEL B: Easements for ingress and egress, automobile parking, pedestrian uses, installation, operation and maintenance of separate and common utility lines, structure support, signs and other shopping center uses, all as more particularly defined and described in that certain Construction, Operation and Reciprocal Easement Agreement recorded August 4, 1965 in Book 7617 Page 539 together with amendments recorded in Book 11087, Page 1770; Book 11091, Page 983 and as Instrument No. 87-406989 all of Official Records. 3 g/2000resol/condemn7777Edinger/11/6/00 1996 Plan Amendment Excerpts from Report on the Plan ATTACHMENT #2 Huntington Beach Redevelopment Plan Preliminary Report Excerpts on the Physical and Economic Blighting Conditions of Huntington Center SECTION B A Description of the Physical and Economic Blighting Conditions Existing in the Project Area This section of the Preliminary Report describes the blighting conditions that continue to exist within the Project Area. At the time the Existing Plans were adopted, the City Council concluded that each of the Constituent Areas were blighted; the blight analyses of these Constituent Areas are contained in the Reports to the City Council for each of the areas listed below, and are incorporated into this Preliminary Report by reference: • Yorktown-Lake Redevelopment Project: "Report to the City Council on the Yorktown-Lake Redevelopment Plan"documenting blight for the Yorktown-Lake Redevelopment Project adopted on September 20, 1982; • Talbert-Beach Redevelopment Project: "Report to the City Council on the Talbert-Beach Redevelopment Plan" documenting blight for the Talbert-Beach Redevelopment Project adopted on September 20, 1982; • Main-Pier Redevelopment Project: "Report to the City Council on the Main-Pier Redevelopment Plan" documenting blight for the Main-Pier Redevelopment Project Original Area on September 20, 1982 and the "Report to the City Council on the Main-Pier Redevelopment Project-Plan Amendment No. 1" documenting blight for the Main-Pier Redevelopment Project Added Area adopted on September 6, 1983; • Oakview Redevelopment Project: "Report to the City Council on the Oakview Redevelopment Plan" documenting blight for the Oakview Redevelopment Project adopted on November 1, 1982 and the "Report to the City Council for Amendment No. One to the Oakview Redevelopment Project" documenting blighting conditions for the July 5, 1989 Amendment;and • Huntington Center Commercial District Redevelopment Project: "Report to the Council-Huntington Center Commercial District Redevelopment Plan" documenting blight for the Huntington Center Commercial District Redevelopment Project adopted on November 26, 1984. Rosenow Spevacek Group,Ina Redevelopment Agency of the City of Huntington Beach August,1996 B-1 Preliminary Report Properties No Longer Blighted Section 33354.6(b) of the Law requires that a redevelopment agency identify in a preliminary report any portions of a project area that are no longer blighted. Due to the completion of redevelopment projects within the Talbert-Beach and Yorktown-Lake Areas, the Agency has removed physical and economic blighting conditions affecting approximately 55 acres, or 8%, of the 619-acre Project Area. Although the Law does permit the Agency to remove nonblighted properties from the Project Area, such a disposition would severely impair the Agency's ability to pay its obligations. These obligations include debt service on four separate loan agreements with the Huntington Beach Public Financing Authority with respect to the $33,495,000 1992 Revenue Bonds ("1992 Bonds"). The 1992 Bond indenture prohibits removing territory without bond holder approval. Preliminary analysis indicates that if these are removed, tax increment revenues would drop and impair the Agency's ability to meet bond revenue pledge commitments from these areas. Further, the Plan includes road improvements, traffic signals, police facility renovations, and other improvements that will benefit the entire Project Area, including the Yorktown-Lake and Talbert-Beach Areas. Therefore, the Agency is unable to remove any territory from the Project Area at this time. Existing Blighting Conditions in the Project Area Despite the Agency's best efforts,many blighting conditions that were evident when the Existing Plans were adopted are still present today. These conditions include the following: • Defective Design and Character of Physical Construction, • Faulty Exterior Spacing, • High Density of Population and Overcrowding, • Inadequate Provision for Sanitation Facilities, Rosenow Spevacek Group,Ina Redevelopment Agency of the City of Huntington Beach August,1996 B-2 Preliminary Report • Age, Obsolescence, and Deterioration, • Subdivided Lots of Irregular Form, Shape,and Size, • Inadequate Public Improvements and Facilities, and • Social and Economic Maladjustment Historically, redevelopment of the Project Area has been directly facilitated by the Agency. In order to mitigate the remaining blight within the Project Area, the Agency desires to intensify its efforts through an expanded redevelopment program. The Plan enables the Agency to enact new projects and programs to remove remaining physical and economic conditions. Huntington Center Area The Huntington Center Redevelopment Project Area was established in November 1984 as a means to improve deteriorating and substandard commercial properties. The Huntington Center Area includes office and retail uses, including the 960,000 square foot Huntington Beach Mall ("Mall"). The Mall comprises 58 acres, or 36.3% of the total acreage of the Huntington Center Area. A 23% drop of assessed values in this area between 1990 and 1996 has undercut the Agency's ability to fund needed improvements. This funding shortfall, coupled with an inability to incur debt after November 1996, inhibit the Agency's ability to remove blighting conditions, including: • the increasingly obsolete and deteriorating Mall, • traffic congestion on Edinger Avenue,Center Avenue,and Beach Boulevard,and • awkward lot configurations on Edinger Avenue. In 1982,the Mall (then named Huntington Center)was found to be one of the poorest performing regional malls in the Los Angeles basin. At that time, the Mall generated taxable sales as much as 64% below shopping centers of comparable size. Since that time, many regional shopping centers of the same vintage in Orange County have either undergone a major renovation or been demolished and replaced with a different retail development; many of these centers compete for Rosenow Spevacek Group,Inc. Redevelopment Agency of the City of Huntington Beach August,1996 B-3 Preliminary Report the same shoppers as the Huntington Beach Mall. In 1987, the Mall expanded by 13%, or 107,332 gross leasable square feet, adding a. Mervyn's department store, a food court, and additional in-line shop space. Despite this expansion, sales at the Mall have continued to fall. In 1983,the Mall generated $85,067,000 in taxable sales, or approximately $98 per square foot. By- 1995, sales volume declined to$82 per square foot. According to an analysis of taxable sales trends of shopping centers in the market area compiled by Hinderliter de Llamas and Associates ("HdL"), the Mall has steadily declined in the face of other centers' solid performance. Exhibit B-1 presents a summary of the Mall's taxable sales volumes versus that of nearby centers. Between 1992 and 1995, taxable sales decreased from $116,272,400 to $78,743,800, or nearly 32.3%. The Mall's declining sales also impact nearby retail uses along the Edinger Avenue Corridor according to the Edinger Corridor Economic Market Study ("Edinger Corridor Study")prepared by Cunningham and Associates in October 1995. The Mall, located on the north side of Edinger Avenue, attracts shoppers to retail uses on the south side of Edinger Avenue. The Edinger Corridor Study found that as sales declined by 34% at the Mall between 1992 and 1994, sales in the Edinger Corridor declined by 21%. (Approximately one-half of the retail uses along the Edinger Avenue Corridor are located within the Project Area.) These sales statistics are indicative of the declining viability of the Mall as a location where consumers shop. In 1995, the Orange County Register conducted a survey of consumer attitudes towards fifteen regional retail centers frequented by County residents. Tables B-1, B-2, and B-3 enumerate consumers' attitudes towards the Mall. The Re gist survey found that the Mall lost . more shoppers than any other center in the survey. The reasons why consumers shopped less frequently at the Mall included the following: • variety of stores limited, • favorite store closed, and • getting run down. Rosenow Spevacek Group,Inc. Redevelopment Agency of the City of Huntington Beach August,1996 B4 Preliminary Report Huntington Beach Redevelopment Project Preliminary Report EXERPTS FROM 1995 ORANGE COUNTY CONSUMER ATTITUDE SURVEY MALL SHOPPING FREQUENCY(1994 TO 1995) Shopping Center, Location Shopped Shopped Net Gain More Less or Loss in 1995 in 1995 1. MainPlace, Santa Ana 12.5% 4.2% 8.3% 2. Brea Mall, Brea 10.6% 6.5% 4.1% 3. Westminster Mall, Westminster 10.6% 7.1% 3.5% 4. Fashion Island, Newport Beach 6.7% 3.6% 3.1% 5. Laguna Hills Mall, Laguna Hills 8.9% 6.0% 2.9% 6. Tustin Market Place,Tustin 1.8% 0.4% 1.4% 7. Buena Park Mall, Buena Park 6.6% 5.9% 0.7% 8. Crystal Court, Costa Mesa 0.5% 0.1% 0.4% 9. Anaheim Plaza,Anaheim 1.6% 1.4% 0.2% 10. Los Cerritos Center, Cerritos 1.2% 2.1% -0.9% 11. South Coast Plaza, Costa Mesa 17.8% 21.1% -3.3% 12. Mission Viejo Mall, Mission Viejo 5.2% 9.2% -4.0% 13. The City, Orange 0.6% 4.8% -4.2% 14. Mall of Orange, Orange 2.8% 8.2% -5.4% r.� ..:ttEE���#:RAP!..t.:>•:;::;.:o:«:;:;;:;:::.:;;.;:a;;:.:l�ii�::•�iFR?�::rz>::;: ;:v:;t;>:>�:::<i?>�l:%` �::•''.:�`>» :>?:>:'>•';.....`f•�:. .:3»:`>? h,�,w„•s,,,,,,.,,,,:,,.,,v,• ,uw.,,ws;,,,,,;,;,,,,,,;,;;,,;,;,;,•.,:..,.....:.,...�.,,,,.:,,w...,,.,,.:.,.:.,.:.,,,•:::<„•:.:,:.;:r;.::,:•..;..,:::,::<•h•,,,.,:•,:.;N::w�;<a::««:«.w:;.�,:v:,,;:,,.,K�::,:•;:«:. Source: Orange County Register Huntington Beach Redevelopment Project Preliminary Report EXERPTS FROM 1995 ORANGE COUNTY CONSUMER ATTITUDE SURVEY REASONS FOR SHOPPING LESS FREQUENTLY AT HUNTINGTON BEACH MALL Reason Huntington Average Score Difference Beach of Orange County Mall Score Shopping Centers Variety of stores limited 48.3% 19.7% 28.6% Favorite store location closed 28.1% 9.6% 18.5% Location not convenient 20.2% 32.0% -11.8% Getting run down 5.6% 5.2% 0.4% Source: Orange County Register Rosenow Spevacek Group,Inc. Register SuNey B Preirpt 8/7/96 1 of 1 TABLE B-3 Huntington Beach Redevelopment Project Preliminary Report EXERPTS FROM 1995 ORANGE COUNTY CONSUMER ATTITUDE SURVEY CONSUMER ASSESSMENT OF HUNTINGTON BEACH MALL Attribute Huntington Average Score Difference Beach of Orange County (HB Mall vs.OC Centers) Mall Score Shopping Centers 1995 1994 It's convenient 73.1% 77.2% -4.1% 2.5% Convenient/adequate parking 69.4% 61.7% 7.7% 13.1% Pleasant atmosphere 47.8% 64.0% -16.2% 1 2% Has well-lit/safe parking 43.6% 50.2% -6.6% 11.2% Feeling of security/safety 40.9% 50.6% -9.7% -0.8% Up-to-date, attractive appearance 39.6% 60.9% -21.3% -13.8% Good choice of stores(1) 33.7% 58.5% -24.8% -22.7% It's fun to shop 25.8% 39.9% -14.1% -9.3% Convenient layout of stores(1) 24.3% 34.7% -10.4% -3.1% Special mall events 21.5% 17.6% 3.9% 15.8% Good restaurant selection 17.1% 37.9% -20.8% -11.4% Activities for children 7.6% 15.9% -8.3% -8.3% Notes: (1) Lowest score of all fifteen shopping centers in survey. Source: Orange County Register Rosenow Spevacek Group,Inc. Register Survey A Prelrpt 8/7/96 1 of 1 i EXHIBIT B-1 HUNTINGTON BEACH REDEVELOPMENT PROJECT PRELIMINARY REPORT Quarterly Sales Tax Volumes of Nearby Shopping Centers I THE CITY OF HUNTINGTON BEACH { Hg . ind litergd anAssociates :_ MALLS - 13 QUARTER HISTORY Chart Description• This chart compares sales tax revenues within specified Geographic area(s)of the City to similar GEO areas in 6 other jurisdictions. The prior 12 quarters are shown for historical reference purposes. Comparison Cities Quarters Shown Reflect The Period In Which The Sales Occurred S / 2.320 000 2.088.000 South Coast Plaza Outlets=244 1,856.000 1.624.000 1.392.000 1.160,000 Los Cerritos Center Outlets=192 928.000 ;n Place-Santa Ana --is=184 : •�+ •• • I. 696.000 rashion Island iY ,3 �,• s a� •�. ,.tr f• Outlets=192 � ` •'.a+•.:�r•ft ' "+�• 3 <z:„ f_ Westminster Mall ' �:� •,:r•�.ur+,,..••`�,' '` �...•"°it►+1 �` 464,000 Outlets=205" Buena Park Mall —' w- 232,000 Outlets=160 Huntington Ctr 0 Outlets=76 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr I st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr '92 I '93 '93 '93 '93 ( '94 '94 '94 '94 I 195 .95 '95 195 r , Overall, consumers surveyed rated the Mall well below average in desired attributes of shopping centers; the survey ranked the Mall last in two attributes, including good choice of stores and convenient layout of stores. Another reason for the continued decline of the Mall is its poor physical condition. In June, 1996, Rosenow Spevacek Group, Inc. C RSG") conducted a parcel-by-parcel land use and blight survey. At the Mall, the RSG field survey noted the deteriorating facade and parking lot. The anchor spaces occupied by the Broadway and Montgomery Ward reflect a 30-year old design, and the entire Mall is tired and uninviting by today's standards. Based on an analysis of building permits, the original 823,000 square foot structure of the Mall has not undergone substantial rehabilitation since the Agency adopted the Existing Plan in 1984. Table B-4 itemizes the building permits issued for improvements to the Mall over the past 12 years. Inside the Mall, the number of vacancies of the in-line stores is overwhelming. Of the 74 in-line shops, 50% were vacant. In the Broadway wing of the Mall alone, 14 of the 19 in-line stores were vacant. Photo B-1 was taken on a Friday, June 7, 1996, at about 5:00 p.m., and shows numerous vacant store spaces and the Mall virtually devoid of any shoppers. Rosenow Spevacek Group,Inc. Redevelopment Agency of the City of Huntington Beach August,1996 13-5 preliminary Report PHOTO B-1 Picture taken at 5:00 p.m. on Friday, June 7, 1996, showing vacant stores in the Broadway wing of the Mall. As of June 1996, one-half of the in-line stores at the Mall were vacant. In addition to vacancies of the in-line stores, the Mall is faced with an uncertain future for the Broadway anchor space. Following the acquisition of the Broadway department store chain and subsequent consolidation of the Broadway and Bullock's department stores by Federated Stores in 1995, the new owner announced plans to close the Huntington Beach location in August 1996. This announcement marks the second anchor tenant to abandon the Mall in the past 36 months; J.C. Penney closed its location at Huntington Beach Mall in favor of Westminster Mall in 1993. The prospects of finding a new tenant that could utilize the Broadway space are discouraging, given the consolidation trend of department stores, and a shift in consumer shopping preferences towards open-air discount centers. Exhibit B-2 is a copy of an April 1996 article from the Orange County Register that describes the woes of retailers at the Mall. According to the article, one tenant(Radio Shack) lost$30,000 last year and has signed a short-term lease in the face of the Mall's uncertainty. According to City staff,most of the in-line store spaces are leased on a month-to-month basis. Rosenow Spevacek Group,Inc Redevelopment Agency of the City of Huntington Beach August,1996 13-6 Preliminary Report TABLE B-4 Huntington Beach Redevelopment Project Preliminary Report BUILDING PERMIT HISTORY IMPROVEMENTS TO HUNTINGTON BEACH MALL SINCE 1984 Date Permit No. Project Description Permit Value 1986 Proiects $ 3,281,001 n/a Addition of skylights to common area n/a 1/17/86 Retail addition of 82,927 sf Mervyn's anchor store n/a 3/17/86 Retail addition of Broadway entry n/a 8/25/86 Retail wing/food court addition (74,841 sf) $ 2,915,285 10/16/86 Construct decorative drywall $ 10,000 12/1/86 Regional center expansion $ 355,716 1989 Proiects $ 70,383 2/13/89 Renovation of JC Penney exterior front enterance $ 24,533 6/19/89 Reroof hot mop 30,000 sf $ 45,000 6/30/89 Remodel food court n/a 8/30/89 Addition to Center Court stores(6 stores 300-800 sl) n/a 12/5/89 One illuminated mall sign $ 850 1990 Proiects 9/6/90 Commercial improvements for administrative offices $ 40,000 10/2/90 Corridor extension $ 900 11/13/90 Channel letters-one sign $ 750 1991 Proiects $ 10,000 5/30/91 Repair exterior wall $ 10,000 1993 Proiects $ 10,000 4/5/93 Extending two shops-tenant bulkhead extension $ 10,000 1995 Proiects $ 106,641 1/20/95 Seismic strengthing of outside store canopy $ 6,457 1/20/95 Seismic strengthing/roof repair of tire center $ 35,519 6/16/95 Tear off existing roof and reroof $ 64,665 TOTAL PROJECTS $ 3,478,025 Note: Excludes tenant improvements for anchors, shops and outlying pads. Source: City of Huntington Beach Building Department Building Permit Records Rosenow Spevacek Group,Inc. Mall Improvements Preirpt &7196 1 of 1 Irrespective of the fate of the Broadway space, the Mall property is in dire need of a substantial redevelopment effort to reestablish its viability as a regional retail location. The property owner is constrained from making major modifications to the Mall structure to accommodate new tenants due to the Mall's construction. Because the underlying expansive soils do not support major buildings or foundations, the Mall had to be constructed on pylons below the surface. According to City staff estimates, expansion of the Mall outside of the current footprint would require similar engineering work that could increase construction costs by 30%. Due to low occupancy rates, the Mall cannot generate sufficient resources to fund these additional costs. Given the Mall owner's limited ability to improve the Mall, the Agency desires to assist the property owner with a major renovation of the Mall that will reposition the Mall and reestablish its economic viability. Section E of this Preliminary Report indicates that the direct and financing costs associated with the Mall repositioning and other Project Area commercial rehabilitation/economic development programs could be $250 million. As discussed in Section D, without the Amendment/Merger, the Agency will only collect another $75.1 million of nonhousing tax increment revenue. Therefore, repositioning of the Mall cannot be undertaken by the Agency in the absence of the proposed Amendment/Merger because the cost of such a repositioning would exceed the amount of revenues available to the Agency under the Existing Plan. The Existing Plan also limits the amount of bonded debt to $26.45 million in the Huntington Center Area; the Agency has issued $12.62 million of bonded debt for the Huntington Center Area to date. .Thus, the Existing Plan permits the issuance of another $13.83 million. Because the costs of redeveloping the Mall exceed the remaining bonding capacity, the Agency will need to increase the amount of bonded indebtedness that can be incurred for the Huntington Center Area. Another goal of the Existing Plan for the Huntington Center Area was to correct infrastructure deficiencies which caused traffic congestion. In 1984, the intersections of Edinger Avenue and Beach Boulevard, and Center Avenue and the Interstate 405 ramps were operating at or below minimum standards; these conditions persist today. Traffic operation is measured using a level Rosenow Spevacek Group,Ina Redevelopment Agency of the City of Huntington Beach August,1996 B-7 Preliminary Report of service ("LOS") scale from LOS A, meaning free flow of traffic, to LOS F, meaning extreme congestion and delays. As a general criteria, the City's acceptable level of service is LOS C for arterial links, and LOS D for signalized intersections. According to a traffic study conducted by the County Environmental Management Agency in 1994,this intersection continues to operate at LOS E. The Center Avenue/Interstate 405 intersection has become more congested over the last 10 years, decreasing from LOS D in 1984 to LOS E in 1994. Also, Beach Boulevard is currently operating at LOS F through this portion of the Project Area, according to the Draft Environmental Impact Report("DEIR")for the Project prepared by LSA Associates. Lots on the south side of Edinger Avenue, between the railroad right-of-way and Beach Boulevard, lack internal circulation and sufficient parking due to mixed ownership. The lack of integration between these retail and office properties create excessive curb cuts on Edinger Avenue for ingress and egress. Because vehicles must use Edinger Avenue when traveling to adjacent stores,traffic on Edinger Avenue is congested. Mixed ownership also poses a barrier to shared use of parking lots on individual parcels, causing some retail properties to be underparked. Pursuant to conversations with commercial brokers in the area, lack of parking, as well as the underperformance of the Mall, cause prospective tenants to discard the vacant 50,000 square foot retail space as a viable location. Section E of this Preliminary Report includes a listing of the on-site and st-eet improvements to improve traffic circulation in this area. Due to the lack of tax increment revenues, the Agency has not been able to work with property owners on the south side of Edinger Avenue to construct needed on- and off-site improvements. Therefore, infrastructure projects have been deferred to the future. The Plan will allow the Agency to utilize tax increment revenues from other portions of the Project Area to improve traffic circulation in the Huntington Center Area. Another benefit of the Amendment/Merger is the extension of the time period to incur debt. Without the Amendment/Merger, the Agency will not be able to incur indebtedness to finance infrastructure improvements because the Existing Plan prohibits the Agency from incurring debt after November 1996. The Plan enables the Agency the ability to finance these improvements in the future by extending the period to incur debt to 2014. Rosenow Spevacek Group,Inc. Redevelopment Agency of the City of Huntington Beach August,1996 B-8 Preliminary Report EXHIBIT B-2 HUNTINGTON BEACH REDEVELOPMENT PROJECT PRELIMINARY REPORT April 1996 Article from Orange County Register Regarding Decline of Huntington Beach Mall i E LING •r 1, ,�� , � S GO ,. S mod. _ MAN[AVEAYMM Orange County Regster GIVING UP:A shoe store at the Huntington Beach Mali holds a goin"utof-business sale.A Macy's convemon could boost the ailing mall UNCERTAIN FUTURE RETAIL: The rebuilding of Huntington Beach Mall hinges on whether Federated will close Broadway. By QUYEN DO/The Grange County Register The mall is Huntington Beach's single from Huntington Beach largest business and is second only to the car dealerships m generating revenue for the city. he future of the Huntington David Biggs,the city's director of eco- Beach Mall remains in limbo as nomics and redevelopment,said the mall Federated Department Stores generated nearly$18 million in tax reve- weighs whether to dose the nue m the early 1990s Last year,it brought mall's Broadway store or con- in a record low M,000. vert a-W Macy t figure does n4 r_eQect the addition 1be9 av `f t' - s a ger to r till t e into the'ol Penney location at the end or mall but needing Federated s decision to September,and Barnes&Noble Booksell- pomt to a strategy.Federated acquired the J ers in October,which filled the old Barker Broadway chain in October and has an- a Bros location in a separate building next to pounced the fate of all but four of its 82 Cuciut City and Staples. stores. f Overall,sales tax provides$16 million of Federated will announce its decision for the city's S%mdhoa operating budget. the lone Orange County Broadway before Mall owners said they're working with the end of the year,said spokeswoman the city but cannot move forward until Fed- Mary Ann Shannon Previously,Federated WAITING IT OUT:Radio Shade manager erated announces the Broadway's fate. In plans to convert 49 Broadway David Johnson,holding a sample of his wares, "I'm sure the city has a different opinion stores to Macy's and five to Bloomingdales says the stare bit 530,000 last year_ on things,but the ownerslup of the mall has Others were sold off or turned into ware- experience in the industry,"Sonnonstuie houses mall's ability to attract shoppers. said "Demolishing(the mall)is not an op- A Macy's conversion in Huntington "The day Penney's left,the mall went tion that we're interested in or looking at Beach would be a powerful selling point in downhill."said Marsha Baumann,owner of this time They don't own the mall. persuading traditional mail stores to repop- Cardo's Footwear,who is movmg her busi- She said any changes to the man must be ulate the ailing center,which is one-third ness Monday to a strip mall in Laguna approved by anchor stores Montgomery Vacant However,the loss of another an- Beach."It's a shock to walk through It's Ward,Mervyn's,Broadway and Burlington chor would probably lead to a repositioning empty like a ghost town.It doesn't even Coat Factory,a discount outlet that sells of the mall,possibly as a discount and en- feel like a mall." linens and clothes tertainment mecca Radio Shack,which usually signs up for "You must have anchor stores to be a -We're hanging on the decision they have five-to 10-year leases,renewed for only one major player,"said Esmael Adibi,director :so make,"mall spokeswoman Linda Son- year in 1996,said store manager David of the Center for Economic Research at -nonstme said The owner,MCA Huntington Johnson,whose store lost SM.000 last year. Chapman University He said anchor stores &Associates,is considering adding restau- City officials want to see the mall re- --draw shoppers and tenants The big stores .rants and cinemas to bring back the vamped into a sales-tax powerbouse.Their build customer loyalty,while smaller stores .crowds that deserted the mall after J C ideas range from simply filling vacancies give shoppers variety. enney moved to the Westminster Mall in and remodeling to demolishing the mall "For a mail to be successful it niust ex- ovember 1993 and turnip it into a"power center"filled t g po panel its choices and make itself more The threat of losing another big store has with big-box discounters such as Costco and gene see MALL Page 2 t many merchants wondering about the Wal-Mart. MALE.: wait 1s torturous 1°or mad[, civ FROM I modern and come up with new ideas to attract customers:' .:;;y Adibi said,noting that's been the strategy of shopping power. Va`a"t MERVYN'$ STILL IN houses South Coast Plaza i cos watts SEA'`' LIMBO to Mesa and MainPlate in Santa Ana. ''S," :?�i,F; Huntington Beach Mail Employees and shoppers say ,g -cecent renovations make them _ owv++eK are still wain optimistic the store will stay. }:F!t�_-•:�' for Federated Stores to A new security system was tr: ' '''a decide whether they'll added and employees have been MONTGOMERY ^':,�. a; convert The Broadway trained to operate on an updated WARD F MERVYji'SrY store into a MaCyk register system, said Roger Payne. an assistant cosmetics department manager for the Broadway. If they're closing. I don't F fspeisb ' a. H� - think they would be pouring moo- , r �. ��• :eFlRsr�,,�<_::; ; ey into the store;'he said.He added that the store has been re- : ' , �efrt{x,::;::' stocking merchandise regularly. ' MONIGOMERY Shoppers also said Broadway , , WARD )� employees have told them their r r y>•%1` ...sh �3-r.'y'-: t Broadway cyd cards s will soon con- ert The 30•year-old mall,south of the San Diego(I.105)Freeway, r has 960.000 square feet of retail BURUNGTONCOAT ' space.in fiscal 1991 it thrived at FACTORY = full occupancy.By 1996.leased 1 space has dropped to 6S percent. Some shoppers say Barnes& :;.. ;• i �?•.::.." i Noble, which also sells music and has an adjacent Starbucks '�:...:},.•N''�``e:�.. •Z••�• '=, + Coffee, has attracted new cus tomers. "I have an affinity for the mall since Barnes & Noble started here:'said Howard Carlson,S3, St7�t► s + of Tustin while waiting for his ; BROADWAY t friends near the Palm Court food �"; swaaaFlobM '1 t area in the mall."I used to not '� 0 `. , to ptwa:Fayor..�, ,..,.,. t come here." .K2 A,.: »•'-- + r: : r The bookstore's manager, tr.; .. c Donna McCune,said the retailer •. isd6' Ass.o.s a I-.rz ., ;• I ,� `t'fi-: has found its niche in Orange %yr !!�� a Count .k r �r....�ez"-`r-1, r N r t "The concept is fairly new to Orange County,"she said."Our The orange Cot+nty Regater c store is doing phenomenally r well.We've beat our initial sales plan." economic director Biggs.He said Complex to draw customers. between two successful malls. t Mall owners say overall sales the city has identified a range of "There may be some combina- Westminster is two miles away c are on the rise,in part because of options to the owners,including tion(of the changes)in the mall and South Coast is about eight ) the improving economy in remodeling or reconstructing the to snake economic sense," he miles." ! Orange County. mall,similar to Anaheim Plaza. said. Westminster Mall, a 1.2 mil- t Sonnoistine, who provided Richard Bruckner,a redevel• If mail business doesn't pick lion-square-foot regional mall I year•to date sales increases on opment manager for Anaheim, up,the city can acquire the proQ- with 17S stores,blossomed after v more than a dozen merchants in said Anaheim Plaza faced a sim- erty under eminent domain,said a Qtll renovation in 1989, said % the mall, said the increase ilar situation in 1992,when more Biggs. spokeswoman Stephanie Green, ranged from 8 percent for Sees than half of the stores were It's never our first prefer- maintahling a 90 percent occu• C Candy to 18 percent for Claire's closed after Robinson's left and ence,'he said."We're waiting to panty rate or better since 1990. c Boutique,an accessory store. the Broadway was deciding see what the owners will do.It's a e The food court showed a 10 r• Green attributes the moil's Pe whether to stay. collaborative effort" success to having strong anchor v cent increase,she added. The property owner and the Huntington Beach City Coun stores such as Robinsons May, t Dull owners have's agree• city decided to demolish the mall cilman Dave Garafalo disagreed Sears and J.C.Penney and a con- F ni Gil bring Romano's Macaro- Y r: ni Grill, a tamilystyle Italian and rebuild it as an open-air re- that city acquisition is an option, slant variety of promotions.such li restaurant, to the comer of mil center anchored by Wal- sayingtt���utyy proSc e��Eastereggpt+�ts�aadlo , BeaehandF.dinger,tormerlythe Mart,Comp USA and Ross Dress mill ion'sbortf •id . 2celebrati '":'r. =•'. site of a Chevron gas station.The For Less.The plaza reopened in budget and would not be able to ` 'Adibi and Green say the malls 1' restaurant will open in July. late 1994. finance the property. can exist in close pro+dmity. c Some say the improvement "Our sales have more than Biggs'said another problem is "I think it's competitive but 8 has been slow. doubled since the mall re- the mail's location. also complementary," said "I don't think the city can af- opened,"Bruckner said. "It's not in a good competitive Green."We have shoppers that b ford to wait much longer to see Biggs said whichever direction location in the market in terms of are loyal to both centers since we I the current owners do some- the mall takes,it needs more res• malls in the region," he said. don't have a large duplication of t thing;' said Huntington Beach taurants and a movie theater "Huntington Beach Is squeezed stores." Edinger Corridor Economic Study ATTACHMENT #3 Cunningham & Associates MUNICIPAL MANAGEMENT CONSULTING v EDINGER CORRIDIO ECONOMIC!{MARKET ST[IDY% Submitted to.- City of Huntington Beach Redevelopment Agency October, 1995 673 VssU Bonita •Newport Beach,Glifomia 92660 -714/644-7304 - FAX 714/644-9357 TABLE OF CONTENTS PaEe 1. Introduction....................................................................................................................34 2. General Plan Update.......................................................................................................4-6 3. Related Studies...............................................................................................................6-8 4. Trade Area Characteristics.............................................................................................8-9 5. Retail Trends..............................................................................................................10-12 6. City/Redevelopment Agency Initiatives......................................................................13-15 7. Tenant Attraction Marketing......................................................................................15-17 S. Public Improvements..................................................................................................17-19 9. Conclusion/Recommendations...................................................................................19-20 1 ATTACHMENTS Page A. Sales Tax Generated by Huntington Beach Mall.............................................................21 B. General Plan: Subarea Map.............................................................................................23 C. Huntington Center Revitalization Workshop: Auto and Pedestrian Entry into Mall...............................................................................25 D. Trade Area Map: 5-We Ring.........................................................................................27 E. Huntington Beach MaMinger Corridor TotalRetail Sales.............................................................................................................29 F. Huntington Center Redevelopment Project Area Assessed Valuation/Tax Increment Revenue..........................................................31 G. Huntington Center Redevelopment Project Area Map....................................................33 H. Edinger Corridor-Existing Conditions...........................................................................35 L Edinger Corridor-Recommended Improvements..........................................................37 2 INTRODUCTION The Edinger Corridor Economic Market Study addresses both near and long-term economic development considerations related to the North Huntington Beach Business District area located adjacent to the I-405 Freeway. Straddling Edinger Avenue, a major east-west traffic arterial, the corridor is dominated by retail-commercial land uses, and incorporates the Huntington Center Redevelopment Project area. Increasingly, large discount retail outlets are choosing to locate along Edinger or at the Huntington Beach Mall, a 900,000 square foot regional shopping center which forms the primary retail nucleus of the area. Despite its strategic geographic location and strong consumer demographics, the Edinger Corridor has suffered declining retail sales performance in recent years. Exacerbated by the relocation of the J.C.Penney department stone in 1993, annual sales tax revenues generated by the Huntington Beach Mall have slipped from a high of$1.28 million in 1990 to its current level of$827,000 for calendar year 1994. Penney's depart-are is indicative of the challenging situation faced by the mall in particular, and the surrounding retail area in general. (Attachment`A') ' The attached map delineates the boundaries of the Edinger Corridor for the purposes of this study. (Attachment `B') The corridor links Edinger Avenue to Beach Boulevard in the vicinity of the 405- Freeway. This intersection represents the City's primary northern retail anchor with the downtown business district serving as its southern anchor. The area is important to the City's economic base both 3 for this reason, and because it accounts for 10.3%of the Citys approximately$15 million total annual retail sales tax revenues from all outlets. GENERAL PLAN UPDATE The City is currently undergoing an update of its General Plan, the policy document which governs long-range planning and development issues. Several elements of the Plan, including Land Use, Circulation, Urban Design and Economic Development, are concerned with future growth along the Edinger Corridor. The intersection of Beach Boulevard/Edinger Avenue/I-405 Freeway represents the focal point of what is commonly known as the North Huntington Beach Business District. The Land Use Element identifies this area as the Citys only"Regional Commercial Core." Six distinct subareas comprise this key business district: • Huntington Center(Huntington Beach Mall) • Corporate Center(One Pacific Plaza) • Edinger Corridor • "Old World" • `Student Centee, • Transit Center 4 The Element defines the area-wide functional role of the regional core as follows: "Enhance Huntington Center, the Edinger Corridor, and adjacent properties as a key focal point of regional commerce." Specific land uses which are permitted and encouraged within the overall district currently include: • Commercial General(CG) • Commercial Office(CO) • Commercial Regional(CR) • Mixed-Use Horizontally Integrated Housing(Wo The land use designations slated for the six subareas by the Land Use Element are intended to facilitate both new development and rehabilitation of existing structures which will encourage the emergence of the Edinger Corridor/North Huntington Beach Business District as a significant major destination within the larger West Orange County region. At its optimum level of development, in terms of land use type, density, and design, the area is envisioned to be a commercial hub integrating retail, office, and multi-family residential uses. High volume discount or"big box" retail, in particular, is viewed as an appropriate market niche for the area which could serve as a catalyst for other desirable development and economic growth. The Economic Development Element of the General Plan is especially important to the Edinger Corridor because of its focus upon the financial contribution made by the area to the Cites overall 5 economic health and vitality. This Element provides the framework and direction from a long-range planning perspective for the creation of various"economic development strategies"designed to achieve more immediate objectives related to expansion of the local tax base,business attraction and retention, and job creation. In addition to a recently completed citywide Economic Development Strategy, this Element has provided the impetus for the Edinger Corridor Economic Market Study as well as an Economic Development Long-Range Opportunities and Constraints Analysis. Each of these strategies contribute to the implementation of the general economic development goals outlined within the Economic Development Element. RELATED STUDIES In addition to the City General Plan, several other important studies related to the Edinger Corridor have been completed,thereby attesting to its prominence from a community development perspective. The following historical documents have been utilized and referenced for the purposes of this report: • "Precise Plan of Street Improvements for Edinger Avenue"(April, 1992) • "Huntington Center Revitalization Workshop(December, 1990) • "Huntington Beach Center Signage and Orientation Workshop(June, 1990) • Edinger Corridor Study(September, 1989) Each of the aforementioned reports have contributed significantly to the factual knowledge base regarding this key subsector of the overall Huntington Beach economy. In the 1990 Revitalization 6 Workshop, one alternative development scenario envisioned a major expansion of the shopping mall, with an accompanying widening of Edinger Avenue which is analyzed in greater detail by the 1992 Precise Plan for Street Improvements. As illustrated by the following design concept borrowed from the workshop report, (Attachment `C') the mall could be expanded toward Edinger onto the open expanse currently utilized for surface parking thereby creating a much closer orientation to the street. In addition to two new anchor stores,this scenario recommended that an 8-screen multiplex of movie theaters be included. The plan assumed the realignment of the 405-Freeway southbound off-ramp at Beach Boulevard which has yet to occur and is considered to be important from a circulation standpoint to the long-term economic viability of both the mall and the Edinger Corridor. The workshop and other studies were conducted prior to the relocation of J.C.Penney's and the recent sale of The Broadway chain to Federated Department Stores bringing the future of the Huntington Beach Mall store into question. A new Federated-owned department store(e.g.,Macy's or Bullock's) is a possibility as a replacement for The Broadway, although declining sales activity at the mall since the time of the workshop has brought the entire concept of a traditional retail shopping center into question. The addition of large discount retail stores like Burlington Coat Factory and Barnes and Noble Books to the center are basically in line with the workshop's recommendation for an emphasis on the mid-line promotional center market. The appropriateness of the mall expansion toward Edinger and the addition of theater screens have not been altered by the changing general economy. This appears to be an economically viable, and inevitable, future market focus for the mall. An altemate 7 scenario could involve the complete or partial demolition of the existing Mall and its replacement with a development specifically designed to enhance a discount retail/entertainment theme. TRADEARF.A CHARACTERISTICS As illustrated by the attached trade area map(Attachment`D'),the Edinger Corridor faces heavy retail competition within the 5-mile ring radiating from the Beach Boulevard/Edinger/1405 intersection. In addition to the Huntington Beach Mall, the immediate area is served by one other super regional shopping center,the I million-plus square foot Westminster Mall,which is only one mile away and just over the city boundary. Despite being located approximately seven miles away in Costa Mesa, the mammoth South Coast Plaza Center also comes into play from a competitive standpoint due to its relatively easy access from Huntington Beach along the I405 Freeway. Three regional centers-The Pavilion and the Westminster Center in Westminster, and the Garden Promenade in Garden Grove- range from 300,000 to over 500,000 square feet in gross leasable area, thus adding significant competition to an already saturated mid-range retail market trade area. It is interesting to note, however, that all of the above mentioned retail competition is concentrated toward the City's northern end along the I-405 Freeway,while its strongest demographics are apparent to the south nearer to high income, beach-oriented residential areas. The nearest major shopping opportunities, besides the Edinger Corridor area, for these coastal residents are Fashion Island in Newport Beach to the south and Marina Pacifica in Long Beach to the north(which is currently being 8 rennovated). Each of these centers leave something to be desired for the Huntington Beach consumer, either due to lack of geographic accessibility, competitive pricing,and/or range of product choices. Huntington Beach s consumer demographic profile is impressive and largely untapped in terms of retail sales potential. Recent studies estimate the Citys total retail sales leakage - that is, retail purchases made by city residents outside city boundaries - at between $80 million to $250 million annually. Conservatively,this outflow amounts to at least$1 million per year in potential sales tax revenue being lost to the City General Fund. Huntington Beach residents are affluent and highly educated, two consumer traits which spell tremendous additional economic potential for the Edinger Condor area. Recent demographic analyses of the resident population reveals the following general trends: • High income($53,000 median household) • Low unemployment(5%) • High education(32%college graduates) • High"white collar"employment(71%professional/managerial) • Hgh owner-occupied housing(55%home owners) • High housing values($236,000 median) Source:Focus:Orange County, 1995 and Urban Decision Systems 9 i - RETAIL TRENDS Previous studies have indicated that the greatest share of retail sales leakage from the City is occurring in three key subsectors-restaurants, apparel, and general merchandise. The Edinger Corridor area has an excellent opportunity to capitalize on these gaps in the existing retail trade sector. As mentioned previously,the corridor is beginning to emerge as a significant large discount retail center. In addition to Burlington Coat Factory and Barnes and Noble, key national tenants include Circuit City, Office Depot, Staples,Men's Warehouse,Home Depot,Toys R Us, Mervyn's, and Kids R Us. The presence of such name retailers can serve as a catalyst for attracting similar tenants as well as complimentary users like restaurants and theaters. One regional shopping center which has been very successful in this regard is the Tustin Marketplace which began with mainly big box retail tenants and evolved into something greater than the sum of its individual parts by bringing in trendy restaurant and entertainment-oriented uses in the latter stages of development. This trend may be viewed as what has been aptly termed the "demalling of America", whereby traditional enclosed, twin department store anchored shopping centers are gradually changing into more open air, entertainment-oriented gathering places. This new atmosphere affords consumers the opportunity to participate in a total shopping experience including browsing, dining, and entertainment 10 within an easily accessible, outdoor environment. Fashion Island at Newport Center and the Century City Plaza adjacent to the Shubert Theater are good local examples of the new directions which retail shopping areas are taking in the 199Us and beyond. Because of its discount retail emphasis,the Tustin Marketplace may be closer in flavor, and therefore a more appropriate general model for the Edinger Corridor. The Huntington Beach Mall is the acknowledged retail anchor of the Edinger Conidor/North Huntington Beach business district. Operated by the Mace Rich Company, this 196Ys vintage mall faced an ongoing trend of decline and loss of market share,but has shown recent signs of stability. The Burlington Coat Factory and Barnes and Noble leases should help provide direction for other retail growth along Edinger. Occupancy rates, which had recently slipped to an all-time low of 65 percent, will be bolstered by the addition of these major tenants. Likewise,4th Quarter, 1994 sales,traditionally the most active 3-month period during the year, were down by 34 percent from 1992. This negative trend also served to pull down retail performance in the Edinger Corridor reflected by a 21 percent decline over the same period for the area as a whole. (Attachment`E') Finally, property tax revenues to the City have decreased,as well as tax increment revenues to the Redevelopment Agency which are down by 43 percent, mainly due to a substantial drop in assessed value of the mall real estate. (Attachment`F') 11 The mall needs to be the primary catalyst for change if the emerging make-over of the Edinger Corridor is to achieve any large measure of success. In order for this change to occur, it appears to be essential that the mall be at least renovated, and hopefully also enlarged. In the alternative, the Mall could be partially or completely torn down and rebuilt in a more functional configuration which would serve to improve its retail shopping viability. As indicated earlier in this report,the mall buildings could benefit by being physically and architecturally oriented more towards the Beach Boulevard/Edinger Avenue intersection. Access and visibility from the I405 Freeway also should be upgraded and improved in order to effectively draw customers into the area. The presence of the mall, especially if a department store continues to occupy the Broadway space, could provide a tremendous advantage to the general discount retail orientation of the corridor by offering a measure of higher end comparison shopping opportunities in the important apparel and general merchandise categories. Under the preceding scenario, a major missing link for the mall would be the incorporation of movie theaters into the tenant base nix. On the other hand, a decision by Federated Stores to permanently close the current Broadway location could be a blessing in disguise by allowing the discount retail/entertainment theme to emerge unfettered by the presence of a single,higher-end traditional department store anchor. With or without the traditional department store,the mall and the corridor need movie screens in order to offer the optimum range of shopping/entertainment alternatives. The addition of theaters more or less automatically attracts restaurant uses to the immediate vicinity which would complete the circle of desired venues available to shoppers along the Edinger Corridor, and help to enhance and define the regional core area envisioned by the City General Plan. 12 CITYIREDEVELOPMENT AGENCYINITIATIVES Without exerting undue influence over private business market forces, the City of Huntington Beach and it's Redevelopment Agency are in an excellent position to provide policy leadership and direction, as well as offer economic development incentives designed to assist the Edinger Corridor/North Huntington Beach Business District in achieving its greatest potential. As indicated by the attached map (Attachment `G'), a key portion of the Edinger Corridor area is included within the boundaries of the Huntington Center Redevelopment Project Area. The existence of the redevelopment area provides the City with an important economic development tool which can be utilized to assist with revitalization efforts along the corridor. Under California Law, the redevelopment process allows a locally controlled agency to pool property tax increment revenues which can be directed in a number of specific ways. Redevelopment agencies can conduct any of the following activities in order to reduce physical and/or economic blight conditions: • Issue bonds backed by firture tax increment revenues • Acquire private property in order to assemble future development sites. • Reduce or subsidize land costs in order to encourage desirable private development. • Make loans to construct improvements or rehabilitate private property. • Fund necessary public h fiastrucwm improvements in support of private development. 13 Adopted in 1984, the Huntington Center Project Area is only now beginning to approach the achievement of its stated redevelopment goa!,. In recent years,the Project Area has been hampered by declining real estate values which have had the effect of eroding the annual amount of tax increment revenues accruing to the Agency. Consequently, the area is suffering from a negative cash flow situation on an annual basis. Up to this point in time, fund balance cash reserves have been appropriated in order to stem the tide of losses which amounted to nearly$1.5 million for the 1994/95 fiscal year. At the current rate, fund balance reserves are projected to be significantly reduced by the conclusion of the 1998-99 fiscal year. The Agency is taking a number of steps to arrest and hopefully reverse this alarming trend. These include the possibility of merging the Agency's five existing project areas in order to improve the overall balance sheet, as well as amending certain provisions of the areas underlying plans to extend various time and dollar limitations imposed upon it, including the power to acquire private property through the eminent domain process. Of equal or greater importance to maintaining the financial viability of the Project Area, however,is the need to generate private real estate investment. This will result in expansion of the property tax base, and hence, incremental revenues accruing to the Agency which can be used for redevelopment purposes. Additional investment will also serve to bring more sales tax revenues to the City General Fund thereby benefiting all residents. In order to help make this happen, the Agency must play an active role in the economic development process by worldng to attract and retain those businesses which contribute the most of the local economy in terns of jobs and tax base. 14 City government itself can also be a significant factor in the revitalization of the Edinger Corridor through its planning and regulatory functions pertaining to zoning and land use. As discussed earlier in this report, several Elements of the City General Plan directly impact the corridoes future direction and focus. These documents provide a basic framework for such critically important issues as circulation, signage, and design. Taken in combination with various supplemental studies also described previously, the Plan essentially covers that which needs to be done in order to complete the revitalization of the Corridor area. The next step as recommended by the General Plan is a Specific Plan overlay which can be applied to individual parcels of private property, as well as required public improvements, throughout the corridor area The Specific Plan can go beyond general land use and zoning requirements to require certain types of tenant uses on particular parcels. An example of this relates to automobile service uses situated on the retail pads fronting Edinger Avenue. While such uses might fit general commercial zoning criteria, they would not enhance the mixed uselentertainment- oriented retail concept envisioned by various urban planners for the corridor area. Restaurants would be much more desirable pad tenants in keeping with the preceding development theme. TENANT A TTRA CTION AMMETING As alluded to previously, the attraction of several types of commercial tenants are key to the ongoing success of revitalization efforts within the Edinger Corridor/North Huntington Beach Business District. The entertainment-oriented retail theme needs to include the following venues: 15 • Major discount retail outlets,especially Apparel and General Merchandise. • Restaurants,especially large national chains. • Movie theaters. A coordinated tenant attraction marketing campaign needs to be undertaken as a joint venture between major property ownersJlandlords and the City Economic Development Department, which includes both the Redevelopment and Business Development functions. With Mace Rich as the most important link in the chain, the City should begin by compiling a major property owner list for the entire Edinger corridor area. This information is readily available from County Assessor data files. Once the list is complete, City staff should directly contact each major property owner individually to discuss anticipated future directions for the corridor area describing the advantages of the entertainment retail theme, and the City's willingness to provide incentives, both financial and regulatory, to attract particular tenants on a targeted basis. These incentives are detailed in the City Economic Development Strategy along with objective rating criteria for gauging the level and extent of assistance provided. At a minimum, specific incentives for corridor property owners and tenants should include: • Assessment districts to assist with financing, parking, maintenance, security, promotions and signage. • Low interest loans for new construction,building rehabilitation,and tenant improvements. • Permit processing assistance for building improvements,landscaping,and business licenses. 16 Once the basic incentive package has been developed and "sold" to the major property owners, direct tenant solicitation can begin. The steps in the targeted attraction campaign should proceed along the following schedule: • Utilizing available computerized mailing services such as Retail Lease Trac and Inside Prospects of California to compile contact lists in the identified tenant categories. • Conduct initial promotional mailings to targeted prospects including economic/demographic data and information on available incentives. • Place follow-up phone calls to all respondents, as well as any highly desired prospects (i.e. a particularly appropriate restaurant or theater chain). • Conduct site visits and city tours for interested prospects stressing business benefits of an Edinger Corridor location. The above-referenced tenant attraction process should be repeated on a continuous revolving basis in order to demonstrate the Cityrs commitment to achieving its economic development goals for the ' Corridor area. PUBLICIMPROVEMENTS The City General Plan and all of the previously cited related studies pertaining to the Edinger Corridor/North Huntington Beach Business District have pointed to the need for significant additional ' 17 public improvements. Perhaps the most critical of these deficiencies relates the limited accessibility and visibility of both the corridor and the mall from the I405 Freeway. (Attachment `H') The attached circulation map aptly illustrates the difficulty which a shopper encounters when attempting to access the corridor area. The vicinity is hard to reach from either direction on the I405, and is especially confusing to reach from the southbound off-ramp which deposits drivers at the rear of the mall at Center Avenue where a left or right turn must be made to reach Edinger or the mall. Moreover, the mall and corridor is difficult to see from the southbound lanes and virtually invisible for those traveling northbound. The impaired visibility is due to a combination of inadequate signage and overgrowth or inappropriate freeway landscaping. The City is currently working with CalTrans on a landscape improvement project in the vicinity of the south bound Edinger off-ramp which will be beneficial to the area in general. As one alternative, the 1989 Edinger Corridor Study recommended a realignment of the southbound off-ramp and a new public roadway leading through the mall directly to Edinger Avenue. (Attachment `I') While a new driveway entrance is planned at the rear of the Mall, the public street alternative would be much more desirable from a circulation standpoint. A public improvement project of this kind could be financed through Community Facilities District Bonds, secured by property tax assessments. The study also proposed a signage program for the corridor which would more attractively identify"gateways, public streets, and private uses." Along these lines, consideration should be given to constructing an additional I405 freeway readerboard sign situated to the north of the existing auto dealer readerboard. Finally, a planned extension of Gothard Street,joining it with 18 Hoover Street immediately to the west of the Mall, will significantly improve access from the north to both the Mall and the Corridor. The logic of the aforementioned circulation and signage recommendations remains today, and should be implemented along with median landscaping and street scape improvements along Edinger Avenue. The length of the corridor currently has a barren look with little curb appeal for prospective shoppers. Better signage and improved ingress and egress to and from businesses situated on Edinger would help to create an area-wide theme and enhance sales. CONCLUSIONIRECOMMENDATIONS The Edinger Corridor/North Huntington Beach Business District has the economic potential to truly become the Regional Commercial Core envisioned by the General Plan. The combination of large discount retail operations with movie theaters and dining opportunities could transform the corridor into an attractive destination for comparison shopping and entertainment. While not the major focus at this time, the integration of multi-family residential housing could serve to enhance the trade area demographics thereby improving tenant attraction efforts. An aggressive public/private sector joint tenant solicitation marketing campaign can provide the initial step in revitalizing the corrido?s retail base. Extensive public infrastructure, circulation, and streetscape improvements, along with a comprehensive signage program, will serve to identify for shoppers and delineate the corridor area in the process attracting additional tax base and jobs. 19 The fol.' recommended implementation measures will assist City government, and the private business sector in achieving mutually beneficial economic development goals: • Implement a joint city-property owner retail tenant marketing campaign targeted toward large discount retailers,movie theaters,and restaurants. • Adopt a property owner/tenant incentive program designed to encourage new'investment and construction. • Complete public improvements related to traffic circulation, landscaping, and signage to increase access,visibility,and identity. • Encourage expansion and redesign or replacement of the Huntington Beach Mall around an entertainment/retail theme with buildings physically oriented more toward Edinger Avenue. • Formulate a specific plan overlay for private properties and for public improvements. • Extend Redevelopment Agency time and dollar limitations in order to maximize available economic development tools and prerogatives. In particular, maintain eminent domain authority as recommended by the Project Area Merger/Amendment Feasibility Analysis. 20 CITY OF HUNTINGTON BEACH SALES TAX GENERATED BY HUNTINGTON BEACH MALL Sales Tax $2 M $1.5 M $1.0M $500 K -0- Calendar Year 1992 1993 1994 Source:Hnderliter,de Llamas&Associates #A 21 Agency's Five Year Implementation Plan ATTACHMENT #4 Redevelopment Agency of the City of Huntington Beach 1999-00 through 2003-04 1 1 • 1 1 CIi7 0f NINTINU41 MAU Adopted: December 20, 1999 TABLE OF CONTENTS Introduction...................................................................................................................1 Contents of the Implementation Plan................................................................. 1 Background...................................................................................................................2 BlightingConditions..........................................................................................2 Goals of the Redevelopment Plan.................................................................... 3 Review of the Prior Implementation Plan..........................................................4 Anticipated Planning Period Projects and Programs................................................6 NonhousingPrograms......................................................................................9 Waterfront Project............................................................................ 9 CIMProject...................................................................................... 9 Edinger Corridor Improvement Study............................................. 10 Economic Development Program................................................... 11 HousingPrograms.......................................................................................... 12 MercyHouse.................................................................................. 12 Shelterfor Homeless...................................................................... 13 BowenCourt Project...................................................................... 13 Center Avenue Project................................................................... 13 Citywide Acquisition/Rehabilitation................................................. 14 Five-Year Budget........................................................................................................15 HousingUnit Estimates .............................................................................................18 Redevelopment Agency of the i Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Introduction This document is the Five-Year Implementation Plan ("Implementation Plan") for the Redevelopment Agency of the City of Huntington Beach ("Agency") for fiscal years 1999-00 through 2003-04. This Implementation Plan presents the goals and objectives, anticipated projects and programs, and estimated expenditures relating to the Agency's Huntington Beach Redevelopment Project("Project"). Contents of the Implementation Plan Section 33490 of the California Community Redevelopment Law ("Law") requires that the Implementation Plan include the following information: ■ specific goals and objectives of the Agency for the Huntington Beach Redevelopment Project Area("Project Area"), ■ the specific programs, including potential projects, and estimated expenditures proposed to be made during the next five years, and ■ an explanation of how the goals and objectives, programs, and expenditures will eliminate blight within the project area and will improve and increase the supply of housing affordable to very low, low, and moderate income households. The Law also requires that the implementation plan address the Agency's affordable housing production needs and achievements; these items are specifically addressed in the Affordable Housing Compliance Plan,which is found at the end of this Implementation Plan. Redevelopment Agency of the 1 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Background The City Council of the City of Huntington Beach("City") created the Agency in March 1, 1976. Between 1982 and 1984, the Agency adopted five separate redevelopment projects, namely Main-Pier, Talbert-Beach, Yorktown-Lake, Oakview, and Huntington Center. In December 1996, these constituent project areas were amended and merged to form a single, consolidated Project Area. A map depicting the boundaries of the Project Area is included at the end of this Plan as Exhibit"A". Blighting Conditions Redevelopment projects are established to remedy conditions of blight as defined by the Law that is in effect at the time a redevelopment project is adopted. The Law's definition of what constitutes blight have changed substantially since the constituent areas of the Project Area were established in the early 1980s. The Law's current blighted definition is set forth below: • Unsafe/Dilapidated/Deteriorated Buildings. Buildings in which it is unsafe or unhealthy for persons to live or work. These conditions can be caused by serious building code violations, dilapidation and deterioration, defective design or physical construction, faulty or inadequate utilities, or other similar factors. • Physical Conditions that Limit the Economic Viability and Use of Lots/Buildings. Factors that prevent or substantially hinder the economically viable use or capacity of buildings or lots. This condition can be caused by a substandard design, inadequate size given present standards and market conditions, lack of parking, or other similar factors. • Incompatible Uses. Adjacent or nearby uses that are incompatible with each other and which prevent the economic development of those parcels or other portions of the project area. • Lots of Irregular Shape, Inadequate Size, and Under Multiple Ownership. The existence of subdivided lots of irregular form and shape and inadequate size for proper usefulness and development that are in multiple ownership. • Depreciated/Stagnant Property Values, Impaired Investments. Depreciated or stagnant property values or impaired investments, including,but not necessarily limited to, those properties containing hazardous wastes that require the use of agency authority as specified in Article 12.5 (commencing with Section 33459). • High Business Turnovers and Vacancies/Low Lease Rates/Abandoned BuildingsNacant Lots. Abnormally high business vacancies, abnormally low lease rates,high turnover rates, abandoned buildings, or excessive vacant lots within an area developed for urban use and served by utilities. Redevelopment Agency of the 2 Five-Year Implementation Plan City of Huntington Beach • 1999-00 through 2003-04 • Lack of Neighborhood Commercial Facilities. A lack of necessary commercial facilities that are normally found in neighborhoods, including grocery stores, drug stores, and banks and other lending institutions. • Overcrowding/Excess of Adult Businesses. Residential overcrowding or an excess of bars, liquor stores, or other businesses that cater exclusively to adults,that has led to problems of public safety and welfare. • High Crime Rates. A high crime rate that constitutes a serious threat to the public safety and welfare. The Law also characterizes inadequate public improvements as blight when the above conditions are also present. The Agency has previously documented blighting conditions that persist in the Project Area, most recently in conjunction with the two plan amendments in 1996 and 1999. These persistent conditions include deterioration, irregular subdivision of lots, age and obsolescence, inadequate public•improvements, and high crime rates relative to other areas of the City. The Agency's proposed projects and expenditures outlined in this Plan will be evaluated in terms of how such activities address these blighting conditions. Goals of the Redevelopment Plan Section 500 of the Redevelopment Plan delineates the Agency's community development goals for the Project Area. These goals formulate the overall strategy for this Implementation Plan and will serve as a guide for the Agency's activities during the next five years. • Eliminate and prevent the spread of conditions of blight including: underutilized properties and deteriorating buildings, incompatible and uneconomic land uses, deficient infrastructure and facilities, obsolete structures, and other economic deficiencies in order to create a more favorable environment for commercial, office, industrial, residential, and recreational development. • Expand the commercial base of the Project Area. • Improve public facilities and public infrastructure. • Improve inadequate drainage infrastructure. • Improve and/or provide electric, gas, telephone, and wastewater infrastructure to both developed and undeveloped properties within the Project Area. • Promote local job opportunities. • Encourage the cooperation and participation of residents, businesses, business persons, public agencies, and community organizations in the redevelopment/revitalization of the Project Area. Redevelopment Agency of the 3 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 • Implement design and use standards to assure high aesthetic and environmental quality, and provide unity and integrity to developments within the Project Area. • Address parcels of property that are: of irregular form and shape, are inadequately sized for proper usefulness and development, and/or are held in multiple ownership. • Remove impediments to land disposition and development through the assembly of property into reasonably sized and shaped parcels served by improved infrastructure and public facilities. • Recycle and/or develop underutilized parcels to accommodate higher and better economic uses while enhancing the City's financial resources. • Promote the rehabilitation of existing housing stock. • Increase, improve, and preserve the community's supply of housing affordable to very low, low and moderate income households. Review of the Prior Implementation Plan The Agency's first implementation plan, adopted in October 1994, delineated a series of nonhousing and housing projects and programs, the majority of which were initiated or fully implemented during the planning period. The Agency's achievements over the past five years include the following: ■ New Duke's/Chimayo's restaurants and Pier Plaza completed ■ Acquisition of full block site for Plaza Almeria, site clearance and relocation complete, and construction approximately 90%complete. ■ Selection of developer and approval of disposition and development agreement with CIM/Federal for development of blocks 104/105 ■ Acquisition of all mobile homes and clearance of former Driftwood mobile home park; construction of Waterfront project expansion initiated. ■ Plans completed for the widening of the McFadden/I-405 overcrossing. ■ Completed plans for Gothard-Hoover connection. ■ Rehabilitated 158 residential units in the Oakview subarea. ■ Approval of 1996 Amendment/Merger of five separate project areas ■ Approval of 1999 Redevelopment Plan amendment to extend eminent domain within blocks 104/105 of Main-Pier subarea. ■ Demolition of the fire damaged Standard Market Building and construction is nearing completion on anew 9,500 square foot replacement structure. Redevelopment Agency of the 4 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Anticipated Planning Period Projects and Programs The following narrative describes the nonhousing and housing programs proposed for the next five years. Anticipated program expenditures are based on projected tax increment revenue expected for FY 1999-00 to FY 2003-04. Greater or lesser funding may be available, depending upon actual assessed valuation changes in the Project Area. Table 1 below summarizes the Agency's proposed programs. A more detailed description of each project and program follows this summary matrix, along with a five-year budget forecast showing projected resources and expenditures. Redevelopment Agency of the 5 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 IMPLEMENTATIONFIVE YEAR REDEVELOPMENTOF OF • Estimated Program Time Frame Goals Achieved Blight Mitigated Agency Cost NONHOUSING PROGRAM Waterfront Project Ongoing Alleviate and prevent the spread of blighting conditions Inadequate public improvements $ 7,000,000 Expand commercial base of Project Area Social and economic maladjustment Improve public facilities and infrastructure Promote local job opportunities Remove impediments to development Redevelop underutilized parcels CIM Project Begins in 2003-04 Alleviate and prevent the spread of blighting conditions Defective design and character $ 787,022 Expand commercial base of Project Area Age,obsolescence and deterioration Improve public facilities and infrastructure Irregular lot subdivision Promote local job opportunities Inadequate public improvements Implement compatible design and use standards Social and economic maladjustment Remove impediments to development Redevelop underutilized parcels Address irregular and undersized parcels Edinger Corridor Begins in 2003-04 Alleviate and prevent the spread of blighting conditions Defective design and character $ 340,000 Expand commercial base of Project Area Age,obsolescence and deterioration Improve public facilities and infrastructure Inadequate public improvements Promote local job opportunities Social and economic maladjustment Implement compatible design and use standards Remove impediments to development Economic Development Ongoing Alleviate and prevent the spread of blighting conditions Defective design and character $ 8,400,000 Program Expand commercial base of Project Area Age,obsolescence and deterioration Improve public facilities and infrastructure Inadequate public improvements Promote local job opportunities Social and economic maladjustment Implement compatible design and use standards Remove impediments to development TOTAL FIVE YEAR NONHOUSING PROGRAM COST $ 16,527,022 IMPLEMENTATIONFIVE YEAR REDEVELOPMENTOF OF • Estimated Program Time Frame Goals Achieved Blight Mitigated Agency Cost HOUSING • Mercy House 2002-03 Work to increase the supply of very low,low and Not applicable 250,000 moderate income housing opportunities Shelter for Homeless 2002-03 Work to increase the supply of very low,low and Not applicable 750,000 moderate income housing opportunities Bowen Court Project 1999-00 to 2000-01 Work to increase the supply of very low,low and Not applicable 1,800,000 moderate income housing opportunities Center Avenue Project 2002-03 Work to increase the supply of very low,low and Not applicable 650,000 moderate income housing opportunities Citywide Acquisition Rehab Ongoing Work to increase the supply of very low,low and Not applicable 7,140,000 moderate income housing opportunities TOTAL FIVE YEAR HOUSING PROGRAM COST $ 10,590,000 GRAND TOTAL $ 27,117,022 Nonhousing Programs Waterfront Expansion (Hilton Grand Coast Resort Project) This project is under development on a 38 acre parcel adjacent to the existing 296-room Waterfront Hilton. It will include a 520-room hotel, 50,000 square foot conference center and a 13,000 square foot retail center. The project will feature Mediterranean architecture with abundant landscaping, fountains, swimming pools and two tennis courts. On an adjacent parcel will be developed a residential project of approximately 177 homes in duplex and cluster configuration. A future phase calls for an additional,third,hotel of about 300 rooms. Expenditures During the five-year period,the Agency anticipates expending approximately$7.0 million to repay advances for this project. Plan Objectives the Project Will Address • Alleviate and prevent the spread of blighting conditions • Expand commercial base of Project Area • Improve public facilities and infrastructure • Promote local job opportunities • Remove impediments to development • Redevelop underutilized parcels Conditions of Blight the Project Will Address • Inadequate public improvements • Social and economic maladjustment CIM Project The Agency and CIM have entered into an Disposition and Development Agreement to facilitate the redevelopment of blocks 104/105 in downtown Huntington Beach. The CIM project involves development of mix of retail, restaurant and hotel uses, replacing undeveloped and obsolete uses at this location. This project will involve displacement of nine residential rental units, consisting of seven(7) one-bedroom units and two (2)two-bedroom units. Section 33490(a)(3)requires that this Plan identify the proposed locations suitable for replacement dwelling units, should displacement occur. The Agency's Replacement Housing Plan for the project, adopted on May 3, 1999, indicates that in fact the Agency's affordable housing activities have generated a surplus of 315 replacement units, and that the project's replacement housing needs will be met by this surplus. The location of the Agency's replacement housing units are itemized on Table 2 below. Redevelopment Agency of the 9 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Expenditures During the five-year period, the Agency anticipates expending approximately$787,022 on this project. Project-generated tax revenues will offset the majority of these costs. Plan Objectives the Project Will Address • Alleviate and prevent the spread of blighting conditions • Expand commercial base of Project Area • Improve public facilities and infrastructure • Promote local job opportunities • Implement compatible design and use standards • Remove impediments to development Conditions of Blight the Project Will Address • Defective design and character • Age, obsolescence and deterioration • Irregular lot subdivision • Inadequate public improvements • Social and economic maladjustment Edinger Corridor Improvement Study The Agency is undertaking steps to enhance the Edinger corridor in the Huntington Center subarea. During the planning period, the Agency will conduct a land use, zoning, and market study for this area. The study will also evaluate circulation, ingress/egress, and new development opportunities in the area. Expenditures During the five-year period, the Agency anticipates expending approximately$340,000 on this project. Plan Objectives the Project Will Address • Alleviate and prevent the spread of blighting conditions • Expand commercial base of Project Area • Improve public facilities and infrastructure • Promote local job opportunities • Implement compatible design and use standards • Remove impediments to development Conditions of Blight the Project Will Address • Defective design and character • Age, obsolescence and deterioration • Inadequate public improvements • Social and economic maladjustment Redevelopment Agency of the 10 Five-Year Implementation Plan Citv of Huntineton Beach 1999-00 through 2003-04 Economic Development Program Beyond those projects identified above, the Agency is also pursuing other economic development projects throughout the Project Area. Because these projects are still in a formative stage, specific project parameters and any subsidies are not yet available. However, all projects under the Agency's economic development program are oriented towards the elimination of Project Area blighting conditions, expansion of the community's economic base, and other Redevelopment Plan goals. During the planning period,the Agency estimates that additional economic development projects which could be implemented include,but are not limited to, Huntington Center,the 31-acre Pacific Coast Highway project,the Atlanta/Beach project, the Fourth Block East infill project, and the Beach/Edinger project. Expenditures During the five-year period, the Agency has allocated approximately$8.4 million to implement economic development programs, contingent upon specific project needs. Plan Objectives the Project Will Address • Alleviate and prevent the spread of blighting conditions • Expand commercial base of Project Area • Improve public facilities and infrastructure • Promote local job opportunities • Implement compatible design and use standards • Remove impediments to development Conditions of Blight the Project Will Address • Defective design and character • Age, obsolescence and deterioration • Inadequate public improvements • Social and economic maladjustment Redevelopment Agency of the 11 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 LOCATION OF • REDEVELOPMENT OF OF • Category 0 Bedroom 1 Bedroom 2 Bedroom 3 Bedroom 4 Bedroom Total Very Low Income Emerald Cove 32 132 0 0 0 164 313 11th Street 0 5 4 0 0 9 7812 Barton 0 0 4 0 0 4 Five Points Senior Villas 0 32 0 0 0 32 17372 Keelson 0 0 2 2 0 4 17382 Keelson 0 0 3 1 0 4 17361 Koledo 0 0 5 0 0 5 17371 Koledo 0 0 5 0 0 5 17422 Queens 0 0 4 0 0 4 17432 Queens 0 0 4 0 0 4 17291 Koledo 0 0 4 0 0 4 17351 Koledo 0 0 4 0 0 4 Ronald Rd.Habitat(7862 Ronald Rd. 0 0 3 0 0 3 Bridges(7611 Nichols) 0 0 3 0 0 3 0 Low Income Ocean View Estates 0 0 24 0 0 24 Brisas del Mar 0 2 8 4 0 14 725-731 Utica Av. 0 0 36 0 0 36 Total Moderate Income Brisas del Mar 0 6 14 10 0 30 Five Points Senior Villas 0 16 0 0 0 16 Pacific Park Villas 0 0 25 0 0 25 Cape Ann 0 0 0 102 44 146 Promenade 0 0 28 52 0 80 0 Source:Keyser Marston Associates Housing Programs Mercy House Project Preliminary plans call for six units of transitional housing for single parents with children. This project will be located on a vacant parcel (northeast corner of Elm Street and Cypress Avenue) owned by the Redevelopment Agency in the Oakview project sub area. Redevelopment Agency of the 12 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Expenditures Based on projected resources, the Agency anticipates expending$250,000 during the five- year planning period. Plan Objectives the Project Will Address • Work to increase the supply of very low, low, and moderate income housing opportunities. Shelter for Homeless Shelter for the Homeless is a nonprofit provider of shelter, transitional and permanent housing throughout Orange County. Shelter for the Homeless is currently looking for both new construction and acquisition-rehab opportunities in Huntington Beach to complement existing projects located in the Oakview neighborhood. Expenditures Based on projected resources, the Agency anticipates expending $750,000 during the five- year planning period. Plan Objectives the Project Will Address • Work to increase the supply of very low, low, and moderate income housing opportunities. Bowen Court Project The Agency owns a vacant parcel across from the Civic Center, in the Yorktown-Lake project sub area. This site has entitlements for a twenty-one unit senior rental apartment project. All of the units are planned for very low-income seniors. Merit Housing Development Corporation, a nonprofit based in Orange, California, is the developer of the project. Expenditures Based on projected resources, the Agency anticipates expending an additional $1,800,000 million during the five-year planning period. This project assistance consists of a$900,000 loan, and a$900,000 grant for underwriting development costs. Plan Objectives the Project Will Address • Work to increase the supply of very low, low, and moderate income housing opportunities. Center Avenue Project A Disposition and Development Agreement(DDA)with Pacific Development Company governs this Agency-owned vacant parcel located in the Huntington Center project sub area. The ten year(beginning in 1993) DDA commits the Agency to a maximum of$650,000 for a housing project on the site. To date, there has been no project submitted by the developer and Redevelopment Agency of the 13 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 approximately three years remain on the DDA. Based on the size of the parcel and the current zoning, it appears that an efficiency apartment project of approximately eighty units may be suitable for the site. Expenditures Based on projected resources, the Agency anticipates expending$650,000 during the five- year planning period. Plan Objectives the Project Will Address • Work to increase the supply of very low, low, and moderate income housing opportunities. Citywide Acquisition/Rehabilitation Program The Agency proposes to invest its affordable housing resources in acquisition and rehabilitation projects throughout the City. These activities would permit the Agency with the greatest discretion to upgrade deficient and substandard housing units. Currently,the Agency expends approximately$500,000 annually on this program, which results in an average of 7 acquisition and rehabilitated units each year. With additional housing resources projected over the next five years,the Agency can expand the impact of this program in order to meet City housing production goals pursuant to the Housing Element's regional housing needs assessment. Some of these funds may be allocated to Orange County Community Housing Corporation (O.C.C.H.C.)to acquire and rehab multifamily rental apartment units,primarily for very low and low-income families. O.C.C.H.C. currently owns thirty-two units in four and five-plex properties in the Oakview area. Assuming the Agency expends the entire $7.14 million projected to be available for this program, as many as 102 units could be rehabilitated. Expenditures Based on projected resources,the Agency anticipates expending $7.14 million during the five- year planning period. Plan Objectives the Project Will Address • Work to increase the supply of very low, low, and moderate income housing opportunities. Redevelopment Agency of the 14 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Five-Year Budget Tables 3 and 4 present a preliminary five-year budget for the nonhousing and housing programs, respectively. Tax increment revenues were conservatively estimated based on a 2.0%increase in secured assessed values plus development of the Waterfront, CIM, and Plaza Almeria projects. The budget also contains other project revenues, including interest earnings, rental income, and transient occupancy tax reimbursements. Expenditures were based on the 1999-00 budget, and include bond debt service, loan and advance repayments, and administrative costs. In total, the Agency anticipates expending $16,527,022 on nonhousing programs, and $10,590,000 on affordable housing programs. Redevelopment Agency of the 15 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 TABLE-3- REDEVELOPMENT AGENCY OF OF •N BEACH NONHOUSING RESOURCES oa 1999-00 2000-01 2001-02 2002-03 2003-04 Beginning Available Fund Balance 4,145,036 4,153,982 4,189,621 4,150,487 4,176,806 Revenues Tax Increment Revenue /1 4,663,806 5,389,781 6,164,675 6,457,467 7,325,264 30,000,991 Interest Earnings 227,977 228,469 230,429 228,277 229,724 1,144,876 Main Pier Misc Revenue 1.838,500 1,808,100 2,494,500 2,660,300 2,883,500 11,684,900 Subtotal otal Kesources , Expenditures Debt Service-HBPFA 2,612,206 2,623,166 2,620,379 2,629,669 2,624,029 13,109,449 Transfer to General Fund 700.000 700,000 700,000 700,000 700,000 3,500,000 Debt Service-Huntington Nag Bank 95,000 95,000 95,000 95,000 95,000 475,000 Abdelmuti Contract 135,000 135,000 135,000 135,000 135,000 675,000 Parking in-lieu fees - - 300,000 - - 300,000 Pass Through Agreements 64,309 213,106 219,508 226,123 232,952 955.998 Statutory Taxing Agency Payments - 1,376 4,134 7,030 31,045 43,585 Operating Expenses 964,822 1,013,063 1,063,716 1,116,902 1,172,747 5,331,251 Miscellaneous Expenses 10,000 10,000 10,000 10,000 10,000 50,000 ERAF Loan Repayment - - 731,000 - - 731,000 Housing Fund Repayment - - 1,350,000 - - 1,350,000 Capital and Special Projects 1/ Waterfront Project 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 7,000,000 CIM Project - - - - 787,022 787,022 Edinger Corridor 340,000 - - - - 340,000 Economic Development Progra 400,000 1,200,000 300,000 3,000,000 3,300,000 8,200,000 lotal Expenaitures Ending Available Fund Balance 4,153,982 4,189,621 4,150,487 4,176,806 4,127,499 1/ Assumes 2%secured assessed value growth,plus phased development of Plaza Almeria,Waterfront residential,and CIM No revenues generated by implementation of the Economic Development Program are included in this forecast,to avoid overstating potential nonhousing revenues. Redevelopment Agency of the 16 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 IMPLEMENTATIONFIVE YEAR REDEVELOPMENTOF OF .N BEACH HOUSING RESOURCES 1 2 3 4 5 Total 1999-00 2000-01 2001-02 2002-03 2003-04 Beginning Available Fund Balance 3.172,754 2,685,144 2,682,209 2,713,836 2,729,401 Revenues Tax Increment Revenue /1 1,165,951 1,347,445 1,541,169 1,614,367 1,746,576 7,415,508 Interest Earnings 174,501 147.683 147,521 149,261 150,117 769,084 Five Points Seniors Villas 38,000 38,000 38,000 38,000 38,000 190,000 ERAF Loan Repayment - - 731,000 - - 731,000 Housing Fund Repayment(MP) - - 1,350,000 - - 1.350,000 Subtotal 1,378,453 1,533,128 3,807,690 1,801,628 1,934.693 10,455,591 Total Resources 4,551,207 4,218,272 6,489,899 4,515,464 4,664.093 Expenditures Operating Expenditures 20,500 20,500 20,500 20,500 20,500 102,500 Property Tax Collection Charge 10,563 10,563 10,563 10,563 10,563 52,815 Transfer to Emerald Cove 35,000 35,000 35,000 35,000 35,000 175,000 Housing Projects Mercy House - - - 250,000 - 250,000 Shelter for Homeless - - - 750,000 - 750,000 Bowen Court 1,800,000 - - - - 1,800,000 CenterAvenue - - - 650,000 - 650,000 Citywide Acquisition/Rehab - 1,470,000 3.710,000 70,000 1,890,000 7,140,000 Total Expenditures 1,866,063 1,536,063 3,776,063 1,786,063 1,956,063 10,920,315 Ending Available Fund Balance 2,685,144 2,682,209 2,713,836 2,729,401 2,708,030 1/ Assumes 2%secured assessed value growth,plus phased development of Plaza Almeria,Waterfront residential,and Cl Redevelopment Agency of the 17 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Housing Unit Estimates Section 33490(2)(A) of the Law requires that the implementation plan address housing fund revenues and expenditures, as well as any applicable housing production activities over the next five years. These elements are included in the Agency's Amended Ten-Year Affordable Housing Compliance Plan, incorporated herein by reference. In addition to these data, Section 33490(2)(B) requires various estimates of housing unit production over the time frame of the next five years, next ten years, and over the duration of the Redevelopment Plan. These estimates are included in Table 5 below. FIVE YEAR IMPLEMENTATION PLAN TABLE 5 REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH HOUSING UNIT ESTIMATES Plan Time Frame Current 5 Years 10 Years Duration As of 1999- 1999- 1982- Sep-99 2003 2008 2024 Total Market Rate&Affordable Units Projected (H&S Sec.33490(a)(2)(B)(1)) New Construction n/a n/a 289 2,186 Substantial Rehabilitation n/a n/a - - Price Restricted n/a n/a - - Total n/a n/a 289 2,186 Affordable Housing Production Requirement (H&S Sec.33490(a)(2)(B)(ii)) Low and Moderate Income n/a n/a 26 207 Very Low Income n/a n/a 17 146 Total 43 353 Units Developed to Meet Production Requirement (H&S Sec.33490(a)(2)(B)(iii)) Low and Moderate Income 155 n/a n/a n/a Very Low Income 247 n/a nla n/a Total 401 n/a n/a n/a Units to be Developed by Agency (H&S Sec.33490(a)(2)(B)(iv and v)) Low and Moderate Income n/a - n/a n/a Very Low Income n/a - n/a n/a All Others n/a - n/a n/a Total n/a - n/a n/a 1/ "n/a"means not applicable by Redevelopment Law Redevelopment Agency of the 18 Five-Year Implementation Plan City of Huntington Beach 1999-00 through 2003-04 Broad Criteria and Objectives ATTACHMENT #5 City of Huntington Beach Broad Criteria and Objectives for Huntington Center Owner Participation Agreement In order to negotiate an Owner Participation Agreement for the redevelopment of Huntington Center, it is recommended that the City establish a set of broad criteria and objectives by which proposals can be measured and shaped. This outline presents staffs proposal for the key criteria. Financial Provide positive cash flow to City General Fund (net of cost of service). w. Provide positive cash flow to the Redevelopment Agency, net of any costs associated with the project. Minimize public funds invested into the project. Limit investment to a defined feasibility gap that is funded by the Owner and repaid over a 20-year term from a share of project revenues. Consider linking repayment of defined feasibility gap to an incentive- based formula (i.e., higher public revenues warrant repayment of a higher negotiated defined feasibility gap, if needed). Financial (continued) Owner to be responsible for all site preparation / clearance and development costs. Provide for protection of Agency's expected tax increment revenues against future downward assessments. Minimize the Agency's cost of funds (repayment of defined feasibility gap) through appropriate public finance mechanisms at the Agency's election. Development Assure development of a high-quality regional-serving retail and entertainment project. Assure the project sets the standard desired for future development in the Edinger Corridor. Provide adequate traffic and circulation improvements that ensure free movement of traffic in the area given the additional traffic generated. Ensure that the intersections of Beach & Edinger and I-405 & Center Avenue are improved as attractive gateways to the City. Development (continued) Coordinate land use and development standards to ensure future incorporation of the Montgomery Ward parcel. Environmental Minimize impacts on surrounding areas. Provide new jobs and economic opportunities to residents of the region. (g:dcb:proj ects:H/C:critera) Request for Agency Action 6/19/2000 ATTACHMENT #6 Council/Agency Meeting Held: Deferred/Continued to: � i proved ❑ Conditionally Approved ❑ Deni d l- ty rk's Signature Council Meeting Date: June 19, 2000 Department ID Number: ED 00-26 CITY OF HUNTINGTON BEACH s REQUEST FOR REDEVELOPMENT AGENCY ACTION r C_.. = ri SUBMITTED TO: HONORABLE CHAIRMAN AND REDEVELOPMENT AGENCY, MEMBERS co CD CD > ' `� SUBMITTED BY: RAY SILVER, Executive Director (1� = v PREPARED BY: DAVID C. BIGGS, Director of Economic Development Pf " SUBJECT: Approve Developer Selection from Huntington Center Owner Participation Proposals Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: On March 3, 2000, the Redevelopment Agency issued a Statement of Interest and Request For Proposal. (RFP) letter to all the major property owners and long- term tenants in the Huntington Center redevelopment site. The letters requested proposals for the redevelopment of the entire Huntington Center. Three proposals were submitted (Burlington Coat Factory, The Ezralow Company and Montgomery Wards). The Agency Board needs to select a respondent to undertake the comprehensive redevelopment of the site. Funding Source: Not applicable at this time Recommended Action: Direct staff to negotiate an Owner Participation Agreement with Huntington Center Associates, LLC, an Ezralow Company subsidiary, for the comprehensive redevelopment of Huntington Center. Alternative Action(s): Do not select an overall developer for the entire Huntington Center. Analysis: On November 26, 1984, the Redevelopment Agency Board adopted the Huntington Center Commercial District Redevelopment Plan. One of the principal reasons for the adoption of the plan was the obsolescence of the Huntington Center and the need to redevelop it. As time has progressed, the center has lost two of its anchor stores and has become severely deteriorated. JC Penney left the Center in August of 1994; Broadway closed its store in August of 1996. The replacement store for JC Penney only occupies two of three floors in the building. _� REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: June 19, 2000 DEPARTMENT ID NUMBER: ED 00-26 The City has seen its sales tax revenue from the site decline from over$1.5 million in 1990 to less that$850,000 in 1998. One of the existing anchors has seen its sales volume decline by 30% between 1994/95 and 1998/99. The gross assessed value, of the site, which has dramatically driven down the Redevelopment Agency revenues, has declined from $94 million in 1993/94 to $45 million in 1999/00. In addition, there are property owner initiated assessed valuation appeals now pending. The community has long clamored its redevelopment, as the center has become an eyesore. The Agency attempted to work with the various owners of the center over the past 10 years to no avail. Recently a new owner has come into the picture and has demonstrated the interest to pursue the Center's redevelopment. The Agency intends for the Huntington Center to be rehabilitated and repositioned into a high-quality, well-integrated retail and entertainment center under unified ownership. To that end, the Agency has determined that, in order to revitalize the economy of the center and to best achieve the redevelopment goals of the Agency and Redevelopment Plan, the Agency may need to encourage comprehensive changes to both the structural and tenant composition of the Huntington Center. The Agency believes that unified development of the Huntington Center will allow for the oversight and site control necessary to effectively redevelop and maintain the center as a superior quality development, and will advance the Redevelopment Plan's stated goal of implementing design and use standards to assure high aesthetic and environmental quality, and providing unity and integrity to developments within the Project Area (Redevelopment Plan, Section 500). In addition, Agency expert consultants confirm that unified development and maintenance of the Huntington Center in the highest standards will enable the center to attract the combination and caliber of tenants as well as financing necessary to reposition it into a first-rate retail and entertainment center. Because of the Huntington Center's location as a major gateway to the City, it is vital to the interests of the City that the Huntington Center be redeveloped in a manner that will significantly enhance the image of the community and set the standard desired for future high-quality development in the City. The Agency believes that the unified, comprehensive development and maintenance of the center as envisioned by the Agency will accomplish these purposes as well as those set forth in the Redevelopment Plan. In order to effectuate the Redevelopment Plan and accomplish the objectives described above, the Agency issued a Request for Proposal and Statement of Interest (RFP) (Attachment 1) to qualifying owners and long-term tenants within the Huntington Center. The RFP described the objectives of the Agency and Redevelopment Plan, and sought proposals for the redevelopment of the entire Huntington Center in accordance with such objectives. Three proposals were submitted - Burlington Coat Factory (Attachment 2), The Ezralow Company (Attachment 3) and Montgomery Wards (Attachment 4). Agency staff has carefully reviewed and analyzed the three proposals in light of both the goals and objectives described above and the specific requirements set forth in the RFP (see Attachment 5 for summary matrix), and has come to the conclusion that only the proposal from The Ezralow Company meets these goals, objectives and requirements. RCAHBMaII -2- 6/6/00 10:02 AM r REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: June 19, 2000 DEPARTMENT ID NUMBER: ED 00-26 The Economic Development Department is recommending The Ezralow Company's proposal for several reasons. First, it was the only submission which addressed and proposes to fulfill the Agency's stated goal of comprehensive development - the proposal offered detailed plans prepared by experts for the extensive redevelopment of the Huntington Center in its entirety. The submissions by Montgomery Ward and Burlington Coat Factory, however, did not address the Agency's stated goal of comprehensive development. Rather, Montgomery Ward only addressed the renovation of its two individual buildings, and Burlington Coat Factory only addressed its desire to continue leasing property within the Huntington Center. Based on their proposals, it does not seem that either Montgomery Ward or Burlington Coat Factory desire or are willing to engage in a comprehensive redevelopment of the Huntington Center as envisioned by the Agency, instead, they want only to maintain their individual stores. However, fragmented development proposals will not accomplish.the goals and objectives established by the Agency and Redevelopment Plan. Second, The Ezralow Company was the only party which submitted essentially all of the documents which were required by the RFP and necessary for the Agency to adequately evaluate the potential participant's redevelopment plans for the Huntington Center as well as the potential participant's development experience and financial capability (please see Attachment 5). Montgomery Ward and Burlington Coat Factory did not submit these essential documents. For these reasons, the Economic Development Department recommends that Agency staff enter into negotiations with The Ezralow Company (or any one or its affiliates or subsidiaries) for an Owner Participation Agreement for the redevelopment of the Huntington Center. If this recommendation is approved, staff will negotiate for a 60-day period, during which the selected participant shall be required to provide adequate assurances to Agency that the participant has definitive plans for and is capable of attracting the combination and caliber of tenants as well as financing necessary to rehabilitate and reposition the entire Huntington Center into a first-rate, unified development. Environmental Status: None for this action. Attachment(s): City CIerWs Page Number No. Description 1 RFP Letter. I2 Burlington Proposal. a7 3 Ezralow Proposal. ZSoq 4 Montgomery Wards Proposal. 5 Huntington Center Proposal Analysis Matrix. F � . RCAHBMaII _3- 616100 10:02 AM r REQUEST FOR REDEVELOPMENT AGENCY ACTION MEETING DATE: June 19, 2000 DEPARTMENT ID NUMBER: ED 00-26 RCA Author: D. Biggs X5909&Gus Duran X1529 RCAHBMall .- 616/00 10:02 AM RFP Letter •�;--.�, _ rye ti:r�:';;; _rvsrk, � zri �az,.t ;H,�,,�aa�u'j ��Fx °'�:a!�;•,�'�r"�"'x��,'�;:'�r�`t�s ��.,. �"' '(r;�...�''�>>::..:n�'�ii,=t. '��.tii'.'�- '�".: hr y�i� �1ri..- ;��',�"�.i:'+.�+ �'-:ez � s" :,•��. d,SY'k£,`-'.���n � 'Ft2`-' p.���R!,�b'.{e��' l _ L� w,s. in'.e }4.- +•x'- rr'4',ff 'a?..`.�,�. l..w'. � r`Y��+h�..+c"._1Y '�:1` •LL;;;Y'. w1!s..fi:.\rt?.- <s• y' F_ � _ s • City of Huntington Beach ( 1 2000 MAIN STREET CALIFORNIA92648 DEPARTMENT OF ECONOMIC DEVELOPMENT Director 714/536-5582 Redevelopment 714/536-5582 FAX 714/375-5087 Housing 714/536-5542 March 3, 2000 Burlington Coat Factory Warehouse of HB,Inc. Attn: Legal Department 1830 Route 130 North Burlington,NJ 08016 Re: Statement of Interest and Request For Proposal for Redevelopment of Huntington Center. Within the Huntington Beach Redevelopment Project Area (Burlington Coat Factory,7777 Edinger Ave.,Huntington Beach, CA 92647) Dear Business Owner: A. Introduction The Redevelopment Agency of the City of Huntington Beach (the "Agency") is seeking the interest of property owners (defined below) in the redevelopment of the Huntington Center (the "Site"). The Site is part of the Huntington Beach Redevelopment Project, which Redevelopment Plan was approved and adopted by the City Council of the City of Huntington Beach on December 16, 1996 by Resolution No. 3343. The Agency intends for the Site to be.rehabilitated and repositioned into a high-quality, well-integrated retail and entertainment center under unified ownership. The Agency believes unified ownership of the Site will allow for the oversight and control necessary to effectively redevelop and maintain the Site, without the problems often associated with fragmented ownership. The revitalized Site is intended to serve the region and to provide new jobs and economic opportunities to residents of the region. In addition,the location of the Site as a major gateway to the City of Huntington Beach, as well as the excellent visibility and accessibility from the 405 Freeway, calls for a superior quality redevelopment that will significantly enhance the image of the community and set the standard desired for future high-quality development in the Edinger Corridor. This Request For Proposal provides property owners located within the Site with the opportunity to participate in the proposed redevelopment of the Site. All participation shall be subject to the approval of the Agency and shall,be consistent with the Redevelopment Plan and F 2 c� 1 the"Rules Governing Participation and Preferences by Property Owners and Business Occupants for the Huntington Beach Redevelopment Project," dated August 1996 (the "Owner Participation Rules"), incorporated herein by this reference as though fully set forth herein. Pursuant to the Owner Participation Rules, a "property owner" is any person, persons, corporation, association, partnership, or other entity holding recorded fee title to or a long-term lease of real property in the Site for so long as such property owner holds such title or long-term lease. A "long-term lease" is a lease of real property with a term of twenty (20) years or more, with at least ten (10) years remaining on such term. Property owners who are interested in redeveloping the Site must file a Statement of Interest Form(attached) by April 17, 2000 and must submit the Development Proposal requested in this Request For Proposal by May 2, 2000. All property owners must be qualified to perform their total obligations within a period of time to be provided by the Agency, and will be required to secure the performance of their obligations in a reasonably satisfactory manner. The Agency is not obligated to accept any Statements of Interest or Development Proposals, and is not obligated to consider any Statements of Interest or Development Proposals after the dates set forth above. B. Request for Proposal This invitation is the first step taken by the Agency leading to the selection of a developer to rehabilitate and reposition the Site located in the Huntington Beach Redevelopment Project Area. This Request For Proposal is being sent to property owners within the Site who may file a Statement of Interest Form and Development Proposal with the Agency. The Agency has determined that you qualify as a property owner within the Site, and therefore have an opportunity to participate in the potential redevelopment of the Site through the process outlined in this letter. C. Purpose of Request For Proposal The purpose of this Request For Proposal is to ask prospective developers to submit sufficient information regarding development expertise and financial capabilities to enable the Agency to award a developer the right to negotiate an Owner Participation Agreement with the Agency. D. The Site a. Location. The Site is within the Huntington Beach Redevelopment Project Area and is generally bound by Edinger Avenue on the south, the Southern Pacific Rail Road Right of Way on the west, Center Avenue on the north, and the 405 Freeway and Beach Boulevard on the northeast and east. b. Characteristics. The Site currently exists as a shopping center commonly known as the Huntington Center. The Site is zoned general commercial. 2 C. Development Costs. Site preparation and clearance and all redevelopment costs for the Site will be the responsibility of the developer. d. Public Improvements. Public improvements such as road improvements, sidewalks, open spaces, and other public infrastructure will be the responsibility- of the developer. e. Working Capital. As stated above, the Agency desires the Site to be redeveloped under unified ownership. Therefore, subject to these owner participation procedures, the Agency will consider utilizing its powers to facilitate assembling the Site as necessary to effectuate the redevelopment of the Site. In that event,the Agency may require the developer to advance all or a significant portion of the working capital required by the Agency to assemble the site, by the advance payment of the purchase price, loans, or other mechanism to be negotiated with the Agency. The Agency has made no determination to acquire any portion of the Site at this time. E. Submissions a. Deadlines. Development Proposals must be received at the following address no later than May 2,2000: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach, California 92648 Attention: Gus Duran, Housing and Redevelopment Manager No Development Proposals will be considered unless the Agency has previously- received a Statement of Interest Form (attached) from the developer by April 17, 2000. b. Format for Submissions. The format for submitting Development Proposals consists of the following elements: 1. Identification of Developer. i. Name, address,telephone and facsimile number of developer. ii. Organization of developer (i.e., individual, corporation, partnership, etc.); principals of developer (i.e. corporate officers, principal stockholders, general and limited partners, etc.) and manager to be responsible for proposed redevelopment; and relationship of developer with any parent corporation, subsidiary, joint venture, or other entity. 2. Leases. Statement regarding any lease commitments developer may have A on the Site. 3 3. Redevelopment Concept for Site. i. Description of proposed land uses and the arrangement of these uses. The proposed redevelopment should be described in sufficient detail to form the basis for the developer's preliminary cost estimates. Architectural drawings/renderings are not required at this time. ii. The number and size of structures and the type of construction to be used. iii. A break-out of the estimated total cost of the proposed redevelopment and a statement of any basic assumptions affecting the feasibility of the proposed redevelopment. iv. A schedule of performance outlining the estimated time for each step of the redevelopment process. 4. Financial Capability. i. Copy of certified financial statement of developer, prepared in accordance with accepted accounting practices and dated within six (6) months prior to submission of the Development Proposal. ii. Copies of any annual reports, financial rating reports or other documents indicating the financial condition of developer. iii. Statement indicating how developer proposes to finance the redevelopment of the Site (including proposed source of financing, amount of equity investment, and probable terms and conditions of financing). iv. List of names and addresses of bank or other financial institution(s) and references. Letter of recommendation from developer's bank would be helpful. 5. Development Experience. The Agency is particularly interested in the developer's ability to assemble and manage a team of redevelopment participants including architects, planners, engineers, builders, financial consultants,marketing specialists and management personnel. i. List of development projects in which developer and/or proposed associates have participated, including any 'urban renewal or redevelopment areas, showing the location,type and dollar volume of the work. ii. Descriptions and illustrations of the proposed architect's work on projects which have been built or are under construction. 4 iii. If developer plans to retain and manage the completed development, submit description of developer's experience in ownership and management of completed developments. If a management firm is to be employed for this purpose, submit sufficient data on the firm's experience to enable the Agency to determine its ability to manage the completed development. Please feel free to include any other information which you may feel is appropriate or pertinent. F. A�ency Evaluation of Information Submitted. The Agency will evaluate Statements of Interest and Development Proposals which are submitted on time. The Agency will consider factors such as: a. The degree to which the Development Proposal would achieve the redevelopment objectives for the Site, including whether the Development Proposal conforms to and meets the goals and objectives of the Redevelopment Plan. b. The developer's demonstrated ability to complete redevelopments of this type successfully and in a timely manner. C. Whether the Development Proposal is feasible (financially and otherwise) or in the best interest of the Site and community. Based on the information submitted, the Agency may select a developer from among those submitting Statements of Interest and Development Proposals to negotiate with towards an Owner Participation Agreement. The Agency reserves the right at its sole discretion to reject any and all Statements of Interest and Development Proposals. Please direct any questions to Gus Duran, Department of Economic Development, at . (714) 374-1529. Sincerely yours, David C. Biggs Director of Economic Development Enclosure �- 2- 5 STATEMENT OF INTEREST FOR PARTICIPATION IN THE HUNTINGTON BEACH REDEVELOPMENT PROJECT I hereby express my interest in participating in the Huntington Beach Redevelopment Project: l. Name of Property Owner/Tenant: Phone: 2. Home Address: f- 3. Address of Property owned or rented in the Project Area: 4. Name of business in the Project Area: Phone: 5. I own ( ); am a tenant ( ); and wish to rehabilitate ( ); build ( ); sell ( ) my present property. If tenant,indicate: month-to-month( ); or lease( ); expiration date of lease:_ 6. My present type of business is: 7. Nature of proposed participation: I understand that submission of this Statement of Interest does not in any way obligate me to participate in the Project. Signed: Return to: Title: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Date: Huntington Beach,California 92648 r-2 �� Burlington Proposal }.-��, r'> .�� :��3":; its• t# ;„� .' .i .). �.. �,. �y:..,��M. ,•"_ ». �r '�i 3 ., s A" 'i„: c��'a" +a �.sy��+, Z a Ci.,:`an.+dirt+y'S��,=n.r.',»r»+i€W n.r :r�;, .F:e+. c�. K .w` +„r..-..,'�•.r,*,.xl; :���,.�,a .:.�f„k,... u*;f.,Y"s4' `�T�.v"-`.`�i. e'`�r»t�:-•'^ i�z-•� .stS.�,,-,..._�_.!-aa, fi � -,s x a°���*�;..`g`�.:,?�' `4;':y� .s'L4'#'ir..,-A FROM TUCHMAN & ASSOCIATES PHONE NO. : 2133950595 Apr. 28 2000 10:28AM P2 TUCHMAN & ASSOCIATES ATTORNEYS AT LAW 3435 WILSHIRE BOULEVARD 30TH FLOOR LOS ANGELES.CALIFORNIA 90010 PHONE 213.385.8000 - FAX 213.355.0595 April 28,2000 David Biggs City of Huntington Beach Economic Development 2000 Main Street P.O.Box 190 Huntington Beach, CA 92648 Re: In re Burlington Coat Factory Our File No. 9956 Dear Mr.Biggs: Burlington Coat Factory hereby submits its Proposal pursuant to the Statement of Interest filed on April 13,2000. Burlington Coat Factory proposes to remain on the premises under the same terms and conditions which exist under its present lease. In the alternative,Burlington Coat Factory will participate by moving to similar space with the same square footage so long as the ternns and conditions of its lease remain the same or similar. Ezralow'is under a contractual obligationto include Burlington CoatFactoryin any proposal it submits. To date we have not been contacted by Ezralow. Very truly yours, BURLINGTON COAT FACTORY PAUL TANG TUC ASSOCIATES 17� A'VC L.TUCHMAN 1/ "Ezralow"shall mean The Ezralow,Company.or any.of its affiliates or related entities,including without limitation,Huntington Center Associates LLC. F 2 13 TL!CHMAN & ASSOCIATES PHONE NO. : 2133850595 Apr. 12 2000 12:00PM P2 STATEMENT OF INTEREST FOR PARTICIPATION IN THE HUNTINGTONI BEACH REDEVELOPMENT PROJECT I hereby express my interest in participating in the Huntington Beach Redevelopment Project: 1. Name of Property Owncr/Tenaat: ,rli ngton Coat Factory Warehouse of Huntington Beach, Inc. , c/o Burlington Coat Factory Warehouse 1230 Rome 1 in, Bnr1 i ngton . NJ 08016 Phone: (609) 387-7800 (extension 2022) Deal 2. Re Address: 7777 Edinger Street, Huntington Beach, CA 92647 3. Address of Property owned or rented in the Project Area: 7777 Edinger Street, Huntington Beach, CA 92647 4. Name of business in the Project Area: Burlington Coat Factory _ k Phone: (714) 379-6077 (local) (609) 387-7800 ext 2022 (corporate) 5. I own ( ); am a tenant (x); and wish to rehabilitate ( ); build( ); sell ( ) my Present property. If tenant,indicate: month-to-month( );or lease( );expiration date of lease: 2025 *See Attached Lease for Special Provisions & Attachment 8 6. My present type Of business is: Retail 7. Nature of proposed participation: Continue Tenancy Under Terms and Conditions of Lease Agreement (Attached) 8. See Attachment 8 for further details. I understand that submission of this Statement of Interest _dm = in any way obligate me to participate in the Pbgiect. Signed-" 224 f.�-� Renua to: Title: C_'G(,EC. V(CC- 69/Lc I Val? Redevelopment Agency of the City of Huntington Bath 2000-Main Street Date_ Z421'J 1/ Huntington Bcwk California 92648 ,E 1A ILI �7kOM TUCHMAN 8 ASSOCIATES PHONE N0. : 2133850595 Apr, 12 2000 12:00PM P3 Statement of Interest for Participation In The Huntington Beach Redevelopment Project Attachment 11811 Burlington Coat Factory Warehouse of Huntington Beach, Inc. ("BCF") has a long term lease ("Burlington Lease") with Huntington Center Associates LLC ("HCA") , the landlord of the Huntington Beach Mall ("Shopping Center") . The Burlington Lease ends in the year 2025. The lease has specially drafted clauses protecting BCF from redevelopment of BCF' s demised premises undertaken by the landlord. These special clauses were built into the lease agreement when the lease was entered into in 1995. HCA, the owner of the Shopping Center, has refused to negotiate in good faith and comply with the terms and conditions' of the lease agreement, which require redevelopment proposals be submitted to BCF. In the event of razing of the structure, the parties are required to submit the dispute to binding arbitration. BCF filed a petition to compel arbitration in the Orange County superior court. Argument was heard on March 31, 2000. The court dismissed the petition without prejudice because it considered the matter premature. HCA argued at the hearing that they did not know whether they were going to leave the structure standing or destroy the structure altogether. BCF is proceeding to file a lawsuit against HCA for breach of contract, as the court hearing the petition suggested it should, in the event HCA does not include BCF in its proposals. These special provisions of the lease greatly enhance the value of the leasehold interest, and the value of this leasehold interest, even on a time adjusted basis, is many millions of dollars. BCF wants to participate in the redevelopment of the Shopping Center under terms and conditions which are fair and reasonable, and in conformity, or near conformity to its original lease agreement. BCF has a steady flow of customers. BCF has a loyal customer base. BCF consistently performs by consistently generating millions in net sales per year. In its fiscal year of June 1998 to May 1999, BCF had over S14 million in net sales. The tax benefits to the city are self-evident. BCF provides a unique appeal to a divergent market, and there is no store like it in the immediate vicinity. BCF does not want to inhibit redevelopment.. BCF wants to thrive at the center. The economic downturn of the mall is completely unrelated to the tenancy of BCF. if BCF can generate revenues of this magnitude even in a so-called economically blighted environment, , then it is =ROM .•TUa- MAN & ASSOCIATES PHONE NO. : 2133650595 Apr. 12 2000 12:01PM P4 Treasonable to assume that with an increase in traffic and more tenants that redevelopment will bring even more revenue and a larger tax base will be generated. As required by the Rules Governing Participation and Preferences By Property Owners and Business Occupants For the Huntington Beach Redevelopment Project (the "Rules") , BCF must be given reasonable preferences (over other potential tenants or lessees) to lease or rent premises within the newly rehabilitated or developed facilities. In addition to the Rules, the lease preserves BCF' s status as a tenant within the Shopping Center in spite of redevelopment of BCF' s demised premises. With that being said, HCA has yet to communicate its intentions with respect to the location of BCF' s new premises within the redeveloped center, nor has HCA delivered its proposed plans to BCF. 1 • 3 or 5 LEASE AGREEMENT between MCA HUNTINGTON ASSOCIATES, L.P. a Delaware limited partnership as Landlord and BURLINGTON COAT FACTORY WAREHOUSE OF HUNTINGTON BEACH, INC. a California corporation dba Burlington Coat Factory as Tenant for promises located within HUNFNGTON BEACH MALL HUNTINGTON BEACH, CALIFORNIA ATTORNEYS FOR LANDLORD: ATTORNEYS)FOR TENANT: COLUNS&EATON 2151S Hawthorne Bou{evard Suite 450 Torrance.CA 905M Teiepr'wne(310)540-2020 Dated:. L__13.41 ;LING.TOC �- TALE OF CONTENTS PAGE ARTICLE I CERTAIN LEASE PROVISIONS 1 ARTICLE II DEMISED PREMISES 5 ARTICLE III TERM 6 ARTICLE IV RENT 7 ARTICLE V CONSTRUCTION 7 ARTICLE VI USE AND OPERATION 10 ARTICLE VZI INDEMNITY AND INSURANCE 11 ARTICLE VIII FIRE AND OTHER CASUALTIES 15 ARTICLE IX REPAIRS, MAINTENANCE AND ALTERATIONS 17 ARTICLE X CONDEMNATION 19 ARTICLE XI COMMON AREAS AND COMMON AREA COSTS 20 ARTICLE XII ASSIGNMENT AND SUBLETTING 23 ARTICLE XIII TENANT'S ADDITIONAL AGREEMENTS 26 Tenant's Affirmative Agreements 26 ` Tenant's Negative Agreements 27 Signs 27 ARTICLE XIV PERCENTAGE RENT 28 Payment of Percentage Rent and Gross Sales Reports 28 Gross Sales 29 Books and Records 30 ARTICLE XV UTILITIES 31 ARTICLE XVI REAL ESTATE TAXES 33 ARTICLE XVII CERTAIN ADDITIONAL DEFINED TERMS 33 Common Areas 33 Common Area Costs 34 Concessionaire 34 Gross Leasable Area 34 Landlord 34 -i- �� _ r S 3BURLING.:CC TABLE OF CONTENTS PAGE ARTICLE XVII CERTAIN ADDITIONAL DEFINED TERMS (CONT'D.) Landlord's Managing Agent 35 Lease Year 35 Occupant 35 RED► 35 Shopping Center 35 ARTICLE XVIII DEFAULTS AND REMEDIES 41 ARTICLE XIX SURRENDER OF DEMISED PREMISES 44 ARTICLE XX SUBORDINATION 45 ARTICLE XXI GENERAL PROVISIONS 47 Quiet Enjoyment 47 Relationship of Parties 47 Governing Laws 47• Holding Over 47 Inspectiorr of Demised Premises 47 Successors 48 Estoppel Certificate 48 Brokerage 48 Notices 48 Obligation Joint and Several Where Tenant More Than One Person or Entity 49 Construction of Lease Agreement 49 No Waiver 49 No oral Modifications 49 Right of Redemption 49 Unavoidable Delays 49 Interpretations, Captions and Definition of Person 50 No Oral Agreement 50 Short Form Lease 51 q -ii- _ �a n -si.Ze .CC TABLE OF CONTENTS PAGE ARTICLE XXI GENERAL PROVISIONS (CONT'D.) Notice to Mortgagee and Ground Lessor 51 No Assumption By Mortgagee 51 Authority 51 z Accord and Satisfaction 51 Effect of Invalidity 52 Right to Lease 52 Approvals and Consents 52 Hazardous Materials 52 REIT Qualifications 56 Counterparts 56 Survival of Obligations 56 SIGNATURES •57 GUARANTY EXHIBIT A - Site Plan EXHIBIT B - Tenant's Approved Siqnage 2-10 F-2 -iii- r :.13b.43BURL:NG:ON.3 THIS LEASE AGREEMENT (this "lease") , made this n �s-� day c 4� P R% L 19 (the "Effective Date") by and between Landlord: MCA HUNTINGTON ASSOCIATES, L.P. , a Delaware limited partnership and Tenant: BURLINGTON COAT FACTORY WAREHOUSE OF HUNTINGTON BEACH, INC. , a California corporation c WITNESSETH• In consideration of the Rent to be paid and the covenants to be performed by Tenant hereunder, Landlord does hereby lease and demise to Tenant, and Tenant does hereby lease and take from Landlord, the Demised Premises hereinafter described, upon the terms and conditions hereinafter set forth: ARTICLE I CERTAIN LEASE PROVISIONS As used herein, the following terms shall have the meaning hereinafter specified: (a) Demised Premises, as more fully set forth in Article II: Approximately 133,500 square feet of Gross Leasable Area located on the first and second floors of Building III as shown on Exhibit "A" attached hereto and made a par` • hereof *by this reference. (b) (i) Term, as more fully set forth in Article III: Approximately Thirty (30) years (ii) Delivery Date, as more fully set forth in Article II: The date Landlord delivers exclusive physical possession of the Demised Premises to Tenant with Landlord's Work (as hereinafter defined in Section 2.2) complete. (iii) Required •Opening Date, as more fully set forth in Article VI: The one hundred twenty-first (121st) day following the later of (a) the Delivery Date or (b) the "Plan Approval Data" [as hereinafter defined in this Article I(b) (iii) ) . The term "Plan Approval Date" means the date that Landlord has approved Tenant's final drawings for Tenant's Work (as defined in Section 5.1) . Landlord and Tenant acknowledge and agree that the running of the aforesaid one hundred fifty (150) day construction period from the Plan Approval Date is specifically contingent upon Tenant submitting to Landlord or resubmitting to Landlord, as the case may be, Tenant's drawings for Tenant's Work within the time periods set forth in Section 5.1 of this lease and that the Plan Approval Date shall a pushed-back by one (1) day for each day that Tenant delays or fails to submit or resubmit its drawings to Landlord in a timely manner , as herein provided; provided, however, in the event, Landlord fails to approve or disapprove Tenant's drawings within ten (10) business days after receipt thereof as provided in Section 5.1 herein, one (1) day for each day thereafter that Landlord fails to approve or disapprove Tenant's drawings shall be subtracted froi the number of.days of Tenant delays. For example, ii — ` the Plan Approval Date is March 15, 1995, and if the r L136.438URLINGTON.3 2 total number of days of Tenant delays is ten (10) days, the Plan Approval Date shall be pushed-back to March 10, 1995. Further, if the total number of days of Tenant delays is ten (10) days and the total number of days of Landlord delays is five (5) days, the Plan Approval Date shall be pushed back to March 10, 1995. (iv) Rent Commencement Date, as more fully set forth in Article III: The earlier of (a) the date upon which Tenant initially opens the Demised Premises for business t or (b) the Required Opening Date. r (v) Iaase Expiration Date: January 31, 2025 (c) (i) Fixed Minimum Rent per annum, as more fully set forth in Article IV: Four Hundred Sixteen Thousand Two Hundred Fifty and No/100 Dollars ($416,250.00) per annum from the Rent Commencement Date through the last day of the calendar month immediately prior to the fifth (5th) anniversary of the Rent Commencement Date; then Four I Hundred Forty-Nine Thousand Six Hundred Twenty-Five and No/100 Dollars ($449,625.00) per annum through the last day of the calendar month immediately prior to the tenth (loth) anniversary of the Rent Commencement Date; then Four Hundred Eighty-Three Thousand and No/100 Dollars ($483,000.00) per annum through the last day of the calendar month immediately prior to the fifteenth (15th) anniversary of the Rent Commencement Date; then Five Hundred Sixteen Thousand Three Hundred Seventy-Five and No/10o Dollars ($516,375.00) per annum through the last day of the calendar month immediately prior to the twentieth (20th) anniversary of the Rent Commencement Date; then Five Hundred Forty-Nine Thousand Seven Hundred Fifty and N0/100 Dollars ($549,750.00) per annum through the last day of the calendar month immediately prior to the twenty-fifth (25th) anniversary of the Rent Commencement Date; then Five Hundred Eighty-Three Thousand One Hundred Twenty-Five and No/100 Dollars ($583,125.00) per annum for the remainder of the Term. Fixed Minimum Rent per month, as more fully set forth in Article IV: Thirty-Four Thousand Six Hundred Eighty- Seven and 50/100 Dollars ($34,687.50) per month from the Rent Commencement Date through the last day of the calendar month immediately prior to the fifth (5th) anniversary of the Rent Commencement Date: then Thirty- Seven Thousand Four Hundred Sixty-Eight and 75/100 Dollars ($37,468.75) per month through the last day of the calendar month immediately prior to the tenth (loth) anniversary of the Rent Commencement Date; then Forty Thousand Two Hundred Fifty and No/100 Dollars ($40,25b.00) per month through the last day of the calendar month immediately prior to the fifteenth (15th) anniversary of the Rent Commencement Date; then Forty- Three Thousand Thirty-One and 25/100 Dollars ($43,031.25) per month through the last day of the calendar month immediately prior to the twentieth (20th) anniversary of the Rent Commencement Date; then Forty- Five Thousand Eight Hundred Twelve and 50/100 Dollars ($45,812.50) per month through the last day of the calendar month immediately prior to the twenty-fifth (25th) anniversary of the Rent Commencement Date; then Forty-Eight Thousand Five Hundred Ninety-Three and 75/100 Dollars ($48,593.75) per month for the remainder of the Term. (d) (i) Percentage Rent Rate, as more fully set forth in Article XIV: Two percent (2%) ZZ r 1136.41BURL:NGTCN.: S Base Sales per annum, as more fully set forth in Article: XIV: Twenty Killion and No/100 Dollars ($20,000,000.00) per annum from the Rent Commencement Date through the last day of the calendar month immediately prior to the fifth (5th) anniversary of the Rent Commencement Date; then Twenty-One Million Six Hundred Thousand and No/loo Dollars ($21,600,000.00) per annum through the last day of the calendar month immediately prior to the tenth (loth) anniversary of the Rent Commencement Date; then Twenty-Three Million Two Hundred Thousand and No/100 Dollars ($23,200,000.00) per annum through the last day t of the calendar month immediately prior to the fifteenth (15th) anniversary of the Rent Commencement Date; then Twenty-Four Million Eight Hundred Thousand and No/100 Dollars ($24,800,000.00) per annum through the last day of the calendar month immediately prior to the twentieth (20th) anniversary of the Rent Commencement Date: then Twenty-Six Million Four Hundred Thousand and No/100 Dollars ($26,400,000.00) per annum through the last day of the calendar month immediately prior to the twenty- fifth (25th) anniversary of the Rent Commencement Date; then Twenty-Eight Million and •No/loo Dollars ($28,000,000.00) per annum for the remainder of the Term. (e) (1) Permitted Use, as more fully set forth in Article VI: For the operation of a multi-departmented store for the retail sale of a wide variety of goods and services and for no other use or purpose. (ii) operation of business within the Demised Premises to initially be a typical first class Burlington Coat Factory store. (iii) Tenant's initial Store Name: Burlington Coat Factory (f) Intentionally omitted. (g) (i) Address for notices to Landlord: MCA•Huntington Associates, L.P. c/o-LaSalle Partners 355 S. Grand Avenue Suite 4280 Los Angeles, California 90071 Attention: David Jones and MCA Huntington Associates, L.P. c/o The Macerich Company P.O. Box 2172 233 Wilshire Boulevard, Suite 700 Santa Monica, California 90407 Attention: Legal Department With a copy-of notices to the Shopping Center Manager at the address hereafter set forth in Article I(h) (iii) for the payment of Rent. (q) (ii) Address for notices to Tenant: 1803 Route 130 N Burlington, New Jersey 08016 Attention: Legal Department _ G,�-� f L136.43BURLING:CN.3 4 (g) (iii) Address for payment of Rent: MCA Huntington Associates, L.P. Huntington Beach Mall 7777 Edinger Avenue, Suite 300 Huntington Beach, California 92647 Attention: Manager (h) In the event Tenant's Gross Sales [as such term is hereinafter defined in Section 14.2(a) ] from the Demised Premises for calendar year 2005, or calendar year 2011, or calendar year • 2017, as cart-M—ed to Landlord by Tenant's chief financial 6flTcer are less than Tenant's Minimum Gross Sales (as such term is hereinafter defined in this Article I(h)] for calendar year 2005, or calendar year 2011, or calendar year 2017, Tenant may, at its option, upon written notice to Landlord, which notice ("Tenant's Termination Notice") must be given, if at all, not later than the February 1 immediately following the expiration of the calendar year in question terminate this lease effective as of the January 31 immediately following the first (1st) anniversary of the expiration of the calendar year in question. The term "Tenant's Minimum Gross Sales" as used herein shall mean the product obtained by multiplying Tenant's j Minimum Base Sales (as hereinafter determined and defined in this Article I(h) ] by a percentage equal to the percentage of increase in the Consumer Price Index (as hereinafter defined in this Article I(h) ] published for the month in which the Rent Commencement Date occurs as compared to the Consumer Price Index published for the month of January of the calendar year in question. The term "Tenant's Minimum Base Sales" as used herein shall mean the product obtained by multiplying the Gross Leasable Area of the Demised Premises by one Hundred I Twenty-Five Dollars ($125.00) . The term "Consumer Price Index" as used herein means the United States Department of f Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Los Angeles-Anaheim-Riverside Average, Subgroup "All items", (1982-84-100) . In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100. Tenant's right to terminate this lease pursuant to the provisions of this Article I(h) is conditioned upon Tenant not being in default under this lease beyond the expiration of the applicable cure period. In the event Tenant is not open for business in the Demised Premises during all of the calendar year in question, Tenant's Gross Sales during such calendar year shall be deemed to be Tenant's Gross Sales during the twelve (12) consecutive month period that the Demised Premises was last open for business. In the event Tenant is not open for business in the Demised Premises during a part of the calendar year in question (the "Closure Period") , Tenant's Gross Sales during such Closure Period shall be deemed to be Tenant's Gross Sales during the same period that the Demised Premises was last open for business, or Tenant's average daily Gross Sales during the calendar year in question, whichever is greater. ZIA I L136.43BURLINGTON.3 S References contained in this article I to additions_ provisions of this lease are for convenience and designate some of the Articles and Sections where references to the particular Certain Lease Provisions appear. Each reference in this lease to any of the Certain Lease Provisions contained in this Article I shall be construed to incorporate all of the terms of such additional provisions, and in the event of any conflict between any of the Certain Lease Provisions of this Article I and any other provision of this lease, the latter shall control. The listing in this Article I of monetary charges payable by Tenant shall not be construed to be an exhaustive list of all monetary amounts payable by Tenant under this lease. ARTICLE II DEMISED PREMISES SECTION 2.1 The Demised Premises having a total approximate Gross Leasable Area [as hereinafter defined in Article XVII(d) ] as set forth in Article I(a) comprise a portion of that certain retail shopping center commonly known as Huntington Beach Mall [the "Shopping Center" as more fully set forth in Article XVII(j) ]. The Demised Premises and the Shopping Center are depicted on Exhibit "A" (Site Plan) attached hereto. The Demised Premises are demised and leased subject and subordinate to all liens, encumbrances, easements, restrictions, agreements, covenants, ground and underlying leases, any rights of way, any other matters or documents of record, including any document placed of record_by Landlord, zoning laws and regulations affecting or governing the Demised Premises and general and special taxes not delinquent. j without limiting the foregoing, it is the intent of the partir hereto that this lease :shall be subject to and subordinate to t REA [as hereinafter defined in Article XVII(i) J, that Tenant an(. all persons occupying the Demised Premises, or any part thereof, shall take the leasehold estate granted hereby subject to the REA and will not violate by omission or commission any of the terms or provisions of the REA. Landlord represents to Tenant that to the best of Landlord's knowledge that none of the matters referred to in this Section 2.1 will restrict Tenant from opening the Demised Premises for business as a Burlington coat Factory store and thereafter using the Demised Premises for the Permitted Use set froth in Article I(a) (i) herein or materially limit any of Tenant's rights under this lease except as set forth in the REA. Notwithstanding anything to the contrary contained in this lease, in the event Tenant is unable to open the Demised Premises for business as a Burlington Coat Factory store because of any of the matters referred to in this Section 2.1 (the "opening Restrictions") , Tenant shall furnish Landlord written notice of such fact describing in reasonable detail the nature of such Opening Restrictions. Landlord shall have the right, but not the obligation, to elimate the Opening Restrictions necessary for Tenant to open the Demised Premises for business as a Burlington. Coat Factory store within sixty (60) days after receipt of notice of such Opening Restrictions (the "Opening Restrictions Satisfaction Period") . In the event Landlord fails to eliminate the Opening Restrictions necessary for Tenant to open the Demised Premises for business as a Burlington Coat Factory store prior to the expiration of the Opening Restrictions Satisfaction Period, Tenant shall have the right as its sole remedy for such failure to terminate this lease upon written notice to Landlord, which notice must be given, if at all, not later than fifteen (15) days after expiration of the Opening Restrictions Satisfaction Period. In the event Tenant's right to terminate this lease is exercised as herein provided, this lease shall thereafter be null and void and neitt• party shall, have any. further, obligations or liabilities under tt. lease. i r L136.43BURLINGTON.3 6 SECTION 2.2 Tenant acknowledges and agrees that (i) Tenant shall accept possession of the Demised Premises from Landlord in "as is" broom clean condition, subject to completion of Landlord's Work; (ii) Landlord is performing no work with respect to the Demised Premises, except Landlord shall, at its sole cost and expense, remove all interior partition walls located in the Demised Premises except for those interior partition walls indicated and shown on Sheets D1 and D2 of the Demolition Plans prepared by Robert Kubicek Architects and Associates, Inc. dated February 24, 1995 as not being removed by Landlord as a part of Landlord's demolition work, remove all existing floor coverings located in the • Demised Premises which contain concentrations of asbestos fibers at levels regulated by the Governmental Authorities of -the state of California (i.e. concentrations of asbestos fibers in percentages greater than one-tenth of one percent (<0.1%) ], remove the escalator between the second floor of the Demised Premises and the -third floor of the building of which the Demised Premises is a part and cap the escalator opening and perform Landlord's Asbestos Abatement Work (as defined and set forth in Section 21.28(e) herein] (collectively, "Landlord's Work") prior to delivering .physical possession of the Demised Premises to Tenant; (iii) except for Landlord's Work, Landlord shall have no responsibility for any work or improvement which may be required to prepare the Demised Premises for Tenant's use or for any work in remodeling the Demised Premises; (iv) Tenant shall, at its sole cost and expense, complete any items of work which may be required upon the Demised Premises and undertake the renovation and remodeling of the Demised Premises prior to initially opening the Demised Premises for business, all in accordance with the provisions of Article V of this lease; and (v) Landlord, Landlord's Managing Agent (as hereinafter defined in Article XVII(f)] and the Landlord Parties (as hereinafter defined in Section 7.1) have, except as otherwise specifically provided in this lease, made no, representations or warranties as to the condition of the Demised Premises, the suitability of the Demised Premises for the conduct of Tenant's business or the date on which the Demised Premises shall be available for occupancy by Tenant. Tenant hereby releases Landlord, Landlord's Managing Agent and the Landlord Parties from and against any and all claims whatsoever for damages for any delays in the date on which the Demised Premises shall be available for occupancy by Tenant. Landlord reserves the right, provided that Landlord gives Tenant's store manager reasonable prior notice of Landlord's intention to perform such work (except in case of an emergency where no notice shall be required) to install, maintain, use, repair, and replace pipes, ducts, conduits, vents and wire leading in, through, over or under the Demised Premises, it being understood, however, that Landlord will use its good faith efforts to avoid unreasonable interference with or disturbance of Tenant's operations within the Demised Premises to the extent reasonably practicable under the circumstances in connection with any repairs and/or installations made by Landlord. ARTICLE III TERM This lease shall begin and be of full force and effect as to both Landlord and Tenant as of the Effective Date. The Term of this lease shall commence on the Rent Commencement Date and expire at midnight on the Lease Expiration Date, unless sooner terminated as herein expressly provided. If the Rent Commencement Date and/or the Lease Expiration Date cannot be ascertained as of the date hereof, then the parties agree that upon the request of either party, they will execute and deliver a supplemental agreement setting forth the Rent Commencement Date and/or the Lease Expiration Date when same are ascertainable. i L136.43BURLINGTON.3 ARTICLE IV RENT SECTION 4.1 The rental reserved under this lease to Landlord during the Term, which Tenant covenants and agrees to pay to Landlord as herein provided, without prior demand therefor and without any deduction or set-off whatsoever, shall consist of fixed _min9mne+_rent,--percentage rent and additional rent. (separately, 'Fixed-Minimum Rent," "Percentage Rent" and "Additional Rant" and collectively;--"Rent") . All Rent and other sums payable by Tenant : to Landlord pursuant to this lease shall commence to accrue on the Rent Commencement Date, shall be paid in lawful money of the United 'States of America and shall be paid and delivered to Landlord at Landlord's address set forth in Article I(g) , or at such other place as Landlord may from time to time direct by notice to Tenant. The Rent Commencement Date shall not be delayed or affected by failure or refusal of Tenant to take possession of the Demised Premises or any portion thereof in violation of its obligation hereunder to do so-or by any failure of Tenant to complete Tenant's Work by the Required Opening Date except as otherwise provided in Section 21.17 herein. SECTION 4.2 The Fixed Minimum Rent in the applicable annual amounts sat forth in Article I(c) (i) shall be paid by Tenant to Landlord in the applicable monthly installments set forth in Article I(c) (ii) , in advance, on the first day of each month during each Lease Year (as hereinafter defined in Article XVII(g)) of the Term of this lease, except that the first monthly installmaht of Fixed Minimum Rant shall be paid to Landlord upon the Rent Commencement Date of this lease. If any month within the Term of this lease is less than a full calendar month, then the Fixed Minimum Rant for such fractional month shall be on a per diem basis based upon the number of-days in such month. i SECTION 4.3 Percentage Rent shall be payable by Tenant to Landlord in accordance with the provisions of Article I(d) and Article XIV. SECTION 4.4 All sums required to be paid by Tenant pursuant to the provisions of this lease, other than Fixed Minimum Rent and Percentage Rent, shall be as Additional Rent. i ARTICLE V CONSTRUCTION SECTION 5.1 Tenant covenants and agrees to renovate and remodel the Demised Premises and to construct and/or install its leasehold improvements, trade fixtures, signage and other personal property therein (collectively, "Tenant's Work") in a good and workmanlike manner, at Tenant's sole cost and expense, in accordance with drawings approved in writing by Landlord. Tenant's Work shall include all required work with respect to the electrical, mechanical, heating, ventilating, air conditioning, sprinkler systems, plumbing, and other systems and installations serving the Demised Premises. Tenant's Work shall be designed, engineered, installed and performed in accordance with the design and construction criteria set forth in the tenant design & construction criteria booklet for the Shopping Center ("Landlord's Design & Construction Criteria") . Tenant shall submit to Landlord within thirty (30) days after the Effective Date of this lease, four (4) sets of working drawings (blueline prints) and one (1) set of reproducible drawings (sepia set) covering Tenant's Work prepared by.Tenant.'s licensed architect and/or licensed engineer, at Tenant's expense, which drawings shall be in conformity with Z7 Landlord's Design & Construction Criteria. Tenant's working I I r L136.43BURLINGTON.3 a drawings shall be subject to the approval of Landlord which approval shall not be unreasonably withheld or delayed; provided, however, Tenant's drawings for the interior layout of the Demised Premises shall not be subject to Landlord's approval. Landlord agrees to approve or disapprove Tenant's drawings within ten (10) business days after receipt thereof. If Landlord shall notify Tenant of any objections to the portions of the working drawings which require Landlord's approval such objections shall be specified in reasonable detail and Tenant shall make necessary revisions and resubmit final drawings to Landlord for approval within fifteen (15) days after such notice. If Landlord shall not = approve the working drawings, Tenant and Landlord shall use their best efforts to cooperate and agree on all of the mcdifications necessary to obtain Landlord's approval of the working drawings. Landlord's approval of the final drawings shall be evidenced in writing which, at Landlord's option, may be by letter delivered to Tenant or by endorsement to that effect on two (2) sets of the final drawings, one (1) set to be retained by Landlord and one (1) set by Tenant. Upon written approval by Landlord of the final drawings for Tenant's Work, Tenant shall promptly,thereafter submit said approved final drawings to the appropriate governmental agencies and shall promptly seek all necessary approvals and permits and pay all necessary fees incidental to Tenant's Work. There shall be no material deviations from 'or changes in the aforesaid approved final drawings without the prior written consent of Landlord. Promptly after receipt of all approvals and permits, Tenant shall cause Tenant's Work to 'be commenced and thereafter diligently prosecute to completion in a good and workmanlike manner, all in conformance with the approved final drawings for Tenant's Work, Landlord's Design & Construction Criteria and all Governmental Regulations (as hereinafter defined in Section 6.1) of all Governmental Authorities (as hereinafter defined in Section 6.1) having jurisdiction of the Demised Premises. There shall be no penetrations of the roof or installation of radio, television or other antennas, without the prior written approval of Landlord. Notwithstanding anything to the contrary contained in this lease, Tenant shall be permitted to provide satellite communications services to the Demised Premises. Accordingly, Tenant shall be permitted to install on the roof of the building of which the Demised Premises is a part, a satellite dish, antennae and transmission equipment and wire, cable, conduit and associated equipment and facilities (collectively, "Communications Equipment") to provide communication services to the Demised Premises; provided such Communications Equipment shall (a) be installed in accordance with the applicable provisions of Landlord's Design & Construction Criteria (and then maintained) by Tenant at its sole cost and expense and in accordance with (x) plans and specifications thereof prepared by Tenant and approved in writing by Landlord (and containing such degree of particularity as to size, location, appearance, structural load, materials and the like as Landlord shall reasonably request) , and (y) all applicable Governmental Regulations of the Governmental Authorities (including, without limitation, all FCC and other licenses and approvals required in connection with the Communications Equipment) ; (b) Tenant shall, at its sole cost and expense, immediately repair any damage caused to the Demised Premises and/or the building of which the Demised Premises is a part as a result of the installation of such Communications Equipment; (c) Tenant shall install the Communications Equipment free of liens and encumbrances as required by Section 5.2 of this lease; (d) Tenant shall, at its sole cost and expense, remove the Communications Equipment at the expiration or earlier termination of this lease and repair any damage caused to the Demised Premises and/or the building of which the Demised Premises is a part as a result of such removal; (e) Tenant shall indemnify, defend (with counsel satisfactory to Landlord) and hold Landlord, Landlord's Managing Agent and the Landlord Parties harmless from and against all Claims (as hereinafter defined) arising or accruing as a result of the installation and maintenance 5 :.136.+39URLINGTON.3 9 of the Communications Equipment: and (f) The commercial genera_ liability insurance maintained by Tenant pursuant to the provisions of Section 7.2(a) shall include a contractual liability endorsement insuring the performance by Tenant of the indemnity agreement contained in (e) above protecting against any Claims in connection with the installation, use, maintenance and removal of the Communications Equipment. Any and all roof penetrations required by Tenant and approved by Landlord shall be at Tenant's expense, and at Landlord's option shall be engineered and installed by Landlord's general contractor or roofing subcontractor. Tenant's cost for such roof work shall not exceed the prevailing competitive • rate charged by reputable independent engineers and roofing contractors located within the trade area served by the Shopping Center. SECTION 5.2 Tenant shall do all things reasonably necessary to prevent the filing of any mechanics' or other liens or encumbrances against the Shopping Center, or any part thereof, or upon any interest of Landlord or any mortgagee or any ground or underlying lessor in any portion of the Shopping Center, by reason of work, labor, services or materials supplied or claimed to have been supplied to Tenant or any one in possession of the Demised Premises, or any part thereof through or under Tenant. If any such lien or encumbrance shall at any time be filed against the Shopping Center, or any portion thereof, Tenant shall notify Landlord in writing thereof and shall either cause same to be discharged of record within twenty (20) days after notice of the filing of same or, if Tenant in Tenant's discretion and in good faith determines that such lien should be contested, Tenant shall within twenty (20) days after notice of the date of the filing of same furnish•to Landlord such security as may be necessary and/or required to prevent any foreclosure proceedings against the Shopping Center, o- any portion thereof, during the pendency of such contest. I Tenant shall fail to discharge any such lien or encumbrance or fail to furnish to Landlord such security as hereinabove provided within the time period herein provided, then, in addition to any other right or remedy of Landlord resulting from Tenant's said default, Landlord may, but shall not be obligated to, discharge such lien or encumbrance either by paying the amount claimed to be due or by procuring the discharge of such lien by giving security or in such other manner as is, or may be, prescribed by law, and Tenant agrees to reimburse Landlord, as Additional Rent, promptly, upon demand, for all costs, expenses and other sums of money in connection therewith, with interest thereon at an annual rate equal to the two percent (2%) over the commercial rate of interest charged from time to time by Sank of America in Los Angeles, California, as such bank's "prime rate" or the maximum lawful rate legally permitted in j the state in which the Shopping Center is located, whichever is less (the "Default Rate") . All materialmen, contractors, artisans, f mechanics, laborers and any other persons now or hereafter contracted with Tenant for the furnishing of any labor, services, materials, supplies or equipment with respect to any portion of the Demised Premises and/or the Shopping Center are hereby charged with notice that they must look exclusively to Tenant to obtain payment for same. Landlord shall have the right to post and maintain on the Demised Premises, file and/or record notices of non- responsibility, and:such other notices as Landlord may deem to be proper for the protection of Landlord's interest in the Demised Premises. Tenant shall before the commencement of any work which might result in any lien or encumbrance being filed against the Shopping Center or any part thereof give Landlord at least twenty (20) days prior written notice of its intention to commence such work in sufficient time to enable Landlord to post, file and/or record such notices of non-responsibility or such other notes as Landlord may deem proper for the protection of Landlord's interes in the Shopping Center. Upon completion of Tenant's work and upc completion of -any Alterations -'as hereinafter defined in Section Q 9.3j, Tenant agrees to cause a timely Notice of Completion to be Z i r :.136.:3BURLINGTON.3 :o recorded in the office of the recorder of the county in which the Shopping Center is located in accordance with the terms of Section 3093 of the Civil Code of the State of California or any succeeding statue. SECTION 5.3 At all times during the performance of Tenant's Work or any other construction work by Tenant with respect to the Demised Premises, Tenant shall have and maintain in force builder's risk insurance (completed value form, if available) and worker's compensation insurance affording applicable statutory coverage and containing required statutory limits. Prior to commencement of Tenant's Work, Tenant shall provide. Landlord a duplicate original :or certificate of insurance evidencing compliance with the provisions of this Section 5.3. All such policies shall comply with the provisions of Article VIZ. SECTION 5.4 Any access to or possession of the Demised Premises by Tenant prior to the Rent Commencement Date shall be on and subject to all the other terms, provisions, covenants and conditions of this lease, except for the payment of Rent. ARTICLE VI USE AND OPERATION SECTION 6.1 Subject to and in compliance with all applicable present and future laws, ordinances, orders, rules, regulations, codes, directives, statutes and requirements (collectively, "Governmental Regulations") affecting the Demised Premises of all duly constituted federal, state, county, municipal and local governments, and of all governmental and quasi-governmental agencies, boards, commissions and departments thereof (collectively, "Governmental Authorities") having jurisdiction of the Demised Premises and all applicable rules and regulations of the local fire insurance rating service office and any other similar insurance service office, organization or group of which Landlord's insurance carriers are members (collectively, "Insurance Service Office"), the Demised Premises shall be used by Tenant solely for the Permitted Use as set forth in Article I(e) (i) , and for no other use or purpose. SECTION 6.2(a) Subject to the provisions of Section 21.17 herein, Tenant covenants and agrees that it will use its good faith efforts to complete Tenant's Work and open its business in the Demised Premises to the public "adequately fixturized, staffed and stocked" (as such term is hereinafter defined in Section 6.2(b) j not later than the Required opening Date but in no event later than sixty (60) days following the Required opening Date. Thereafter, Tenant covenants and agrees to use, occupy and c-qnduct its business in the entire Demised Premises for a ermitted Use continuously and without interruption until the day crior to the_ ten ( ) anniversary, of a Tenant in ll'tiay ove_netl *►+p npm;Rpa Premises for business (t4e, "Tenant's O�eratin-Covenant") in the manner se o in tlis lease and'under Tenant's Store Name as set forth in Article I(e) (iii) other than such portions of the Demised Premises as are reasonably required for storage and office space subject, however, to all of the terms, covenants and conditions of this lease. (b) Tenant covenants and agrees that during the period of Tenant's Operating Covenant and, thereafter, if Tenant elects to remain open for business, that Tenant shall (i) subject to the provisions of Section 21.17, be open and remain open for business to the public daily during all hours on all days that the Occupants of any two (2) of Buildings I, II or IV as shown on Exhibit "A" are open for business but in any event during all hours and on all days that Tenant's other Burlington Coat Factory stores are open for 3d I L136.43BURLINGTON.3 11 business in southern California: (ii) adequately fixturize staff its store with sufficient trade fixtures and employees (as determined in Tenant's sole reasonable business judgment) to handle the maxinum profitable business and keep and maintain within and upon the Demised Premises an adequate inventory of merchandise (as determined in Tenant's sole reasonable business judgment) of such size, character and quality sufficient to accomplish the same ("adequately fixturized, staffed and stocked") on all days and during all hours that Tenant is required or elects to remain open for business to the public; (iii) maintain displays of merchandise in the display windows, if any, and keep such display windows, = exterior signs and exterior advertising displays adequately illuminated continuously during such hours that the Shopping Center is open for business to the public as determined by'Landlord; and (iv) utilize for office, clerical or other non-selling purposes only such space in the Demised Premises as is reasonably required for Tenant's business therein. (c) After the expiration of Tenant's Operating Covenant, Tenant shall have the right to cease doing business at the Demised Premises and/or to vacate the Demised Premises by giving Landlord ninety (90) days prior notice to that effect (such notice herein a "Go-Dark Notice") . Further, if Tenant does not give Landlord a Go- Dark Notice, but for a period of more than ninety (90) days, Tenant ceases doing business at the Demised Premises and/or vacates or abandons the Demised Premises, and if such cessation of business and/or vacating of the Demised Premises is not the result of con- demnatibn, casualty, remodelling or the occurrence of an event described in Section 21.17 herein, then Tenant shall be deemed to have given Landlord a Go-Dark Notice on the ninety-first (91st) day following the date on which Tenant's. cessation of business at the. Demised Premises began or the ninety-first (91st) day following date on which Tenant vacated or abandoned the Demised Premises. Tenant shall give Landlord a Go-Dark Notice (or if Tenant is doe. to have given Landlord a Go-Dark Notice as aforesaid) , Tenant shall have the right to cease doing business at the Demised Premises and/or to vacate or abandon the Demised Premises, and Tenant shall comply with the provisions of Section yJ,_J herein, but Tenant agrees that for the remainder of the Term it shall cont nue v all Rent and other c arges in accordance with the provisions-.of s lease, sUFJec ever, to Tenant's right to terminate this lease pursuant to the provisions of Article I(h) herein and subject to Landlord's right to terminate this lease as hereinafter provided in this Section 6.2(c) . In the event Tenant gives Landlord a Go- Dark Notice (or if Tenant is deemed to have given Landlord a Go- Dark Notice) pursuant to the provisions of this Section 6.2(c) , Landlord shall have the oEt�in, but not the obligation, to termi- nate this lease at any time thereaffer upon at least thirty (30) days' prior written notice (provided Tenant does not reopen for business within such thirty (30) day period) by giving Tenant notice to that effect (herein the "Termination Notice") . In the event Landlord gives Tenant a Termination Notice pursuant to this Paragraph, then this lease shall terminate on the date set forth in the Termination Notice. ARTICLE VII INDEMNITY AND INSURANCE SECTION 7.1(a) Tenant covenants with Landlord that from and after the Delivery Date, Tenant will indemnify, defend (with counsel satisfactory to Landlord) , and hold harmless Landlord, Landlord's Managing Agent and their respective past and present officers, directors, shareholders, beneficiaries, trustees, ager servants, employees and independent contractors (collectively, "Landlord Parties") , • and- Landlord's Designee(s) (as hereinai__r 3` defined in Section 7.2(c) J from and against any and all claims, I .36.43BCRLI C Cv.2 suits, proceedings, actions, causes of action, responsibility, liability, demands, damages, judgments, penalties, costs, expenses, losses, executions and charges of any kind or character (collectively, "Claims") on account of any real or claimed damage to property of Tenant or anyone claiming under, by or through Tenant or injury to or death of persons from any occurrence whatsoever in or on the Demised Premises, or any occurrence in or on the remainder of the Shopping Center resulting out of any act or omission or negligence of Tenant, or any Concessionaire (as hereinafter defined in Article XVII(c) ) , or their respective past and present officers, directors, shareholders, invitees, customers, agents, servants, employees and independent contractors (collectively, the "Tenant Parties") , or resulting out of any default, breach, violation or non-performance by "Tenant of any provision of this lease, or resulting out of Tenant's work, or any repairs or Alterations which Tenant may make or cause to be made upon the Demised Premises, including any mechanics' or other liens resulting from the foregoing, but Tenant shall not be liable for any Claims to the extent such Claims result from the negligence or willful misconduct of Landlord, Landlord's Managing Agent, the Landlord Parties or Landlord's Designee(s) . .Tenant's obligation to indemnify and hold harmless Landlord, Landlord's Managing Agent, the Landlord Parties and Landlord's Designee(s) under this Section 7.1(a) (and under each and every other indemnification and hold harmless provision contained in this lease) shall survive the expiration or earlier termination of this lease until the last to occur of (a) the last date permitted by law for the bringing of any Claims with respect to which indemnification may be claimed by Landlord, Landlord's Managing Agent, the Landlord Parties or Landlord's Designee(s) against Tenant under such indemnification and hold harmless provision, or (b) the date on which any Claims for which indemnification may be claimed against Tenant by Landlord, Landlord's Managing Agent, the Landlord Parties or Landlord's Dos ignee(s•) under such indemnification and hold harmless provision is fully and finally resolved, and shall include the actual reasonable attorneys' fees and investigation costs and all other costs, expenses and liabilities incurred by any such indemnitee from the first notice that any Claim is to be made. (b) Landlord covenants with Tenant that from and after the Delivery Date, Landlord will indemnify, defend (with counsel satisfactory to Tenant) , and hold harmless Tenant and the Tenant Parties from and against any and all Claims on account of any real or claimed damage to property of Landlord or anyone claiming under, by or through Landlord or injury to or death of persons from any occurrence whatsoever in or on the Common Area of the shopping Center, or any occurrence in or on the Demised Premises resulting out of any act, or omission or negligence of Landlord or the Landlord Parties, or resulting out of any default, breach, violation or non-performance by Landlord of any provision of this lease, or resulting out of Landlord's work, or any repairs which Landlord may make or cause to be made upon the Demised Premises, including any mechanics' or other liens resulting from the foregoing, but Landlord shall not be liable for any Claims to the extent such Claims result from the negligence or willful misconduct of Tenant or the Tenant Parties. Landlord's obligation to indemnify and hold harmless Tenant and the Tenant Parties under this Section 7.1(b) (and under each and every other indemnification and hold harmless provision contained in this lease) shall survive the expiration or earlier termination of this lease until the last to occur of (a) the last date permitted by law for the bringing of any Claims with respect to which indemnification may be claimed by Tenant or the Tenant Parties against Landlord under such indemnification and hold harmless provision, or (b) the date on which any Claims for which indemnification may be claimed against Landlord by Tenant or the Tenant Parties under such indemnification and hold harmless provision is fully and finally resolved, and shall include the actual reasonable attorneys' fees and • �Z L116 3 BURLINGTON.3 13 investigation costs and all other costs, expenses and liabilit._._ incurred by any such indemnitee from the first notice that any Claim is to be made. SECTION 7.2(a) From and after the Delivery Date and continuing thereafter until the end of the Term, Tenant agrees to obtain and maintain in full force and effect, at its own cost and expense (in addition to builder's risk insurance and worker's compensation insurance required pursuant to section 5.4(a) ], commercial general liability insurance for bodily injury and property damage with coverage limits of not less than Two Million Dollars ($2,000,000.00) combined single limit, per occurrence and in the aggregate, insuring against any and all liability of the insured for injury to persons (and death) and/or damage to property of any person or persons in or about the Demised Premises arising out of the possession, use, occupancy, management, maintenance, repair, control and enjoyment of the Demised Premises, and all areas appurtenant thereto. In no event shall the minimum limits of such commercial general liability insurance required of Tenant under this lease be considered as limiting the liability of Tenant under this lease. (b) From and after the Delivery Date and continuing thereafter until the end of the Term, Tenant agrees to obtain and maintain in full force and effect, at its own cost and expense, (i) fire and extended coverage insurance providing protection against any peril included within the classification of "all risk" insurance issued by insurance companies licensed to do business in the state in which the Shopping Center is located, including, without limitation, coverage for vandalism, malicious mischief and sprinkler leakage, covering Tenant's Alterations, fixtures, equipment, furnishings, merchandise and other personal proper' from time to time located on the Demised Premises, such insuran to be in an amount ecival to the full replacement cost value new. The proceeds of such insurance, so long as this lease remains in effect, shall be retained by Tenant and used by Tenant to repair and/or replace the Alterations, fixtures, equipment, furnishings, merchandise and other personal property so insured. (c) All commercial general liability insurance policies required of Tenant under this lease shall be written as primary policies, not contributing with or in excess of the coverage which Landlord, Landlord's Managing Agent or Landlord's Designee(s) may carry, and shall name, as additional insureds, Landlord, Landlord's Managing Agent and such other person or persons designated by Landlord to Tenant that have an insurable interest in the Demised Premises including the holders of any mortgage affecting the Demised Premises and any lessors under any ground or underlying leases liening the Demised Premises (collectively, "Landlord's Designees)"], and shall (i) be issued by insurance companies licensed to do business in the state in which the Shopping Center is located, with a general policy holders' rating of not less than A and a financial rating of not less than Class VIII as rated in the most current available "Best's" Insurance Reports, and (ii) contain a provision that the insurance companies writing such policies will give to Landlord, Landlord's Managing Agent and Landlord's Designee(s) thirty (30) days notice in writing in advance of any cancellation, lapse or reduction respecting such insurance. All commercial general liability insurance policies shall contain (i) a cross liability endorsement to the effect that Landlord Managing g Landlord's Mana in Agent and Landlords Designee(s) • although named as additional insureds shall nevertheless be entitled to recovery under said policies for any loss or damage occasioned to them by reason of the negligence of Tenant, its Concessionaires or the Tenant Parties and (ii) a contractua- liability endorsement specifically insuring the performance bl Tenant of that part. of. the-. indemnity agreement relating to r-- L136.:3BURLINGT^N.3 14 liability for injury to or death of persons and damage to property contained in Section 7.1(a) . SECTION 7.3 A duplicate original or certificate of all policies of insurance procured by Tenant in compliance with its obligations under this lease shall be delivered to Landlord at least fifteen (15) days prior to the time such insurance is first required to be carried by Tenant, and thereafter at least thirty (30) days prior to the expiration of any such policy. In the event of Tenant's failure, in whole or in part, at any time during the Term, to obtain and maintain insurance required to be carried by = Tenant under the provisions of this lease or to provide Landlord such evidence thereof within fifteen (15) days after Landlord's written request therefor, Landlord shall have the right (but shall not be obligated) to procure such insurance and Tenant shall pay to Landlord promptly, on demand, as Additional Rent, the costs and expenses thereof with interest thereon at the Default Rate. Any insurance required to be provided by Tenant under Section 7.2 may be satisfied by inclusion of the Demised Premises within the coverage of a so-called blanket policy or policies of insurance carried and maintained by Tenant; provided, however, that Landlord, Landlord's Managing Agent and Landlord's Designee(s) shall be named as additional insureds thereunder as their interest may appear and that the coverage afforded Landlord will not be reduced or diminished by reason of the use of such blanket polices of insurance, and provided further that the requirements sat forth herein are otherwise satisfied. Tenant agrees to permit Landlord at all reasonable times to inspect any policies of insurance of Tenant which Tenant has not delivered to Landlord. SECTION 7.4 Tenant agrees to use and occupy the Damiseic� Premises and to use all other portions of the shopping Center which it is permitted to use by the terms of this lease at its own risk, and Tenant (for itself and all persons claiming under, by or through Tenant) hereby releases Landlord, Landlord's Managing Agent, the Landlord Parties and Landlord's Designee(s) from all Claims an account of damage to property or injury to or death of persons occurring in, on or about the Demised premises and/or the Shopping Canter, except to the extent such Claims result from the breach of this lease by Landlord or result from the negligence or willful misconduct of Landlord, Landlord's Managing Agent, the Landlord Parties or Landlord's Designee(s) . SECTION 7.5 If at any time as a result of or in connection with Tenant's use of the Demised Premises, the fire and extended coverage insurance rate(s) applicable to the Demised Premises or the building of which the Demised Premises is a part, shall be higher than that which would be applicable for the Permitted Use, Tenant agrees that it will pay to Landlord, as Additional Rent, promptly, on demand, such portion of the additional premiums for all fire and extended coverage insurance policies in force with respect thereto as shall be attributable to such higher rate(s) ; provided, however, in no event shall Tenant be required to pay to Landlord any increase in Landlord's fire and extended coverage insurance rates caused by another occupant of the Shopping Center. If Tenant installs any electrical equipment that overloads the lines in the Demised Premises or the building in which the Demised Premises is located, Tenant shall, at its own cost and expense, promptly make whatever changes are necessary to remedy such condition. SECTION 7.6 Landlord covenants and agrees to obtain and maintain throughout the Term fire and standard extended coverage insurance that shall include the Demised Premises (excluding Tenant's fixtures, equipment, furnishings, merchandise and other personal property from time to time located on the Demised Premises) providing protection against any peril included within the classification of "all risk" insurance issued by insurance �y 1,`2 L176.4 3 SU'RLINGTC:7.3 15 companies licensed to do business in the state in which tha Shopping Center is located in an amount not less than that required by all aortgages which aay now or hereafter lien the Demised Premises but in no event in an amount less than eighty percent (80%) of the replacement cost of the Demised Premises exclusive of excavations, foundations and footings. Any insurance provided by Landlord under this Section 7.6 may be provided by means of a policy or policies of blanket insurance covering additional items or locations or insureds provided that the requirements of this Section 7.6 are otherwise satisfied. The cost of maintaining the insurance carried by Landlord pursuant to this Section 7.6 shall be included in Common Area Costs (as hereinafter defined in Article = XVII(b) ). Tenant shall have no rights in any policy or policies of insurance maintained by Landlord pursuant to the provisions of this Section 7.6 and shall not be entitled to be named as an insured thereunder. ARTICLE VIII FIRE AND OTHER CASUALTIES SECTION S.i If the Demised Premises or the buildings comprising the Shopping Center shall be damaged or destroyed during the Term by fire or any other casualty, Landlord shall (subject to Landlord being able to obtain all necessary permits and approvals therefor, including, without limitation, permits and approvals required from any agency or body administering environmental laws, rules or regulations and except as hereinafter provided in Section 8.2) repair the same. ` SECTION 8.2 If however, (a) the Demised Premises shall by damaged or destroyed (1) by fire or other casualty (i) to W extent of fifty percent (50%) or more of the cost of replacemez. thereof, or (ii) so that fifty percent (50%) or more of the Gross Leasable Area contained in the Demised Premises shall be rendered untenantable, or (2) by any casualty other than those covered by fire and standard extended coverage insurance policies carried by Landlord pursuant to Section 7.6, or (b) if the Demised Premises shall be damaged in whole or in part during the last thirty-six (36) months of the Term, or (c) if Landlord's mortgagee shall require that the insurance proceeds be applied against the principal balance due on such mortgage, or (d) if the buildings comprising the Shopping Center are damaged to the extent that Landlord is not required to rebuild same pursuant to the terms of the REA, or (a) if the enclosed mall of the Shopping Center is damaged to the extent that Landlord is not required to rebuild same pursuant to the terms of the REA, then, in any such event, Landlord may, at its option, either terminate this lease or elect to repair. the Demised Premises, the buildings comprising the Shopping Center, and/or the enclosed mall, as the case may be, and Landlord shall notify Tenant as to its election within ninety (90) days after such fire or other casualty; provided, however, except during the last thirty-six (36) months of the Term of this lease, Landlord's right to terminate this lease is contingent upon Landlord contemporaneously terminating the leases of all similarly affected tenants in the Shopping Center. Tenant shall have the right to terminate .this lease upon thirty (30) days written notice to Landlord in the event the Demised Premises shall be damaged or destroyed to the extent of twenty-five percent (25%) or more of its replacement cost during the last thirty-six (36) months of the Term. Further, except during the last thirty-six (36) months of the Term of this lease, in the event Landlord rather than rebuilding the Demised Premises elects to terminate this lease as herein provided and if Landlord within a three (3) year period following the date of termination of this lease commences t rebuild the Demised Premises for a retail use, then Landlord shal_ offer to enter,into- a new lease with Tenant for the remainder of the Term of this lease on the same terms and conditions as provided 35 r Ll3 6.4 3 9G'RL::1GT:Y.3 .6 in this lease. If Landlord or Tenant elect to terminate this lease, then the Term shall end at the end of the calendar month in which such election is made. If Landlord or Tenant do not elect to terminate this lease, then Landlord shall perform such repairs and rebuilding as set forth in Section 8.3 and Tenant shall perform such repairs and rebuilding as set forth in Section 8.4, and the Term shall continue without interruption and this lease shall remain in full force and effect. Tenant hereby expressly waives all rights to terminate this lease under Sections 1932(2) and/or 1933(4) of the Civil Code of California, as the same may be amended from time to time, or under any similar statute now or hereafter in force, or under any present or future laws or case decisions to the same effect. SECTION 8.3 If Landlord or Tenant do not elect to terminate this lease as provided in Section 8.2, Landlord shall promptly after settlement of insurance claims and the obtainment of all necessary permits and approvals diligently reconstruct the Demised Promises (but in no event shall Landlord be required to restore any damage to Tenant's trade fixtures, equipment, furnishings, merchandise, signs and other personal property) to substantially the same condition existing on the date of the casualty. All work to be performed by Landlord shall be done in such manner that upon completion thereof, that portion of the Demised Premises repaired or rebuilt shall contain substantially the same amount of Gross Leasable Area as immediately prior to the damage or destruction. SECTION 8.4 If Landlord or Tenant do not elect to terminate this lease as provided in Section 8.2, Tenant shall, at its own cost and expense, repair and restore Tenant's trade fixtures, equipment, furnishings, merchandise, signs and other personal property in a manner and to at least a condition equal to that existing prior to its damage or destruction. Tenant agrees to commence the performance of its restoration work when notified by Landlord that the restoration work to be performed by Tenant can, in accordance with good construction practices, then be commenced, and Tenant shall complete such restoration work and reopen (if closed) the Demised Premises or the portion closed for business within one hundred twenty (120) days thereafter. SECTION 8.5 All proceeds payable from Landlord's insurance policies with respect to the Demised Premises shall belong to and shall be payable to Landlord. If Landlord or,Tenant do not elect to terminate this lease as provided in Section 8.2, Landlord shall disburse and apply so much of any insurance recovery as shall be necessary to pay and reimburse Landlord for the costs incurred by Landlord with respect to Landlord's restoration work referred to in Section 8.3. SECTION 8.6 During any period in which the Demised Premises is damaged or destroyed by reason of any fire or other casualty and there is substantial interference with the operation of Tenant's business in the Demised Premises as a result of such damage or casualty which, in Tenant's sole reasonable business judgment, requires Tenant to temporarily close all or a portion of the Demised Premises for business, the Fixed Minimum Rent shall abate in the proportion that the Gross Leasable Area of the Demised Premises rendered unusable for the Permitted Use bears to the total Gross Leasable Area of the Demised Premises, and such abatement shall continue for the period commencing with the date of such fire or other casualty and ending on the date that shall be the earlier of (i) one hundred twenty (120) days after completion by Landlord of such restoration work as Landlord is required to perform under the provisions of Section 8.3, or (fi) the reopening of the Demised Premises or the portion closed for business following such fire or . other casualty, or (iii) in the event Landlord or Tenant elects to terminate this lease, until the date of termination. 36 r L136.43BURLINGTON.3 17 SECTION 8.7 Landlord and Tenant hereby release and waive on behalf of themselves, their respective directors, officers, agents, employees and assignees, and any other party who may look to Landlord and/or Tenant for reimbursement, and (to the extent it is legally possible for it to do so) on behalf of its insurer, the other party from any liability for any loss or damage occasioned to the property of such waiving party or the property of others under its control resulting from any fire or other casualty where such loss or damage is covered by fire and extended coverage insurance required to be carried by such party under the terms of this lease, or is otherwise insured by such party (or if a party to this lease • is self-insured, to the extent any such loss or damage would have been covered by fire and extended coverage insurance otherwise 'required to be carried by such party under the terms of this lease) , irrespective of any negligence an the part of the other party which may have contributed to or caused such loss or damage. Landlord and Tenant covenant and agree that each will obtain for the benefit of the other party a waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any loss or damage covered by fire and extended coverage insurance required to be carried under this lease. ARTICLE IX REPAIRS, MAINTENANCE AND ALTERATIONS SECTION 9.1 Landlord shall within a reasonable period after receipt of written notice from Tenant make or cause to be, mad* necessary structural repairs to the foundations, exterior walls and all.—.other structural elements of the Demised Premises (but excluding frames surrounding, all windows, doors, plate glass, storefronts and signs) 4Lnd to the roof of the building of which the Demised Premises is a part. Landlord shall not be required to make any repairs or installations where the need for same are necessitated, caused or occasioned by (1) any act or omission or negligence of Tenant or its Concessionaires, or-the Tenant Parties unless occasioned by a risk covered by Landlord's insurance, (2) any matter(s) referred to in Sections 9.2(b) or 13.1(B) , or (3) any fire or other casualty or condemnation, except as provided in Articles VIII and X. Tenant hereby expressly waives all rights to make repairs at the expense of Landlord under Sections 1941 and/or 1942 of the Civil Code of California, as the same may be amended from time to time, or under any similar statute now or hereafter in force, or under any present or future laws or case decisions to the same effect. Notwithstanding anything to the contrary contained in this Section 9.1, in the event Landlord fails to make the repairs to the Demised Premises and/or the "No Build Area" (as hereinafter defined in Section 11.1) required to be made by Landlord under the terms of this lease within thirty (30) days after receipt of written notice from Tenant specifying in reasonable detail the j repairs to be made, unless such repairs cannot be completed within thirty (30) days in which event Landlord's commencing such repairs within such thirty (30) day period and thereafter diligently prosecuting same to completion shall satisfy the condition of this provision, Tenant shall have the right, but not the obligation, to make said repairs- on behalf of Landlord and Landlord shall pay to Tenant the reasonable cost of such repairs together with interest thereon at the Default Rate within thirty (30) days after receipt of paid invoices from Tenant. In the event Landlord fails to reimburse Tenant for the cost of such repairs within the time period herein provided, Tenant shall have the right to deduct the cost of such repairs from Rent otherwise due Landlord under this lease until the cost of such repairs has been deducted in its entirety. Further, if, in an emergency, in Tenant's reasonable opinion, any repairs to the Demised Premises and/or the No Build Area which are Landlord's obligation under the terms of this lease are immediately necessary for the proper use and enjoyment of the � 3 :.136.43BCRL:YG:CN.3 .3 Demised Premises or to avoid damage or injury to the Demised Premises or its contents, Tenant shall aake all reasonable efforts to notify Landlord of the need for such emergency repairs which notification may be by oral notice or facsimile to the Shopping Center manager and if such emergency repairs are not immediately made, Tenant may forthwith make such reasonable emergency repairs as necessary to eliminate the emergency on behalf of Landlord, and Landlord shall pay to Tenant the reasonable cost of such emergency repairs within thirty (30) days after receipt of paid invoices from Tenant. In the event Landlord fails to reimburse Tenant for the cost of such repairs within the time period herein provided, Tenant shall have the right to deduct the cost of such repairs from Rent otherwise due Landlord under this lease until the cost of such repairs has been deducted in its entirety. SECTION 9.2(a) Tenant shall, at its sole cost and expense, keep, replace and maintain the interior, non-structural elements of the Demised Premises and the windows (including surrounding window frames) , doors, plate glass, storefronts and signs in good order, condition and repair (except for repairs specifically required of Landlord pursuant to Section 9.1) including, without limitation, all heating, ventilating and air conditioning units and systems serving the Demised Premises, plumbing units and systems including toilet facilities and toilet fixtures, sprinkler systems, electrical systems and equipment and lighting systems and other systems within or exclusively serving the Demised Premises, interior non-structural walls and interior surfaces of exterior walls,:. ceilings, floors and floor coverings, showcases, and Tenant_'s trade fixtures, furnishings and equipment. . The obligations of Tenant pursuant to this Section 9.2(a) shall also include, without limitation, all necessary painting and refurbishment as often as may be required -to keep the Demised Premises in good order, condition and repair, the replacement of any glass (including plate glass) which may be damaged or broken with glass of the same quality and strength, and all installations, repairs, modifications and alterations necessitated pursuant to the provisions of Sections 9.2(b) and 13.1(B) . If• Tenant refuses or neglects to' maks repairs and/or maintain the Demised Premises, or any part thereof, in good order, condition and repair as obligated to do so under the terms of this lease, Landlord shall have the right, upon giving Tenant reasonable written notice of its election to do so, to make such repairs or perform such maintenance on behalf of and for the account of Tenant and Tenant shall pay to Landlord, as Additional Rent, promptly, upon demand, the costs and expenses thereof, with interest thereon at the Default Rate. (b) Tenant shall, at its sole cost and expense, install and Maintain in the Demised Premises smoke evacuation equipment, smoke detection equipment, fire extinguishers and other fire protection in. compliance with all Governmental Regulations of the Governmental Authorities having jurisdiction of the Demised Premises and as required by the rules and regulations of the Insurance Service office. If any Governmental Regulations of the Governmental Authorities having jurisdiction of the Demised Premises or the Insurance Service office require the installation of or any changes, modifications or alterations with respect to any sprinkler system, smoke evacuation system, smoke detection system or additional sprinkler heads or other equipment (collectively, "Fire Protection Installations") by reason of Tenant's business, or the location of partitions, fixtures, equipment or other property placed in the Demised Premises by Tenant, Tenant, at its sole cost and expense, shall promptly make such Fire Protection Installations required whether the work involved be structural or non-structural. SECTION 9.3 After completion of Tenant's Work, Tenant shall not make any installations, improvements, additions, and/or alterations (individually and collectively, "Alterations" for the purposes of this Section 9.31 to the Demised Premises or any. part 300 L136.:3BURLINGTON.2 19 thereof without Landlord's prior written consent. In the evei,, Tenant desires to make any structural repairs or Alterations to the Demised Premises required or permitted to be performed by Tenant under any provision of this lease, such repairs (excluding emergency repairs) and Alterations shall not be commenced until working drawings therefor shall have been prepared in conformity with Landlord's Design & Construction Criteria and approved by Landlord. All repairs and Alterations shall be at Tenant's sole cost-and expense-and shall be performed in a good and workmanlike manner using materials of at least the same grade and quality as originally used by Tenant in performing Tenant's Work under this lease. All structural repairs and Alterations shall be performed under the supervision of a licensed architect or licensed structural engineer in conformance with the approved drawings therefor, Landlord's Design & Construction Criteria and all Governmental Regulations of all Governmental Authorities having jurisdiction of the Demised Premises and once commenced such repairs and Alterations shall be diligently prosecuted to completion to the end that the Demised Premises shall at all times be a complete architectural unit except during the period of work. In performing all repairs and Alterations, Tenant shall have the repairs and Alterations performed in such a manner as not to impede access to the premises of any other occupant (as hereinafter defined in Article XVII(k) in the Shopping Center. Notwithstanding the foregoing, Tenant may, at its sole cost and expense, make Alterations to the Demised Premises without the consent of Landlord provided that (i)•no such Alterations shall alter, modify or in any other manner whatsoever affect the structural portions of the Damised Premises or the building of which the Demised Premises is a part, and/or the exterior of the Demised Premises (including, but not limited to, the storefront (including Tenant's *entrance int^ the enclosed mall of the Shopping Center) and the exteri signage) , and/or the plumbing, electrical, heating, ventilatinc air conditioning, mechanical and other systems and installations located outside or not exclusively serving the Demised Premises; (ii) Tenant shall before the commencement of any Alterations give Landlord at least fifteen (15) days prior written notice of its intent to commence any such Alterations; and (iii) Tenant shall upon Landlord's request furnish to Landlord for informational. purposes only Tenant's plans and specifications for such Alterations. ARTICLE X CONDEMNATION SECTION 10.1 If the entire Demised Premises shall be taken under the power of eminent domain by any public or quasi-public authority, or sold to the condemning authority (or to its designee) under the threat of eminent domain, or if such portion thereof shall be so taken as to make it imprudent or unreasonable in the judgment of Tenant reasonably exercised to use the remaining portion of the Demised Premises for the Permitted Use (which taking is hereinafter referred to as a "Total Taking") , then in such event this lease shall terminate and expire on the date of surrender of possession of the Demised Premises to the condemning authority as a result of such condemnation proceedings. Tenant shall continue to pay the Rent hereunder and, in all other respects, keep, observe and perform all of the terms, covenants, agreements, provisions and conditions of this lease to be kept, observed and performed by Tenant until the date of such surrender, but not thereafter. In the event Tenant shall have paid Rent for a period beyond such date of surrender, Landlord shall promptly repay such amounts to Tenant. SECTION 10.2 In case of a condemnation of a portion of th Demised Premises which is not a Total Taking (which taking i= hereinafter referred-,to,as a "Partial Taking") , this lease shall 39 remain in full force and effect as to the portion of the Demised L136.43BURLINGTON.3 20 Premises remaining immediately after such Partial Taking, without any abatement or reduction in Rent, except that the Fixed Minimum Rent shall be equitably apportioned according to the Gross Leasable Area so taken, and Landlord shall, at its own cost and expense, restore the remaining portion of the Demised Premises to the extent necessary to render same a complete unit of like quality and character as existed prior to such Partial Taking, but the cost thereof shall not exceed the net proceeds of the condemnation award actually received and retained by Landlord. Tenant hereby expressly waives all rights to petition the Superior Court of the State of California to terminate this lease in the event of a : partial taking of the Demised Premises under Section 1265.130 of the California Code of Civil Procedure, as the same may be amended from time to time, or under any similar statute now or hereafter in force, or under any present or future laws or case decisions to the same effect. SECTION 10.3 All compensation awarded or paid upon a Total or Partial Taking of the Demised Premises including, without limitation, any award for diminution of the value of the leasehold shall belong to and be the property of Landlord without any participation by Tenant; provided, however, that nothing contained herein shall be construed to preclude Tenant,. at its sole cost and expense, from independently prosecuting any claim directly against the condemning authority in such condemnation proceedings (or consolidating such claims with Landlord's claims if under the laws of the state in which the Shopping Center is located only one lump sum award is made by the condemning authority) for loss of business, and/or moving expenses, and/or depreciation to, damage to, and/or cost of removal of, and/or for the value of stock and/or trade fixtures, furniture and other personal property belonging to Tenant and which, pursuant to the provisions of this lease, would remain Tenant's property at the expiration of the Term of this lease; provided, however, that no such claim shall diminish or otherwise adversely affect Landlord's award or the awards of any and all ground and underlying lessors and/or mortgagees. ARTICLE XI COMMON AREAS AND COMMON AREA COSTS SECTION 11.1 Landlord shall operate and maintain, or cause to be operated and maintained, the Common Areas [as hereinafter defined in Article XVII(a)] for their intended purposes in good order, condition and repair. Tenant and its concessionaire(s) and their respective employees, agents, customers and invitees are, except as otherwise specifically provided in this lease; authorized, empowered and privileged to use the Common Areas (for their intended purposes) in common with other persons during the Term of this lease, subject, however, to the provisions of this Article XI. Landlord shall at all times after the Effective Date have the right and privilege of determining the nature and extent of the Common Areas, and of making such changes, rearrangements, additions or reductions therein from time to time as it deems to be : desirable, including, without limitation, the location, relocation, • enlargement, reduction or addition of driveways, malls, entrances and exits, automobile parking spaces, employee and customer parking areas, the direction and flow of traffic, establishment of protected areas, landscaped areas and any and all other facilities of the Common Areas, and the right at any time to locate on the Common Areas permanent or temporary kiosks, displays, carts, stands and/or other buildings and/or other improvements of any type; provided, however, in no event shall any kiosks, carts or stands be located closer than fifty (50) feet of any entrance to the Demised Premises; and further provided that no such changes to the Common Areas shall materially and adversely interfere with customer access to or visibility of the Demised Premises. Landlord covenants and �a 1 L136.:3BURLINGTON.3 21 agrees that Landlord shall not (except as otherwise required by the Governmental Authorities) reduce the number of parking spaces in the Shopping Center below 4.3 parking spaces for each 1000 square feet of Gross Leasable Area of buildings available for lease in the Shopping Center. Further, Landlord covenants and agrees that Landlord shall not construct any buildings or other structures or make or permit to be made (except as otherwise required by the Governmental Authorities) any material changes . within the applicable No Build Areas shown on Exhibit "A", Page 1 (i.e. "No Build Area No. 1" and/or "No Build Area No. 211) , subject, however, to Landlord's right to make changes to "No Build Area No. 1" and/or • "No Build Area No. 2" (as applicable) as more particularly hereinafter provided in Article XVII(j) herein. SECTION 11.2(a) All Common Areas shall be subject to the exclusive control and management of Landlord, and Landlord shall have the right at any time after the Effective Date and from time to time during the Term of this lease, to establish, modify, amend and enforce uniform reasonable rules and regulations binding and non-discriminatorally enforced as to all Occupants of the Shopping Center with respect to the Common Areas and the use thereof. Tenant agrees to abide by and conform with such rules and regulations upon notice thereof, and to use its reasonable efforts to cause its Concessionaires, customers and invitees and its and their respective employees and agents, so to abide and conform. Landlord may at any time and from time to time during the Term hereof exclude and restrain any person from use and occupancy of the Common Areas, excepting, however, Tenant, its Concessionaires and other occupants of the Shopping Center and their respective employees, agents, customers and invitees who make use of the Common Areas for their intended purposes in accordance wit' reasonable non-discriminatorally enforced rules and regulatio. established by Landlord from time to time with respect to th Common Areas. The rights of Tenant hereunder in and to the Common Areas shall at all times be subject to -the rights of- Landlord and other Occupants of the Shopping Center to use the same in common with Tenant, and it shall be the duty of Tenant to keep all of said Common Areas free and clear of any obstructions created or permitted by Tenant or resulting from Tenant's business in the Demised Premises. If in the opinion of Landlord unauthorized persons are using any of said Common Areas by reason of the presence of Tenant in the Demised Premises, Landlord may enforce Landlord's right to exclude and restrain all such unauthorized persons by appropriate proceedings. Nothing herein shall affect the rights of Landlord at any time to remove any such unauthorized persons from said Common Areas or to restrain the use of any of said Common Areas by unauthorized persons. (b) Landlord shall have the right (i) to temporarily close, if necessary, all or any portion of the Common Areas to such extent as may in the opinion of Landlord's counsel be reasonably necessary to prevent a dedication thereof or the accrual of any rights of any person or of the public therein, (ii) to close temporarily all or any portion of the Common Areas to discourage non-customer use, (iii) to use portions of the Common Areas while engaged in making additional improvements.or repairs or alterations to the Shopping Center; provided, however, Landlord agrees to use its best good efforts to make such improvements, repairs or alterations in such a manner as to minimize interference with customer access to or visibility of the Demised Premises to the extent reasonably practicable under the circumstances, (iv) to transfer, in whole or in part, any of Landlord's rights and/or obligations under this Article XI to any Occupant of the Shopping Center or to any other party as Landlord may from time to time determine provided that i- no event shall any such transfer release Landlord from it obligations..under,this_Article.XI, and -(v) to do and perform sucL_ other acts (whether similar or dissimilar to the foregoing) in, to �1 and with respect to, the Common Areas as in the use of good r_ . � t L136.33BURLINGTON.3 22 business judgment Landlord shall determine to be appropriate for the Shopping Center. (c) Tenant agrees to use its good faith efforts to cause its officers, employees, agents and any Concessionaires to park their respective automobiles, trucks and other vehicles only in such parking areas, within or outside the Shopping Center, designated by Landlord from time to time as the employee parking area. Tenant further agrees, upon request, to furnish to Landlord the motor vehicle license numbers assigned to the vehicles of Tenant and any Concessionaire, and their respective officers, employees and agents. Tenant shall not at any time interfere with the rights of Landlord and other Occupants or their respective officers, employees, agents, customers and invitees to use any part of the parking areas and other Common Areas of the Shopping Center. Landlord reserves the right to impose parking charges (determined by meters or otherwise) provided such charges do not discriminate against Tenant and are required by the Governmental Authorities. SECTION 11.3 Commencing on the Rent Commencement Date and continuing for the full Term of this lease, Tenant covenants and agrees to pay to Landlord, as Additional Rent, Tenant's Share of Common Area Costs for each Lease Year. Tenant's Share of Common Area Costs for the period from the Rent Commencement Date through and including December 31, 1995 shall be Two Hundred Thousand Two Hundred Fifty and No/100 Dollars ($200,250.00) per Lease Year (the "Bass CAM Amount") . The Base CAM Amount for any partial Lease Year at the beginning of the Term shall be appropriately prorated. For Lease Year 1996 and for each Lease Year thereafter during the Term, Tenant's Share of Common Area Costs shall be the Base CAM Amount increased by a percentage equal to the percentage increase in the Consumer Price Index (as hereinafter defined in this Section 11.3) published for the month of December of each Lease Year as compared to the Consumer Price Index published for the month in which the Rent Commencement Date occurred; provided, however, in no event shall Tenant's Share of Common Area Costs exceed the "CAM Cap" (as hereinafter defined in this Section 11.3) in effect for the Lease Year in question. The CAM Cap for Lease Year 1996 shall be the product obtained by multiplying the Base CAM Amount by 1.03 (i.e. Two Hundred Six Thousand Two Hundred Fifty-Seven and 50/100 Dollars ($206,257.50)]. The CAM Cap for Lease Year 1997 and for each Lease Year thereafter during the Term shall be the product obtained by multiplying the CAM Cap in effect for the prior Lease Year by 1.03. Notwithstanding any decrease in the Consumer Price Index in no event shall Tenant's Share of Common Area Costs in any Lease Year be less than Tenant's Share of Common Area Costs in the prior Lease Year. The term "Consumer Price Index" as used herein shall mean the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Los Angeles-Anaheim- Riverside Average, Subgroup "All items", (1982-84-100) . In the, event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of l00 only in the event that the basis used in such index or publication is less than 100. Tenant's Share of Common Area Costs shall be paid monthly, in advance, on the first day of each month during each Lease Year of the Term in an amount equal to one-twelfth (1/12th) of the annual amount then payable by Tenant as Tenant's Share of Common Area Costs. 1 _136.43BURLINGTON.3 23 ARTICLE XII ASSIGNMENT AND SUBLETTING SECTION 12.1 Tenant acknowledges and agrees that Tenant's agreement to operate its business in the Demised Premises for the Permitted Use set forth in Article I(e) (i) and under Tenant's Store Name sat forth in Article I(e) (iii) continuously and uninterruptedly during the period of Tenant's Operating Covenant as provided in Sections 6.2(a) and 6.2(b) was a primary inducement and precondition to Landlord's agreement to lease the Demised Premises to Tenant. Accordingly, except for a Transfer of this lease permitted pursuant to the provisions of Section 12.7 herein, Tenant ' shall not, and shall not have the power to, transfer, assign, sublet, enter into license or concession agreements, mortgage or hypothecate this lease or Tenant's interest in and to the Demised Premises or any part thereof, by operation of law or otherwise (collectively, a "Transfer" for the purposes of this Article XII) prior to the expiration of Tenant's Operating Covenant. After the expiration of Tenant's Operating Covenant, Tenant shall have the right to assign this lease or sublease all or a portion (but in no event less than one (1) entire floor) of the Demised Premises for the Permitted Use to a transfers having at least three (3) other existing stores each operating under a single store name in more than 50,000 square feet (a "Qualified Transferee") , with Landlord's prior written consent, which consent shall not be unreasonably withheld or delayed. Any attempted or purported Transfer without Landlord's written consent (where such consent is required shall be null and void, have no force or offact and confer no rights upon any third party. SECTION 12.2 Should Tenant desire to enter into a Trans! of this lease to a Qualified Transferee, Tenant shall give noti, thereof to Landlord by requesting in writing Landlord's consent to such Transfer at least forty-five (45) days prior to the effective data of any such Transfer, which notice ("Tenant's Notice") , shall include (i) the full particulars of the proposed Transfer, including its effective date, terms and conditions, and copies of any offers, draft agreements, subleases, letters of commitment or intent, and other documents pertaining to such proposed Transfer; (ii) the identity, financial condition and previous retail business experience of the proposed transferee and (iii) any further infor- mation reasonably relevant to the proposed Transfer which Landlord shall have requested within fifteen (15) days after receipt of Tenant's Notice. Except for those Transfers permitted without Landlord's consent pursuant to the provisions of Section 12.7 herein, Tenant's Notice shall be deemed to be an offer by Tenant to assign this lease to Landlord or to a nominee designated by Landlord or to sublet the Demised Premises or the portion proposed to be sublet to Landlord or to a nominee designated by Landlord for the balance of the Term under all the same terms, covenants and conditions as are contained in this lease. In the event Landlord accepts such offer with respect to either an assignment of this lease or a sublease of the entire Demised Premises, then this lease shall terminate with respect to the entire Demised Premises and the Term shall end on the date stated in Tenant's Notice as the effective date of the assignment or sublease as if that date had been originally set forth in this lease as the Lease Expiration Date. In the event Landlord accepts such offer with respect to a sublease of a portion of the Demised Premises, then this lease shall terminate only with respect to that portion of the Demised Premises affected by such offer to sublease and the Fixed Minimum Rent and monthly installments of Fixed Minimum Rent during the unexpired portion of the Term shall be reduced, proportionately, s' that the Fixed Minimum Rent and monthly installments of Fix Minimum Rent shall then, be based upon _the Gross Leasable Area o_ the remaining portion of the Demised Premises and the Base Sales shall be adjusted based upon the revised Fixed Minimum Rent. At; U 3 6.4 3 BURLING-1ON.1 24 any time within thirty (30) days after Landlord's receipt of the last of the information specified in clauses (1) , (ii) and (iii) above, Landlord may by written notice to Tenant elect to (1) consent to the proposed Transfer upon the terms and conditions approved by Landlord, or (2) elect to recapture the Demised Premises as heretofore provided in this Section 12.2. Failure of Landlord to exercise any option granted Landlord under clauses (1): and (2) above within thirty (30) days after receipt of the. last of information specified in clauses (i) , (ii) and (iii) above shall be deemed a consent to the proposed Transfer to the Qualified Transferee. Notwithstanding anything to the contrary contained herein, in no event shall any assignment, subletting or other Transfer of any portion of Tenant's interest in this lease cause the Demised Premises to be divided into more than two (2) units without Landlord's prior written consent, which consent may be given or withheld in Landlord's sole and absolute discretion. Further, in the event of a sublease of an entire floor of the Demised Premises, in no event shall access to the Demised Premises from the enclosed mall of the Shopping Center be encumbered in any manner whatsoever. SECTION 12.3 Intentionally omitted. SECTION 12.4 Intentionally omitted. SECTION 12.5 Notwithstanding any Transfer by Tenant as provided herein, the provisions of this Article XII shall apply to any further Transfer. If Landlord consents to any such Transfer, Tenant may, within ninety (90) days after the date of Landlord's consent (but not thereafter without Landlord's written consent), enter into the particular Transfer consented to by Landlord on the terms and conditions approved by Landlord. Each assignment of this leas* or sublease of, all or a portion of the Demised Premises entered into by Tenant which is consented to by Landlord or permitted without Landlord's consent pursuant to the provisions of this Article XII shall be evidenced by an instrument executed by Tenant and Tenant's transferee, which, (i) -in the case of an assignment, shall contain a covenant.on the part of the assignee to assume for the benefit of Landlord all of the obligations of Tenant under this lease, and (ii) in the case of a sublease, shall contain a provision that it is subject to all of the terms, covenants and conditions of this lease. The voluntary or other surrender of this lease by Tenant or a mutual cancellation thereof shall not work a merger, and shall at the option of Landlord, terminate all or any existing subleases or subtenancies or shall, at Landlord's option; operate as an assignment to Landlord of such subleases or subtenancies. No Transfer pursuant to this Article XII shall relieve Tenant or any predecessor-in-interest to Tenant or any Guarantor of its obligations to pay' the Rent and to perform all of the other obligations to be performed by Tenant under the terms of this lease. Tenant's and Tenant's Guarantor shall, notwithstanding any Transfer, with or without the consent of Landlord, remain primarily liable for the performance of all obligations of Tenant under this lease. In the event of a default in the performance of Tenant's obligations hereunder after any such' Transfer, Landlord may proceed against Tenant and/or Tenant's Guarantor either at the same time as it proceeds against such assignee or subtenant or prior to proceeding against such assignee or subtenant. Moreover, nothing herein shall require Landlord to proceed against such assignee or subtenant, and Landlord may elect, in the event of a default in the performance of Tenant's obligations pursuant to this lease, to proceed solely and directly against Tenant and/or Tenant's Guarantor. In such event, Tenant shall be solely responsible to seek such contribution or reimbursement to which it may be entitled from such subtenant or assignee. The acceptance by Landlord of any Rent due under this lease from any person other than Tenant shall not be deemed to be a waiver by Landlord of any provisions of this lease or to be a consent to any Transfer. '4y - 2 L156.43BURLINGTION.3 25 SECTION 12.6 (a) If Tenant or Tenant's Guarantor i_ '-d corporation (other than one hereinafter described in this Section 12.6(b) ) , unincorporated association or partnership, Tenant agrees that any transfer, assignment or hypothecation by operation of law or otherwise by Tenant or Tenant's Guarantor of all or substantially all of the assets of such corporation, association or partnership, or of any voting stock or interest in such corporation, association or partnership so as to result in the loss of or a change in the voting control of such corporation, association or partnership by the person or persons owning a majority of said voting stock or such association or partnership • interest at the date of this lease shall be deemed a Transfer within the meaning and provisions of this Article XII, and that any such transfer, assignment or hypothecation or loss of or change in voting control without Landlord's written consent shall constitute an event of default under this lease and in addition to all other remedies available to Landlord for such default, Landlord shall have the right to terminate this lease upon thirty (30) days written notice to Tenant. (b) The provisions of this Section 12:6 shall not apply to a corporation whose entire outstanding voting stock is listed on a national securities exchange or to a corporation if at least eighty percent (80%) of its entire outstanding voting stock is owned by another corporation whose entire outstanding voting stock is listed on a national securities exchange. For the purposes of this Section 12.6, (1) "national securities exchange" shall have the same meaning as defined in the Securities Exchange Act of 1934, as amended; (2) "stock ownership" shall be determined hereunder in accordance with the provisions set forth in Section 544 of the Internal Revenue Code of 1986 as the same existed on December 22. 1987, after amendment thereof by the Revenue Bill of 1987; and "voting stock" shall refer to shares of stock regularly entitles vote for the election of directors of the corporation. r.. SECTION 12.7 Notwithstanding anything to the contrary contained in this Article XII, Tenant shall have the right, without the consent of Landlord, but upon not less than thirty (30) days prior notice to Landlord, to Transfer this lease to (i) any affiliate of Tenant or (ii) any corporation resulting from the consolidation or merger involving Tenant or an affiliate of Tenant within any other entity. Any Transfer pursuant to (i) or (ii) above shall be subject to the following conditions: (a) such Transfer shall not relieve Tenant or Tenant's Guarantor from any of its obligations under this lease; and (b) such Transfer shall be subject to all of the terms, covenants and conditions of this lease and such transferee shall expressly assume for the benefit of Landlord the obligations of Tenant under this lease by a document reasonably satisfactory to Landlord. In addition, Tenant shall have the right to operate departments within the Demised Premises without Landlord's consent by means of sublease, concession or license agreements provided such departments shall not exceed in the aggregate more than twenty-five percent (25%) of Gross Leasable Area of the Demised Premises, or be separated by demising walls, or entitle Tenant to any additional sigtage or additional entrances into the Demised Premises, or release Tenant or Tenant's Guarantor from its obligations under this lease and provided further that the Gross Sales of any such subtenant, concessionaire or licensee are included in Tenant's Gross Sales for the purpose of computing Percentage Rent under this lease. All such sublease, concession or license agreements shall be subject and subordinate to all of the terms and conditions of this lease and any and all modifications thereto. � y5 L136.4 3BURLINGTON.3 26 ARTICLE XIII TENANT'S ADDITIONAL AGREEMENTS SECTION 13.1 Tenant agrees at all times during the Term, at its_sole cost and expense, to: (A) confine Tenant's trash, rubbish, garbage and other refuse in receptacles located within the Demised Premises so as not to be visible to the public and to arrange for the regular periodic removal thereof. Should Tenant agree to use Landlord's designated sanitation contractor for the Shopping Center, Tenant agrees to pay to Landlord, as Additional Rent, promptly as and whdn billed the charges for such trash, rubbish, garbage and other refuse removal from the Demised Premises not to exceed comparable prices charged by other reputable sanitation contractors in the trade area served by the Shopping Center: provided, however, Landlord shall have the right to have the charges for such trash, rubbish, garbage and other refuse removal billed directly to Tenant by the sanitation contractor, in which event, Tenant agrees to pay to the sanitation contractor, as Additional Rent, promptly as and when billed the charges for such trash, rubbish, garbage and other refuse removal not to exceed comparable prices charged by other reputable sanitation contractors in the trade area served by the Shopping Center; (8) promptly comply with all Governmental Regulations affecting the Demised Premises of all Governmental Authorities having jurisdiction of the Demised Premises by reason of Tenant's business or for any other reason, including, but not limited to, installations, repairs, modifications and alterations, whether structural or non-structural, foreseen or unforeseen, that are necessitated by any such Governmental Regulations. Notwithstanding anything to the contrary contained in this Section 13.1(8) , Tenant shall not be required to make any structural alterations, repairs, modifications or installations to the Demised Premises unless necessitated by (i) the nature of Tenant's particular use of the Demised Premises, or (ii) any act or omission or negligence of Tenant, its Concessionaires or the Tenant Parties unless occasioned by a risk covered by Landlord's insurance; (C) pay-directly to the appropriate taxing authority, before delinquency, any and all taxes, assessments and public charger' levied, assessed or imposed during the Term by the Governmental Authorities upon Tenant's business or upon Tenant's leasehold interest, fixtures, furniture, appliances or personal property installed or located in the Demised Premises, or that constitute a lien upon any of the foregoing, or on Tenant's right to occupy, or do business at, the Demised Premises; (D) maintain positive air pressure in the Demised Premises so as to prevent the drawing of heated or cooled air from the enclosed mall of the Shopping Center, and keep the Demised Premises heated or air conditioned, as the case may be, to at least the same minimum temperature (in the case of heat) or the same maximum temperature (in the case of air conditioning) as Landlord shall maintain in the enclosed mall. Notification of such temperatures shall be given to Tenant by Landlord; (E) use the Shopping Center's name, as same may be changed from time to time, in referring to the location of the Demised Premises in all local newspaper, radio and television or other advertising with respect to Tenant's business at the Demised Premises in Orange County, California; (F) store and/or stock in the Demised Premises only such merchandise as Tenant is permitted to sell at retail pursuant to this lease; • _r L136.43SURLI.NGTCN.3 27 SECTION 13.2 Tenant agrees that it will not at any time during the Term: (A) conduct or permit in the Demised Premises (i) any fire, bankruptcy, auction, or "closeout" (other than in the ordinary course of Tenant's business) sale, or (ii) any use for any purpose other than the Permitted Use and operations incidental thereto; (B) use, or permit to be used, any part of the Common Areas or any other areas within the Shopping Center, other than within the Demised Premises, for the sale, display or storage of any • merchandise or for the solicitation of customers or for any other business, occupation or undertaking; (C) use any loudspeakers, phonographs, or other devices of similar nature in such manner as to be heard or experienced outside of the Demised Premises; (D) permit the emission of any objectionable noise, odors, fumes, smoke or light from the Demised Premises; (E) permit deliveries to the Demised Premises except through the delivery areas serving the building of ,which the Demised Premises is a part. SECTION 13.3 Tenant shall, at its sole cost and expense, install and maintain in good repair a new sign(s) for the Demised Premises including the cost of electricity therefor, subject to Tenant's compliance with the following conditions in connection therewith: (i) prior to installation of such sign(s), Tenant shall, at its sole cost and expense, obtain from the Governmental Authorities having jurisdiction of the Demised Premises, al: approvals necessary for the installation, erection and maintenance of such sign(s) ; (ii) Landlord shall have approved, in writing, Tenant's drawings for its sign(s) as to dimension, content, material, location and design prior to the erection thereof; and (iii) such sign(s) when installed shall comply with Landlord's Design & Construction Criteria and all Governmental Regulations of all Governmental Authorities having jurisdiction of the Demised Premises. Except as provided in this Section 13.3, Tenant agrees that it will not place on the roof, doors, glass panes and supports of the show windows and the exterior walls of the Demised Premises any sign, symbol, advertisement, neon, flashing, strobe or other light, shade, or any other object or thing visible to public view outside of the Demised Premises, without first obtaining Landlord's approval as to whether the same shall be so installed or placed and, if so, as to the location, number, type, and appearance of each thereof. Tenant shall not display, paint or place or cause to be displayed, painted or placed, any handbills, bumper stickers or other advertising devices on any vehicle parked in the automobile parking areas of the Shopping Center, whether belonging to Tenant or any Concessionaire, or their respective officers, employees and agents, or to any other person, nor shall Tenant or any Concessionaire solicit or distribute, or cause to be solicited or distributed, any handbills or other advertising devices in the Shopping Center. Notwithstanding the foregoing, Landlord hereby approves the location, material, dimension, color, content and design of Tenant's proposed signage as set forth on Exhibit "B" attached hereto and incorporated herein by this reference, subject to the approval of such signage by the Governmental Authorities. having jurisdiction thereof. L13 6.4 3 BURLI.NGTO:I.3 28 ARTICLE XIV PERCENTAGE RENT SECTION 14.1(a) In addition to the payment of Fixed Minimum Rent and Additional Rent provided for in this lease, Tenant shall pay to Landlord for each Lease Year during the Term, as Percentage Rent, an amount, if any, equal to the product of the Gross Sales for such Lease Year in excess of the Base Sales for such Lease Year multiplied by the Percentage Rent Rate set forth in Article I(d) (i) . Tenant shall deliver to Landlord within fifteen (15) days = after the end of each calendar month of the Term a monthly statement of Gross Sales showing the amount of Gross Sales for the ' preceding calendar month. Simultaneously with the delivery to Landlord of each annual statement of Gross Sales referred to in Section 14.1(c) herein, Tenant shall pay to Landlord an amount, if any, equal to the product of the Gross Sales reported for the preceding Lease Year in excess of the Base Sales for such Lease Year multiplied by the Percentage Rant Rate set forth in Article 1(d) (i) . Notwithstanding the foregoing, the amount of Percentage Rent payable by Tenant for the first partial Lease Year of the Term shall be equal to (a) two percent (2t) of the amount by which Tenant's Gross Sales for the period between the Rent Commencement Date and the day prior to the first (1st) anniversary of the Rant Commencement Date (the "Measuring Period") exceeds Twenty Million and No/100 Dollars ($20,000,000.00) , multiplied by (b) a fraction the numerator of which is the number of calendar days in the first partial Lease Year and the denominator of which is 365. Percentage Rent, if any, for such first partial Lease Year shall be paid by Tenant to Landlord within thirty (30) days following the expiration of the Measuring Period. The foregoing provisions shall not off act the computation of Percentage Rant to be paid by Tenant for any portion of the Term subsequent to the first partial Lease Year. Tenant shall submit to 'Landlord not later than thirty (30) days following the expiration of the Measuring Period an annual statement of Gross Sales made during the Measuring Period in accordance with the provisions of Section 14.1(c) . (b) In the event any Lease Year shall be less than twelve (12) full calendar months, then the Base Sales for such partial Lease Year shall be appropriately adjusted so that the same shall be an amount equal to the product obtained by multiplying the Bass Sales by a fraction, the numerator of which shall be the actual number of days in such Lease Year for which Gross sales are required to be reported and the denominator of which shall be three hundred sixty-five (365) . If Fixed Minimum Rent during any Lease Year is abated, reduced or increased pursuant to the provisions of. this lease, or by written agreement of the parties hereto, then the Base Sales shall be appropriately reduced or increased, as the case may be, by a percentage equal to the percentage decrease or increase, as the case may be, in the Fixed Minimum Rent payable for the period during which the change in the Fixed Minimum Rent is in effect. (c) Tenant shall deliver to Landlord within sixty (60) days after the end of each Lease Year an annual statement of Gross Sales showing Gross Sales for the preceding Lease Year and also showing the amounts, if any, excluded from Gross Sales under the provisions of Section 14.2(B) . Each such annual statement of Gross Sales shall be certified by the chief accounting officer of Tenant. Such annual statements of Gross Sales shall be in such form and style and contain such details and breakdowns as Landlord may reasonably require. With respect to the last Lease Year of the Term, the aforesaid payment, if required, shall be made within thirty (30) days after the Lease Expiration Date or the date of earlier termination of the Term of this lease, and the provisions of this Article XIV shall survive the expiration or earlier termination of the Term of this lease. L136.33BCRLINGTO1.11.3 24 SECTION 14.2(a) The term "Gross Sales" as used herein means the aggregate dollar amount of the price charged for all goods, wares, merchandise, beverages and food sold, delivered, leased or licensed, and all charges for services sold and/or performed by Tenant in, at, on or from the Demised Premises, whether made for cash, on credit, or otherwise, and (except as hereinafter provided) without reserve or deduction for inability or failure to collect, including, but not limited to: sales, leases or licenses of goods, wares, merchandise, beverages, foods or services (i) where the orders therefor originated and/or are accepted in, at, on or from the Demised Premises but delivery thereof is made from or at any • place other than the Demised Premises, (ii) made pursuant to mail, telegraphic, telephone, facsimile or other similar orders received° ` or filled in, at, on or from the Demised Premises or directed thereto, and/or (iii) made by means of mechanical or other vending devices, in, at or on the Demised Premises. (b) For the purposes of this Article XIV, there shall not be included in Gross Sales, or, if included, there shall be deducted from Gross Sales, as the case may be: (i) the actual net amount of refunds or allowances actually made or allowed by Tenant in accordance with reasonable business practices upon trans- actions included within Gross Sales where the item is returned by the purchaser to and accepted by Tenant (provided that anything given in exchange for returned items shall be included in Gross Sales) ; (ii) sales, luxury or retailer's excise taxes (not including gross receipts taxes or similar taxes) imposed try dulyns constituted governmental authority which are added to the sellir price (or absorbed therein) and paid directly by the customer a. actually paid over to -the taxing authority by Tenant; (iii) returns to shippers or manufacturers; (iv) exchange of merchandise between stores and warehouses of Tenant where such exchanges are made solely for the convenient operation of Tenant's business and not for the purpose of consummating a sale which has been made at, in, or from the Demised Premises and/or not for the purpose of depriving Landlord of the benefit of a sale which otherwise would be made at, in, on or from the Demised Premises; (v) delivery and alteration charges; (vi) insurance proceeds: (vii) receipts from vending machines and public telephones used exclusively by Tenant's employees; (viii) receipts from the sale of fixtures, machinery and equipment which are not stock in trade; (ix) interest, service or sales carrying charges or other charges, however denominated, paid by customers for extension of credit on sales and where not included in the merchandise sales price but not charges or expenses in connection with credit cards or bank cards whether paid by the customer or by Tenant shall be excluded from Gross Sales except as hereinafter provided; (x) provided that (a) , (b) and (c) below do not exceed in the aggregate a total of more than three percent (3%) of Tenant's Gross Sales in any single Lease Year calculated on a non* cumulative basis: -1 L136.43BGRLINGTCN.3 30 (a) the amount of bad checks and/or uncollected credit sales to the extent previously included in Gross Sales to the extent written off by Tenant for federal income tax purposes, provided that if subsequently collected, said bad checks and/or uncollected credit sales shall be included within Gross Sales in the Lease Fiscal Year in which subsequently collected; and (b) sales to Tenant's employees at a discount in accordance with Tenant's standard employee discount • policy: and (c) charges paid to credit card companies. (c) Each sale on a deferred payment basis shall be treated as a sale for the full price at the time the sale is entered into, irrespective of the time for payment or the time when title passes. Each and every sale made by a Concessionaire shall be deemed to be a sale made by Tenant for the purposes of this Article XIV. SECTION 14.3 "Base Sales" is the annual amount of Gross Sales in the applicable amount as set forth in Article I (d) (ii) , but subject to adjustment in accordance with the provisions of Section 14.1(b) as the result of any increase or decrease of Fixed Minimum Rent as may be specifically provided for in this lease. Percentage Rent Rate is the applicable percentage as set forth in Article SECTION 14.4(a) Tenant shall keep and shall require its Concessionaires, if any, to keep and maintain at all times during _ the Term in the Demised Premises or, at Tenant's election, at. Tenant's principal accounting office complete and accurate books of account and records of 'all Gross Sales in, at, on or from the Demised Premises in accordance with generally accepted accounting principles. Such books of account and records shall include at least those as would normally be required to be kept and examined by an independent accountant in accordance with generally accepted auditing practices in performing an audit of Tenant's Gross Sales and all sales tax returns, which books of account and records shall be conveniently segregated from other business matters of Tenant. Such books of account and records with-respect to any Lease Year shall be so kept and maintained, properly added and totalled for at least thirty-six (36) calendar months after the end of such Lease Year (the "Retention Period") . (b) The acceptance by Landlord of payments of Percentage Rent shall be without prejudice to Landlord's right to audit Tenant's books of account and records relating to Gross Sales in order to verify the amount of Tenant's Gross Sales. Landlord and its authorized representatives, including, without limitation, Landlord's Managing Agent, shall have the right upon reasonable prior notice to Tenant during regular business hours until the end of the Retention Period, to audit all* such books of account and records relating to Gross Sales. Notwithstanding the foregoing, it is agreed that Landlord's right to audit as provided above shall be limited to once every Lease Year, provided that in the event any audit shall result in a dispute between Landlord and Tenant and such dispute may be resolved by another audit, Landlord shall be entitled to said second audit. Tenant shall produce same on request of Landlord. If it shall be determined as a result of any such audit that there has been a deficiency in the payment of Percentage Rent, such deficiency shall become immediately due and payable to Landlord with interest thereon at the Default Rate from the date when said payment should have been made. In addition, if any such audit shows that the amount of Gross Sales stated on any of Tenant's annual statements of Gross Sales was understated by more than two percent (2%) , and as a result thereof additional So :I :3BURLINGTON.3 31 Percentage Rent of more than Two Thousand and No/100 Dolla_ . ($2,000.00) is due Landlord, then Tenant shall pay to Landlord, all of Landlord's reasonable costs and expenses connected with said audit up to a maximum amount of Two Thousand Five Hundred and No/100 Dollars ($2,500.00) per audit. If at any time prior to the expiration of the Retention Period, Landlord shall reasonably contend that error may exist with respect to any of Tenant's annual statements of Gross Sales, then Tenant's books of account and records of Gross Sales for such applicable annual statement period shall be kept and maintained by Tenant until Landlord's contention has been finally determined even if longer than the Retention Period in question. Any information obtained by Landlord as the result of such audit shall be held in confidence by. Landlord and shall not be divulged by Landlord to any person or used for any purpose except that Landlord shall be permitted to divulge such information (i) when necessary in connection with the trial of any action, proceeding or arbitration between Landlord and Tenant, (ii) in connection with any bona fide prospective sale of the Shopping Center, (iii) to any mortgagee or prospective mortgagee of the Shopping Center; (iv) to any ground or underlying lessor, or (v) pursuant to a subpoena that Landlord reasonably believes to have been legally issued and validly served upon Landlord, or (vi) as necessary to Landlord's employees, agents, attorneys and accountants. SECTION 14.5 The term "Tenant" as used in Sections 14.2 and 14.4 shall also include all Concessionaires. ARTICLE XV UTILITIES, UTILITY AND ACCESS EASEMENTS SECTION 15.1 Tenant agrees to pay promptly, as and when the same become due and payable, all water rents, rates and charges, all sewer rants and all charges for electricity, gas, heat, steam, hot and/or chilled water, air conditioning, ventilating, lighting systems, and other utilities supplied to the Demised Premises following the Delivery Date and throughout the Tarm. If any such charges are not paid when due (and the non-payment may result in the establishment of a lien or encumbrance upon the Demised Premises and/or the Shopping Center) Landlord may pay the same, and any amount so paid by Landlord shall thereupon become due to Landlord from Tenant as Additional Rent, with interest thereon at the Default Rate from the date of such payment by Landlord until the date of repayment by Tenant. SECTION 15.2 If Landlord shall elect to furnish any utility services to the Demised Premises, Tenant shall purchase its requirements thereof from Landlord at Landlord's cost therefor, not to exceed the rates Tenant would have been charged therefor by the applicable local public utility supplier. SECTION 15.3 Tenant covenants and agrees that at all times its use of electric current shall never exceed the capacity of the feeders to the Demised Premises or the wiring installations therein. SECTION 15.4 Except to the extent caused by the negligence or willful misconduct of Landlord, Landlord's Managing Agent or the Landlord Parties, Landlord, Landlord's Managing Agent and the Landlord Parties shall not be liable in damages or otherwise for any failure or interruption of any utility service being furnished to the Demised Premises. No such failure or interruption shall entitle Tenant to terminate this lease or stop making any Rent or other payment due hereunder. C51 L136.43BURLINGTCN.3 72 SECTION 15.5 Landlord hereby grants to Tenant, its agents, employees and contractors from and after the Delivery Date and continuing during the Term of this lease a non-exclusive easement to use the elevators and stairways of the building of which the Demised Premises is a part for access to the penthouse -of the building of which the Demised Premises is a part for toe sole purpose of enabling Tenant to perform repairs and maintenance to the heating, ventilating and air conditioning equipment, mechanical equipment, electrical equipment and other equipment located in the penthouse which serves the Demised Premises. 0. = SECTION 15.6 Tenant hereby grants (i) to Landlord, its agents, employees and contractors and (ii) to the Occupants from time to time occupying the third (3rd) floor of the building of which the Demised Premises is a part and their respective agents, employees, customers and invitees from and after the Delivery Date and continuing during the Term of this lease a non-exclusive easement to use the elevators and stairways of the building of which the Demised Premises is a part for the sole purpose of access to the third floor and penthouse of the building of which the Demised Premises is a part. The easement granted to the •Occupants of the third (3rd) floor of the building pursuant to (ii) above is contingent upon Landlord and Tenant agreeing upon an access plan for use of the elevators and stairways of the building by the Occupants of the third (3rd) floor of the building in a manner that does not compromise the security of the Demised Premises. Landlord and Tenant agree to use their good faith efforts to mutually agree upon an access plan for use of the elevators and stairways. of the building by the Occupants of the third (3rd) floor of the building. Landlord hereby reserves to itself the use of the exterior of the building and the right to provide direct exterior access to the third (3rd) floor of the building provided that any such direct exterior access to the third (3rd) floor of the building shall not adversely interfere with customer access to the Demised Premises. Further, Tenant hereby grants to Landlord the right, at its sole cost and expense, upon reasonable prior notice to Tenant to install such lines connections and meters as may be necessary to enable the utilities serving the third floor of the building of which the Demised Premises is a part to be separately metered from the Demised Premises. ARTICLE XVI REAL ESTATE TAXES SECTION 16.1 The term "Real Estate Taxes" as used herein shall include any form of real property tax or assessment, excise on rent, and any other governmental imposition, general and special, ordinary and extraordinary, unforeseen or foreseen, of any kind or nature whatsoever (including, but not limited to, assessments for public improvements or benefits) which are laid, assessed, levied, imposed upon, or become due and payable as a lien against the land, the building and all other improvements located on the tax parcel (the "Tax Parcel") of which the Demised Premises is a part, or any part thereof. Landlord represents to Tenant that the building of which the Demised Premises is a part and the land underlying such building (i.e. Building III as shown on Exhibit "A") is a separate tax parcel. "Real Estate Taxes" shall in no event include Landlord's franchise taxes, general income taxes, inheritance, estate or gift taxes or the taxes described and referred to in section 13.1(C) . SECTION 16.2 Commencing on the Rent Commencement Date, and continuing for the full Term of this lease, Tenant covenants and, agrees to pay to Landlord, as Additional Rent, Tenant's Share of Real Estate Taxes for each Lease Year. Tenant's Share of Real Estate Taxes for the period from the Rent Commencement Date through and including December 31, 1995 shall be One Hundred Thirty-Three 511Z Thousand Five Hundred and No/100 Dollars ($133,500.00) Rpr Vqse Year (the "Base Tax Amount"). The Base Tax Amount for a _pvrft aL L1-56.43BLt'ti LINGTON.3 33 Lease Year at the beginning of the Term shall be appropriately prorated. For Lease Year 1996 and each Lease Year thereafter during the Term Tenant's Share of Real Estate Taxes shall be the Base Tax Amount increased by a percentage equal to the percentage increase in the total Real Estate Taxes levied and assessed against the land, buildings and all other improvements located on the Tax Parcel as compared to the total Real Estate Taxes levied and assessed against the land, buildings and all other improvements located on the Tax Parcel for tax fiscal year 1995-1996. Landlord shall furnish to Tenant each Lease Year a copy of the tax bill for the Tax Parcel. Landlord reserves the right to adjust Tenant's j Share of Real Estate Taxes based upon the tax fiscal, year utilized by the taxing authorities. Tenant's Share of Real- Estate Taxes shall be paid monthly, in advance, on the first day of each month during each Lease Year in an amount equal to one-twelfth (1/12th) of the annual amount then payable by Tenant as Tenant's Share of Real Estate Taxes. SECTION 16.3 In addition, to Tenant's payment of Tenant's Share of Real Estate Taxes, Tenant shall pay to Landlord upon receipt of an invoice therefor any tax or excise levied, impossed upon or measured by rent (a "rent tax") provided such rent tax is exclusively limited to rentals receivable from real estate. In the event any such rent tax is applicable to forms of receipts not limited to rentals receivable from real estate (including without limitation, income, business, gross receipts or profit taxes) than Tenant shall have no obligation to pay such taxes pursuant to this Section 16.3 unless a gross receipts tax is levied in substitution for ad valorem taxes and then only to the extent of -such substitution. Any rent tax payable by Tenant pursuant to this Section 16.3 shall be computed upon the amount of taxable rent? payable by Tenant under this lease and not upon Tenan% proportionate share og all of Landlord's taxable rentals receivab,_ from the Shopping Center as a whole. ARTICLE XVII CERTAIN ADDITIONAL DEFINED TERMS The following terms, when used in this lease with the first letter of each word therein capitalized, are defined terms and shall have the- meanings set forth herein: (a) "Common Areas" as used herein means the portions of the Shopping Center which, at the time in question, have been designated and improved for common use by, or for the benefit of the Occupants, including, without limitation (if and to the extent facilities therefor are provided by the Landlord at the time in question) : the land and facilities utilized for or as parking areas; open and/or enclosed malls; access and perimeter roads; truck passageways and loading platforms therein; service corridors and stairways providing access from store premises to such platforms and truck passageways; above-ground and subsurface passageways and parking facilities; landscaped areas; exterior walks, arcades, stairways, ramps, interior corridors, escalators, elevators, stairs, pedestrian walks and balconies; directory equipment; undergrouror storm and sanitary sewers, utility lines and the like; washroomao,comfort and first aid stations, drinking foun- tains, toilets and other public facilities; community rooms and auditoriums; parcel pick-up stations; bus stations, taxi stands and other public transportation facilities. Any portion of the Shopping Center so included within Common Areas shall be excluded therefrom when designated by Landlord for a non-common use, and ar portion thereof not theretofore included within Common Areas sha. be included when so designated and improved for common use. �I r :.�.6.31SU'2r LI:IG:C:J. 34 (b) "Common Area Costs" as used herein means the total costs and expenses paid or incurred by Landlord, Landlord's Managing Agent, their respective agents, and/or designees for operating, managing, administrating, insuring, maintaining, repairing and/or replacing all or any part of the Common Areas (and any installations therein, thereon, thereunder or thereover) . (c) "Concessionaire" as used herein means any person, corporation or other entity, who or which conducts any business (whether or not a retail business) in any portion of the Demised Premises as undertenant or subtenant of Tenant or under any = concession or license from Tenant or as a subtenant of, or under any concession or license from, any such undertenant or subtenant or person holding such concession or license, whether or not Tenant was authorized under the provisions of this lease to make or grant any such lease, license or concession. (d) "Gross Leasable Area" as used herein means with respect to the Demised Premises and all other areas in the Shopping Center which are available from time to time for the exclusive use and occupancy by an Occupant, the actual number of square feet of floor space on all floors of all such areas measured from the exterior faces of all exterior walls (and from the extensions thereof, in case of openings) and from the center line of interior walls dividing any such areas. (e) "Landlord" as used herein means only the person or entity who or which at the time in question holds the landlord's interest in this lease, it being intended that the covenants and obligations contained in this lease on the part of Landlord shall be binding on Landlord, its successors and assigns only during their respective periods of owning or holding Landlord's interest in this lease, and that in the event of any sale, transfer or exchange of the Demised Premises by Landlord or assignment of this lease (other than as collateral security for a loan) Landlord shall automatically be freed and relieved of all liability under any and all of the covenants and obligations contained in or derived from this lease arising out of any act, occurrence or omission relating to the Demised Premises or this lease accruing after the consummation of such sale, transfer or exchange. Notwithstanding anything to the contrary provided in this lease, it is expressly understood and agreed that (i) there shall be absolutely no personal liability on the part of Landlord, Landlord's Managing Agent or the Landlord Parties or any successor in interest of Landlord or Landlord's Managing Agent with respect to any of the terms, covenants and conditions of this lease, such exculpation of personal liability to be absolute and without any exception whatsoever, and shall survive the expiration or earlier termination of this lease, and (ii) any money judgment obtained against Landlord resulting from any default by Landlord under this lease or other claim against Landlord arising under this lease shall be satisfied only out of Landlord's equity in the Shopping Center and the proceeds of any sale or refinancing thereof [the term "Shopping Center" for the purposes of this Article XVII(e) only shall mean that portion of the Shopping Center owned by or ground leased to Landlord], and no other real, personal or mixed property of Landlord or any partner, stockholder, officer, director or trustee or joint venturer or co-venturer of, Landlord, wherever located, shall be subject to levy on any such, judgment obtained against Landlord and if Landlord's equity in the Shopping Center and the proceeds of any sale or refinancing thereof is insufficient to satisfy such judgment, Tenant will not institute any further action, suit, claim or demand, in law or in equity, against Landlord for or on the account of such deficiency. Tenant hereby waives, to the extent waivable under law, any right to satisfy said money judgment against Landlord except from Landlord's equity in the Shopping Center and the proceeds of any sale or refinancing thereof. 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L13 6.:3 BURLINGTC11.3 35 (f) "Landlord's Managing Agent" as used herein means The Macerich Property Management Company, a California corporation, or any other person or organization with whom Landlord has entered into a management contract regarding the Shopping Center. (g) "Lease Year" as used herein means each period of January 1 through December 31 during the Term, except that the first Lease Year shall be the period from the Rent Commencement Date through the December 31 next succeeding the Rent Commencement Date and the last Lease Year shall be the period from the January 1 next preceding the Lease Expiration Date or the date of earlier termination of the Term of this lease, as the case may be, to and including the Lease Expiration Date or the date of earlier termination of the Term of this lease, as the case may be. (h) "Occupant" as used herein means any person, corporation or other entity (including, without limitation, Tenant) from time to time entitled to the use and occupancy of Gross Leasable Area in the Shopping Center, whether as a tenant, or as a Concessionaire of a tenant, or as a fee owner; provided, however, that Landlord shall not be deemed to be an "Occupant" except to the extent, it any, that Landlord is then conducting a retail business with the general public in the Shopping Center. (i) "REA" as used herein means that certain Construction, Operation and Reciprocal Easement Agreement dated July 19, 1965, and recorded on August 4, 1965 as Instrument No. 2170 in Book 7617, Page 539 in the official Records of orange County, California, as amended by First Amendment to Construction, operation "and Reciprocal Easement Agreement dated December 31, 1973, and recorded on March 4, 1974 as Instrument No. 2497 in Book 1087, Page 1770 in the Official Records of Orange County, California, and re-recorded on March 8, 1974, as Instrument No. 6999 in Book 11091, Page 983, in the Official Records of Orange County, California, as amended by Amendment No. 2 to Construction, operation and Reciprocal Easement Agreement dated April 23, 1987, and recorded on July 17, 1987, as Instrument No. 87-406989 in the Official Records of Orange County, California, as the same may be further amended from time to time. (j) "Shopping Center" as used herein means the shopping center described in Section 2.1 plus any other parcel(s) of land at any time designated by Landlord to be added thereto (but only so long as any such designation remains unrevoked) which are used for Shopping Center or related purposes, including, but not limited to, employee parking, or the furnishing to the Shopping Center of any utility or other service for any office and/or professional building or for any other improvement appropriate or related to the operation or functioning of the Shopping Center, together with all present or future buildings and improvements thereon. Lan hereby reserves the right at any time after the Effectjyp_D and from time to time during the erm s tease, to renovate, econliaur__ e_and/or modernize the Shopping Cerit'er ih such manner and at •such times as Landlord may, in its s lute discretion, deem advisable for the best in erests and mutual bene —Of the Occupants of the shanpulq_ s�iter. By way of il tr lusation only, and not to be construed as limiting the extent or scope of such renovation, reconfiguration and/or modernization, Landlord may -enlarge. add additional stores o reinfo educe, rec redesign, realign; modif�ri� and _the bui nqs i e `S opping en er (lnrltng, without limitation, the building of W11 I on e emised rlwwlapes is a part) including, without limitation, entrances thereto, as well as other structures, facilities, malls, walkways, landscaped areas, and/or other areas of the Shopping Center, and raze in whole or in part the building's (including, without limitation, t e build in;_­5`r-`Wh ich the Demised; Pry 1 is a part) , structures, facilities and/or othe improvements in the Shopping Center, and construct new buildings, structures,_ facilities and/or.other improvements in *t ST5Ij9Uj; F- , i.136.43BURLINGTON.3 53 (ii) the Marine Protection, Research and Sanctuaries Act �_W_ U.S.C., Section 1401-1445) ; (iii) the Clean Water act (33 U.S.C_, Section 1251, ,et. sea.) ; (iv) RCRA, as amended by the Hazardous and Solid Waste Amendments of 1984 (42 U.S.C., Section 6901, et. see.) ; (v) CERCLA, as amended by the Superfund Amendments and Reauthorization Act of 1986 (42 U.S.C., Section 9601, et. seg.) ; (vi) TSCA, (vii) the Federal Insecticide, Fungicide and Rodenticide Act, as amended (7 U.S.C., Section 135, ,et. sea.) ; (viii) the Safe • Drinking Water Act (42 U.S.C., Section 300(f) , et. sea.) ; (ix) OSHA; (x) the Hazardous Liquid Pipeline Safety Act (49 U.S.C., Section 2001, its. sect.) ; (xi) the Hazardous Materials c Transportation Act (49 U.S.C., Section 1801, et. sea.) ; (xii) the Noise Control Act of 1972 (42 U.S.C., Section 490,1, qt. sea.) ; (xiii) EPCRA; (xiv) National Environmental Policy Act (42 U.S.C., Section 4321-4347) ; and (xv) the Safe Drinking water and Toxic Enforcement Act of 1986. (b) Tenant shall be deemed to be (1) the person in control, (2) an operator of the Demised Premises and (3) the person in charge with respect to the Demised Premises for purposes of reporting requirements under CERCLA, as amended. Tenant agrees (i) that should it or its Concessionaires or the Tenant Parties know of the release or escape or threatened release or escape of any Hazardous Materials, in, on, under or about ,the Demised Premises, including, without limitation, the release or escape or threatened release or escape of any Hazardous Materials in connection with Tenant's Work, or in connection with any repairs or Alterations made by Tenant to the Demised Premises or any part thereof, that they will promptly notify Landlord of such release or escape or threatened release or escape, and (ii) that it vill provide all warnings of exposure to Hazardous Materials in, on, under or about the Demised Premises in strict compliance with all applicat Governmental Regulations. (c) -'Tenant covenants and agrees that Tenant shall at no time use or permit the demised Premises to be used in violation of any Governmental Regulations relating to Hazardous Materials. Tenant shall assume sole and full responsibility for, and shall promptly remedy at its sole cost and expense, all such violations involving Hazardous Materials introduced by Tenant, its Concessionaires or the Tenant Parties into the Demised Premises, provided that Landlord's written approval of any remedial actions shall first be obtained which approval shall not be unreasonably withheld. Further, Tenant shall not enter into acry settlement agreement, consent decree or other compromise relating to Hazardous Materials in any way connected with the Demised Premises, without first notifying Landlord of Tenant's intention to do so and affording Landlord ample opportunity to appear, intervene or otherwise appropriately assert Landlord's interest with respect thereto. Tenant shall at no time use, analyze, generate, manufacture, produce, transport, store, treat, release, dispose of or permit the escape of, or otherwise deposit in, in, under or about the Demised Premises, any Hazardous Materials, or permit or allow its Concessionaires or the Tenant Part=es to do so, without Landlord's prior written consent. Tenant's compliance with the terms of this Section 21.28(c) and with all Governmental Regulations relating to Hazardous Materials shall be at Tenant's sole cost and expense. Tenant shall-pay or reimburse Landlord promptly upon demand for any costs or expenses incurred by Landlord (with interest thereon at the Default Rate) , including Landlord's actual attorneys', engineers' , consultants' and other experts' fees and disbursements incurred or payable to determine, review, approve, consent to or monitor the requirements for compliance with Governmental Regulations relating to Hazardous Materials, including, without limitation, above and below ground testing. If Tenant fails t comply with the provisions of this Section 21.28(c) , Landlord shal have the right, but not tte obligation, without in any way limiting' Landlord's other rights and remedies, to enter upon the Demised f-2-- 5� L136-43BURLING770N•3 55 Premises or to take such other actions as Landlord deems necessary or advisable to clean up, remove, resolve, or minimize the impact of, or otherwise deal with, any Hazardous Materials on or affecting the Demised Premises following the receipt of any notice or information asserting the existence of any Hazardous Materials introduced by Tenant, its Concessionaires or the Tenant Parties into the Demised Premises. All costs and expenses paid or incurred by Landlord in the exercise of any such rights shall be payable by Tenant to Landlord upon demand with interest thereon at the Default Rate. It shall be an event of default under this lease, entitling Landlord to exercise any of its rights and remedies under this j lease, if any provision of this Section 21.28 is not strictly complied with at all times. Upon the Lease Expiration Date or earlier termination of the Term of this lease for any reason whatsoever, Tenant agrees to deliver the Demised Premises to Landlord free of any and all Tenant Installed Hazardous Materials (as such term is hereinafter defined in Section 21.28(d) ) so that the condition of the Demised Premises shall conform to and be in strict compliance with all Governmental Regulations relating to Hazardous Materials. (d) Landlord shall have the right, upon written notice to Tenant, at any time and from time to time during the Term of this lease, at its sole cost and expense (except as hereinafter provided) , to cause an environmental survey (the "Survey") to be made of the Demised Premises by an environmental consulting firm (the "Consulting Firm") designated by Landlord to determine whether the Demised Premises contains any Hazardous Materials. Landlord shall upon completion of such Survey promptly furnish to Tenant a copy of such Survey prepared by the Consulting Firm. In the event said Survey shall disclose the presence of Hazardous Materials in, on, under or about the Demised Premises, and if it is determined based upon the original approved final drawings for Tenant's work, or on the basis of any subsequent drawings submitted to Landlord pursuant to the terms of this lease, or on the basis of other information and data available to Landlord that the existence of said Hazardous Materials arose out of or is in any way connected with the use, analysis, generation, manufacture, production, purchase, transportation, storage, treatment, release, removal and disposal or escape of Hazardous Materials or products containing Hazardous Materials by Tenant, its Concessionaires or the Tenant Parties during the period of Tenant's occupancy of the Demised Premises (the "Tenant Installed Hazardous Materials") , Tenant shall reimburse Landlord for the cost of the Survey within fifteen (15) days after receipt of an invoice therefor, and (i) Tenant shall, within thirty (30) days thereafter, at its sole cost and expense, cause all of said Tenant Installed Hazardous Materials to be abated and removed from in, on, under or about the Demised Premises and transported from the Shopping Center for use, storage or disposal in compliance with all Governmental Regulations relating to Hazardous Materials and Landlord's hazardous materials abatement criteria by a hazardous materials abatement contractor (the "Abatement Contractor") licensed in the state in which the Shopping Center is located and approved by Landlord; or (ii) Landlord may, at its sole option, upon written notice to Tenant, cause all of said Tenant Installed Hazardous Materials to be abated and removed from in, on, under or about the Demised Premises and transported from the Shopping Center for use, storage or disposal in compliance with all Governmental Regulations relating to Hazardous Materials by a hazardous materials abatement contractor selected by Landlord, in which event, the costs and expenses of such abatement, removal and disposal, as reasonably estimated by Landlord, shall be paid to Landlord by Tenant, as Additional Rent, within ten (10) days after receipt of an invoice therefor. In the event Tenant fails to timely perform its obligations under this Section 21.28(d) , Landlord shall have the right (but shall not be obligated) to perform Tenant's obligations under this Section 21.28(d) , in which event, Tenant shall pay to Landlord, as Additional Rent, promptly, li �6 upon demand, the costs and expenses thereof, with interest ther at the Default Rate. (e) Landlord represents to Tenant that Landlord has caused an environmental survey of the accessible areas of the Demised Premises to be performed by ATC/Diagnostic Environmental Inc. ("ATC") to determine the presence of asbestos-containing construction materials in the accessible areas of the Demised Premises containing concentrations of asbestos fibers at levels regulated by the Governmental Authorities of the state of California (i.e. concentrations of asbestos fibers in percentages greater than one-tenth of one percent (>O.1%) . The survey by ATC included visual observation for asbestos-containing construction t materials, sampling of suspect materials and laboratory analysis (collectively, the "Tests") . The Tests performed by ATC on the ' sampled materials reveal that such sampled materials do not contain asbestos fibers in percentages greater than one-tenth of one percent (>0.1%) except for the asbestos-containing materials located as shown on the Asbestos Survey Report prepared by ATC (the "Pre-Existing Asbestos") . Except for the "Remaining Asbestos (as hereinafter defined) , Landlord agrees to cause all other Pre- Existing Asbestos to be abated and removed• from the Demised E Premises prior to delivering possession of the Demised Premises to Tenant (collectively, "Landlord's Asbestos Abatement Work") . The term "Remaining Asbestos" as used herein means the asbestos- containing joint compound located at the joints and seams of the interior partition walls of the Demised Premises indicated and shown on Sheets Dl and D2 of the Demolition Plans prepared by Robert Kubicek Architects and Associates, Inc. dated February 24, 1995 as not being removed by Landlord as a part of Landlord's demolition work. Tenant acknowledges and agrees that in no event shall Landlord be responsible for any remedial action with respect to the Remaining Asbestos and that Tenant shall, at its sole cos and expense, be responsible for any and all remedial action wit. respect to the Remaining Asbestos. Except for any remedial action with respect to the Remaining Asbestos, in no event shall Tenant (and Landlord shall) be responsible for any remedial action with respect to any other asbestos or other Hazardous Materials existing in the Demised Premises unless such asbestos or other Hazardous Materials were introduced into the Demised Premises by Tenant, its Concessionaires or the Tenant Parties during the period of Tenant's occupancy of the Demised Premises. SECTION 21.29 Landlord and Tenant agree that all Rent paid to Landlord under this lease shall qualify as "rents from real property" as defined in Internal Revenue Code ("Code") Section 856(d) , and as further defined in Treasury Regulation ("Regulation") Section 1.856-4. Should the requirements of the abovementioned Code Section and Regulation Section be amended so that any Rent (Fixed Minimum Rent, Percentage Rent and Additional Rent) payable to Landlord under this lease no longer qualifies as "rents from real property" for the purposes of the Code and associated Regulations, the Rent payable to Landlord under this lease shall be adjusted so that such Rent will qualify as "rents from real property" under the Code and Regulations, as amended. provided, however, that any adjustments required pursuant to the provisions of this Section 21.29 shall be made so as to produce the equivalent (in economic terms) Rent as was payable by Tenant prior to such adjustment. SECTION 21.30 This lease may be executed and delivered in counterparts, each of which shall be deemed to be a duplicate original hereof. This lease may also be executed in multiple counterparts and shall be effective when counterparts hereof, when taken together, bear the signatures of or on behalf of all of the parties set forth below comprising Landlord and Tenant. SECTION. 21-31• The -,parties" expressly' agree that (i) all unperformed obligations of either party pursuant to this lease that shall have accrued prior to the Lease Expiration Date or earlier C>� termination of this lease and (ii) all provisions of this lease which contemplate performance by either party after the Lease Expiration Date or earlier termination of this lease shall survive _.�' the Lease Expiration Date or earlier termination of this lease. s Uld.:3BURLZNGTCN.3 36 Center and enlarge the Shopping Center, makik alterations therein, additions thereto and construct adjoining thereto, including, without limitation, construction of parking decks and elevated parking facilities (the foregoing are singly and collectively called "Improvements" for the purposes of this Article XVZI(j]) . Without limiting the foregoing, Tenant specifically ackno*edges and agrees that as additional consideration to LandlbCd for Landlord entering into this lease with Tenant that Landlord may at any time and from time to time during the Term of this lease do any, or all, or any combination of the following: (A) relocate, reconfigure, redesign and/or realsign the existing exterior entrance to the Demised Premises (the "New ' Exterior Entrance") ; provided, however, in no event shall the . size and dimensions of the New Exterior Entrance be materially* smaller than the size and dimensions of the existing exterior entrance to the Demised Premises without Tenant's written consent which consent shall not be unreasonably withheld or delayed; and/or (B) convert the Shopping Center from an enclosed mall type of shopping center to a multi-sided strip type shopping center by eliminating all or any portion of the enclosed mall of the Shopping Center, including, without limitation, the portion of the enclosed mall fronting on the Demised Premises, replacing all or any portion of the area formerly covered by the enclosed mall with new Common Area improvements and/or converting and improving all or any portion of the area formerly covered by the enclosed mall as additional. Gross Leasable Area; and/or (C) raze all and/or any portion of the buildings and other improvements currently located within "No Build Area No. 2" as shown on Exhibit "A", Page 1, replace such razed buildings and other improvements with new parking facilities and construct new buildings and other improvements in the Shopping Center in a location (including,-without limitation, within "No Build Area No. 1" as shown on Exhibit "A", Page 1) and in such configuration as determined by Landlord in its sole and absolute discretion, except that in such event no new buildings shall be constructed within "No Build Area No. 2" as shown on Exhibit "A", Page 1; and/or (D) raze all and/or any portion of the buildings and other improvements from time to time located in the Shopping Center, including, without limitation, the building of which the Demised Premises is a part and construct new buildings and other improvements in the Shopping Center in a location and in such configuration as determined by Landlord in its sole and absolute discretion. In the event Landlord elects to raze the building of which the Demised Premises is a part, Landlord and Tenant agree as follows: Landlord shall, at its sole cost and expense, construct the "New Premises Building Improvements" (as hereinafter defined) , and Tenant shall, at its sole cost and expense [except as hereinafter provided with respect to the payment by Landlord to Tenant of the unamortized net book value of Tenant's leasehold improvements to the Demised Premises (hereinafter referred to as the Existing Premises for the purpose of this Article XVII(j) ], construct and/or install the New Premises Store Improvements (as hereinafter defined) . As used herein, the term "New Premises Building Improvements" shall mean a new two (2) level shell building (the "New Premises") containing approximately 60,000 square feet of Gross Leasable Area on each level and containing in the aggregate approximately 120,000 square feet of total Gross Leasable Area, together with slab floor, '_136 3BURLINGTON.] 37 adequate water and sewer roughed into the New Premises, adequate heating, ventilating and air conditioning units, sprinkler main (but not sprinkler heads) , two (2) elevators (passenger and freight) , one (1) escalator connecting the first level of the New Premises with the second level of the New Premises, adequate electrical power at the transformer with an empty conduit roughed into the New Premises, main exterior entrance and truck dock serving the New Premises. As used herein, the term "New Premises Store Improvements" shall mean all work with respect to the New Premises which is not included in the New Premises Building Improvements, including, but not limited to, installation of sprinkler heads, ceiling, lighting, restrooms (to code) , heating, ventilating and air cond1ti ' q duct work, all electrical work, interior partitions, wall floor coverings and installation of all furniture, equipme trade fixtures, materials and other personal property nec for Tenant to operate its business in the New Premises. Landlord shall, at -its sole cost and expense, p and deliver to Tenant a conceptual design (the "Design") the reconfigured Shopping Center showing the approximate to . tLon of the New Premises as well as the location of other build4fts and other improvements to be located in the reconfigured SbApping Center. Tenant shall have the right to approve the Desigli of the reconfigured Shopping Center including the location of !the New Premises which approval shall not be unreasonably withheld or delayed. If Tenant shall not approve the Design, Tenant and Landlord shall use their best efforts to cooperate and agree 'on all of the modifications necessary to obtain the approval of Tenant'to the Design, and Landlord's project architect (the "Center: - Architect") shall promptly revise the Design to incorporate al: such modifications which are mutually acceptable to Landlord and Tenant. In the event. Landlord and Tenant despite their best. efforts are unable to agree upon the Design for the reconfigured Shopping Center including the location of the New Premises within sixty (60) days after the initial submission thereof to Tenant, then such dispute shall be submitted to the Center Architect, The Center Architect shall review all points of disagreement, shall meet with Landlord and Tenant, individually or separately, shall suggest methods and points of compromise and shall take such other steps and actions as the Center Architect shall deem appropriate to resolve all points of disagreement. The Center Architect shall record in writing all agreements reached as to points of disagreement and shall, if any points of disagreement have not been resolved within thirty (30) days after submission of such matters to the Center Architect, promptly notify Landlord and Tenant in writing (the "Center Architect's Notice") of all remaining unresolved issues (the "Unresolved Issues") . The Unresolved Issues shall be submitted to final and binding arbitration as follows: Landlord and Tenant shall each within twenty (20) days of receipt of the Center Architect's Notice designate one person, as hereinafter provided, to represent it as an arbitrator. The arbitrators so appointed by Landlord and Tenant shall within ten (10) days following the aforesaid twenty (20) day period designate one additional person as arbitrator to the end that the total number of arbitrators shall be three (3) . The appointment of all arbitrators under this Section shall be in writing and shall be submitted to the other party. Any person designated as an arbitrator shall be knowledgeable and experienced in the development and design of regional shopping centers, but shall not be in the employment of either Landlord or Tenant, directly, indirectly or as an agent, except in connection with the arbitration then proceeding. The arbitrators shall meet or otherwise confer as deemed necessary by the arbitrators to resolve the Unresolved Issues and a decision of a majority of the arbitrators .will. be_final, andobinding upon Landlord and Tenant. The decision of the arbitrators shall be in writing and shall be f-2 * cal L13-6.43BURLINGTON.3 38 made as promptly as possible after the designation of the third (3rd) arbitrator, but in no event later than thirty (30) days from the date of the designation of the third (3rd) arbitrator. A copy of the decision of the arbitrators shall be signed by at least two (2) of the arbitrators and given to each party in the manner provided in Section 21.10 of this lease for the giving of notice. The fees, costs and expenses of the arbitrators and arbitration proceeding (except for a party's attorney's fees) shall be paid and shared equally by Landlord and Tenant. No damages thall be awardable in arbitration. The decision of the arbitrators may be entered as a judgment in a court of competent jurisdiction. Any a arbitration conducted under this Section shall be in accordance with the rules of the American 'Arbitration Association# to the ' extent such rules do not conflict with the procedures herein set forth. The costs and fees of the Center Architect shall be paid by Landlord. The New Premises Building Improvements shall be constructed by Landlord in accordance with the approved working drawings and specifications therefor, in a good and workmanlike manner and in accordance with all applicable Governmental Requirements of the applicable Governmental Authorities. Landlord shall, at its sole cost and expense, prepare and deliver to Tenant for approval working drawings and specifications for the New Premises Building Improvements within a reasonable period of time following the date Tenant has approved the Design for the reconfigured Shopping Center. Tenant shall not unreasonably withhold or delay its approval of the working drawings and specifications so long as (i) the New Premises as depicted thereon (i.e. on the working drawings and specifications) meet all applicable requirements of the REA and all applicable Governmental Requirements of all Governmental Authorities having jurisdiction, and (ii) the design presents an exterior appearance of the New Premises which is compatible in quality and appearance with that of the other buildings amd other improvements which have been or are to be constructe n the Shopping Center. If Tenant shall not approve the workin wings and specifications for the New Premises Building Imp sents, Landlord and Tenant shall use their best efforts to coo a and agree on all of the modifications necessary to obtain thr roval of Tenant to the working drawings and specifications, am the Center Architect shall promptly revise the working drawi and specifications to incorporate all such modifications wb are mutually acceptable to Landlord and Tenant. If Landlord aiA Tenant cannot agree upon the working drawings and specificatiorat within thirty (30) days after the initial submission thereof to, fonant, then such working drawings and specifications shall be submI ted to the Center Architect. The Center Architect shall review al-I Points of disagreement, shall meet with Landlord and Tenant, ind oually: or separately, shall suggest methods and points of compreWse and shall take such other steps and actions as the Center hitect shall deem appropriate to resolve all points of disagreement. The Center Architect shall record in writing all agreements reached as to points of disagreement and shall, if any points of disagreement have not been resolved within fifteen (15) days after submission of such matters to the Center Architect, promptly determine all remaining issues. The Center Architect shall promptly notify Landlord and Tenant in writing of such determinations and such determinations shall be final and binding upon Landlord and Tenant. The costs and fees of the Center Architect shall be paid by Landlord. The New Premises Store Improvements shall be constructed and/or installed by Tenant in accordance with the approved working ' drawings and specifications therefor, in a good and workmanlike manner, in accordance with all applicable Governmental Requirements of the applicable Governmental Authorities and the applicable provisions of Section 5.1 and 9.3 of this lease. Tenant shall L at its sole cost and expense, prepare and deliver to-randlord not , L136. 43BliRLI:iGTON.3 39 later than sixty (60) days following the date Landlord and Tenant have agreed on the workings drawings and specifications for the New Premises Building Improvements, working drawings and specifications for the New Premises Store Improvements. Tenant's workings drawings and specifications for the New Premises Store Improvements shall be subject to the approval of Landlord which approval shall not be unreasonably withheld or delayed; provided, however, Tenant's working drawings and specifications for the interior layout of the New Premises shall not be subject to Landlord's approval. If Landlord shall not approve the working drawings and specifications for the New Premises Store Improvements, Landlord c and Tenant shall use their best efforts to cooperate and agree on all of the modifications necessary to obtain the approval of Landlord to the working drawings and specifications, and Tenant's architect shall promptly revise the working drawings and specifications to incorporate all such modifications which are mutually acceptable to Landlord and Tenant. If Landlord and Tenant cannot agree upon the working drawings and specifications within thirty (30) days after the initial submission thereof to Landlord, then such working drawings and specifications shall be submitted to the Center Architect. The Center Architect shall"review all points of disagreement, shall meet with Landlord and Tenant, individually or separately, shall suggest methods and points of compromise and shall take such other steps and actions as the Center Architect shall deem appropriate to resolve all points of disagreement. The Center Architect shall record in writing all agreements reached as to points of disagreement and shall, if any points of disagreement have not been resolved within fifteen (15) days after submission of such matters to the Center Architect, promptly determinla all remaining issues. The Center Architect shall promptly notify Landlord and Tenant in writing of such determinations and such determinations shall be final and binding upon Landlord and Tenant. The costs and fees of the Center Architect shall be paid by Tenant. Landlord shall use good faith efforts to deliver to Tenant, and Tenant agrees to accept from Landlord, possession of the New Premises sixty (60) days prior to the anticipated substantial completion of the New Premises Building Improvements. The term "New Premises Delivery Date" shall mean the date upon which Landlord delivers possession of the New Premises to Tenant. Tenant shall be entitled to enter the New Premises, at its own risk, from and after the New Premises Delivery Date for purposes of completing the New Premises Store Improvements, provided that all inventory, materials, supplies, fixtures and equipment of Tenant placed within the New Premises shall be placed therein at the sole risk of Tenant, and Landlord shall not be liable for any damage, injury, loss or theft thereof or thereto. The term "substantial completion of the New Premises Building Improvements" shall mean that the New Premises Building Improvements are substantially complete subject to minor punch list items. Landlord shall use good faith efforts to cause substantial completion of the New Premises Building Improvements to occur within sixty (60) days after the New Premises Delivery Date. Upon delivery of the New Premises to Tenant, Tenant shall construct and/or install, at its sole cost and expense, the New Premises Store Improvements as herein provided free of mechanics' and materialmens' liens as required by Section 5.2 of this lease. Portions of the New Premises Building Improvements work may be performed concurrently with the performance of the New Premises Store Improvements work. Landlord and Tenant shall use their best efforts to cooperate with one another during the period they are concurrently performing the New Premises Building Improvements work and the New Premises Store Improvements work, respectively, and, without limiting the foregoing, Tenant shall perform the New Premises Store Improvements work in a manner reasonably calculated to minimize interference with, or delay in the construction of, the New Premises Building Improvements. Landlord..covenants and..agrees,to.indemnify, defend and hold Tenant 3 and the Tenant Parties harmless from and against all Claims of any �O L-6.i3BURL:NGTCN.] ;0 kind incurred or arising from the performance by Landlord or the Landlord Parties of the New Premises Building Improvements work, excluding any claims arising or accruing as the result of the negligence or willful misconduct of Tenant or the Tenant Parties. Tenant covenants and agrees to indemnify, defend and hold Landlord, the Landlord Parties and Landlord's Designee(s) harmless from and against all Claims of any kind incurred or arising from the performance by Tenant or the Tenant Parties of the New Premises Store Improvements work, excluding any Claims arising or accruing as the result of the negligence or willful misconduct of Landlord, the Landlord Parties or Landlord's Designee(s) . ' Landlord shall procure and pay for all approvals, permits and licenses of all Governmental Authorities having jurisdiction with respect to the construction of the New Premises Building Improvements. Tenant shall procure and pay for all approvals, permits and licenses of all Governmental Authorities having jurisdiction with respect to the construction and/or installation of the New Premises Store Improvements. Upon completion of the New Premises Building Improvements by Landlord and the New Premises Store Improvements by Tenant, Landlord shall obtain a Certificate of Occupancy for the New Premises. Tenant shall continuously operate its business in the Shopping Center in the Existing Premises in accordance with the terms of this lease until such time as Tenant is ready to open for business in the New Premises; provided, however, Tenant shall have the right to cease operating for business in the Existing Premises for a reasonable period of time before it opens for business in the New Premises (in order to accommodate Tenant's move to such 'New Premises) , such reasonable period of time not to exceed thirty (30) days before the date Tenant opens for business in the New Premises. The term "completion of the New Premises Building Improvements" shall mean the New Premises Building Improvements are complete (including minor punch list items) . Landlord shall use good faith efforts to cause the completion of the New Premises Building Improvements to occur on or before the date which is thirty (30) days after the date upon which substantial completion of the New Premises Building Improvements occurs. Tenant agrees to construct and/or install the New Premises Store Improvements work and open for business in the New Premises not later than the New Premises Required Opening Date, which shall be defined to be the last to occur of (i) thirty (30) days after substantial completion of the New Premises Building Improvements, (ii) ninety (90) days after the New Premises Delivery Date, or (iii) fifteen (15) days after completion of the New Premises Building Improvements; provided, that, in no event shall Tenant be required to open for business in the New Premises during the period from November 15 to January 2 in any Lease Year. Within fifteen (15) days after the date that Tenant opens for business in the New Premises, Tenant shall re-deliver the Existing Premises to Landlord in the manner and in the condition set forth in Section 19.1 of this lease. Tenant shall be permitted to remove from the Existing Premises all of its personal property and unattached moveable fixtures, installations and equipment which pursuant to the terms of this lease would remain Tenant's property at the expiration of the Term of this lease. The title to any and all personal property, fixtures, installations and equipment remaining in the Existing Premises after the fifteenth (15th) day following the date Tenant opens for business in the New Premises shall automatically vest in Landlord and Landlord shall not be obligated to pay Tenant any compensation therefor; and, Tenant waives any and all claims against Landlord for 'any damage or loss to Tenant resulting from Landlord's retention and/or disposition of any such personal property, fixtures, installations and equipment. 6-i :136.43BURLINGTON.3 1 4 For the period between the date Tenant opens for business in the New Premises and the date Tenant re-delivers the Existing Premises, each of the Existing Premises and the New Premises shall constitute the "Demised Premises" under this lease; provided, however, that from and after the date Tenant opens for business in the New Premises and provided Tenant is no longer open for business in the Existing Premises, Tenant shall be relieved of its obligation to pay Fixed Minimum Rent, Percentage Rent, Real Estate Taxes and Common Area Costs attributable to the Existing Premises. Upon re-delivery by Tenant of the Existing Premises, the New Premises shall constitute the "Demised Premises" under this lease. Rent for the New Premises shall commence to accrue on the earlier of (a) the date Tenant opens for business in the New. Premises or (b) the New Premises Required Opening Date. The Fixed Minimum Rent and Common Area Costs for the New Premises shall be the —e_as She. Fixed Minimum Rent and Common Area Costs applicable to the Existing Premises, notwithstanding the fact that the Gross Leasable Area of the New Premises is less than the Gross Leasable Area of the Existing Premises. The Percentage Rent Rate and Base Sales figures for the New Premises shall be the same as the Percentage Rent Rate and Base Sales figures applicable to the Existing Premises. The- Real Estate Taxes for the New Premises shall be the same as the Real Estate Taxes applicable to the Existing Premises, notwithstanding the fact that the Gross Leasable Area of the New Premises is less than the Gross Leasable Area of the Existing Premises, except that (i) the term "Tax Parcel" as used in Section 16.1 of this lease shall mean the Tax Parcel of which the New Premises is a part, and (ii) the base year for calculating Tenant's Share of the increases in Real Estate Taxes shall be the tax Yiscal year in which Tenant opens for business in the New Premises. In the event Tenant is relocated to New Premises as hereit provided, such relocation shall be at Tenant's sole cost and expense, except Landlord. as its sole contribution for such relocation„agrees to reimburse Tenant (provided Tenant is not then in default under this lease beyond the expiration of the applicable notice and/or cure period) for the then unamortized net book value of Tenant's leasehold improvements to the Existing Premises (but only to the extent said leasehold improvements were paid or by Tenant) amortized in accordance with generally accepted accounting principles over the shortest period of time allowable under the rules and regulations promulgated from time to time by the Internal Revenue Service within thirty (30) days after the date Tenant has (i) opened for business in the New Premises, and (ii) re-delivered possession of the Existing Premises to Landlord in the manner and in the condition required by Section 19.1 of this lease, and (iii) delivered to Landlord a copy of the Certificate of Occupancy for the New Premises, andl(iv) delivered to Landlord a copy of Tenant's recorded Notice of Completion with respect to the New Premises Store Improvements work. L�thin ninety (90) days after the date Tenant opens for business in the Existing Premises, Tenant shall deliver tO_jADAjord a written statemetjt (the "Leasehold Improvement CSs�3'tatement" i g) se � forth in •reasonab.je•_detail the costs in d by Tenant for its leasehold improvements to the Existing Premises, sighe-T aad"'certified as correct 'by Tenant's cFilef financial officer, together with paid invoices_.fpr_said lea ld improvements and s-Mi other--back-up information as Landlord may reasonably request to enable Landlord to substantiate the cost of Tenant's' leasehold•improvements to the Existing Premises 4nd.-tb verify t a -Ehe Leaseh_oYd Improvemet n "Cost Statement does not include any costs that are not directly attributable to Tenant's leasehold improvements to the Existing Premises. The term "leasehold improvements" as used herein shall in no event include Tenant's trade fixtures, equipment, furniture, signs and/or other personal property belonging to Tenant, and which pursuant to the terms of this lease, would remain the property of Tenant at the expiration• of. the Term-.-of:-this, lease. Landlord shall have the r right upon reasonable prior notice to Tenant to examine and audit L136.43BURLINGTON.3 42 Tenant's books and records with respect to -the cost of Tenant's leasehold improvements to the Existing Premises. Except for the payment of% the then unamortized net book value of Tenant's leasehold improvements to the Existing Premises, Tenant shall pay all costs and expenses in connection with the construction and installation of the New Premises Store Improvements, including, without limitation, the costs and expenses of moving and/or relocating its trade fixtures, equipment, furniture, signage, merchandise and other personal property from the Existing Premises to the New Premises. It is expressly understood and agreed that Landlord shall at all times and in all instances have complete exclusive control of the location, design, structure, construction, and aesthetics of the Improvements, as well as all activities undertaken by Landlord in connection therewith. No exercise by Landlord of any rights herein reserved shall entitle Tenant to any damage for any injury or inconvenience occasioned thereby nor to any abatement of Rent. Any portion of the Shopping Center which is taken for any public or quasi-public use under any statute or by right of eminent domain (or conveyed to the condemning authority under the threat of eminent domain) or dedicated to public use or ceded or conveyed to any governmental authority for street or other purposes shall be thereafter excluded from the Shopping Center. ARTICLE XVIII DEFAULTS AND REMEDIES SECTION 18.1 This lease is entered into upon the condition that Tenant shall faithfully and punctually perform all of the covenants, agreements, provisions and conditions by it to be performed as set forth in this lease. The following shall each be deemed to be an event of default by Tenant under this lease: (i) the failure of Tenant to pay any Rent, or any other sum or charge due to Landlord and/or to any other party in accordance with the provisions of this lease, as and when due, if such failure continues for a period of time in excess of fifteen (15) days after notice thereof from Landlord to Tenant (which notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure Section 1161, It sec., as amended) ; or (ii) if Tenant fails to complete Tenant's Work and open the Demised Premises for business to the public adequately fixturized, staffed and stocked within sixty (60) days following the Required Opening Date, or thereafter, if the Demised Premises is not occupied by Tenant and open for business to the public adequately fixturized, staffed and stocked on the days and hours. required by this lease during the period of Tenant's Operating Covenant; or (iii) if Tenant vacates or abandons the Demised Premises ("vacates or abandons" is herein defined to include, without limitation, any absence by Tenant from the Demised Premises for fourteen (14) consecutive days or longer while Tenant is in default of any provision of this lease beyond the expiration of the applicable cure period) ; or (iv) the making by Tenant of any general assignment for the benefit of creditors, the filing by or against Tenant of a petition to have Tenant adjudged bankrupt or a petition for reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant, the same is dismissed within thirty (30) days), the appointment of a trustee or receiver to take possession of substantially all of Tenant's assets located at the Demised Premises or of Tenant's interest in this lease, where possession is not restored within thirty (30) days, the attachment, execution or other judicial seizure of substantially all of Tenant's assets located at the Demised Premises or of Tenant's interest in this lease, where such seizure is not discharged within thirty (30) days, or Tenant's convening of a meeting of its creditors or any . �c L136.43BL'RLINGTON.3 43 class thereof for the purpose of effecting a moratorium upon c composition of its debts, (v) the failure of Tenant to faithfully and punctually perform or observe any other covenant, agreement, provision or condition on the part of Tenant to be performed or observed if such failure continues for a period of time in excess of thirty (30) days after notice thereof from Landlord to Tenant (which notice shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure Section 1161, et sec., as amended) ; provided, however, that if the nature of Tenant's failure is such that more than thirty (30) days are reasonably required for its cure, then Tenant shall not be deemed to be in default for the purposes of this Section 18.1 if Tenant commences to cure such failure within said thirty (30) day period r and thereafter diligently prosecutes such cure to completion; then upon the occurrence of any one or more of the aforesaid events of default enumerated in this Section 18.1, Tenant, upon demand, shall forthwith pay Landlord all Rent and other sums then due to Landlord under this lease and Landlord, in addition to any other remedies available to it hereunder and at law and/or in equity, at its option, may terminate this lease and all rights of Tenant hereunder by giving written notice to Tenant of such intention to terminate (in which case Tenant shall have no further claim hereunder) or Landlord may continue this lease in full force and effect for so long as it does not terminate Tenant's right to possession of the Demised Premises (in which case, Landlord may'enforce all of its rights and remedies hereunder, including the right to recover Rent required to be paid by Tenant as same becomes due) and the following provisions shall apply, as the case may be: A. Termination: (1) In the event Landlord terminate!; this lease as a result of an event of default by Tenant, Landlord may recover possession of the Demised Premises by any lawful means and remove all persons and property therefrom, and Landlord shall bE entitled to recover from Tenant as damages all amounts which Landlord is entitled to recover pursuant to Section 1951.2 of the Civil Code of California, as the same may be amended from time to time, or under any successor thereto, including, but not limited to, all of the following: (a) the worth at the time of the award of any unpaid Rent and other charges which have been earned at the time of termination; plus (b) the worth at the time of the award of the amount by which the unpaid Rent which would have been earned after termination until the time of the award exceeds the amount of the loss of such Rent and other charges that Tenant proves could have been reasonably avoided; plus (c) any other amount necessary to compensate Landlord for the detriment proximately caused by Tenant's failure to perform its obligations under this lease. (2) For the purposes of this Subparagraph A, all Rent other than Fixed Minimum Rent shall be computed at a rate equal to the average amount paid or payable by Tenant for the three (3) Lease Years prior to such termination unless three (3) Lease Years of the Term of this lease have not elapsed, in which case such amount shall be annualized based upon the average monthly amount payable for the entire period of Tenant's occupancy of the Demised Premises. (3) As used in clauses (a) and (b) of this Subparagraph A. (1) , the term "worth at the time of the award" shall be computed by allowing : interest at the Default Rate. (4) The amount recoverable by' Landlord pursuant to clause (c) of this subparagraph A. (1) shall include, without limitation, any costs and expenses incurred by Landlord in maintaining or preserving the Demised Premises after such default by Tenant, preparing the Demised Premises for reletting to a new tenant, accomplishing any repairs or alterations to the Demised Premises for the purpose of such reletting, repairing any damage thereto occasioned by the act or omission of Tenant and any other costs necessary or appropriate to relet the Demised Premises. L116.:3BCRLINGTCN.3 44 B. Lease Not Terminated: (1) In the event Landlord elects 'not to terminate this lease as a result of an event of default by Tenant, then this lease shall continue in full force and effect, and Landlord may enforce all of its rights and remedies hereunder and at law and/or in equity, including, without limitation, the right to recover Rent as same becomes due as more particularly provided pursuant to Section 1951.4 of the Civil Code of California, as the same may be amended from time to time, or under any successor thereto. However, Tenant shall continue to have the right to possession of the Demised Premises and thereafter Tenant shall have the right to assign this lease or sublet the Demised Premises with Landlord's prior written consent, which consent shall not be unreasonably withheld, but which consent may be contingent upon the satisfaction of any or all of the terms and conditions set forth in section 12.3 herein. (2) For the purpose of this sub- paragraph B. , Tenant's right to possession of the Demised Premises shall not be deemed to have been terminated by efforts of Landlord to relet the Demised Premises, by its acts of maintenance or preservation with respect to the Demised Premises, or by appointment of a receiver to protect Landlord's interests hereunder. No re-entry or taking possession of the Demised Premises by Landlord shall be construed as an election to terminate this lease nor shall it cause a forfeiture of Rent remaining to be -paid during the balance of the Term, unless- a written notice of such intention to terminate be given to Tenant. C. Landlord reserves the right to terminate this lease at any time after an event of default by Tenant which is not cured by Tenant within the applicable notice and/or cure period, if any, by giving written notice to Tenant of Landlord's intention- to terminate prior to the date of cure. D. The term "Tenant" as used in clause (v) of the first grammatical paragraph - of this Section 18.1 shall also include Tenant's Guarantor and/or assignee of Tenant's interest in this lease. The term "an affiliate of Tenant" as used herein means any other person (as such term is hereinafter defined in Section 21.18) , directly or indirectly, controlling, controlled by, or under common control with Tenant. For purposes of this definition, "control" with correlative meanings (including "controlling", "controlled by" and "under common control with") , as applied to any person, means the possession of a legal and equitable interest in the person sufficient to grant the power to direct or cause the direction of the management and policies of that person. SECTION 18.2 In the event of any event of default by Tenant which is not cured by Tenant within the applicable cure period, Landlord may (but shall not be obligated to) at any time, after five (5) days written notice to Tenant, except in emergency situations (for which no notice shall be required) , cure such default for the account, and at the expense, of Tenant. If Landlord at any time so elects or is compelled by any other person to cure such default or is compelled to incur any other expense arising out of such default by Tenant (including, without limitation, Landlord's reasonable attorneys' fees and disbursements in instituting, prosecuting or defending any suits, actions or proceedings to enforce Landlord's rights under the provisions of this lease or otherwise) the sum(s) so paid by Landlord, with all interest (at the Default Rate) , costs and damages, shall be paid by Tenant to Landlord within ten (10) days following demand. Such expenses may be recovered in the same action or proceeding forming the basis of default. SECTION 18.3 If either party .incurs any expense, including reasonable attorneys' fees, in connection with any action or proceeding instituted by either party by reason of any default or alleged default of the other party hereunder, the party prevailing in such action or proceeding shall be entitled to recover its said 6 _2 L136.43BURLINGTON.3 45 reasonable expenses from the other party. Such reasonably expenses, including attorneys' fees, shall be deemed to have accrued on the commencement of such action and shall be paid whether or not such action is prosecuted to judgment. SECTION 18.4 Intentionally omitted. SECTION 18.5 If Tenant shall neglect or fail to pay within ten (10) days after the same is due and payable, any Fixed Minimum Rent, Percentage Rent or Additional Rent, or any other amount required to be paid under this lease, Tenant shall pay to Landlord, : in addition to such unpaid amounts, interest upon such unpaid amounts from the due date thereof to the date of payment at the Default Rate. ARTICLE XIX SURRENDER OF DEMISED PREMISES Upon the Lease Expiration Date or earl ier•termination of the Term of this lease, Tenant agrees, without necessity for notice, to quit the Demised Premises and surrender possession thereof to Landlord, broom clean, in first class condition, ordinary wear and tear not requiring maintenance and repair and casualty damage excepted, together with all keys and combinations to locks, safes and vaults and Alterations, fixtures and equipment which may have been made in, on or to the Demised Premises (except as hereinafter provided in this Article) , all of which shall thereupon become.the property of Landlord without any claim thereto by Tenant. On or before the end of the Term, Tenant shall remove from the Demises' Premises all its property including movable trade fixtures ar. equipment installed at Tenant's cost and expense, and any or all o. such property not so removed shall, at Landlord's option, become the exclusive property of Landlord or be disposed of by Landlord, at Tenant's cost and expense, without further notice to, or demand upon, Tenant. Tenant shall promptly repair in a good and workmanlike manner all damage to the Demised Premises caused by the removal therefrom of such property. ARTICLE XX SUBORDINATION SECTION 20.1 This lease and all of Tenant's rights hereunder shall be subject and subordinate to all ground or underlying leases or subleases that include the Demised Premises, including, without limitation, a sale leaseback lease or leaseback leases to which Landlord is or may become a party as a tenant or a subtenant thereunder, and to the lien of all mortgages, in all amounts and, all advances thereon, which may now or hereafter lien the Demised' Premises, and to all renewals, replacements, modifications, consolidations and extensions of any thereof; provided, however, Tenant agrees that any such lessor or mortgagee may elect to have this lease be made superior to any ground or underlying lease or the lien of its mortgage, and in the event of such election and upon notification by Landlord or such lessor or mortgagee to Tenant to that effect, this lease shall be deemed superior to' said ground or underlying lease or to the lien of any such mortgage, whether this lease is dated prior to or subsequent to the date of said ground or underlying lease or mortgage. Notwithstanding anything to the contrary contained in this Section 20.1, so long as Tenant is not in default hereunder beyond the expiration of the applicable cure period, this lease shall remain in full force and effect in 1 accordance with its terms from the Effective Date and throughout the.Term. r • L135.33SURLINGTON.3 46 SECTION 20..2 The provisions of Section 20.1 shall be self- operative and no further instruments of subordination shall be required by any such lessor or mortgagee; provided, however, if Landlord requests confirmation of the subordination provided for in Section 20.1, Tenant shall, without charge therefor, within ten (10) days after demand, execute, acknowledge and deliver to Landlord (in recordable form if requested) any certificate or instrument that may be required by any such lessor or mortgagee to evidence such subordination and non-disturbance. Any such certificate or instrument may, at the option of any such lessor or mortgagee, contain any or all of the provisions set forth in = Section 20.3 and/or 20.4. Upon request and without charge therefor, Tenant shall, within ten (10) days after demand, execute, acknowledge and deliver to the holder of any mortgage that liens the Demised Premises and/or to any lessor under a ground or underlying lease (including a purchaser under a sale leaseback transaction) that included the Demised Premises an instrument acknowledging any assignment by Landlord of Landlord's rights under this lease to any such holder or lessor in connection with such mortgage and/or such ground or underlying lease. If any ground or underlying lessor or mortgagee requests that this lease be made superior, rather than subordinate, to any such ground or underlying lease or mortgage, Tenant shall, without charge therefor, within ten (10) days after demand, execute, acknowledge and deliver to Landlord (in recordable form if requested) any certificate or instrument evidencing such priority which any ground or underlying lessor or mortgagee may at any time request in connection therewith. In the event that Tenant fails to execute and deliver any such certificate(s) or instrument(s) within ten (10) days following written request therefor Landlord may treat such failure on the part of Tenant as a default of Tenant's obligations under this lease. SECTION 20.3 At the request of the holder (or successor in interest) of any such mortgage or the lessor under any such ground or underlying lease, Tenant shall attorn to and recognize such holder (or successor-in-interest) or lessor as Tenant's landlord hereunder upon the terms and conditions of this lease for the remainder of the Term. Upon such attornment this lease shall con- tinue in full force and effect as a direct lease between Tenant and such holder (or successor-in-interest) or lessor except that such holder (or successor-in-interest) or lessor shall not be (i) liable for any previous act or omission by Landlord, Landlord's Managing Agent or the Landlord Parties under this lease, (ii) subject to any offset of Rent which may have theretofore accrued to Tenant against Landlord, (iii) bound by any modification of this lease not expressly provided for herein unless such modification shall have been expressly approved in writing by such holder (or successor-in- interest) or lessor (unless (a) at the time any such modification was executed and delivered by Tenant, Tenant had no knowledge or notice as to the interest of such holder (or successor-in-interest) or lessor or (b) such modification was approved by a predecessor in interest of such holder (or successor-in-interest) or lessor or (c) such modification was executed prior to the existence of such mortgage or ground or underlying lease), or (iv) bound by any previous prepayment of Rent for a period greater than one (1) month in advance . unless such prepayment shall have been expressly approved in writing by such holder (or successor-in-interest) or lessor. Tenant shall, without charge therefor, within ten (10) days after demand, execute an instrument in form and substance reasonably satisfactory to any such holder (or successor-in- interest) or lessor confirming the foregoing provisions of this Section 20.3 and Tenant shall deliver the same to Landlord or to such holder (or successor-in-interest) or lessor as Landlord may direct. `_lro.33BURLINGTON.3 47 SECTION 20.4 If at any time during the Term Landlord sha be the holder of a leasehold estate by virtue of a ground or underlying lease covering premises which include the Demised Premises, and if such leasehold estate shall terminate or be terminated for any reason, and as a result thereof, Landlord owns neither the fee nor leasehold estate of the land comprising the Demised Premises then, at the request of the fee owner of the land comprising the Demised Premises, Tenant agrees to attorm to and recognize said fee owner as Tenant's landlord hereunder upon the terms and conditions of this lease for the remainder of the Term. Upon request of any such fee owner and without charge therefor,' Tenant shall within ten (10) days thereafter execute and deliver to such fee owner an instrument confirming the foregoing provisions of this Section 20.4, in form and substance reasonably satisfactory to such fee owner. SECTION 20.5 The term "mortgage" as used herein shall include a mortgage, a deed of trust, a deed to secure debt, a security deed and any other conveyance or agreement for security purposes, which may now or hereafter lien Landlord's estate and interest in the Shopping Center, or any part thereof, and/or Landlord's interest in the buildings and improvements now or hereafter constructed in the Shopping Center, or any part thereof. The term "mortgagee" and/or "holder of a mortgage" as used herein shall include the holder of or the beneficiary under a mortgage. SECTION 20.6 Notwithstanding anything to the contrary contained in this Article XX, Tenant's obligation to subordinate its rights hereunder to the lien of any future mortgage, future deed of trust or other future subordination shall be conditioned upon Tenant receiving from any party seeking such superior position a written agreement in recordable form reasonably satisfactory tc Tenant to the effect that so long as Tenant pays the Rent due unde this lease and otherwise complies with the terms hereof, Tenant'a occupancy hereunder shall not be disturbed. Tenant shall agree to attorn directly to any such party. Landlord represents to Tenant that as of the Effective Date that there are no mortgages liening Landlord's estate and interest in the Shopping Center. ARTICLE XXI GENERAL PROVISIONS SECTION 21.1 Landlord represents and warrants that Landlord has the full right and lawful authority to enter into this lease and perform Landlord's obligations under this lease and if Tenant shall discharge the obligations herein set to be performed by Tenant, Tenant shall have and enjoy from the Delivery Date and then throughout the Term the quiet and undisturbed possession of the Demised Premises and all appurtenances appertaining thereto. SECTION 21.2 Neither party hereto shall be deemed, in any way or for any purpose, to have become, by the execution of this lease or any action taken hereunder, a partner of the other party in its business or otherwise or a joint venturer or a member of any joint enterprise with such other party. SECTION 21.3 This lease shall be governed exclusively by the provisions hereof and by the internal laws of the state in which the Shopping Center is located without regard to the principle of conflicts of law. SECTION 21.A If Tenant shall remain in possession of the Demised Premises after the end of the Term without notice from Landlord to the contrary or without the execution of a new lease or other written agreement signed by both Landlord and Tenant, then Tenant, at the option• of Landlord, shall be deemed to be l� t :8 occupying the remised Premises as a month-to-month tenant at a monthly charge equal to one hundred twenty percent ;120%) of the monthly installment of Fixed Minimum Rent payable for the :ast month of the Term, otherwise subject to all of the other covenants, agreements, provisions and conditions of this Lease. SECTION 21.5 At all reasonable times during Tenant's business hours and upon reasonable prior notice to Tenant's store :manager (and in emergencies at all times without notice) , Tenant agrees to permit Landlord and its authorized representatives, including, without limitation, Landlord's Managing Agent, to enter the Demised Premises for any purpose permitted by law, including, without limitation, for the purpose of (i.) examining the Demised Premises to ascertain if the Demised Premises is in good order, condition and repair, (ii) posting of notices of nonresponsibility or other notices which Landlord may deem necessary for its protection, (iii) showing the Demised Premises to prospective purchasers, mortgagees, ground or underlying lessors, or tenants, (iv) performing any obligations of Tenant which Landlord is authorized by this lease to perform, (v) performing services required of Landlord under this lease, (vi) making any repairs or performing 'any work in, on or about the Demised Premises in connection with any of Landlord's rights or obligations under this lease, or (vii) taking possession 'of the Demised Premises due to an event of default in the manner provided for in this lease: provided, however, that Landlord's access shall not, under the circumstances, unreasonably interfere with Tenant's use and enjoyment of the Damised Premises. SECTION 21.6 Subject to the provisions of Article XII, and except as otherwise specifically provided in this lease, the terms and provisions of this lease shall be binding upon and inure to the benefit of Landlord and Tenant and their respective successors, assigns, heirs, administrators, executors and representatives. SECTION 21.7 At any time and from time to time, within ten (10) days after request by Landlord and without charge therefor, Tenant shall execute, acknowledge and deliver to Landlord, Landlord's Managing Agent or to Landlord's Designee(s) , a written statement: (1) certifying that this lease is unmodified and in full force and effect (or if modified, stating the nature of such modification and certifying that this lease, as so modified, is in full force and effect) ; (2) certifying the Effective Date, the Rent Commencement Date and the Lease Expiration Date; (3) acknowledging that all conditions to be performed by Landlord under this lease have been performed, or stating those claimed by Tenant not to have been performed; (4) acknowledging that there are no defenses or offsets against Landlord, or stating those claimed by Tenant; (5) certifying the Rent payable pursuant to this lease and that the obligation for the payment of Rant has commenced (if that be the case) and the date to which Rent has been paid in advance, if any; and (6) containing such other certifications and acknowledgments as may be reasonably requested by Landlord, any mortgagee or prospective mortgagee of Landlord or any prospective purchaser of Landlord. Landlord agrees to execute and deliver without charge to Tenant, a comparable certificate from time to time upon Tenant's written request in connection with a permitted Transfer of this lease. It is intended that any such statement may be relied upon by any prospective purchaser of the fee or any leasehold of the Shopping Center and/or any mortgagee or prospective mortgagee or any assignee of any thereof or any assignee or sublessee of Tenant. SECTION 21.8 Except for Pentz & Partners ("Pentz") and except for The Samual Schaul company ("Schaul") whose fees are to be paid by Landlord to Pentz pursuant to the terms of a separate agreement between Landlord, Pentz and Schaul, Tenant represents and warrants that it has not had any dealings with any other realtors, brokers or agents in connection with the negotiation of this lease and agrees to pay, and to indemnify, defend (with counsel reasonably '7Z L1jo.:]BURLING-._^7.1 49 satisfactory to Landlord) and hold Landlord harmless from a, against any and all Claims for any compensation, commission or charges claimed by Pentz and/or Schaul (other than the fees to be paid by Landlord to Pentz pursuant to the terms of the separate agreement between Landlord, Pentz and Schaul) and/or any other realtors, brokers or agents claiming to have dealt with Tenant and not Landlord with respect to this lease and/or the negotiation thereof. SECTION 21.9 Intentionally omitted. SECTION 21.10 All notices, statements, demands, requests, consents, approvals, authorizations, offers, agreements or other communications (collectively referred to in this Section 21.10 for convenience as a "notice") which may be given or are required to be given under this lease or by law shall be in writing and shall be effective (i) upon delivery thereof in person to the intended addressee or (ii) when received or when delivery is first attempted as shown on the return receipt if sent by an overnight delivery service addressed to the intended addressee at the address(es) appearing in Article I(g) of this lease or such other address(es) as either party shall designate by notice from time to time in the same manner as provided for in this Section 21.10, or (iii) when received or when delivery is first attempted as shown on the return receipt if sent by United States mail, postage prepaid, certified mail, return receipt requested, addressed to the intended addressee at the address(es) appearing in Article I(g) of this lease or such other address(es) as either party shall designate by notice from time to time in the same manner as provided for in this Section 21.10. A notice to Landlord shall not be effective unless -and until a copy thereof shall also be given to Landlord at the address set forth in Article I(g) (fii) or at such other address as Landlorr' shall designate by notice from time to time in the same manner a provided for in this Section 21.10. SECTION 21.11 If at any time the term "Tenant" shall include more than one (1) person or entity, or shall be a partnership or joint venture, then the obligations hereunder of such persons and/or entities and/or partners and/or venturers shall be joint and several. SECTION 21.12 Each agreement, term and provision of this lease to be performed by Landlord or Tenant shall be construed to be both a covenant and a condition. SECTION 21.13 The failure of either party to insist in any one or more cases upon the performance of any of the covenants, agreements, provisions or conditions of this lease or to exercise: any option contained herein shall not be construed as a waiver or a relinquishment for the future of any such covenant, agreement, provision, condition or option. Receipt by Landlord of Rent or of any other payment or the acceptance by Landlord of performance of anything required by this lease to be performed by Tenant with or without knowledge of the breach of a covenant shall not be deemed a 'waiver of such breach. No waiver of any covenant, agreement, provision or condition of this lease shall be deemed to have been made unless expressed in writing and signed by the party against whom such waiver is charged. SECTION 21.14 This lease may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any change, modification or discharge is sought. SECTION 21.15 In no event shall Landlord attempt to hold Tenant's Guarantor Burlington Coat Factory Warehouse Corporation, Inc. liable beyond its guaranty obligations under this lease. '13 e L136.33BURLIVGTON.3 g0 SECTION 21.16 Tenant hereby expressly -waives any right of redemption or relief from forfeiture under Sections 1174 and/or 1179 of the California Code of Civil Procedure, as the same may be amended from time to time, or under any similar statute now or hereafter in force, or under any present or future laws or case decisions to the same effect in the event that Tenant is evicted or dispossessed from the Demised Premises pursuant to legal process for any cause, or in the event of Landlord obtaining possession of the Demised Premises pursuant to legal process by reason of the violation by Tenant of any of the provisions, covenants, agreements or conditions of this lease, or otherwise. t iSECTION 21.17 The provisions of this Section 21.17 shall be licable if there shall occur on or after the date hereof any (i) ike(s) , lockout(s) or labor dispute(s) ; (ii) inability to obtain or or materials, or reasonable substitutes therefor; (iii) acts of God, Governmental Regulations, enemy or hostile governmental action, civil commotion, fire or other casualty, condemnation or other conditions similar to those enumerated in this item (iii) beyond the reasonable control of the party obligated to perform; or (iv) delays due to the act or omission of the other party. A cause shall be beyond the reasonable control of a party when, on an objective basis, such cause would similarly affect any person or entity similarly situated (such as a fire; labor strike or transportation strike) . A cause shall not be beyond the reasonable control of a party when, on an objective basis, such cause is peculiar to a party (such as financial inability or ordering materials known to require a long lead-time without providing a sufficient lead-time when placing the order) . If Landldrd.or Tenant shall, as the result of any of the above-described events, fail punctually to perform any obligation on its part to be performed under this lease, then such failure shall be excused and not be a breach of this lease by the party in question, but only to the extent occasioned by such event. If any right or option of either party to take any action under or with respect to this lease is conditioned upon the same being exercised within any prescribed period of time or at or before a named date, then such prescribed period of time and such named date shall be deemed to be extended or delayed, as the case may be, for a period equal to the period of the delay occasioned by any above-described event. In the event of any occurrence which a party believes constitutes a cause beyond the reasonable control of such party and which will delay any performance by such party hereunder, such party as a condition precedent for claiming an excuse in performance of any obligation based upon such unavailable delay shall promptly notify the other party in writing of the occurrence and nature of such cause, the anticipated period of delay and the steps being taken by such party to mitigate the effects of such delay. Notwithstanding anything- herein contained, however, (a) the provisions of this Section 21.17 shall not be applicable to Tenant's obligations to pay, when due and payable, Rent or any other sums, monies, costs, charges or expenses required to be paid by Tenant hereunder, or to any obligation of Tenant that can be fulfilled by the payment of money, (b) lack of funds or inability to procure financing shall not be deemed to be an event beyond the reasonable control of Landlord or Tenant, and (c) the Required Opening Date shall be as set forth in Article I(b) (iii); provided, however in the event Tenant is unable to complete construction of Tenant's Work and open the Demised Premises for business by the date which otherwise would be the Required Opening Date because of the reasons set forth in this Section 21.17, the Required Opening Date shall be extended for a period equal to the length of such delay. L136.33BURLINGTON.3 61 SECTION 21.18 As used in this lease and when required by L. context, each number (singular or plural) shall include all numbers, and each gender shall include all genders. The Table of Contents, captions and headings throughout this lease are for convenience of reference only and the words contained therein shall in no way be held or deemed to define, limit, explain, modify, amplify or add to the interpretation, construction or meaning of any provision of, or the scope or intent of this lease and shall not in any way affect this lease. Time is and shall be of the essence of each term and provision of this lease. Subject to the provisions of Section 21.25, all notice periods provided for herein shall be in lieu of, and not in addition to, any notice periods required under the applicable laws of the state in which the • Shopping Center is located. The term "person" as used herein means person, firm, association, partnership, trust estate or corporation, as the case may be. SECTION 21.19 It is understood and agreed that there are no oral or written agreements or representations between the parties hereto affecting this lease, and that this lease supersedes and cancels any and all previous negotiations, arrangements, representations, brochures, displays, projections, estimates, agreements and understandings, if any, made by or between Landlord and Tenant with respect to the subject matter hereof, and none thereof shall be used to interpret, construe, supplement or contradict this lease. This lease, and all amendments thereto, is and shall be considered to be the only agreement between the parties hereto and their representatives and agents. All negotiations and oral agreements acceptable to both parties have been merged into and are included in this lease. There are no other representations, covenants or warranties between the parties and all reliance with respect to representations is solely upon tr express representations, covenants and warranties contained in th. lease. SECTION 21.20 Upon the request of either party, Landlord and Tenant shall execute and thereafter record with-the County Recorder of the County in which the Demised Premises is located a short form lease giving notice of the existence of this lease and the Term. The requesting party shall pay, at its sole cost and expense, any transfer, stamp or other taxes imposed as a result of the recordation of such short form lease. SECTION 21.21 After receiving notice from any person, firm. or other entity that it holds a mortgage which includes the Demised Premises as part of the mortgaged premises, or that it is the lessor under a ground or underlying lease which includes the Demised Premises as a part of the premises demised by such lease, a notice from Tenant to Landlord alleging a default under this lease on the part of Landlord shall not be effective unless and until a copy of the same is given to the holder of such mortgage or to such lessor in accordance with the provisions of Section 21.10, provided that Tenant has been furnished with the mailing address(es) of the holder of such mortgage or such lessor. The curing of any of Landlord's defaults by the holder of such mortgage or by such lessor within thirty (30) days after expiration of the cure period provided in this lease shall be treated as curing and performance by Landlord. SECTION 21.22 With respect to any assignment by Landlord of Landlord's interest in this lease, or the Rent payable hereunder, which assignment is made to the holder of a mortgage as additional security for the interest of the holder of such mortgage which includes the Demised Premises, Tenant agrees that: (i) the execution and delivery thereof by Landlord, and the acceptance thereof by the holder of such mortgage shall never be treated a! any assumption by the holder of such mortgage of any of the w obligations of Landlord" hereunder, unless the holder of such �S L136.33BURLINGTON.3 52 mortgage shall, by notice to Tenant, specifically otherwise elect; and (ii) that, except as aforesaid, the holder of such mortgage shall be treated as having assumed Landlord's obligations hereunder only upon the foreclosure of such holder's mortgage, the taking of possession of the premises liened by such mortgage, and the commencement by such mortgagee to collect Rent and other charges provided for herein directly from Tenant. SECTION 21.23 The persons or person executing this lease on behalf of Tenant and Tenant's Guarantor hereby represent(s) and warrant(s) that Tenant is a corporation duly incorporated in the state of California, that Tenant's Guarantor is a corporation duly incorporated in the state of Delaware and that the person(s) executing and delivering this lease on behalf of` Tenant and Tenant's Guarantor is or are an officer or are officers of Tenant and/or Tenant's Guarantor and that he, she or they as such officers has or have been authorized by all required corporate action to execute this lease and the guaranty of lease attached hereto and deliver same to Landlord. Upon request of Landlord, Tenant agrees to deliver to Landlord instruments reasonably satisfactory to. Landlord evidencing compliance with the foregoing provisions of this Section 21.23. SECTION 21.26 Any payment by Tenant or• receipt by Landlord of an amount of Rent lesser than the Rent herein reserved shall be deemed to be only on account of the amount of Rent reserved herein. Any endorsement or statement on any check or any letter accompanying any check or otherwise as payment as Rent shall not be deemed an accord and satisfaction. Landlord's acceptance of any check or payment shall be without prejudice to Landlord's right- to recover the balance of Rent due or to pursue any other remedy . available to Landlord pursuant to this lease or otherwise. SECTION 21.25 If any term or provision of this lease or any portion of a term or provision hereof or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this lease, or the application of such term or provision or portion hereof to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this lease and each portion thereof shall be valid and be enforced to the fullest extent permitted by law. SECTION 21.26 Landlord reserves the absolute right to effect such other tenancies in the Shopping Center as Landlord, in the exercise of its sole business judgment, shall determine to best promote the interests of the Shopping Center. Tenant does not rely on the fact, nor does Landlord represent, that any specific tenant or number of tenants shall during the Term of this lease occupy any space in the Shopping Center. SECTION 21.27 In any instance in which any party to this lease shall be reVested to consent to or approve any matter with respect to which consent or approval is required by any of the provisions of this lease, such consent or approval shall be given in writing, and shall not be unreasonably withheld or delayed, unless the provisions of this lease with respect to a particular consent or approval shall expressly provide that the same shall be given or refused in the sole and absolute discretion of such party. SECTION 21.28(a) Tenant covenants and agrees that Tenant shall at all times from and after delivery of possession of the Demised Premises to Tenant, be responsible and liable for, and be in complete and strict compliance with all applicable present and future' Governmental Regulations of all Governmental Authorities having jurisdiction of the Demised Premises relating to or arising directly or indirectly out of or in connection with the use, analysis, generation, manufacture, production, purchase, Li36.:3B RL:NGTON.3 :53 transportation, storage, treatment, release, removal or disposa_ - "Hazardous Materials" in, on, under or about the Demised Premises by Tenant, its Concessionaires and the Tenant Parties with respect to Hazardous Materials introduced into the Demised Premises by Tenant,_ its Concessionaires or the Tenant Parties. The term "Hazardous Materials" as used herein shall include, without limitation, whether now or subsequently listed in any listing or publication of the Governmental Authorities defining hazardous materials, the following: (1) any "hazardous waste" as defined by the Resource Conservation and Recovery Act of 1976 (42 U.S.C., Section 6901, It. sea.) ("RCRA") , as amended from time to time and regulations promulgated thereunder; (2) any "hazardous substance" ` being "released" in "reportable quantity" as such terms are defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C., Section 9601, gt. sea.) ("CERCLA") , as amended from time to time and regulations promulgated thereunder; (3) asbestos; (4) polychlorinated biphenyls; (5) urea formaldehyde insulation; (6) "hazardous chemicals" or "extremely hazardous substances", in quantities sufficient to require reporting, registration, notification and/or special treatment or handling under the Emergency Planning and Community Right-to-Know Act of 1986 (42 U.S.C., Section 11001, et. Zea.) ("EPCRA") , as amended from time to time and regulations promulgated thereunder; (7) any "hazardous chemicals" in levels that would result in exposures greater than those allowed by permissible exposure limits established pursuant to the occupational Safety and Health Act of 1970 (29 U.S.C., Section 651, gt. sea.) ("OSHA") , as amended from time to time and regulations promulgated thereunder; (8) any substance which requires reporting, registration, notification, removal, abatement and/or special treatment, storage, handling or disposal under Sections 6, 7 or 8 of the Toxic Substances Control Act (15 U.S.C., Section 2601, et sea.) ("TSCA") as amended from time to time and regulatio promulgated thereunder; (9) any toxic or hazardous chemical— described in Occupational Safety and Health Standards (29 C.F.R. 1910 1000, It. sec.) in levels which would result in exposures greater than those allowed by the permissible exposure limits pursuant to such Governmental Regulations; (10) any 'hazardous wastes' as defined in the California Health and Safety Code (Section 25117) , or as 'hazardous substances' as defined in the California Health and Safety Code (Section 25316) , or as a chemical that is known to the State of California "to cause cancer or reproductive toxicity" under the Safe Drinking Water and Toxic Enforcement Act of 1986 (California Health and Safety Code, Section 25249.5, gam. sea.) , as amended from time to time and regulations promulgated thereunder; (11) the contents of any storage tanks, whether above or below ground; and (12) anything defined as hazardous, toxic or "controlled industrial waste" under any present or future Governmental Regulations relating to "Environmental Protection", "Environmental Matters", "Industrial Hygiene" [as such terms are hereinafter defined in this Section 21.28(a) ], use, analysis, generation, manufacture, production, purchase, transportation, storage, treatment, release, removal and disposal of Hazardous Materials. The terms "Environmental Protection", "Environmental Matters" and "Industrial Hygiene" as used herein shall include, without limitation, any matter which affects the environment or which may affect the environment, the use of sophisticated electrical and/or mechanical equipment, chemical, electrical, radiological or nuclear processes, radiation, sonar and sound equipment, use of lasers, and laboratory analysis and materials. The term "Governmental Regulations" relating to Hazardous Materials shall mean all applicable governmental regulations promulgated by the Governmental Authorities relating to air pollution, water pollution, noise control and/or transporting, storing, handling, discharge, disposal or recovery of on-site or off-site hazardous substances or materials, including, withou limitation, the following, as same may be amended from time tc..... time:. (i) the Clean:.Air•Act' (42 -U.S.C:, Section 7401, et. se .) ; L136.43BURLINGTON.3 57 IN WITNESS WHEREOF, the parties have executed this lease as of the day and year first above written. MCA HUNTINGTON ASSOCIATES, L.P., a Delaware limited partnership By: MCA Huntington Inc., a• Dela a e corp a ion, its Gen rah rtn r WITNESS: (ATTEST) s-- — By: 61(Landlord) BURLINGTON COAT FACTORY WAREHOUSE OF HUNTINGTON BEACH, INC., a California corporation WI SS: (ATTEST) / By: By: (Tenant) (CORPORATE SEAL) 1� �r IOWA tutu TM . ,m. 1� ��EE4�.�EEKAW ZOE NUMB it \ ; L J J�- ..•RA.,JV f. In consideration of, and as an inducement for :he granting, execution and delivery of a certain lease dated (therein the "lease") , by MCA HUNTINGTON ASSOCIATES, L.P. , the Landlord therein named (herein the "Landlord") to BURLINGTON COAT FACTORY WAREHOUSE OF WNTINGTON BEACH, INC. , a California corporation, the Tenant therein named (herein the "Tenant") , and in further consideration of the sum of Ten Dollars ($10.00) and other good and valuable consideration paid by Landlord to the undersigned, the receipt and sufficiency of which are hereby acknowledged, the undersigned, BURLINGTON COAT FACTORY WAREHOUSE CORPORATION a Delaware corporation (herein and in the lease the "Guarantor") , hereby guarantees to the Landlord, its successors and assigns, the full and prompt payment of Rent, as defined in the lease, and any and all other sums and charges payable by Tenant, its successors and assigns, under the lease, and hereby further guarantees the full and timely performance and observance of all the covenants, terms, conditions and agreements of the lease to be performed and observed by Tenant, its successors and assigns; and Guarantor hereby covenants and agrees to and with Landlord, its successors and assigns, that if default shall at any time be made by Tenant, its successors or assigns, in the payment of Rent, or if Tenant should default in the performance and observance of any -of the terms, covenants, provisions or conditions contained in the lease, Guarantor shall and will forthwith pay such Rent to Landlord, its successors and assigns, and any arrears thereof, and shall and will forthwith faithfully perform and fulfill all of such terms, covenants, conditions and provisions, and will forthwith pay to Landlord all damages that may arise in consequence of any default by Tenant, its successors or assigns, under the lease, . including without limitation, all attorneys' fees, and; disbursements incurred by Landlord or caused by any such default and or by the enforcement of this Guaranty. If at any time the term "Guarantor" shall include more than one (1) person or entity, the obligations of all such persons and/or entities under this Guaranty shall be joint and several. Guarantor's obligatig s under this Guaranty shall be for the period from the Effective Date through the day prior to the twelfth (12t�) anniversary ot._the Rent C5mmencement Date (as such term a s' re defined in the lease)'; arealte'r;---Guarantor's obligations under this Guaranty shall be automatically extended for periods of six (6) years, on the twelfth (12th) , eighteenth (18th) , twenty-fourth (24th) anniversary of the Rent Commencement Date if Tenant has not exercised its option (if available) to terminate the lease pursuant to the provisions of Article I(h) of the lease. Guarantor hereby expressly understands and agrees that this Guaranty is an absolute and unconditional Guaranty of payment and of performance and that Guarantor's liability under this Guaranty shall be primary and that this Guaranty shall be enforceable against Guarantor, its successors and assigns, without the necessity for any suit or proceedings on Landlord's part of any kind or nature whatsoever against Tenant, its successors and assigns and without the necessity of any notice of non-payment, non-performance or non-observance or of any notice of acceptance of this Guaranty or of any other notice or demand to which Guarantor might otherwise be entitled, all of which the Guarantor hereby expressly waives. Guarantor hereby expressly understands and agrees that any failure or delay of Landlord to enforce any of its rights under the lease or under this Guaranty shall in no way affect Guarantor's obligations under this Guaranty. Guarantor hereby expressly waives to the fullest extent permitted by applicable law each of the following: the right to require Landlord to proceed against Tenant, exhaust any security which (i) 1-2 �� Landlord now holds cr =ay old• in the future from :erant, ar =ursue any other right or remedy available to Landlord; any and all r-ght to participate in any security deposit held by Landlord now or in the future; all defenses based upon the disability of Tenant, or release of Tenant's liability for any reason whatsoever; any and all rights it may have now or in the future to require or demand that Landlord pursue any right or remedy Landlord may have as against Tenant or any third party; the provisions of California Civil Code Sections 2809, 2810, 2819, 2845, 2847, 2848, 2849, and 2850 as the same may be amended from time to time or under any successor thereto, or under any similar statute now or hereafter in force, or under any present or future laws or case decisions to the same effect; the provisions of California Code of Civil Procedure Sections 580(a) , 580(d) , and 726 as the same may be amended from time to time or under any successor thereto, or under any similar t statute now or hereafter in force, or under any present or future laws or case decisions to the same effect; and any and all other defenses of whatsoever nature to the fullest extent which they may be waived under applicable law. Guarantor hereby expressly understands and agrees that the validity of this Guaranty and the obligations of the Guarantor hereunder shall in no wise be terminated, affected, diminished or impaired by reason of the assertion or the failure to assert by Landlord against Tenant, or against Tenant's successors or assigns, of any of the rights or remedies reserved to Landlord pursuant to the provisions of the lease. Guarantor hereby expressly understands and agrees that this Guaranty shall be a continuing Guaranty, and that the liaity of the Guarantor hereun s a in no way be affected, modified Qr diminisFed-15v reason of any assignment;rLrneWal;-'modification or extension o e lease or by reason of any modification or waiver of or change in any of the terms, covenants, conditiosfs or provisions of the lease by Landlord and Tenant, or by reason of any extension of time that may be granted_ by Landlord to Tenant, its successors or assigns, or by reason o f any an ptcy, insolvency, reorganization, arrangement, assignment for the benefit of creditors, receivership dr trusteeship affecting Tenant, whether or not notice thereof is given to Guarantor. Guarantor warrants and represents to Landlord that it has the legal right and capacity to execute this Guaranty. In the event that this Guaranty shall be held ineffective or unenforceable by any court of competent jurisdiction, then Guarantor shall be deemed to be a tenant under the lease with the same force and effect as if Guarantor were expressly named as a joint tenant therein. Guarantor hereby expressly understands and agrees that all of the Landlord's rights and remedies under the lease or under this Guaranty are intended to be distinct, separate and cumulative, and : no such right or remedy therein or herein mentioned is intended to be in exclusion of or a waiver of any other right or remedy available to Landlord. As used herein, the term "successors and assigns" shall be deemed to include the heirs and legal representatives of Tenant and Guarantor, as the case may be. (ii) 81 _uarantcr heresy warrants and -epresents =:at 'eranz _s a wholly owned subsidiary of the Guarantor and that the Guarantor :s by the laws of the state in which it is incorporated, and any other state having jurisdiction over it, as well as by its charter and by-laws duly authorized to execute this Guaranty. This Guaranty shall be governed by and construed in accordance with the laws of the jurisdiction in which the premises demised pursuant to the lease is located. IN WITNESS WHE709� thjs Guarantor has executed this Guaranty the day of �� 19 BURLINGTON COAT FACTORY WAREHOUSE CORPORATION, a Delaware corporation Att t or Witness: Address: 1830 Route 130 N Burlington, New Jersey 08016 Tu 1 v T\I• M••/►•rw�1•w MI•wt•1 W/N•►r 1►.Nw.l•1 1•/..1 N 1►•t►•rNN � C u.1.1 t. •IN•/•�IYI \•..I�,w L«.«I u. yY «d..•. ••,Y. .•w1..N 6•M •••••N N Iw Nv/ Mt ww.l•1••. •w.1/w• ►•N M•w«• at/./ t..ww •I••• •y/M IMt YN•11.►MI•,w• ••. 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M.•NJ�Aw. �1.1•I ••I•rd•.�M �+�/.1►Y.r,ram Or»NM•, hr.+d/w M••r•r INy.CAI.N r►II rIW�w1 Nr+p. co IQMro`t�A[lY,ncs fir.rs' y .... 1\ Mill L -7' 1171 7 fun" ara ! wry •may • • { • r � Y r`r QjWarr� CL x ; N W' 77 1 HUNTINGTON CENTER ASSOCIATES,LLC 23622 Calabasas Road Suite 100 Calabasas, California 91302 April 14,2000 RECEIVED Via Farsimile and Federal F.xnTress APR 17 2000 Redevelopment Agency of the City of Huntington Beach DEPARTMENT OF 2000 Main Street ECONOMIC DEVELOPMENT Huntington Beach, California 92648 Attention: Mr. David C. Biggs Re: Statement of Interest Regarding Redevelopment of Huntington Center Within the Huntington Beach Redevelopment Project Area (7777 Fdinger Avenue,Huntington Beach, CA 926447) i Dear Mr.Biggs: As you know,we are the owner of the Huntington Center, exclusive of the building and underlying parcel owned by Montgomery Ward. Pursuant to the City's March 3rd request for our Statement of Interest and Request for Proposal for Redevelopment of Huntington Center,we enclose our completed Statement of Interest for Participation in the Huntington Beach Redevelopment Project. Please do not hesitate to call us if you have any questions. Very truly yours, Bryan Ezralow, Trustee of the Bryan Ezralow 1994 Trust, ' Manager of the corporate Manager of j HUNTINGTON CENTER ASSOCIATES,LLC, a Delaware limited liability company cc: Mr. Gus Duran r STATEMENT OF INTEREST FOR PARTICIPATION IN THE HUNTINGTON BEACH REDEVELOPMENT PROJECT I hereby express my interest in the Huntington Beach Redevelopment Project: 1. Name of Property Ownerfl enant: Huntington Center Associates,LLC, a Delaware limited liability company("HCA");Attention:Messrs.Bryan Ezralow and Douglas Gray. Phone: (818) 223-3535 (Mr. Ezralow) and(949) 623-8383 (Mr. Gray). 2. Home Address: 23622 Calabasas Road, Suite 100, Calabasas, California 91302 and 7545 Irvine Center Drive, Suite 200,Irvine, California 92618. 3. Address of Property owned or rented in the Project Area: Huntington Center, 7777 Edinger Avenue, Huntington Beach, California(Parcels 2 through 9 of Parcel Map No. 86-200), exclusive of the Montgomery Ward improvements and underlying land(Parcel 1 of Parcel Map No. 86-200). 4. Name of business in the Project Area: Huntington Center, also known as the Huntington Beach Mall. Phone: (714) 897-2534 (Ms.Pat Rogers,Huntington Center on-site manager). 5. I own (x);ant a tenant 0; and wish to rehabilitate(x) in part; and build(x) in part; sell my present property. ff tenwit, ' - - , expiration d of lease. 6. My present type of business is: real estate development, operation, and management, including without limitation regional retail shopping centers and power centers. 7. Nature of proposed participation: HCA proposes to participate as owner and developer in the redevelopment of the Huntington Center into a high quality,master planned,regional commercial retail, dining, entertainment facility with supporting services (tentatively called The Crossings at Huntington Beach)which will be compatible with the surrounding neighborhood and City of Huntington Beach and consistent with the purposes and objectives of the Redevelopment Plan for the Huntington Beach Redevelopment Project and the goals and policies of the Huntington Beach General 12 r STATEMENT OF INTEREST FOR PARTICIPATION IN THE HUNTINGTON BEACH REDEVELOPMENT PROJECT (continued) Plan. Additional information will be included in HCA's development proposal to be submitted to the City under separate cover. I understand that submission of this Statement of Interest does not in any way obligate me to participate in the Project. Sign Return to: ryan Ezralow, as Trustee of the Bryan Ezralow 1994 Trust, Redevelopment Agency of the Manager for Huntington Center City of Huntington Beach Associates,LLC 2000 Main Street Huntington Beach, California 92648 Title:Manager Date: April 14, 2000 E- f I 2 g4 I WHITM.AN BREED ABBOTT & MORGAN LLP Lo-mox G33 WEST FIFTH STREET `EW YORK Toicxo GREEanvlcH TWENTY FIRST FLOOR NEWARK Writer's direct Los ANGELES. CALIFORNIA 90071-2040 PAX-It BEACH dial number: 213-896-24400 (213) 896-2494 FAC S I:f Z LE: 213-899-2430 May 2, 2000 Via Messenger and Federal Express Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach, California 92648 Attention: Mr. Gus Duran Re: HUNTINGTON CENTER ASSOCIATES, LLC Development Proposal Pursuant to March 3, 2000 Request for Proposal for Redevelopment of Huntington Center Within the Huntington Beach Redevelopment Project Area Dear Sir: As you know, we are counsel to Huntington Center Associates, LLC ("HCA"), the owner of the Huntington Center, exclusive of the Montgomery Ward parcel and improvements. HCA is an affiliate of The Ezralow Company, LLC ("Ezralow") and is managed by one-or more entities controlled by Ezralow. Investor members in HCA include SunAmerica, Inc. and various affiliates of Lubert-Adler Real Estate. Pursuant to the City's March 3, 2000 Request for Proposal for Redevelopment of Huntington Center Within the Huntington Beach Redevelopment Project Area (the "RFP"), HCA has authorized us to submit HCA's Development Proposal as follows below. The format used below is taken from that adopted in the City's RPF, and all section references are to the provisions of subsection E(b) of the RFP: 1. Identification of Developer. i. Huntington Center Associates, LLC c/o The Ezralow Company, LLC 23622 Calabasas Road, Suite 100 Calabasas, California 91302 j Attention: Mr. Bryan R. Ezralow President Telephone: (818) 223-3535 Facsimile: (818) 223-3536 RECEIVED 2 2000 JCH 050200 c:\work\docs\rfp.hb IrEPARUVEN T OF r WHITMAN BREED ABBOTT & MORGAN LLP Development Proposal in Response to Request for Proposal 2 May 2, 2000 ii. Huntington Center Associates, LLC ("HCA")is a Delaware limited liability company the manager of which is Huntington Management Ent., LLC, a Delaware limited liability company (which is managed by BMLF/Huntington, LLC, a Delaware limited liability company of which Bryan Ezralow, Trustee is Manager). The other members of HCA are (i) SunAmerica, Inc., (ii) Lubert-Adler Real Estate Fund II, L.P., (iii) Lubert- Adler Real Estate Parallel Fund II, L.P., and (iv) Lubert-Adler Capital Real Estate Fund II, L.P. The principals of HCA are Bryan Ezralow, Douglas Gray, Gary Freedman, David Leff, and Cristina Agra-Hughes. 2. Leases. HCA is in active and productive discussions with prospective retailers and other occupants regarding the Site, including without limitation, those described in detail to the City by Douglas Gray and other representatives of HCA, all of which is incorporated herein by reference. Additional information will be provided as it becomes available and as you may request. 3. Redevelopment Concept for Site. i. Enclosed is a draft preliminary Specific Plan containing HCA's proposed redevelopment concepts for the Site entitled "The Crossings ar Huntington Beach" (the "Redevelopment Concept") which incorporates, among other provisions, descriptions of proposed land uses and arrangements of those uses. The Redevelopment Concept is incorporated herein-by reference. ii. The Redevelopment Concept includes descriptions and depictions of the number and sizes off structures and the type of construction to be used. iii. A break-out of the estimated total cost of the proposed redevelopment has been provided to the City and is incorporated herein by reference. The basic assumptions affecting the feasibility of the proposed redevelopment include: (i) HCA's selection by the Agency as redeveloper, (ii) the Agency's entering into suitable agreements concerning HCA's redevelop- ment of the Site, and (iii) HCA's ownership or control of the Site sufficient to accomplish the redevelopment of the Site as approved by the Agency. iv. HCA's preliminary schedule of performance, subject to selection of HCA by the Agency as redeveloper and approval by the Agency of a redevelop- ment project, is to commence demolition of outmoded existing improve- ments of the Site in the latter part of this year (perhaps October 2000). Demolition is estimated to take approximately sixty (60) days, after which I JCH 050200 c:\work\docs\rfp.hb r WHITMAN BREED ABBOTT & MORGAN LLP Development Proposal in Response to Request for Proposal 3 May 2, 2000 construction of the redevelopment will commence and is anticipated to take approximately twelve (12) to sixteen (16) months. 4. Financial Capability. i. HCA has provided its financial information to the City which is incorporat- ed herein by reference. ii. HCA has provided copies of its corporate reports and other documents regarding its financial condition and related matters to the City which are incorporated herein by reference. iii. HCA has provided various redevelopment financing information to the City which is incorporated herein by reference. HCA is a financable entity and HCA's interest in the Site is suitable lender security, as evidenced by HCA's financing of its acquisition of its portion of the Site in November 1999 with its existing institutional lenders. In addition, the operating and related agreements of HCA and subentities provide for the collection of capital from the members, as required, and such members have the financial capability to respond. HCA is in discussion with various institutional and other lending sources regarding redevelopment financing. iv. HCA's and Ezralow's banking reference is: Ms. Paige Serden, Vice President, City National Bank, 400 N. Roxbury Drive, Suite 800, Beverly Hills, CA 90210, telephone (310) 888-6473. Please advise if you need additional banking references. A letter of recommendation has been re- quested from City National Bank and will be provided under separate cover. 5. Develoyment Experience. i. HCA has provided a list of development projects and particulars regarding E such projects to the City which are incorporated herein by reference. Over I the last thirty (30) years, Ezralow has developed more than 1,000,000 square feet of prime commercial and multi-tenant space, 20,000 apartment units, and has completed or is now developing retail projects totaling an additional approximately 1,000,000. In addition to clean-sheet development ` projects, Ezralow has rehabilitated earthquake damaged multi-family hous- ing site and warehouse facilities and has redeveloped retail projects present- ing complex development and construction issues. Specific details related to the foregoing are contained in the materials provided to the City. i JCH 050200 cAwork\docs\rfp.hb. i r WHITMAN BREED ABBOTT & MORGAN LLP Development Proposal in Response to Request for Proposal 4 May 2, 2000 ii. HCA's proposed architects are Greenberg Farrow Associates ("GFA"), 15101 Redhill Avenue, Suite 200, Tustin, California, 92780, Attention: Mr. Frank Coda, telephone (714) 259-0500. GFA has been in business as retail and commercial architects, designers, and planners for twenty (20) years and have designed and planned in excess of five hundred (500) projects, includ- ing previous Ezralow retail projects and others now under construction. iii. HCA and Ezralow build to own, generally speaking, and Ezralow's com- mercial and retail management division conducts all management, including the existing Center and the redeveloped Center. Presently, Ezralow manag- es approximately 3,500,000 square feet of Ezralow and affiliates' projects. 6. Additional Information. i. HCA and Ezralow enjoy established relationships with the retail community, including the business representatives and brokers of the prospective tenants and other occupants HCA would consider for the redeveloped Center. As president and vice president of Ezralow Retail Operations, an affiliate of Ezralow, with extensive experience in retail development, Douglas Gray and Paul Bernard are in constant contact with the retailers whose presence is essential to the success of the redeveloped Center. ii. HCA owns (or is the benefitted parry under easements or-licenses with third parties, including Southern California Edison) all of the Site, except for the Montgomery Ward parcel and improvements (Parcel 1 of Parcel Map No. 86-200, as shown on the survey of the Site provided to the City). HCA is also the landlord under various leases with tenants of the existing Center who are anticipated to remain in the redeveloped Center, including without limitation Barnes & Noble, Romano's Macaroni Grill, and other tenants of the existing improvements on the easterly portion of the Site. iii. Burlington Coat Factory Warehouse of Huntington Beach, Inc. ('Burlington") entered into a lease with HCA's predecessor-in-interest on j April 28, 1995 for a portion of the Site corresponding to Parcel 6 of Parcel Map No. 86-200 (the "Lease"). The term of the Lease is approximately thirty (30) years expiring on or about January 31, 2025. HCA, as landlord under the Lease, has made no election under the Lease or otherwise to raze or otherwise change the building owned by HCA of which Burlington's f premises are a part. Accordingly, the Redevelopment Concept enclosed j herewith includes a redevelopment concept for your consideration incorpo- rating the existing building tenanted by Burlington. i JCH 050200 c:\work\docs\rfp.hb Oil r WHITMAN BREED ABBOTT & MORGAN LLP Development Proposal in Response to Request for Proposal 5 May 2, 2000 Please provide a copy of the form of Owner Participation Agreement or comparable redevelopment agreement the City may use in connection with the redevelopment of the Site if HCA is selected as redeveloper. Please do not hesitate to call Bryan Ezralow, Douglas Gray or us if you have any questions. Res e t 1 sub tted, Jam . Hu es 0 i reed Abbott & Morgan LLP cc: Mr. Bryan Ezralow (w/o a 1. Mr. Douglas Gray (w/o encl.) Ms. Cristina Agra-Hughes (w/encl.) i i i I i JCH 050200 c:\work\docs\rfp.hb 1� ti•. Aw �•ti�,.,.�FM�f"rr•'�t'v�r ��____ � ��•' 'u ro• h ��� , , ..�i•rs: ..+ �.•,� I f• 1 .If~v�I, �� �1w • h�i,l:" ���h-` �` 14,•�/;� L- JE.:l1 p'1 a•�r �`1J.�, 1.44 jr]l l N (,�'\ `�'++�_ '�,�•y ti �, �f 1 4,.'N. `�'•ryry`I r •'• f1T '�`Li�f:r^'r^1 r i•f fA I �i7 1 ,��y�l�qq1��!,,I r •" �• Yti,�,�`►....'/ ,II ''1 t'1i t, },� ''� 1• l� �% IWGifO(:1�� ""�••, t'rfP ft !1 ''"",• rJAw .�.,j ;� ���.r'f ,1•ri4u 2 s ',� ;1 • Y' AI S+,Tw Lll rr y r I. �• l yr�� / •l bo• ,, b t1 y • r ;�J Y� � i l'•tir'� �. n! a XII '-}1:1��y,•f'i �' 1-' ,'�31"�,I wu-,���14{�� 1 }�(7�1��' /iCl� { '•�' �-'i.4 � fii^",m.", '„u /� i i I •hli!' ,. . . • �•...-1 � �1 t C i `�� � Y �� �• 1�� 7•i� ''h f�tu irlf.71,I �,i�,��II,.. 1� .i4�11 D�1.:��y� ����1���t� b� i;�'.' �?' �. i , „ '(�� ,,� � `�,"�-���7vr.}y�,I �I�y '! �� � ,�,:,:,. f.,�. .pal:.. -*tT_�`.f' ,µ.':.�'�`•�I.,C•+��1'., n=..� :i3 i �`�,-. itt��l•` � ,�r:r1".'• y,1-.Fr, TA , W. ,1,4 .•, •'�. 'i,•1�'�•N•::.,, •Tt"°!v �sa�r7 tril�;r-��_ j�.r' �i-�.. �•.r•�•'.,, ,Sl.-� •��� ' '- �0 � f" �,•. 1 c ";i'. r(l�l 1 (,=�� 7,., ;ITaI - '��7.I�r' 'r• .Gl ll?f•(r hi/�ilr•-tC- w..::`::w - l�s£..!i.ii. • �•�. 1i-"?L'n.'.;'•1. '1"`•�r `�t• aaaamwoL - tI 1...,wv! •••..•w,� 11`,..raw-::y t'reww.•••n d' -.: "'! ,�I . ( ..rt' '• \ J,' 1 R j V•+7j �w�..� li e}M� -'�I r �,• 7 •,'}'.:�,IN�ncc.�.• •'^ wr••�rt.fi•• r•� •1� �,'�� l�f .;may, f�. �. i; ..i( it �•` '.:T .,\ 1 ,k r`�. 1 ` JAI:'•,=,-•f ry �yam•. • ..1 The Crossings at Huntington Beach City of Huntington Beach SPECIFIC PLAN NO. 13 i Prepared by Huntington Property Associates LLC. with ' Greenberg Farrow Architects Hall&Foreman Linscott Law&Greenspan Adopted , 2000 Ordinance No. March 20, 2000 TABLE OF CONTENTS 3. DEVELOPMENT REGULATIONS 1. INTRODUCTION 3.0 Purpose 55 3.1 General Provisions 55 1.0 Purpose and Intent 2 3.2 Definitions 55 1.1 Authority and Procedures 2 3.3 Development Standards 57 1.2 Scope and Format 3 3.3.1 Permitted Uses 57 1.3 Project Area Description 5 3.3.2 Intensity 57 1.4 General Plan Designation 7 3.3.3 Building Height 57 1.5 Zoning Provisions 7 3.3.4 Setbacks 57 1.6 State Mandated Requirements 8 3.3.5 Landscaping 57 3.3.6 Signs 57 2. DEVELOPMENT CONCEPT 3.3.7 Lighting 57 3.3.8 Parking G1 2.0 General Development Plan I 1 2.1 Regional Commercial Uses 15 4. IMPLEMENTATION 2.2 Open Space and Pedestrian Walkways 17 2.3 Circulation Plan 19 4.0 Administration 65 ' 2.4 Public Facilities 21 4.1 Development Phasing Plan 65 4.2 Methods and Procedures 66 2.5 Design Guidelines 30 2.5.1 Project Area Character 30 4.3 Master Plan GG 2.5.2 Site Planning Guidelines 30 4.4 Site Plan Review GS 2.5.3 Common Area Guidelines 32 4.5 Reuse/Change of Use Review 69 2.5.4 Architectural Guidelines 41 4.6 Environmental Determination 69 2.5.5 Landscape Guidelines 49 4.7 Request for Deviation G9 2.5.6 Signage Guidelines 53 4.8 Specific Plan Amendment 70 4.9 Severability 71 �1 J The Crossings at Huntington Beach Specific Plan 3 . . 0 -w ---- APPENDICES (Volume Two) i A—Legal Description B—General Plan Consistency C—Standard Conditions of Approval and ,gyp Environmental Mitigation Measures D—Sign Standards List of Exhibits Exhibit 1 Vicinity Maps 5 Exhibit 2 Aerial Photograph 6 Exhibit 3 Illustrative Conceptual Master Plan 10 Exhibit 4 Project Description 12 Exhibit 5a Development Concept (Level 1) 13 Exhibit 5b Development Concept (Level 2) 14 Exhibit 6 Open Space and Pedestrian Walkways 16 Exhibit 7 Circulation Plan 18 Exhibit 8 Water System Plan 22 Exhibit 9 Sewer System Plan 24 Exhibit 10 Design Guidelines 29 Exhibit 11 Color and Materials of Common Areas 38 Exhibit 12 Typical Tenant Storefront 45 Exhibit 13 Landscape Concept Plan 48 Exhibit 14 Plant Materials Palette 50 Exhibit 15a Permitted Uses Chart 58 Exhibit 15b Temporary and Seasonal Events Chart 59 Exhibit 16 Development Regulations Chart 60 Exhibit 17 Parking Standards and Details 61 Exhibit 18 Development Regulations Check List 62 Exhibit 19 Conceptual Phasing Plan 64 The Crossings at Hunt;^gton Beach Specific Plan 4 INTRODUCTION 1 �k GR t S �,��•/ =t st�S+�'� �\•' � �'-3.r�. :�.: •a`!�}!•{.Y�t'l"t� y�tU � SZ �' � •r �StcC°'`,... �,Y� i .�S'ti f�i..i�t ��. JM ..•t.'1yj�•� t >•,l.%I14.��^ 'SLR `��:�.x�;'r4.t:F, i. ,�'fr %� '.�,• =t�...a. ' , 51.0 iMd e. 1. f...... lv - � Section One The Crossings at Huntington Beach Specific Plan 5 . . 1 — ^-^^ INTRODUCTION 1.1 AUTHORITY AND PROCEDURE The State of California requires that all cities and 1.0 PURPOSE AND INTENT counties prepare and adopt a comprehensive General Plan for the physical development of their area of The Crossings at Huntington Beach Specific Plan jurisdiction. establishes the planning concept, design theme, development regulations and administrative Following the adoption of the General Plan, the entity procedures necessary to achieve an orderly and is required to develop and adopt regulating programs compatible development of the project area, and to (zoning and subdivision ordinances, building and implement the goals, policies and objectives of the housing codes, and other regulations), which will Huntington Beach General Plan. The intent is to implement the policies described in the General Plan. establish a public/private partnership to enable the creation of a community center setting and achieve a California State law authorizes cities with complete high quality in retail and entertainment design. General Plans to prepare and adopt Specific Plans (Government Code Sections 65450 et. seq.). Specific The Crossings at Huntington Beach Specific Plan Plans are intended to be a bridge between the local identifies the location, character and intensities for a General Plan and individual development proposals. regional commercial complex. The Specific Plan Specific Plans contain both planning policies and establishes the alignment and design of an on-site regulations, and may combine zoning regulations, circulation system and all facilities and infrastructure capital improvement programs, detailed development necessary to facilitate a master planned development. standards and other regulatory methods into one The Specific Plan creates a compatible design theme document which can be tailored to meet the needs of a for the project area and establishes the development specific area. regulations necessary to accomplish the identified objectives. Local planning agencies or their legislative bodies may designate areas within their jurisdiction as ones for The Specific Plan is regulatory in nature and serves as which a Specific Plan is "necessary or convenient". zoning for The Crossings at Huntington Beach. (Government Code Section 65451). Subsequent development plans, Parcel Maps and other entitlement requests for the project area must be consistent with both the Specific Plan and the Huntington Beach General Plan. An Environmental Assessment has been conducted (No. 98-4) and a list of mitigation measures and conditions of approval have been prepared as a companion report to the Specific Plan. The Crossings at Huntington Beach Specific Plan 6 A Specific Plan may either be adopted by ordinance or 1.2 SCOPE AND FORMAT resolution (Government Code Section 65507). Should the legislative body wish to change a proposed Specific The Crossings at Huntington Beach Specific Plan is Plan recommended by the Planning Commission, the divided into four sequential sections. Section One is change must first be referred back to the Commission the Introduction and describes the purpose and intent for consideration, if not previously considered of the document along with a brief explanation of (Government.Code Section 65504). Specific Plan procedures and authorization. Adoption or amendment of a Specific Plan constitutes Section One also presents the Project Area Description a project under the California Environmental Quality and is intended to establish the reasons why the Act (CEQA) and the State's Environmental Impact Specific Plan process is logical and necessary for this Report (EIR) guidelines. If the initial environmental portion of the City. This section presents a general review shows that the proposed or amended plan description of the Specific Plan area; special could significantly affect the environment, the characteristics and existing conditions which make jurisdiction must prepare an EIR and submit it in draft this area unique have been identified. form for public review. The need for an EIR in a particular case is determined by the local government. Section Two describes the Development Concept. The A Specific Plan and an EIR on a Specific Plan overlap design concept evolves from the objectives identified extensively; they must address many of the same and existing conditions discussed in Section One. This concerns and the process for preparing them is nearly section also presents the circulation, public facilities, identical. Therefore, environmental assessment infrastructure and landscaping which will support the should be an integral part of preparing or revising a development concept and reinforce the design theme. Specific Plan. Section Two also includes the Design Guidelines. This section identifies and describes the intended character The preparation, adoption and implementation of The for the area and provides a framework for project Crossings at Huntington Beach Specific Plan by the implementation. City of Huntington Beach is authorized by the California Government Code, Title 7, Division 1, Chapter 3,Article 8,Sections 65450 through 65457. The Huntington Beach General Plan was recently rewritten and adopted by the City Council (May 13, 1996). The amended General Plan maintains the commercial designation for the project area. The Crossings at Huntington Beach Specific Plan is consistent with the goals and policies of the Huntington Beach General Plan. d r1 The Crossings at Huntington Beach Specific Plan 7 t section Three establishes the Development Regulations .`•;; %';' '+� for the Specific Plan area and for individual project "••.•. development. Section Three presents a detailed description of the Development Standards which are necessary to guide and control new projects and carry out the goals and policies of the Specific Plan and the City's General Plan. Section Four presents the Implementation process and r discusses how individual projects and tenant improvements will be reviewed and approved. This section outlines the project approval procedures and , describes the process for project appeals and the - �` J " =`�"�� r•' + -�. _ ; methods by which the Specific Plan can be modified or amended. An Appendix (printed under separate cover) contains View ol'Cwssingsat Hunthtgtoll Beach en(1'1 nce f vurn C011/01•Avenuc all the special studies and reports which have contributed to the formation of the Specific Plan. The Appendix (Volume Two) includes the Legal Description of the site, a General Plan Consistency ""•,.. . y;" �s°? f Analysis, identifies the Mitigation Measures and Conditions of Approval desired in the Environmental Analysis and includes the proposed Sign Standards. _ .carte• View v1*RO111:111o's%lvnl f itgel•A venue The Crossings at Huntington Beach Specific Plan 8 1.3 PROJECT AREA DESCRIPTION a 1 •PASADENA The Crossings at Huntington Beach Specific Plan to covers 63 acres located in the northern portion of the LOS ANGELS City of Huntington Beach. The area is generally C a MA bounded on the north by Center Avenue, on the east ►toru by Beach Boulevard, on the south by Edinger Avenue, .� and on the west by Southern Pacific railroad right-of- ANGELES lNTERNATIOMAL way. AIRPORT LONG A legal description of properties in the Specific Plan TORRANCE SORT ANAH�r� project area has been included in the Appendix. GARDEN project • BEAC SANTA* LONG BEACH/ ANA LOHARBOR S IRVIN SITE. HUNTINGTON BEACH Regional Location Base Ave. �� �J .5 The project area is surrounded by a variety of land A% m uses and activities. The San Diego Freeway (405) and an office retail complex create the northern boundary. McFadden Ave. To the south, office and retail uses are located across GolVWsden CeMsrAo Edinger Avenue. To the east, commercial uses are College located across Beach Boulevard. To the west, is the Southern Pacific Railroad Line. The property across oi from the rail line is designated commercial. 9 ` Edin er M Tt Crossings 0 ra at Huntington C7 Beach Vicinity Maps Site Location a -s' The Crossings at Huntington Beach Specific Plan 9 It ♦S'is m v 1 ' / �'}+�a .'�. � '\` � II C 11►� 1 r,► , '* ` r � :1 �r �+�► �1��•S/•[l } '"\�f+.fir' ♦A `.�Y`^\ ` .! � / ►:•\ t ; ► ♦� of 44 to S' I; .L,y � ,- I'I�^Pr % •/�°�yyj " i�"^;' ,,, Il;t '',`��; r •A•••\\'�` \ `•� `;' t b 1 nr•nrrrrt7. �w�y�„ �� r,"r 11�1i ' t 1 'f',Lt't�,,.� •�' •• • i _,T `` •• s r 1;i U,qf t Y' 1 �r i L ,,`, .,\ ti� ♦� fall 1• �% ...i•.,A�Qd/1• .�. �.1 , 1', Yr �1 ^:Ury``��a�,.e`!'r•:,�.�•�y ��..: .R �.�. _ 'j. , � .(/1�� S1 � Cr•. 1.'...y.' �"' ICI - �� � �1 rI It *`\.\. A Y ...��yr 1 t •�;r t�j� .. a�A�1i 1'Jy � r i ,�r �; r � ♦ Q���•.:It = S M jl� :•�Z� 1,` 1 S'�`... C r �t •r �• 1' .1' • rT�l k}.i ♦1 (lr.rlri�i 'a'�i o...r."i!_ �.�. l�.y.0' '� ,, r� ! � I .. .• ' N:rl� �r � t`,;��^'�tIQ`•.7r Y+ �+ C ♦ !, r",,• r �:�. ti .. � t r i.1r r r �,',�'t �l: ,s 't t � 1 't .R •" r'XT '�, �• . � Ikki jS1. r. 1� r••r••.6T BSI,''M• F'Y..�y•" 't~L Ir ., .t'lrI it ..1��1!iQ�..�v`,•+r• �7 iG�•._„ •�.. mow:. I�.. � '� �� ,.: /. ,:rC:.�-.-�•a-�+�,. �:.:+r�...�.. - ,r 11 it r .a,. '• • wi•r•Y•► •ttrv.'Y�� :' .1• ~ .r...,.....,�.r..•._i.F .:.... •..,;ZT�t.�r: _..r�.trs..r.'. �.�L..".�'.'�+-�� y'q,ya�_.'.!.r._.)•..1„i • ,'.+•'...:�:..N+nrw..:�..___ to �..��•r.�J 1:�ar'�.rr• rtry wr..q.��rx.•'� .�.1.r"•"�•i 'y,yr�/,.„;,�•r' ^ � ,.rr�..�.. r�r,����.�.•'.' .fr ��i r.--a!((�sc� �ry.rri� 'h <. t'o .,1 '�,Y .y + • • ,�' I .�` r1 "�' 4 •'!_ 1..�••�� J..1` .#.j.• 'p�l . „� e 1 •I,' f11 1 1�' 1 •' �:r 'tir�\ .i 1` rt 'r: r r ' !' ql _I''• ��:�. t.' "i 1 � ; .. 1 .��*' '; '1 ` � t. •: 1 1+ '� �� � r�•�.;.-' 3 rI� �k: '.'j, r`�� fir. �. � ' t ,• c i=ri �li �= •n..nl � � •t � 1� � ..t�l :, `. i• •J• r r r r . ;� r1 t •` •� i� ` ' I 11 �i Z r. I• ( .�� ,y ,�� `1. ±rY i' .•�t��� ,.„,...rw:r I _:,,,,_�,'� r. �• tt'; t t • r• a' I I r..lr..a 1 . '1' t R • 1.4 GENERAL PLAN DESIGNATION The entire Crossings at Huntington Beach is currently designated as CR-F2-SP-MU(F9)-Commercial Re__gional-0.5 FAR-Specific Plan Overlay-mixed use overlay-1.9 (MU-0.5 (0/25du/acre in the City's General Plan. The site has been designated for : ,�;, commercial land uses since the mid 19G0's. The commercial regional designation anticipates anchor department stores, promotional retail, restaurants, entertainment, and similar region-serving uses. The site has been designated to be within a Special Development Area requiring that a Specific Plan with special regulations and standards be established for ,r "North Huntington Center." Viow ofMorvyn s frnnr ConlerA venue A� 1.5 ZONING PROVISIONS The Crossings at Huntington Beach is presently zoned General Commercial ("CG") to accommodate a full range of retail and service businesses. The site is also within a sub-area of the merged Redevelopment Project Areas. The adoption of this Specific Plan will supersede the existing zoning and establish a new set of development regulations. K The Crossings at Huntington Beach site currently consists of a number of activities. The site contains ,.:r.,•.,, ; approximately 960,000 square feet of retail commercial space, some of which is currently unoccupied. This site has been approved and developed in numerous phases over the past 30 years. 1 Current market pressures and extent of adjacent View ofSlarhucksandRarnesk Noble%vinCenlerAvenue competing retail activities are driving the need to develop a new exciting commercial center for the City. 0 a% The Crossings at Huntington Beach Specific Plan 11 �LG STATE MANDATED REQUIREMENTS of Huntington Beach. The CMP requires mitigation of traffic impacts of development, as well as trip To comply with the State of California legislated reduction programs. The City of Huntington Beach has mandates, the City of Huntington Beach has adopted completed the mandated components of the CMP o several plans to deal with regional issues including Air including level of service standards, trip reduction Quality, Congestion Management, Growth program, and a capital improvements program for Management and Transportation Demand traffic and transit. Management Plans. All development within the Specific Plan area shall comply with the applicable Growth Management Plan provisions of the following plans: A Growth Management Plan (GMP) is required to South Coast Air Quality Management Plan implement the passage of Orange County Measure M approved in the 1990 election. Its purpose is to ensure The South Coast Air Quality Management Plan that the planning, management, and implementation (AQMP) requires measures to reduce traffic of traffic improvements and public facilities are congestion, improve air quality, and requires that adequate to meet current and projected needs. The cities develop Air Quality components within their City has an approved Growth Management Element, General Plans. These measures include Regulation XV, which meets the requirements for Measure M a program which requires employers of more than one funding, and an adopted Transportation Demand hundred (100) persons to prepare trip reduction Management Ordinance. plans, and a requirement for jurisdictions to prepare an air quality component in the General Flan. Transportation Demand Management The City of Huntington Beach is subject to all local Transportation Demand Management (TDM) jurisdiction requirements set forth by the AQMP. The measures are generally directed at increasing auto City has adopted an Air Quality Element and occupancy, decreasing peak hour usage, and Transportation Dernand Management Ordinance, managing demand for transportation facilities. The which incorporates AQMP measures. City's TDM Ordinance is part of its compliance with' the Growth Management Plan. Congestion Management Plan The Congestion Management Plan (CMP) is required by Assembly Bill 471 (Proposition 111), subsequently modified by Assembly Bill 1791. This Bill requires every urbanized county to adopt a CMP;the County of Orange has prepared a CMP which includes the City The Crossings at Hunti, `,)n Beach Specific Plan 12 „� yy all Ao ra t� • :^ ::�.;� 1 IIIIII ..r �� 1 ^.,. ..ec"�•• � •� ��'�� � - yl li` ;h. is h lil��li4'I fit..+,•' ^trjr��\— . J�• I.+._ { •1 ��•...,.....�..+.r...r •�A J—.1..—�. -�- 1 I r •— r • :� �_'� 'y1er1 �...t` {(...►r"�"��.� i'I i I � ;�^- I v.•r LA'"��t ) �{ I-a1��a����1�'t�R'. 1 M1Y ` t ra�yy r I 1 1 r•1 � �� ��' �i 1� i t� �tl , . . �./i►,.. •L.... _ t �Y.tµ';�• .�I,�L 1 IU 1�I I • / / 0 cola, / Fj rM,tIT'r-1177-11-I'm It237 459 Fal Wd Ir 91 Ole, UO 66 a]; j;G 1; —_ -- _ rc� r _ - _cm, wn ZZ, 414 414 cc 102 (13 .6 L4 IM I rl ILI Id.0 W N11 N Ito., Illustrative Conceptual Master Plan Exhibit 3 Note: Tliisillitstrativesliotvsaliylvllicticaldevelopiticiilwvit,,iii(.)oii lire project Bile. The Crossings at Huntinaton Beach Specific Plan 14 4- _� ',ri�I�TT11TIfrIRItII�.i = I. - •, ii. .h f •«� _23= .\�;,• `�`•\ �••, SAN DIEC�O FREEWAY-405 —'� — � � a. ly -'�`——M ti- •. -•y=_�-— - = ❑ �'• TER AVENUE'., �. { ;� r •� � a is •;� 1 . __ _ _ _ _ _ -- ,�• ;,;•,� ,,`;:' �� 23 -- - - �VIHIII4MN�III�IItF - �r.' - - •, •'IIHI 1 � _ 1 .I � r' �'• �!! I � •affN" .YI "Y �*'"'• 102 II �"EWNGER -AVENUE Illustrative Conceptual Master Plan i Exhibit 3A Note. This illuslralive shows a liypollielical development scenario ou the prnjecl site. O The Crossings at Huntington Beach Specific Plan 15 1 DEVELOPMENT CONCEPT The Crossings at Huntington Beach provides for a range of employment opportunities in professional, retail, service, food service, and entertainment; and 2.0 GENERAL DEVELOPMENT PLAN will broaden the employment base of the community. The Specific Plan establishes a clear development The Crossings at Huntington Beach Specific Plan concept to assure the facilitation of a cohesive development concept provides for a planned retail, complex. Design measures encompassing site dining, and entertainment complex in the northern planning, area landscaping, building architecture, portion of the City of Huntington Beach. The Specific streetscapes, pedestrian linkages, setbacks and signage Plan establishes the general type, location, parameters have been established. Concern with and adherence to and character of all development within the site's these details will combine to create a unique and boundaries, while allowing for creative design ideas integrated development. on individual projects consistent with an overall concept. An illustrative conceptual master plan (Exhibit 3) depicts a scenario utilizing the various guidelines The Crossings at Huntington Beach will be a 63 acre described in the Specific Plan. The plan provides a master planned regional commercial retail, dining, potential layout identifying building orientation and entertainment facility with supporting services. The placement, parking design and access, roadway Specific Plan is designed to allow for development in a configuration,entryways and landscaping. The plan is manner that is compatible with the surrounding not intended to reflect an ultimate design situation, neighborhood and City of Huntington Beach. The however,a large variety of other development patterns Crossings at Huntington Beach Specific Plan provides and activities may evolve which are also consistent an opportunity for a variety of quality commercial with the Specific Plan policies, guidelines and uses,consistent with the City's General Plan. regulations. The project statistical summary is shown on Exhibit 4 and the level one and level two The Crossings at Huntington Beach Specific Plan development concept is shown is Exhibit 5a and 5b. provides the framework and guidelines necessary to create a unique, high quality, visitor serving, The Specific Plan recognizes that development will• retail/dining/entertainment complex. The site's occur over a period of time and, therefore, must natural features and proximity to regional anticipate future concerns for the area. In order to transportation systems make the area ideal for a address this concern, flexibility has been incorporated variety of compatible uses and activities. The into .the Specific Plan Development Regulations development concept is designed in concert with the (Section Three). This flexibility in development area's history of commercial activities and the guidelines is intended to accommodate future market community's need for a strong self-sufficient trends and tenant needs, without sacrificing the economy. intended high-quality character of the project area. The Crossings at Huntington Beach Specific Plan 16 To be demolished 646,719 Theater 100,000 Anchors 175,000 Retail 470,187 Restaurants 77,246 Addilion to Strip Center 717800 SUBTOTAL 8947233 Anchors 827000 Strip Center 106,000 Pads Restaurants 71300 Banks 81240 SUBTOTAL 203,540 Note: Aira distril)litioiis aiv apl)roC11)iale acid play eliiiiige as die project is developed Project Description (statistical summary) Exhibit 4 The Crossings at Huntington Beach Specific Plan 17 milli To be demolished 517 231 f W Theater 100,000 Anchors 175,000 Retail 343,55G Restaunints 77,24G Addition to Ship Center 71,800 SUBTOTAL 767)612 Anchors 211,488 Retail Strip Center 7771076)000' Restaurants 7,300 Ranks 8,240 SUBTOTAL 333,028 n Note: Area distributions are approximate and may change as the projcct is developed. Project Description (statistical summary) Exhibit 4A The Crossings at Huntington Beach Specific Plan 18 n!T!TI[ClTflnll•L1.Miu1:N!,IIII:!!u.lin,lllin!I!Ilu!!iuillumil;;.;. .. ,•, ' r111111111111I1r(II1111II!rrrllllrlllllmnrnrlIL I i irnlinlfllrrllmniTmI;IIIM:nlli!r Ill nln- r III{Ill�llii{Ilihlul;! '! L !• _ - . pp _ 14/ J Arlllllbllillilt1.{II I111iilillLli'!,,.,!1, I-1111'tlll!11111illfhi I` f II— ' , - 11:1 h.M \.1 j SAN DIEGO FREEWAY 305 � I NlllllplllLdllll f •.� � r f- ! �_,,, �' - 1 ��� � - _- _ - - - _ _ - •II: _I I I `- \ lkNl[k AV[NUE f19.\.,.d h.d•� 1 F r_r r_�- _ -1 u t it - _ �t � ) ecru u, 1 � k; � o �•I,n!Illinl:ilnl n(iii -- ---- � I w= -;� _ ' +, ��► - �'�I ,�.�` f11'rllltllli!I{Iliril� :%L:o'•;:, - t ' �.e•, f _ '1S� �i 1�- •1 :{;. 1,�F4-}, � �-< alla:r4l,ullll:: :��n. 1� ;' �y ��:.li 1f{Ilii11P;Ill li!Ht �K o invl! rilltllt!IIIII'ItY i .N7 ' I S S • 1\ 4- '• f _ j c �h.,. tl— t a' Mri�;D �M .+ _ - : J =� r _- 6►� ___I�_ `�� � {III III ,w(«��iiKjk����,� ��; 7:- ♦� y Y t' 'Vd �- y y IV 1,1- rf '' .? l I• .�I' � '/'',l.r� rp. I''I I't 14 B C -3= - _ -- -- - - rf= - - -- 1lltllllll 1 _ = _f�. I�' _ - .1, �'n��,l(�!K+• 1 � •I � -�. •4 .�, I! 1 - -- L__ `. :.� —.J Al l •111111111111",1111111 Ill Illllltllll:Ill Ill llilllllllllllllllllll1111111UI11111U - -Ir - -�f'>'.:•, - " •�' .li.�'Il I JII dlIIl �.hlalllfll!l11111111,1 I(Illlllllllllllll!IIIIIIIIU Ltiulll!Illllltlutu!!..!Id �!11!IndJld,I!;IlI!J!::!IdJ1.111milil . .... .. ...EDINGER, AVENUE� Development Concept Level 1 - Exhibit 5a r The Crossings at Huntington Beach Specific Plan 19 _ ;• 'FIR1iIn1Ttttt1TR(Tlnn 1.�Alin,uulwl.u11111 illll mllm It it r��'J\ •� ,., •'::„nliiiimniullnnnu�mninrnln!mmnl I ��� -� .. Iq r 8► run►►I NI al�rur�rli I nil II III IiIII III ILIII1 111111{IiIIIIINfIIIH ��� � - - - - '�- == I_ • !�I lL�d� �t='• �- SAN DIEGO FREEWAY-405 Hlllllt111111:11111 I _ - - - ' IVA• I •,k -1• �I't - j �' .J •"".'1' ' - • . i .j ��� .•\'•Q.NTEkAVENUE .�1 • y,<I J .I tit,.. tr' t'.`�, •r�+`,I. ;7Ill PIIIL,IIiII'IIV j ;:: - - 3 ,�,^.,i ;_ r hlt µ� 'glllll3illllll•II@ ':uM��:.. , ,\.' .�,,, I � L= S 1 1 • _ l'• y �� 'a �• dH+M)1 Y.\yy! `\u-'lilllll ye'. r�`•yla"",{:rye..'/'. '''�-w. f _= � =f; -�:= ---------•----. . _...._. _-'--------- l ,-.�� ,,,��' ,,_ 'fir' _ `,•... ;�. -i- __ t y_ 1 1Y_ • = 1 rjr.IIL, I I• ! .b:.i� '' •� / r.•..�•4 I .I ,i _ _ _ ff fir' • _ ..�: -_ �� - .:!- \•• I i � - - _ _" __ _: =i- _.i - _ ti { •� ti' `.t h�. •. 1.Fry. i 1 :i a?3: J c3= 3 �s _i_ I B CF :I5-JIIP_ I'_. I .r' Il _ i!allllllll• -Olpl�ulllmuluunl(• 'K,ItlId1101 dtllllhltldlllpllldllldlllalllalll�lllltll611, I I11 I.II IIIIIIIIIIII It III It III II IIt •'111111111U111t11UUIllC II , \—np.lul:_:_,tlii.�.i..t.u.Lll.l.11,laulltll I„1._ I .LI{1 1i J• •.EDINGER,.AVENUE Development Concept Level 2 Exhibit 5b The Crossings at Huntington Beach Specific Plan 20 3�.u`ilfliiJn1lfillida nuuunnuuuuw.luumuuulnwmru'pn%---- . ..._ ��._ _ _ . �.�=:` •• �•:� �✓ r� 1••) ?��:uuun_umm�mmnnm,lmmmnrm _ .�. � � (311ifII�Il�fff:fllliiT'v "" X. SAN DIE� O FREEWAY-405 J- T .�••.' .�,....�.., •.` G NQEK MfiNui' i - i.i r. r. _t f= _ =1.- �_ __ = I. I. I_.•,,';�1,�'.,�.;.\ 1'l,ll 1i V. 0 , n II.111 A1.111IIIIIIii =YI1= % (.'�?,J1 � li•Iilllli�ll!IIIIIII� :;., I i � .';/' �,,(�C II 1 I I I F�I , _-��% .. ° ��f'•. n'n�rn-�ufilrnld--1 .I :- - 1M�k�-1-1-v-►��" ---- •'.\ `�'II III"IIII{II{IIV ' ,uw ,• \� ' I`• i' � — I � 1 �,`hllll•�II!11111119 `'>;,.'''' �I ill �r �_ ��{ __ _ � _- '_ _ - - � r� t� G-' G-- _ S-" S-' - - c_� _ _W'-f, r'..!. ��. �.Ilty, f."y I._ �-' •IIG�,A•�,11I T _ IBnTTMTr'I,I - - - - - - - T_ T . I ` -- - ._ `_ �s,s;:. ( I (� F —)`h11V IIIIIII I!1�UJllul LLMUWt4 Lt htllttl �hlht .iIILUL'I:IIIIIII— — —� � Wtl1WWl11 lJ I!LIItUlttllit �•... _ . rr.:..=__ '� { :1 �':. �� �• ...-- EOINCER,_AYENUE Nrs Development Concept Level 1 Exhibit 5c r The Crossings at Huntington Beach Specific Plan 21 _��_ L •l UP ER AVENUE i s'%1iTI1Tf1f1TffTIIfiTTfill, 0IIIdI171liliilll1111:II1IIftTllf Iliili1411 - i-•.,�� ;.,` 12 I;i FIIIIII,Iili1-IRii..imiw1111'!IIIIIIIIIIfrint =�� 11111111111hlllIV _ jr 7,e T -. 1v�� 11111111111illllillih �- ( I�; ''- �. �• �•`��' '`'�'�`` SAN UIEGO FREEWAY-405 1 I Ifh I\•• ••� wl�h 7 7- 14 j _ I H!'1ill•1'1111111!1,9 A ;�I_ �'(���', ll l_LILLllll11L1:1{_ `1�t``�.'.`� I • I7771 �t_ _ ! - 1 ,—_ - ra .�• ..- fli I�Il�llllllll�l;d �H'.• � 'C` / ;.1 r - _ •, ;; '1!II i Illlilijl'I '; '" ! 1.111111111i ,i�,r ��,..,��`a��' •.. _ .� � I =I" � �I I--' IK.:A. �Il ,rIJ / �.1/).�jnl•' TT �•i.ul.l;.� //,� .•;.���'•. I- r;€. - -_ 77 B CBS -- - ;� 4 t - + :..I:.i I :I 1 1 +i I. -•� 1�. ( Ksi�_.J �- - _� � _ .. � •-, ;a.0}, I - _ .. :... i l ` ,.ksi• �3, � 1 . ' hll1LIWil1111111111L ltlllL1W1L1Ik11L11L111111J11 Lllllllll1111119111111111 J. .�l�lllll_1J.11dI1111d.I1L'llhldulnlll 11 1—,.—I J!I l t „------�._�. bill Ill llll_ILll1lIll11,Ill Li111111_Wf IIlAllWllllulLlllll 111:- �:rEQINGER, AVENUE _ NTS Development Concept Level 2 Exhibit 5d The Crossings at Huntinnton Beach Specific Plan 22 The objective of the Specific Plan is to implement the 2.1 REGIONAL COMMERCIAL USES goals and policies of the Huntington Beach General Plan by defining the physical development of the The Crossings at Huntington Beach Specific Plan Crossings at Huntington Beach site. Included in this recognizes unique development opportunities within approach are the establishment of land use, the project area. The purpose of the Specific Plan is to circulation, infrastructure, landscape and create a distinct cluster of activities and allow for architectural design characteristics for the project individual project development and tenant occupancy area. The Specific Plan consists of a number of major to occur in a timely manner, within an overall Master components which will guide the development process Plan Concept. This approach recognizes development including the Circulation Plan, Public Facilities Plans, phasing patterns, market conditions and establishes Landscape Concept, Design Guidelines, and sufficient flexibility to provide for the opportunity of a Development Regulations. variety of activities within the Specific Plan area. The Specific Plan recognizes that the major portion of The City of Huntington Beach General Plan identifies the project area has been developed around the typical permitted uses under the Commercial Regional existing facility. However, any reuse, subdivision, and land use category. These uses include, but are not subsequent new development shall be subject to the limited to, anchor department stores, outlet stores, provisions of the Specific Plan. Refer to Section 4.5 Site promotional ("big box") retail, retail commercial, Plan Review. restaurants, entertainment, professional offices, financial institutions, automobile sales facilities, and The Specific Plan identifies and requires sufficient similar regional-serving uses. Future activities for the infrastructure and public facilities to adequately and area will depend on market conditions and may efficiently support any and all anticipated uses and include a variety of activities consistent with the City's activities. These improvements will be phased to General Plan. These development activities may be coincide with or precede individual development either an expansion of existing facilities and/or projects. This upfront effort will allow for buildout of independent new projects. The project area can the Specific Plan in an expedited manner, subject to accommodate a total development of 1,100,000 compliance with the Specific Plan and the square feet of regional commercial uses. Environmental Analysis. The Crossings at Huntington Beach Specific Plan identifies effective land planning and design regulations techniques in a flexible format which'can 1 take advantage of ideas and opportunities presented by future tenants and users. 00 The Crossings at Huntington Beach Specific Plan 23 •.I ,: I•f ��RfRT1!Ri�tR- iI-"Nft,!t}�!!�ftRt •••• • ITfiiT, .I n i i1f1T177iLTiiIT?tiT t.111111iIIIIVIIIiifhliu r -r -r •••a -•r :r r �r '�•• � - _ hlllllllllllllllillii.��lilll'lillli�l y 11 t �- _1_ �� y� rl' �_ \� FI SAN nIEGU FREEWAY•405 r4tMRAVENUE �1 -i-, :t 11 �- i- i ...., .-�• '� -i- t.r' - t "�• p- -`- t ,�j,�11 I _ •M nn.ln�nbu.i•:nlL.lait111.illlk• :1 ..__..— _ 1. ' _h I � �' -1' I ! ...•..........•.. :i. i I t l.dil 646 '�' ,y.. .. 'I� �_ -- ----=1,;::.i•, _ `�''"`�dlil'rNli;flliiiliU Li T ti.� y. ...... �--'�• ''•— �,.,. ..•„• ... •r� �r)..rtilltn'tilutll �� I .I t_ _ � =f.' - r I 1flL. ini'; � •:i� �" a ! � �'I y, �• �•• '.1 I I tl iNlitM115l .cC Bob �f1,InullndUtltLll ullluhltltl4,l,I:ulldc LllllllllLllUtpp,pllll,li Ifll � I - m .nl 11 ,� b r I I 11�'��1• t��w~.• '. �+W Jw.a.�' III it i I _ • "6666'0 609 Nt•• IL .ICI+III.pl •N 161111.Id.�161( 'L•.'I•'1'I.Iqn III- ll T 1 .a�I ! N.N•M -•---- INGL UE �~ Open Space / Pedestrian Walkways Plan Exhibit 6 The Crossings at Huntinnton Beach Specific Plan 24 i � -nrm' lei'�.Td}I11tT11R11i11f�1�i1R?1TRiI!1RR•.+1,*r�ARt11�RtRt���►R�rR.t�flRR� •��• �i��' `.•>` ,s< pnE 1t.d �1fHH1�IHllllllf� . =- _ -- _- � �_�Zt �`•: • .;�. flIIHfHHHHIHTHI 111HIH111111 list,� _—._ Qt{IIIIIIIIHIIIIIIID '�( - mn SAN DIEGO FREEWAY-405 7:_ _ _ - _ - 4�ATER AVENUE It LZ JI9 ss«ona k.d _ •ee$$• � t — - — its _ - - - __ _� ••� \`` !;'Is ,O__ u llllLlAua � � VHH{IHfIIIHHIIID �� ,� � • •- N. _ j .�� s��,.,/,,,! ..; �iHIIIIIIIHfHIID = . •;�-�. �•,;:`••. _ _ � S / •/' `s' L>•v. s+sr. » moot = '.,• .•� , Iu.no1 ;.'. Airy•t ' cl►NN�N��� �/� �� �� •N�t��NN��NN N�N� �Ullll •r,. •Lxcu ;' .. .�•`� � I _ =37 - - %Z '" - -- - �' k �� B AC � BC A. - - _ - - - - - - Et/� - Lib tl - - - - _.: w;'; _ MEr•{l..r t till � Y i{I{WWYY1 HIM � EDINGER - Open Space/Pedestrian Walkways Plan Exhibit 6A s„r The Crossings at Huntington Beach Specific Plan 25 REGIONAL COMMERCIAL USE POLICIES: walkway system is also used to connect the Crossings at Huntington Beach with public transportation 2.1.1 Any expansion beyond the initial site plan approval, facilities and surrounding network of public streets shall be through the site plan review process (see (see Exhibit G). t v section 4.5). OPEN SPACE AND PEDESTRIAN WALKWAYS POLICIES: (� 2.1.2 Retail,dining,entertainment,and related uses drawing from a regional commercial/market area shall be the 2.2.1 Individual developments and activity areas within the primary intended activity within the project area. specific plan area shall be linked through a series of pedestrian walkways which culminate in an 2.2 OPEN SPACE AND PEDESTRIAN WALKWAYS interconnected system of pedestrian plazas creating a variety of open spaces. The Crossings at Huntington Beach Master Plan identifies open space areas which can accommodate 2.2.2 A pedestrian walkway system will link or connect all outdoor commercial activities, seasonal recreation and future development pads to the central portion of the entertainment activities, and casual pedestrian Crossings at I-tuntington Beach. meeting places. These pedestrian plazas become the central focus of a number of commercial nodes within the project area. In addition to the major plaza areas, 2.2.3 All pedestrian walkways shall be designed and there are a number of entry nodes which serve as the landscaped consistent with the overall theme of the interfacing links between the vehicular and the Crossings at Huntington Beach. pedestrian areas. 2.2.4 Pedestrian walkways as shown on Exhibit G shall be The clustering of open space plazas are connected incorporated on the Landscape and Technical Site through pedestrian walkways. These walkways also Plans and shall comply with American Disabilities Act serve as a link between the variety of Village requirements. The walkways may include shade trees, commercial facilities and the Entry Plaza, the Village seating,decorative pavers,and lighting. Strada, the Plaza and the Colonnade. A pedestrian The Crossings at Huntington Beach Specific Plan 26 ' I• 1.1tultnnnnnmmmimnmmmm�nmmr� yi (?IiIIIIj�IHIHHI(v - ""' - � � '` • - � flllllllllllllllll>III f1111111111111' - _- _- _- �- _ 'PJ =`- \� � `•��'��' 454 hst L.. In ILWUWWIW JI SNVA kNy �-. �. _ _- - -- - - , Ib ig Imrnrfill _ r `K I � 'r�' a•, h*• = iC.��, ltlllllllllllllliti f.! G' ;- x• •_�" {aQ dIIHIIIIIHtllll� ��"� �""""'A��;%. -� I _ � y �. d q.Rs�'uuau' usr.*. _ � 'ti;ti •�•. A, �.. < rT Z. IT cc wv4 t.No tl I..t.� rJ �...� u u LJ _ i ar 1 uguiu u 1 t uuuumuul muuuuutuuuuuJ �'7�'' JMl�uuuu,ullipuuunwtwuwuuum ETD]NCER,_AVENUE Circulation Legend run►lorwrm UmIjm1IX d Wden m \0 MaIur tmw ay rloarre . sic-nmdbv ,kw, © &mwi k&yror"o Circulation Plan 1 RISM M/RIRM cm � ny,rrK.l tiv.Iwrwut 1 romigvI`M M/RI`M MArt«w Nr+.a+..rJ • E.IrIMR.,.:w.r....r. Exhibit 7 ~1 The Crossings at Huntington Beach Specific Plan 27 1" I. Atli ill III till 11111f111iIII111:I1uI1,II I1CII!UC14�iT`� - t• ,4111LIr"flam - Itfrt:nmr:fttmfl. _ -7•�-- - ,• I rfn�fmmfnmm , 11 Ilrnn t.)`1iIIfI��INtHfitl;lii, �'� �r �_ r ;•� �• �```- •y L T..• �`. 'y '. f1HINNIIiHlli%JFF fj{f�{tltHf{t ud,r �flfl<NfIINNtf?I�t� z ;�' �'.;� =L - _�: :L Jd.IIWIUII:L•1 -. �"' '•"" `�' - �/ t 1' � _ - } �_ �_ �' _ - ♦ =- _- ` L. TutS- 3-EK Ut 1-1 . _ _ - ---�-. o d xl;nn—iiliiin�iiri�li--� ;�• I lux £ IiLHHtItliHridlH �` r �: `. = � :,..,-;1,1�1iHliiiihHll'lii� ��s ti•L:,w..•j�� �.-: ..._ . • - I �� .IWI •,� - -- -_ -_ = y �'TfilT�(iTi �t - _- - .r(111-• -'! 'I v _E_ s I�. 'ail.'';, .,°_ - - -- TWIUUtI `3 _ ► - :,_ - _ - ti y I _� - _ �cr - •'•,�� WIt1�11W itl:ULIWUUWLUUl1Wi1WIl.IWUd41W 1'UtUI ({ (il►�ILIItUWWI WIWLI_lW_ W1.11W1 :•]IJILIIUIIJIUIIuILIILL:U1'ILIJ Illl 1�� '.......... Cimidatk,n Legend � IJI♦Yiw�YY.U+yyMrdY.u�nYul U wF.oll.�wt•Y.a. J. � fyr.Y,..r♦r...aw CSl w..lal...,.wn...�.. Circulation Plan 1 r.WY�YIIN M/YI♦W 11.U.►wn�.w.I1,, O {,iliy Yw SYq Mr,r. Exhibit 7A The Crossings at Huntinaton Beach Specific Plan 28 1, - - • - - ' - • -- �-{f,NifR•AVENUf�y _ _ ---_-_— --•- • i�--- ..__'- -' .. I I -y�}111111�IIIfIIIIfIf11�11iI���1111IIIIIIIIIIIIIIIIIIIIIIIIIIIIII1111111111111111111V%jin -• � 1 ��-� ,' ``� rI ly/ n1111111tllilllltl111111�1�(1fIIIIIIIIllll1111111111_ " QIIIIII 1111lllllir iD "_ - - SAN DIEGO FREEWAY-405 rr•.•ruwtd -, � -�f RIUM _;o- `��' H�IIfIIIHIHIIIIIIin —,` . ;.. - - nllltiul�n-nunu °JIIIIillll�lllllllll� -- dllllllllllllllA 1 _ ra ,4 77 B AC B( 7= _- _ = 1,54 p II11W111LWllI1111111llWluull - y (I11WW11111ll1ll111J11 111111!Lq ltlllllllllmullllllllllllllll(flflflllllllllllllllllllllllllllll --- -AVENUE ,. �.. ...1 ��. N R x _ chadallun legend . Ly,A.nlYw.w6w 11 .4••IAw,wq 1,•,w. 1 .b,..�.b.T.. Pq•w.JMTwW Circulation Plan 1� �, /Wy.ld1.,/.KI,IN•rA,........11ti V,Yq e•fy.n.r�� Exhibit 7B s The Crossings at Huntington Beach Specific Plan 29 EN Fm r r��mr Mmrrmnumm'gin,?-i`nin ITT u niiiuuin nmmmnnnnm 1 ' '� =73- \ \ ' - iIIIHIIHHII{ll�J rz _ c, ?n 405 - -- �- I _ SAN DIEGO FREEWAY �rnNjCK AVCNVC \ zr It I V1, Tr �_ ��`��}IIIIIIIIIIIIIIIIIIIIO ��::'•. , Vol ',�a �\ `• I 'Wilillllllullo-Till HE Mill -_ -- ..37E= =- - = c= -- - __ �. % , "I� = B C B( nuuuunwuuuwuuumuiwwwnuu� bW1Ullluuuunuuuunuuiuuwuuu - uuuuunwuuuwuf — : nuuuu�uunuwuuwuww_` _— �` �f ` -- - --- - EQINGER,..AY ChaAallon legend • Circulation Plan 1 MI�1.M/MI�NfMwR.7wW A. I.M1Yy■INN bIMI�IM.r►.....�w rrti IWry MS.y t.r..� • o •�..�.»,w Exhibit 7C The Crossings at Huntinnton Beach Specific Plan 30 2.3 CIRCULATION PLAN Internal circulation is currently provided by a network of private drives/streets serving as access to individual The Circulation Plan illustrates the general alignments, portions of the project area. Circulation is further classifications, location and design of cross-sections enhanced by a number of signalized entry drives and for public streets and private drives within the area of public transportation facilities (Exhibit 7). the Specific Plan. The Circulation Plan is consistent with the Huntington Beach General Plan's Circulation The circulation plan relies on a hierarchy of Element. circulation features ranging from major arterials to local streets. The system is designed to accommodate Primary access to the City of Huntington Beach and traffic to the project area and around the area while the Crossings at Huntington Beach is provided by discouraging through traffic intrusion through the Interstate 405 (San Diego Freeway).The City's General project site. Plan designates the intersection of Beach Boulevard and Edinger Avenue as an internal node and a primary In order to efficiently facilitate new development on- entry node to the, City. Access to the project site is site, primary access will be from interior drive aisles. provided by a system of arterial highways including: Direct access from adjacent arterials will be subject to review and approval of the Director of Public Works. • Beach Boulevard, a north-south principal arterial Primary access locations into the project area have street (120 foot right-of-way), designated as a state been located and designed to provide full turning highway, a primary path/image corridor, major movements. The locations relate to existing driveways urban scenic corridor,and transit service route. and median designs, and are anticipated to adequately serve the projected traffic volumes for the project area. • Edinger Avenue, an east-west major arterial street Specific future development proposals may require (120 foot right-of-way),designated as a truck route, modifications to these anticipated access locations.The primary path/image corridor, and minor urban two driveways along Edinger, adjacent to the scenic corridor and transit service route. Montgomery Ward TBA shall be closed when a change of use occurs in the existing TBA building. • Gothard Street, a north-south primary arterial street (100 foot right-of-way), designated as a transit The circulation systern shall be master planned to service route corridor. accommodate easy access between activity nodes of the Specific Plan. All street improvement construction • Center Avenue,an east-west secondary arterial street shall be completed in advance of occupancy of new (80 foot right-of-way), designated as a triinsit development. The Planning Director and the Director service route. of Public Works shall approve phasing plans for sheet 1 improvement construction, consistent with development construction phasing. rN The Crossings at Huntington Beach Specific Plan 31 1 Alternative forms of transportation should also receive 2.3.3 Additional new driveway access points from the careful consideration. The current OCTA bus route arterial highways adjacent to the project area shall be passes the project area on Edinger Avenue and Center limited and allowed only when the project, size, Avenue. The project Circulation Plan identifies location or type of use, warrants such access, subject existing and proposed bus turnout locations along to review and approval of the Director of Public Edinger Avenue and Center Avenue. As a supplement Works and Fire Chief. Cai to vehicular access to the project area, potential future access such as a light rail system and stop may be 2.3.4 Deceleration and acceleration lanes for driveway available from the existing rail line on the western access points may be required, depending on the boundary of the site. location of the proposed access point. Right turn in and right turn out accesses to the arterial highways In addition, the Development Concept encourages the shall be considered on an individual project basis, creation of a pedestrian walkway system. As a means subject to the review and approval of the Director of of achieving a strong landscape image, pedestrian Public Works. walkways are required and shall be provided throughout the development to facilitate pedestrian 2.3.5 Shared access facilities and reciprocal vehicular access access from adjacent developments to the project site. to and between individual on-site activities may be The pedestrian walkway system shall include requested and/or required by the Director of Planning walkways around the perimeter of the site in the street for adjacent uses and parcels. right-of-way. 2.3.G Alternative transportation forms such as a light rail CIRCULATION PLAN POLICIES: stop shall be coordinated with Orange County Transportation Authority and pursued by the j 2.3.1 Primary access to the project area shall be from the Crossings at Huntington Reach should a light rail existing signalized intersections along Edinger Avenue urban transit system be developed in the future. and Center Avenue. New access locations into the project area shall occur only where traffic patterns 2.3.7 Pedestrian sidewalks shall be incorporated into the and median openings allow, subject to review and project as a component of the landscape plan.. approval of the Director of Public Works and Fire Sidewalks shall be installed throughout the Chief. development to facilitate pedestrian access from adjacent developments to the project site. The 2.3.2 A new primary access into the project shall be pursued pedestrian walkway system shall include walkways where the San Diego Freeway on and off ramps around the perimeter of the site in the street right-of- intersect with Center Avenue, subject to Cal-Trans, way,and through the parking lot to the project area. Department of Highways approvals,design review and approval of the Directors of Public Works and Planning,and the Fire Chief. The Crossings at Huntington Beach Specific Plan 32 . . ........ 1 2.3.8 Public landscape areas within the right-of-ways may 2.4 PUBLIC FACILITIES require a separate Parkway Landscape Agreement for continued maintenance of the area.. The Public Facilities Plans identify existing and proposed infrastructure, storm drain,sewer and water 2.3.9 On-street parking shall not be permitted anywhere in facility improvements to serve development within the the project area, on both public streets and private Specific Plan area. A specific analysis of infrastructure drives. requirements and detailed design, construction and phasing plans can be found in the final civil report 2.3.10 Additional traffic impact analysis may be required, and bound under a separate cover. due to unanticipated project developments not anticipated in the approved traffic study subject to PUBLIC FACILITIES POLICY: review and approval by the Directors of Planning and Public Works. All public facilities infrastructure necessary to serve development within the Specific Plan area shall be 2.3.11 Circulation system improvements have been master completed concurrent with project development, planned to accommodate ultimate buildout of the subject to review and approval of the Director of Specific Plan. On-site and off-site circulation Public Works. improvements shall be completed prior to occupancy of the particular developments with which the improvements are associated. v 1 The Crossings at Huntington Beach Specific Plan 33 Proposed architectural site changes will be reviewed 2.4.1 WATER SYSTEM by the Fire Department for code compliance and may require additional fire hydrant installation. These Domestic water for the property will be provided by hydrants (if any) will be connected to the existing or the Public Works Water Division of the City of proposed water line loop. The number of hydrants on Huntington Beach. the system is not relevant to the flow delivered and, therefore,does not affect the system. The required fire The Water Division has use of both underground and suppression sprinkler flow rate is approximately imported water sources to service the area. The 22500 gpm. The existing and proposed systems will underground supply comes from nine existing wells, deliver 2,500 gpm at GO psi. It is not anticipated that and imported water delivered to the City of the proposed modifications to the Crossings at Huntington Beach by the Metropolitan Water District Huntington Beach will require water flow for fire (MWD) at three locations. The Specific Plan area is protection above that which the existing system can part of the City's Master Plan for Water Service and deliver. the ultimate development anticipated will be adequately served by the City's systems. All on-site water improvements will be designed to the City of Huntington Beach water standards for future MWD is the major wholesale water purveyor to the City acceptance and maintenance. Locations of fire City of Huntington Beach which, in turn, is the retail hydrants and apparatuses will be reviewed by the Fire provider to all water users in the City, including the Department and Water Division of the City of subject property. The existing and proposed water Huntington Beach to ensure adequate fire flow and supply systems are shown on the Water System Plan pressure. A final design analysis will be performed (Exhibit 8). daring the site engineering stage to properly size the system, determine final alignments, and determine if The existing center has a looped water system. Water additional water improvements are necessary. is delivered to the site by the City of Huntington Beach's 12-inch line located in Edinger Avenue and a 12-inch water main on Beach Boulevard. The proposed modifications to the center will require that a portion of the looped system be reconstructed, identified in the exhibit as "Proposed Water Line." The required hydrant flow for fire sprinkler's in development is 4,000 gallons per minute (gpm) at 20 pounds per square inch (psi). The existing and proposed upgraded systems will deliver 4,000 gpm at 47 psi. The Crossings at Huntinryfon Beach Specific Plan 34 1 2.4.2 SEWER SYSTEM upsized to a 10-inch line so as to allow construction at a flatter slope. The City of Huntington Beach is responsible for the review and approval of the collection of wastewater The existing 10-inch sanitary sewer line exiting the within the project area. The Orange County Sanitation site is adequately sized to carry the anticipated flows District (OCSD) is responsible for the treatment of from the reconstructed center. Ilowever, final design wastewater. The City system ultimately is collected by analysis will be performed daring the site engineering the Sanitation District via their trunk and distribution stage to properly size the system, determine final lines to convey sewage to District Plant #5, located in alignments, and determine if additional sewer Fountain Valley, and District Plant #2 in Huntington improvements are necessary. Beach. The Sewer System Plan (Exhibit 9) depicts the existing sewer system serving the project area. Sewage from the subject property is collected via a private on-site collection system with a singular outfall point at the southwest corner of the site. A G9 inch sanitation district trunk line runs beneath the concrete channel located along the west property line. No changes to this connection will be necessary. An existing on-site private system consists of a series of 41 6, 8, and 10-inch lines collecting into one 10- inch line which is proposed to connect with the county system referenced above. Due to the reconfiguration of the development, it will be necessary to remove or abandon-in-place several sanitary sewer lines and replace them as shown on Exhibit 9. This relocation will place the new sanitary sewer system south of the existing 10-inch waterline. The existing waterline in this area will remain. The westerly 750'+/- of the replacement line will be AI W The Crossings at Huntington Beach Specific Plan 35 1 2.4.3 STORM DRAINAGE The City of Huntington Beach and the Orange County Hydraulic calculations performed on the existing Flood Control District are the agencies responsible for storm drain system revealed that ponding in a 100 W the flood control system in the project vicinity. A year event will be as follows: average depths of 1 foot regional flood control channel exists along the western and a maximum depth of 2.8 feet were determined for boundary of the site. the ponding over line "A." Average depths of 9 inches and a maximum depth of 1.4 feet were determined for The existing drainage system consists of two main the ponding over line "B." lines, "A" and "B". Line "C" drains a small area westerly of the existing Montgomery Ward store in addition to The storm drainage discharge rates from the secondary line "D", and numerous connecting laterals. remodeled Crossings at Huntington Beach will remain All lines drain westerly into•a City of Huntington similar with the exception of the discharge from the Beach Flood Control Channel (Huntington Beach enclosed shopping area. This area will now become an Storm Channel C5-5C2): Drainage area boundaries open air shopping complex. Drainage areas will be have been identified based on existing inlets and catch redistributed allowing line "A" to remain in it's existing basins. position. The entire length of line "B" will be removed and replaced with a larger capacity conduit. As a There is a small drainage area located at the northerly result, no ponding will occur at any point on site perimeter of the Crossings at Huntington Beach which during a 100 year event. drains into a small basin located in the northwest corner of the site. Line "D" will connect to line "B" near the outfall. The existing detention pond will be removed and be Line "A" is comprised of a 42 inch Reinforced regraded as a additional parking area. Line "C" is not Concrete Pipe (RCP) and a variable size Reinforced affected by the proposed remodel. Concrete Box (RCB) section. The RCB is covered by a grate opening for the entire length. There will be a need to add various new lines to' connect to Line "A" and line "B: to drain the open air Line "B" consists of variable size RCP. Line "C" has a section of the Crossings at Huntington Beach. Final direct connection to the City storm channel and drains storm drain sizes will be determined when final design approximately 2.57 acres. Secondary Line "D" calculations are performed. connects to an existing detention in the north-western corner of the site and drains the area adjacent to Center Avenue along the perimeter of the project. The Crossings at Huntington Beach Specific Plan 36 2.4.4 WATER QUALITY Water quality in California is regulated by the U.S. current service needs of the area, however, additional Environmental Protection Agency's National Pollution facilities may be required as additional development Discharge Elimination System (NPDES), which occurs. controls the discharge of pollutants to water bodies from point and non-point sources. A NPDES permit or 2.4.G ELECTRICITY other E.P.A. review will be required for individual construction projects. Electrical service to the area is provided by the Southern California Edison Company. Existing Prior to issuance of any grading permit, the developer transmission and distribution lines are adequate to shall submit a "Notice of Intent" (NOI),along with the service current and potential future needs. Individual required fee to the State Water Resources Control development projects may be required to relocate or Board filed under the terms covered by the State underground existing facilities concurrent with other NPDES General Construction permit. improvements and consistent with the City's Undergrounding Ordinance (17.G4). An exception to Through the NPDES Permit process, the City currently this provision is the GGKv line. requires contributors to non-point runoff pollution to establish Best Management Practices (BMP's) to 2.4.7 NATURAL GAS minimize the potential for pollution. Under this program, the developer is responsible for Natural gas service in the Specific Plan area is identification and implementation of a program of provided by the Southern California Gas Company. BMP's which can include special scheduling of project Adequate facilities exist for current and projected activities, prohibitions of certain practices, future needs. Individual projects may be required to establishment of certain maintenance procedures, and relocate existing facilities concurrent with project other management practices to prevent or reduce the development. pollution of downstream waters. Typical elements of such a BMP program would include addressing the use of oil and grease traps,detention basins,vegetation filter strips,and other common techniques in order to preclude discharge of pollutants into local storm drains and channels. 1 2.4.5 UTILITIES There are several public utility service providers in the Specific Plan area. Adequate facilities exist for the The Crossings at Huntington Beach Specific Plan 37 2.4.8 TELEPHONE Telephone service in the Specific Plan area is provided L� by General Telephone (GTE). Individual projects should coordinate with GTE for the relocation of existing facilities and installation of new service. 2.4.9 CABLE TELEVISION Cable television service within Huntington Beach is provided by Time Warner Communications. Individual projects should coordinate with the Cable Company for the installation of new service. 2.4.10 SOLID WASTE DISPOSAL Rainbow Disposal Company currently provides solid waste disposal services for the area. Based on service projections and anticipated demand increase, an adequate level of service will be maintained. No solid waste disposal facilities are planned to be located in the Specific Plan area. The Crossings at Huntington Beach Specific Plan 38 MONSOON$■ Illlifl AMMAR AMR,XPAIM24444 024,40 NW 411 Design Guidelines Un 'Kii Exhibit 8 The Crossings at Huntington Beach Specific Plan 39 2.5 DESIGN GUIDELINES design criteria, which the City will use to evaluate proposed developments. �2.5.1 PROJECT AREA CHARACTER The Specific Flan's architectural vocabulary blends all • The Design Guidelines establish the character and of its design disciplines into a theme of a coastal Italian style for the development of this retail, dining and Village. Care has been taken to reveal this expression � p g g p entertainment complex with buildings and while at the same time encouraging individual tenant streetscapes that have a distinctive visual identity. The identity. Guidelines accommodate individual project identities and promote interrelationships between The City of Huntington Beach is defined by many complementary building storefronts and exterior elements including the Pacific p ry g c Ocean. Living next to g g spaces. The major elements of the Design Guidelines he Pacific creates m i p � g t c c ea! s any lifestyle and recreational include: site planning, overall project/tenant opportunities for residents and visitors alike. Activities architecture, exterior pedestrian amenities, such as surfing, swimming, boating and fishing,along landscaping, and signage. All development projects with the city's natural features; California's longest within the Specific Plan area shall conform to the uninterrupted sand beach, Bolsa Chica Wetland Design Guidelines and shall incorporate appropriate Preserve and its famous ocean sunset vistas define theme elements. what a coastal town is all about. Many of the architectural features of The Crossings at Huntington The Design Guidelines are to be used by the Crossings Beach will celebrate this coastal living. at Huntington Beach owner and the City of Huntington Beach as part of the Site Plan Review 2.5.2 SITE PLANNING GUIDELINES process. The Design Guidelines are general and may be interpreted with some flexibility in their application The positive shopping experience begins at landscaped to specific projects. Variations may be considered for entrances to the site, which lead to convenient and projects with special design characteristics that still ample parking. The center's open-air spaces of plazas, meet the objectives of the Guidelines. courtyards and passageways will be arranged in a non-linear pattern. Additionally, the main plazas will The Design Guidelines shall be used to promote a high be accented by water features. A pedestrian walkway level of design quality while at the same time provide will connect east to the existing adjacent Village Retail some flexibility, necessary to encourage creativity on center. Italianate themed graphics add to the the part of individual/tenant designers. The Design continuity of all the linked spaces. To facilitate the Guidelines have been prepared to articulate the development of The Crossings at Huntington Beach intended development standards of the Specific Plan. into a unique resource for the community the The Guidelines establish a framework for following site planning policies shall apply: developers/designers of individual projects; and The Crossings at Huntin-+nn Beach Specific Plan 40 SITE PLANNING POLICIES 2.5.2.4 Entry drives shall be a minimum of thirty (30) feet wide. 2.5.2.1 Site layout for the project is designed to route people and vehicles through the site in a clear, identifiable, 2.5.2.5 Building orientation and access shall be designed to efficient and effective manner by incorporating be visible from the surrounding streets and/or unique pedestrian walkways and highlighting main pedestrian plazas. drive aisles with landscaping and paving. 2.5.2.6 Parking shall be provided onsite in a manner that is 2.5.2.2 At least one water element and one public art feature convenient and compatible with the layout and shall be incorporated into the common project area. design of the overall project and consistent with the standards in Exhibit 16. Satellite pad buildings are 2.5.2.3 Loading and storage areas facing Edinger are encouraged to provide a minimum setback without designed to resemble a facade. The facade will be parking between the building and the street (see integrated into the project environment. See example General Plan Policy 10.1.15.c). of Elevation of Tenant storefronts in section 2.5.4 on pages 41-47. 2.5.2.7 Security provisions, including lighting, building entrance visibility and drive locations, shall be carefully considered. TYPICAL PARKING LAYOUTS I �P'i -6 S 7 Potent afEntrySiSnage ..n,,..11110/O • �^ � � *�� � 7YlVad f'arkfi;r flay 90 de.g. d` The Crossings at Huntington Beach Specific Plan 41 . . , -- 1 2.5.3 COMMON AREA GUIDELINES The Crossings at Huntington Beach is divided into amenities that reflect quaint and harmonious lifestyle several unique spaces. The Italian Village Setting will of the Italian Village. A wide color palette with be carried out through distinctive architectural design contrasting accent elements will create a lively • elements including towers, domes and arches, exciting experience for visitors to the Crossings at •� cobblestone streets and walks,water features and site Huntington Beach. (See section 2.5.3, page 38). J I _ .7 �.. . k rI t ?3�R•TI1TIiflTTlti'1R;Ih,l�l..uul:u{.nU.nl{:ull.rL'l1UdItlInW6d.Ul.;d, . . j�_ � '�•' ' ,. 1:! u..III:IIIIi11111111111111I�1'IIIIIIIIIIl IIIIrllllllt . r ti 'I nrTiTnTi ITI 7r rililiiil.T{ifi'fi(i1in11 i I�lilltillltitiilltb„f :i.• ;r �.- I `� Allfltlittitiitilliii fli!Illl illliu:.:.;,,. ;411111it Itllill't� �, '�) Il�r. i i I In�uuwuu.uui •• •` � r-- N r I /�' SAN DIF4( FREEWAY•405 f i t �^Y.�` ��' !� I' :i. .t. ,._ T' f. i •I� II ' Ct N7lRA4ENUE I I�, II _ Ql!1.1llu.11lll:.11lltJlt:LLL!IuLLuul.! I d•,/`(14', {¢i•1, � � ' j 1 , I� I ti �.�'�r,Y ,'� •NF'.S'Un) .... ✓'`,:Y 1r.:4, ( PI � � ;P1d" II .j• ;. . I �. v. \:3 •r1 •J 'Yip 'i•' , 31- � i i I I I� � '+�''� —_ .:�''"':'">�`.i;:. ,�,. ,;-, 4ur,�bt'�'e:�• + --I�,�' � u+�('_'j PFdE�lrl'an:r �ii�,• } , .� '� ;, i. •six°; "' """'�,IE ��rT.� 'P�.��� - ,lu r• Connection �; - w p� � � '*. ,• ,� rt;;:: ,..,:,.; •HII I:in iriuli�;• � .�. 1611lhiliiitlltii:l9 : ; ...• I: "' �',�•. !ll:illlittili!i:iil 'i ' r,: I I� Vill i t+A 'k'� �►• tllwl... '� � �tp:��y`'t.t7.i I I It .� ''.:' 1• •a. .► s L a I w. ti: t t.._�..r-� I!'1{t!. :j1 .1�;[ :•y '�••_ . � I - Tom'. ` I . it;�`•%; — �� ��1 1�1-�, -- �t � � _ ,�`• ' L=� ••'i'• '''S, v ' ••�1 -1 �. A. i Ir+llllillllll ,i I I. .iNIiI' i' 11 I I t: � � luululul �i B "t,::. i Il..ull h.Id1611mL1 1 { I :.�—:. �d.:ul..1.ul;lltb{.d.1111.1{.LIII::L11:1lIIl.Lp,;ILllli ll!II ,.. •• '•II k I � � ..-"=--•-' �. , .-w.hldUlalllallldli._I,II;t,.IU:1111:11lI:IIILIyItLII:1.C1t.11,1.,.{Llp{r U n:..e s.l.na.......:..{..I,.a.i..,l..u..: ...y,lla ,�I EUINGLK�..AYfNIIE L j {j 'I It II ',�•, The Crossings at Huntinaton Beach Specific Plan 42 I r IIIIW,*,--fififRnTmlfiliTRf t1TTfT1TIIR�TI�fI_ i�`� o1111i1j(IIIIIIIII n ckELE ttnuuluuu SAN UIEGO FREEWAY-405 N EK AVENVE _„e '+ o - •j� _= __ __ __ __ _ 1. =.:ISM ���;��3�i\'',�..�;+I•ry�;; Aerarrao ,Connection wi` li_ Mi li __ - __ llWll _ _ - _ -_ -- -- __ � i ttIIIIIUI - - = = a �r�.�.-,;-• I I ; Iuuuunl�IWnuur= WluultllWlllAlmluuumuuwnmmu_uutunuul Il�ummm�muuuunulllf _Illunu_numuil --� .11u�l111L1W1uL11w1111Juoluululunf I —EDINGER_AVENUE.. ..._...._._ . ._�. ----, .- ---"-"•11 -,- . �r The Crossings at Huntington Beach Specific Plan 43 THE ENTRY PLAZA 1 opening towards Center Street and the 405 Freeway, the Entry Plaza is the central Northerly focus of The Crossings at Huntington Reach. The decorative and colorful hardscape will be the primary gathering place for community and retail events. It will contain a sculpture fountain, seating, and kiosks and become the entry portal to the Crossings experience. The Entry Plaza fountain along with the surrounding building architecture will announce the location of The Crossings at Huntington Reach both day and night 'A with the structures and the water features washed in accent lighting. The Crossings at Huntinr'^n Beach Specific Plan 44 �yl " A+�'�p�• �Iv.'y,y�?�i., N?� a',r4t.�r?^ .w:p�q�.w..:•...q.�...:�.r..:r:.• ,.y� i !•rs... �'�1)`/w�YSa �kr��Tyy�J-'� ��'f� , , + "]J��ai4i'�'u'�ii17::t�S�r _ '...:• rr .- yi F••Ir��.;. ..r.::ts!'C�lsti•�l��tE{:•��'�"�h,+ �°"• _._ _� � .c�.�..�..y�..�: ':•...'1� •.� .:`4>M.. r�9�. tl C"r, Y (1�;. + 1 .,• `1.,,,1`;;y'i��:;.v'�,.i' .t .,'�,,.43� .. t.l-�.i ,I.___� �}�t�•�c��,.{�,ci'G.�,��1' �1....�;.'w:.. :!1 � .. fit'.. �, _ .. '- .`. '..'_:_'.••_ �••'.�i,:.. y�'r• ��!f.�•-.+ ' • M 1 t: �:tf 1�/ �1 u, . }. iY-v •11'llll `1 ' 'c'•'C:d ��.� .� •`.' '� I � 'ni' .uRcliro ul�'C7�I,r '•,•ITir''�'••`,p..f„ ,'+�/,� ,1•! •.. >; y^�4. i� Al i ,f,,,, •1. q 1 �.•a ai Ti 1 till .t i"•i'n t •I �y �,�;,'; ?a;, __ .. •— .;�� •��'_' - — - - r- `. _F�. ;� •„�� A'1��.�.. .91L..}:k'Iiy.'•_t.'�_'.�.. 1:, of :, !'�. :��.y.�tom" ':r•«. ; .. ": 'y :7'1'1.1�/n ill ii 1:'�A 4;1/1�,1 f I it'p.���,t'•.L::.fi?l i�;� I I-1illl'h WIN{'1:11 ,r> 1• •� ,. . ..�i�,. .1• .«'� dim 1 P �/ ,,... .j-•=i'.il�i,,,,�1'I.4,,.,:_"1,�:::�;-'a•-�_r.�h.,i�{':(.: � _ .i ,1.�',�;;#.1.•.. a:�--4�-�Jy-h�_ _ ,J• �' •�_4-..��,, i•�.'r .... .f..w_w: v.niri�wwrri+lli►wnviiui..aisv�� ::1.._ _ __ '_r.+.r�e.rrR.�-w.:::.::.... ..rrwwu.w.«..s.r•`,w..•..w.`..... .r�'r•n`!.?.�,.�ac r.ax�a+.vl..:.+.w......... _ 13j( -.�1,'---• ,.- AAA � I: 1 Al 01 tl t.r ! ,. ...,i 4d? �•- ,. .t .. . ,. :�;7J ` '' L 'U�iJal - (r F'`�i�' o�lt. �;,•�.• ;Y'� �,•� ,t .t,z�q �4.y9s •nti,�'�•r,•:p:: !•7q,o«,r>.,..wrne.�•.: .�n�wn•dw�::,7a .ts_.. ' L�I 1 `_^�-� 1a:dEt:.. �WWW1Y� lLl�t:.:i',4ii .il;,�. ;�:!Y:•r. v.•I^.�wnm,�. :1�•.rwr p�rt':•y.`dy`S�j� �!{mw.,azalnlSJ"w Y` ,Czr' 77 ,.+;•r 'Il, iCll+,',4';�t`•t, �,`ri•+ pw�.• r.(ivt, Nike{)��•a�;{�l' r'9' +. .• k' `.1 Y.h. ,J 1 'te��i•'i:l f'1�e(, � wR7,tya4dl.' +'{PG�^.FN'GrKthl (/.7c}r2!i./'�t1i>,i i4�':.�i�i1:..�9�i � i11.1+i'•C 1 THE PLAZA ' I The Plaza (or Town Square) is the center of the Italian Village. It creates the foreground for the theater entry and is the central pedestrian access from the Strada, and the South and North passages into the Villages. Accented by cobble streets, water features and the arched entry and dome of the theater, the Plaza is the hub of the Village. THE COURTYARD AND COLONNADE Once past the arched entry to the theater,the Courtyard expands to provide smaller shops and merchants along with kiosks and the queuing area for the theater. Once past the domed theater entry you enter the Colonnade, which continues the retail experience for the visitor. The continuation of the Italian Village theme will follow throughout the Courtyard and Colonnade with alleys of trees, intimate dining and seating areas and an architectural flare reminiscent of old Florence. The Crossings at Huntington Beach Specific Plan 46 AV Y •` �•,7.1^•�'�',+','t,I:l►;~�^r1Y�,'� 1 f 1 a..�:�r.r 11• .. •' •��.:,r '„ :'��`;Ra 4 ANN' MMUMMM 'f'f J.. : I. '?1.( 4';j/.%//.%i•/ �.ar,� ` __^ � '� ,t l�,;Y•.. '1".ti .1, 1 .�1•�� �,,• ��'� ��e. � - • ,_ .. .� N('�1 ,r .'Y:.,///•' 1'•� ��l1'I• .(,1 'w'•4�i`i;lll� i'°'�•''i�Jljij 1�•�a�i�l�::�w';,(;��'N�,d.Y,, � .... '.+:. 'r• ,aYti:� 'I ,• •�r.�z.�� i s: i°, , .�7�, ":4 �.' r rf,�'( :•. =�i�t ,:,1.�:•,,;:'i. -.-+. ,. .... .• ��;,�;t;.. .�:� ;,;� . �� �,� . �: -� ii ��.�=- .._I�'►r�� ref a-ta�' `;�'1 �., /////I//Y• � ��r � I ICI� ���� 1"! '�i�':'r%1!,�;;�y ',�'"'"�ti IJ/.'/u��J4911!� . ',�•���1�, .... "'�—+�..,.:`•z+33�.,�. • �V.I.V_�.�J_� T) ' .! ..�: `.�. .��r ram, •,�'•�T�7. '��'�1T.-�•Y�4 ■r A ��� �l t•T�, 7.1.1. •ifs) f � 1 i .I COMMON AREA POLICIES: 112.5.3.1 Common Area Lighting will create a strong, my attractive night identity for the project. Selected Elements will be highlighted with illumination. These Elements are selected for their ability to wenhance the dimension and character to the building rt architecture, as well as to promote the appropriate = degree of prestige to the project. «::. f'rrkiltg lot/i tilty n 2.5.3.3 Exterior lighting shall be located and designed to evenly illuminate the parking areas. Particular attention shall be paid to the illumination of all sidewalks and connecting walkways. All light j� standards shall be consistent with respect to design, materials, color and color of light, and with the overall architectural style of the project. All lighting shall be confined within the project. NEW Lighting a!passageway 2.5.3.2 Illumination of buildings and landscaping will be StairAV1111V ° indirect to create a strong positive image. Concealing ' light fixtures within buildings and landscaping can highlight attractive features. Use of a variety of lighting levels at entries, plazas, parking lots, and other areas where evening activity is expected, will create an exciting night time environment. Wnikwayfishur Accent%irlurt The Crossings at Huntington Beach Specific Plan 48 . f , 2.5.3.4 Hardscape in the common areas will consist of non 2.5.3.6 Landscaping in the common area will consist of grid-like patterns, which recall the historical cobble espaliered vines on columns and trellis elements, stone walks and streets of an Italian Village. The potted planters to add detail near storefronts, and water elements are creatively incorporated to large and small planting beds throughout the plazas provide visual delight and interest. and passageways. Landscaping may consist of groundcover grasses,shrubs,vines and trees. r- 1 2.5.3.5 Mechanical equipment shall be screened from view _ of the surrounding public streets " '` Mechanical '' •'�� -�;. • `'"% equipment shall not be exposed on the wall surface of a building. Screening material and color shall be compatible with the overall building design and - g �" colors. Backflow devices, electrical transformers and 4 - other mechanical equipment, located on grade, shall not be located within the front or streetside setbacks, and shall be screened from public view or 2.5.3.7 Trash enclosures and loading docks shall be undergrounded, with the exception of public safety concealed with screen walls, and ornamental gates {� features: These items shall be screened to the best and screens. The facade will be integrated into the t V extent possible with landscape materials and/or low project environment. Landscaping shall be provided level screen walls. were possible. The Crossings at Huntington Beach Specific Plan 49 1 2.5.4 ARCHITECTURAL GUIDELINES 2.5.4A New Anchor Stores and Theaters Many of the elements of the Crossings at Huntington The new anchor stores on the lower level create a ' Beach architecture reflect that of an Italian Village new retail zone below the theaters. The large mass of living environment. The Architectural Guidelines are the upper level theater provides a backdrop for the intended to establish a character, style and quality for facades of the new anchors and allows the visitor to f. each architectural category. The categories are: focus on their stores. The theater will be set as to Ul allow it to be viewed from the 405 freeway. • New Anchor Stores and Theaters • General Tenant Storefronts NEW ANCHOR STORES AND THEATERS POLICIES: • Existing Major Department Stores 2.5.4A.1 Building massing and articulation shall possess a The description of these guidelines is not intended to balance in form and composition. The large planes discourage individual innovation and creativity,but to of the theater and major tenant walls should be simply provide a framework within which an overall enhanced with patterns and graphics consistent sense of place will'be reinforced. Building design shall with the overall design theme of the center. comply with the following architectural policies. S The Crossings at Huntinaton Beach Specific Plan 50 1 Vic ivofNorlh elevation 2.5.4A.2 Building entries shall have a clearly defined 2.5.413 General Tenant Storefronts primary pedestrian entry. The concept for the General Tenant Storefronts is one of an Italian Village. A tenant storefront design 2.5.4A.3 Building materials and colors shall be guided by, would include vernacular of various architectural but not restricted by, the approved Common Area elements. Then, linking each individual tenant palette. storefront to another would create a shopping experience of boutiques and shops that would fill a The elevation shows the second level theater walls walking street. Arches, columns, tower elements, will be articulated with patterns and will provide domes and canopies would be mixed in with display the lower level anchor stores with area to create bays, balconies and balustrades for a distinctly up- large identifying entry articulation. scale look garnered from many European styles and themes. There are two basic types of General Tenant Storefronts: Storefronts facing the 'exterior' toward Edinger Avenue and Center Avenue, and storefronts facing the 'interior' toward the Common Areas. Both storefront types may be one or two levels. The Crossings at Huntington Beach Specific Plan 51 To achieve this' Italian Village concept, general 2.5.413.3 Tenant storefront materials may include but are not tenants in relation to each other may have varying restricted to: t parapet heights, window openings, heights and rhythms,canopies and signage. Opaque: Translucent: • The basic objectives of tenant storefront guidelines Polished metals Glass block are to ensure high quality design and use of Smooth brick Etched glass materials consistent with that of the project and to Smooth plaster Clear glass produce a variety of three-dimensional storefront Glass Fibre Reinforced Concrete Crackle glass designs, each uniquely different from its neighbors Porcelain tile but tied together with common theme materials. Metal grillwork Painted wood GENERAL TENANT STOREFRONT POLICIES: Glazed ceramic tile Smooth or polished stone 2.5.413.1 All storefront designs and plans shall be subject to Powder coated or anodized metal the approval 'of the landlord and the City of Cast concrete or plaster (i.e. columns,cornices) Huntington Beach. 2.5.413.4 Tenants'storefront may project from the face of the 2.5.4B.2 Storefronts are encouraged to have multiple planes building as long as this does not extend beyond the to create a variety of volumes and spaces and to face of the upper level overhang and maintains the maximize each store's visibility. required mall clearances. li AIN, '.i 1,%valion o!'lyhicul s/ortllvn/s slrvivir;s; valyh1v he"ghh; IVr11C1o1V lllylllllls alid heights,Canopies and sitjnage size. The Crossings at Huntington Beach Specific Plan 52 1 ? - t txamplesofSlI elflvill ailleclion concep/s 2.5.4B.5 Storefront designs shall comply with the design guidelines and may require modification in the event that they are too similar to a neighboring store. t 2.5.4B.G Tenants are encouraged to vertically extend their facade design from leaseline to leaseline and from slab to top of parapet or bottom of upper floor above. 2.5.413.7 Tenants are encouraged to have awnings or canopies at their storefronts. w•a .rove yid I'VaInples of aII'nittg Ilse CP The Crossings at Huntington Beach Specific Plan 53 I` tit ;. - ... � _ .+....,....,:�•. .���:.. '" r r. r�".� ,. Ali•:°;� � .._. ; .. .. ,r Fii°-�,1'S.' _�.?`: � — f.,�, 1..�.� ::,;;�=r '.,•' II �������) 1 f . . t.,rr.i::;Li.a; •� �---'• T � 6 ���.-.�s��s � — �.. .� �.i�o,.i 'I�� r�l,e���.�1•_ . �'��I� ..:��9��:�JIp� Typical Tenant • • Exhibit 10 The Crossings at Hunt/RqtonBeach Specific } 2.5.4C Existing Major Department Stores 2.5.4C.2 The facade improvements shall be compatible with the mall architectural theme discussed in design The existing, operating department store is Mervyns. guidelines. The Mervyns building will undergo facade improvements during construction and shall comply 2.5.4C.3 The renovation designs shall be subject to the with policies 2.5.4C.2 through 2.5.4C.4 listed below. approval of the Crossings at Huntington Beach Should Montgomery Wards, in the future, file an management and the City of Iuntington Beach. application for expansion or renovation, the following policies shall apply: 2.5.4C.4 Building materials and colors shall be guided by, but not restricted by, the approved Common Area EXISTING MAJOR DEPARTMENT STORE POLICIES: palette. National retail store materials and colors will also be considered. 2.5.4C.1 The facade improvements shall occur if expansions or renovations to the store are proposed. All improvements shall be subject to DRB approval and compliance with the Specific Plan. t t t The Crossings at Huntington Beach Specific Plan 55 I. 'f-Tifllrm'71t1i7i:uiTifliT�i11 U. I.I n 11'` � i1 't'. \ 164 gtana lexl Q�IfW.�.lf� A'T IU '.'_ �L, `-'�,.• ":� _ r h _ �Ilfi• :,1 i t•i.. �;IWI�71Pa rem A. Ia Y •l. .f s Ju •l f•'g�i,^;• ..��r- - •L =_ '=- - •,,,�,•��,,, _� _ T- Y..= t'��111!9r idG.�� i•l,ffr`� � 1 t �:�` 'W.. ..�J•• :Sl � `y .e �/�'\ its +, _ ..-. vin•i:i. IIIY r,rr ``,,!Y•f:;t. I i _ •V- a - -- � _ v',��'.�+j.�4' `:ui� ,i'I� ^�'!'r!:n. rg:, � � , yr. �J I - � � .1P C1- 'iiM�P1k;.6.agM L��•i• :i.�U•. �PJ:�,�•N4 nra.�41 �'• ,,, +��My����ly� `\` �� •.H. _ M.Y., '•r"t --n^. ••• : '.?:•'=1j.•'.;?';�}'' 16i I _ _ jj7 _ �? _ c - Ill _ �- � - _ °1- �. I _ t )IS�-' 0. • I = - - __ _ - ill. �' �; °`'� ''-' �y, ' _ � a_ _ •��^ _ � 1� .�:,... �j,� � •�... , 1 II 111llill '1111•!1 i it 111: Bill �V •II.•111 111�i:11 i 1•'lll•111 •ill ` :-� ill...111 Ill 1111 lull!nfl Ill ❑l q. lluupl•i . i u 1 ;'Ui 1.11, '•.fir a a. 9.ii. !'.�lfaht w �ti 1. �.. ' N�ER � A_VI,,Ll �. - 'lil�lf l { Ill 1111`� ally, :.:.•,41fa.:--/dill.. n • _ .__ i�_�s_a___ T-� (( �.��+ 1� '11i� _ _t'::::•t. Itf„'M��I'��'I�C.I(+.� ,1;��`r 1;.. ,i:.c.,:,•d+i !` ii1 rL�.,`_ _s'T. L1^�tl;!6i: Landscape Concept Plan Exhibit 11 The Crossings at HuntinnMn Beach Specific Plan 56 { AVENUI _...1�== '�-� SAN DIEGO FREEWAY-405 KER AVENVE'. HaTI •&04RTII _ u:•.o.o \ `- - t' �( +� ; �,.. 4` �. U roe...,T.. n J i',1. �� -*• '.j•,^-__ .- - - _ - 102 wv C B( =�C -'� 4= r. .F -.. -,2- ='�: -.( v.-_�i- :i t. 7.r:•�y •�• =3. -1t��- °: _ =1==y':: _?�c_ 1�II1111111 - -- -- -- Willi fill r r; .$ IU1111 ,.ED{NGER AVENUELL- -r- Landscape Concept Plan Exhibit 11 A The Crossings at Huntington Beach Specific Plan 57 1 2.5.5 LANDSCAPE GUIDELINES 2.5.5.3 Landscape design shall provide formal or informal groupings of deciduous and evergreen trees, The landscape for The Crossings at Huntington Beach flowering shrubs, and groundcover. Trees shall be is an integral component of the overall project design. of even size and shape at the time of installation. This design concept is urban in nature and has strong Replacement trees shall be compatible with the new elements of a Coastal Italian Village . These elements landscape plan. A minimum of five (5) percent of to include the use of strong vertical elements such as the net site area shall be landscape or plazas. Italian cypress and Palms at the main entrances in strategic areas for emphasis and continuity. Some of 2.5.5.4 Plant materials shall be selected to create an the other elements that fit well with an Italian Village informal pattern of landscaping to reinforce the environment include the following which are character of the tree plantings.A formal pattern of indigenous to the California coast. i.e.: Bougainvillea, landscaping shall be created on-site at the project Ivy Geraniums, Hibiscus, Lupine, Azalea, Indian entries. Trees shall be selected based upon the size Hawthorn and tree varieties such as Silk tree, Alder, of the planting area to allow for mature growth Strawberry tree, Deodar Cedar, Carob, Carrotwood, without causing future damage to the Crepe Myrtle and" the like. The Landscape Concept is improvements. A consulting, certified ISA arborist composed of these elements as well as other elements shall review and approve final tree planting plans which are complimentary to and assist in the for compliance. implementation of an integral landscape design. These Landscape Guidelines establish the design character All trees shall be a minimum twenty-four (24) inch and visual qualities for development within the box size.Shrubbery (evergreen and flowering) shall Specific Plan. be low to medium in height; minimum size shall be five (5) gallon. All grass selections shall be made LANDSCAPE GUIDELINE POLICIES: from the approved water efficient materials list. 2.5.5.1 Site layout shall respect and preserve as much of 2.5.5.5 Street tree planting in the'parkway areas shall the existing site features, including trees where include a minimum of one (1) thirty six (36) inch possible. A professional consulting arborist shall be box tree for each forty five (45) feet of lineal. used to help determine whether existing trees can frontage. At the discretion of the Director of Public be saved during construction. Works, this planting may be modified to one (1) twenty four (24) inch box every thirty (30) feet. 2.5.5.2 Existing healthy trees, where feasible, shall be Tree planting shall be grouped in informal drifts preserved or relocated on site. and tree quantities shall be determined by the length of the property adjacent to the street divided by the recommended spacing of each tree variety. All parkway planting shall be subject to review and approval of the Director Of Public Works. The Crossings at Huntington Beach Specific Plan 58 t PLANT PALETTE - SITE DESCRIPTION ROTANICAI,NAME COMMONNAMF. FRONTAGE TREE BAUHINIA BLAKEANA HONGKONG ORCHID TREE LAGERSTROEMIA FAUREI CRAPE MYRTLE METROSIDEROS EXCELSUS NEW ZEALAND CHRISTMAS TREE FRONTAGE HEDGE LIGUSFRUM J.TEXANUM' TEXAS PRIVET NERIUM OLEANDER TEFITE PINK' DWARF OLEANDER FRONTAGE ACCENT SHRUB BOUGAINVILLEA SP. BOUGAINVILLEA LANTANA SP. LANTANA FRONTAGE GROUNDCOVER GAZANIA SP. GAZANIA MESEMBRYANTHEMUM SP. ICE PLANT tNTRY DRIVE THEME TREE PHOENIX DACTYLIFERIA DATE PALM ENTRY DRIVE TREE JACARANDA MIMOSIFOLIA JACARANDA KOELREUTERIA PANICULATA GOLDENRAIN TREE PYRUS CALLERYANA TRADFORD' BRADFORD PEAR ENTRY DRIVE ACCENT SHRUB AZALEA SP. AZALEA ENTRY DRIVE EDGE SHRUB PHORMIUM TENAX FLAX ENTRY DRIVE LOW SHRUB TRACHELOSPERMUM JASMINOI DES STAR JASMINE END ISLAND TREE LAGERSTROEMIA FAUREI CRAPE MYRTLE RHAPIOLEPIS'MAJESTIC BEAUTY' INDIA HAWTHORN TREE FORM END ISLAND LOW SHRUB LANTANA SP. LANTANA TRACHELOSPERMUM JASMINOIDES STAR JASMINE ROSMARINUS OFFICINALIS SPREADING ROSEMARY END ISLAND ACCENT SHRUB ROSA SP. SHRUB ROSE PARKING LOT TREE PLATANUS ACERIFOLIA'BLOODGOOD' LONDON PLANE TREE—Generally too large for small ULMUS PARVIFOLIA TRUE GREEN' TRUE GREEN ELM islands—we would require AGONIS FLEXUOSA PEPPERMINTTREE smaller(at maturity) growing Irees. BOSQUE TREE WASHINGTONIA ROBUSTA MEXICAN FAN PALM SCREEN TREES EUCALPTUS SP. EUCALYPTUS PINUS SP. PINES AGONIS FLEXUOSA PEPPERMINT TREE PARKING GARAGE SCREEN TREE TRISFANIA CONFERTA BRISBANE BOX PARKING GARAGE PLANTING BOUGAINVILLEA SP. BOUGAINVILLEA TRACHELOSPERMUM JASMINOI DES STAR JASMINE SPECIMEN TREES ERYTHRINA CAFFRA KIFFIRBOOM CORAL TREE SEFVICE DOCK FICUS M.NITIDA'GREEN GEM' FICUS COLUMNS SCREEN TREES PODOCARPUS MACROPHYLLUS YEW PINE PRUNUS CAROLINIANA CAROLINA LAUREL CHERRY Plant Materials Palette 1 Exhibit 12 The Crossings at Huntington Beach Specific Plan 59 2.5.5.G Pedestrian walkway systems shall be designed to Perimeter parking lots adjacent to arterial streets unify the entire project area and provide pedestrian shall be provided with additional landscape site access to buildings, parking and site activity treatment to ensure that the parking areas are areas from the perimeter project area and from adequately screened from adjacent street views. within the site. Pedestrian walkways shall be a Berming in these areas is encouraged and shall be a minimum of five (5) feet clear in width with no maximum of three (3) feet high and have a natural vehicular overhang. appearance in form. However, the fact that a successful retail shopping center must be seen from 2.5.5.7 Perimeter landscaping around the project areas the adjacent streets will be the determining factor shall provide a consistent edge treatment using a in the selection and placement of all perimeter limited variety of plant materials. landscaping. 2.5.5.8 Parking lots shall be planted at the rate of one (1) Shrubbery shall be planted in areas where berms tree for every ten (10) parking stalls. Parking lot are not practical,such as along the perimeter of the trees shall be twenty-four (24) inch box trees. All parking areas. Shrub planting shall be provided in tree planting areas shall be a minimum net width of a minimum five (5) gallon size and spaced a four (4) feet in one direction and a net width of maximum of three (3) feet apart. Shrubbery shall four (4) feet in the other direction. Small trees (at not exceed three (3) feet in height. Hedges shall be maturity)shall he utilized in these planting areas trimmed from the ground and maintain an eight (8) inch clearance from the ground. Parking lot treatments shall be consistent and contribute to the project landscaping unity. Parking Where cars overhang the curbs, ground cover lots shall be planted with trees in such a manner as planting shall be required;a maximum overhang of to provide maximum shade. An alternative which two (2) feet shall be permitted. The overhang area clusters or groups parking lot trees may be shall not be considered as .part of the required considered. Larger trees may also be considered as minimum percentage of on-site landscaping or substitutes for a number of smaller trees, subject to minimum planter width. review and approval of the Director of Public Works. The Crossings at Huntinaton Beach Specific Plan 60 1 2.5.5.9 Perimeter landscaping shall preserve or construct a Enhanced paving (pavers, interlocking bricks, minimum ten 00) foot wide landscape buffer stamped concrete, or other similar material) shall between the arterial highway and private project be provided at all driveway entrances from the improvements, including buildings, walls, parking public right-of-way to the project. Major driveway areas, etc. Landscape improvements within the entrances, as identified on the Circulation Plan, public right-of-way, adjacent to private Exhibit 7, shall incorporate enhanced materials improvements, shall be constructed by the project frorn the property line to the back of the adjacent developer and maintained by the property owner landscape planter or a minimum of 15 feet. Minor consistent with the overall landscape theme. The driveway entrances shall provide a minimum of design shall be consistent with the approved eight feet of enhanced treatment. Edinger Corridor concept. Pedestrian connections consisting of enhanced 2.5.5.10 Landscape medians, located in the arterial paving materials shall be provided along the front highways adjacent to the project area, shall be of the satellite buildings (Barnes and Noble, Circuit maintained by the City. City, and Staples) and within the pedestrian walkway connecting these outlying buildings to the 2.5.5.11 Entry drives shall be constructed in conformance main mall. Enhanced paving materials shall also be with the Specific Plan (Policy 2.5.2.3) and City provided throughout the public plazas and from design standards (Public Works Standard Plans) Edinger Avenue at the main project entrance subject to the review by the Director of Public (across from Sher Lane) along a pedestrian path to Works. Project access points shall be designed to the main plaza. provide entering and exiting drives with adequate views of approaching pedestrians and vehicles. 2.5.5.12 Interior plaza areas and courtyards shall be provided as focal points. These areas shall be an Entry drives shall provide convenient access to integral part of the building architecture and be parking lots at various site locations. In addition to connected by a walkway system to the public street trees and on-site landscaping, each entry pedestrian walkways. shall be designated by ground cover—planting, shrubs,and large specimen trees on each side of the 2.5.5.13 Irrigation systems shall comply with the City's entry. These trees shall be located a minimum of ten "Water Efficient Landscape Requirements." (10) feet back from the intersection of driveways (Ordinance #1452). and property lines to avoid line-of-sight conflicts. The Crossings at Huntington Beach Specific Plan 61 2.5.5.14 All landscaping shall conform with the 2.5.G SIGNAGE GUIDELINES requirements of Chapter 232 (Landscape Improvements) of the Huntington Beach Zoning The Signage Guidelines identify a. framework to t� and Subdivision Ordinance, the City Arboricultural advertise a place of business, providing directions or and Landscape Standards and Specifications and information can be accomplished without detracting City Standard Plans, in addition to the Specific Plan from the overall design quality of the project area.The un J policies. Signage Guidelines also contribute to the overall project area urban retail design theme. Design, color, 2.5.5.15 Landscape screening is intended to soften and blend materials and placement are all important in creating the connection of the building areas with the signs that are architecturally attractive and integrated landscape of the parking lots. 'Trees shall be into the overall project area design. The intent is to provided to soften,and visually relieve,parking and create and promote a quality visual environment by utility areas and to provide summer shade. allowing only signs which are compatible with their surroundings and which effectively communicate Trash enclosure areas, where appropriate, shall be their message. provided with tree and shrub planting screens to soften the enclosure. Mechanical equipment and Signs shall be designed to be architecturally transformer areas shall have landscape screening compatible with the colors and materials of the and/or low-level screen walls. Valves, meters, back adjacent building. All signing shall be consistent with flow preventers, etc., where appropriate, shall be the Crossings at Huntington Beach's sign standards screened by shrub plantings and/or low level (appendix D). screen walls. 2.5.5.16 Landscape lighting shall be provided in selected areas to aesthetically enhance the site. Pedestrian walkways shall include adequate night lighting for public safety. 2.5.5.17 Conservation water measures shall be incorporated in the landscape design. A minimum of seventy-five (75) percent of the required landscape area shall be planted with ground cover and the balance (a maximum of 25 percent) with turf. The use of shrubs, hedges, and berming shall be provided to screen cars in the parking lots from street view. The Crossings at Huntington Beach Specific Plan 62 1 DEVELOPMENT REGULATIONS aiau�a j� �g� ` � - 0001 , 4� - 1 i JA 7M��7W-j OOD Do �hH-.. Hag fil -- �- - o 1� Ww -- 00 ' 1 Section Three The Crossings at Huntington Beach Specific Plan 63 DEVELOPMENT REGULATIONS 3.1.0 DEVELOPMENT REGULATIONS_POLICIES: t 3.1.1 Not withstanding provisions to the contrary, all l� grading shall be approved by both the Planning 3.0 PURPOSE Director and Director of Public Works,or designee. The purpose of this section is to provide specific development regulations and standards that will be 3.1.2 Construction may commence only after the Planning applied to development projects in the Specific Plan. Director finds that the project is consistent with the Upon adoption by the City of Huntington Beach, the regulations and applicable policies and guidelines of Crossings at Huntington Beach Specific Plan will be the Specific Plan. the zoning document for the project area. 3.1.3 All structures in existence at the time of Specific Plan 3.1 GENERAL PROVISIONS adoption (with the exception of Auto Repair, Maintenance, Service and the bank building ) shall be The provisions contained herein shall govern the deemed in conformance with the Specific Plan. design and development of The Crossings at Huntington Beach Specific Plan area. Standards and/or criteria for development and activities not specifically addressed in this Specific Plan may require 3.2 DEFINITIONS referral to the current provisions of the Huntington Beach Zoning and Subdivision Ordinance and For the purposes of the Specific Plan, words, phrases Municipal Code. and terms shall have the meanings as defined below. Terms not specifically defined in the Specific Plan shall Whenever a use has not been specifically listed as have the same definition as used in the City of being a permitted use, the City of Huntington Beach Huntington Beach Zoning and Subdivision Ordinance shall determine if the use is consistent with the intent in effect at the time of any individual request. of this Specific Plan and compatible with other permitted uses. In addition, all projects must comply When not inconsistent with the context,words used in with the following policies. the present tense include the future tense; words used in the singular number include the plural number; and words of the masculine gender include the feminine and neutral gender. The word "shall" is always mandatory and the word "may" is permissive. The Crossings at Huntington Beach Specific Plan 64 } 3.2.1 Architectural Features. Architectural features include 3.2.8 Private drive. A privately owned and maintained elements that compliment the building architecture roadway used to provide vehicle access through the such as, but not limited to, walls, architectural towers property. and domes (with The Crossings at Huntington Beach logo), spires, and arches. Architectural features may 3.2.9 Renovation. Any request to remodel, improve, include signage as depicted in the attached signage renovate,upgrade,or refurbish the interior or exterior guidelines of an existing building, including minor improvements to accommodate new tenants or an 3.2.2 Communication Antenna. All types of receiving and upgraded look for an existing tenant. transmitting antenna,except satellite dish antenna and wireless communication facilities. 3.2.10 Site plan. A plan prepared to scale, showing accurate and complete dimensions of all buildings, structures, '3.2.3 Deviations. An adjustment in one or more landscaping, parking, drive aisles, uses, etc. and the Development Regulations in order to accommodate exact manner of development proposed for a specific special circumstances and/or unique architectural parcel of land. features. 3.2.11 Street. A public or approved private thoroughfare or 3.2.4 Entryway. The point of ingress and egress from a road easement which affords the principal means of public or private street to the individual project. access to abutting property. 3.2.5 Final approval. Ten (10) days after approval by the 3.2.12 Structural alteration. Any change in,or alterations to, discretionary body and no appeal of that decision has the structure of a building involving: the bearing wall, been filed. column, beam or ceiling joints, roof rafters, roof diaphragms, foundations, retaining walls or similar 3.2.G Modification (Minor). An amendment to the exhibits components. and/or text which does not change the meaning or intent of the Specific Plan. 3.2.13 Ultimate right-of-way. The adopted maximum width for any street, alley or thoroughfare as established by: . 3.2.7 Modification (Major). An amendment to the exhibits the general plan, a precise plan of street, alley or and/or text which is intended to change the meaning private street alignment, a recorded parcel map, or a or intent of either the Master Flan Concept, Design standard plan of the Department of Public Works. Guidelines, or Development Regulations. Major Such thoroughfares shall include any adjacent public modifications require a Zoning Text Amendment-and easement used as a walkway and/or utility easement. action by the Planning Commission and City Council. The Crossings at Huntington Beach Specific Plan 65 3.2.14 Use. The purpose for which land or building is 3.3.1 Permitted Uses. Permitted uses shall be required to arranged, designed, or intended, or for which it is meet all applicable provisions of the Huntington Beach occupied or maintained. Zoning and Subdivision Ordinance .Code. A list of permitted uses is provided in Exhibit 15. 3.2.15 Wall or fence. Any structure or devise forming a r. physical barrier. This definition shall include: wood, 3.3.2 Intensity. The maximum intensity shall be consistent concrete, concrete block, brick, stone or other with the City's General Plan. masonry material. 3.3.3 Building height. The maximum allowable building 3.2.16 Zone. A district as defined in the State Conservation height shall be seventy-five (75) feet. Rooftop and Planning Act, shown on the official zoning maps mechanical equipment and parapet walls may exceed and to which uniform regulations apply. the maximum permitted building height by fifteen (15) feet. Special themed architectural structures or 3.2.17 Zoning maps. The official zoning maps of the City of elements such as towers or domes may be allowed up Huntington Beach which are a part of the to one hundred-twenty (120) feet. comprehensive zoning ordinance. 3.3.4 Setbacks. Refer to Exhibit 1 G. 3.3 DEVELOPMENT STANDARDS 3.3.5 Landscaping. Landscaping shall be permanently maintained in an attractive manner in all setback and The Development Standards shall serve as the parking lot areas fronting on,or visible from,adjacent mechanism for the implementation of the Crossings at public streets. Huntington Beach land uses.The standards set forth in this section will assure that future development within 3.3.G Signs. All signs in the project area shall conform to the the Pacific promenade is implemented in a manner provisions of the sign standards in Appendix D. consistent with the intent of the project area Master Plan. The standards contained herein provide flexible 3.3.7 Lighting. All illumination of interior circulation mechanisms to anticipate future needs and achieve streets, parking areas, and project sites, shall be. compatibility between land uses and the surrounding coordinated to provide consistent illumination community. Standards and guidelines are designed to intensity. Emphasis shall be placed on areas of high be compatible with the existing land use categories of vehicular and pedestrian activity. Light fixtures and the City. The primary land uses in the Crossings at standards shall be consistent with building Huntington Beach shall be regional commercial,retail, architectural style. Public streetlights shall comply dining,and entertainment. with the City of Huntington Beach guidelines for street lighting. The Crossings at Huntington Beach Specific Plan 66 New building construction (over and above that permitted by the development described in Exhibit 4) of the following uses shall be permitted within the Crossings at Huntington Beach Specific Plan subject to review and approval of a Site Plan Review by the Planning Director. Other changes in occupancy, such as, like for like tenant changes, new tenants established-within existing buildings, and/or intensification of tenant uses shall be subject to building permit plan check review to verify compliance with parking and the Specific Plan review. }?j ! r ;'I pi 11111 1111111111 Y.�.76W) .l8.. iYil�.flM9r SLbf .L.91!'tik::O.s.:D.tk'. Aquarium Day Care Facilities Government Offices Parking -surface -structured -valet Banks and other financial institutions Public assembly areas * Commercial recreation and live entertainment Utilities and facilities Food Markets (Specialty Markets n.t.e 10,000 s.f.) General Retail Day Spa Hotels Motels Movie Theaters Restaurants fast food with drive-through -with outdoor dining -'with alcohol sales -'with live entertainment and dancing OFFICE Business and Professional Personal Services-----•--- -----.._...------------- — OTHER PERMITTED RETAIL Car stereo and alarm installation,ifintegrated into an anchor/major retail building Portable carts and kiosks Note:Other'Sinlilar'uses nzqybepevtnittedsal fect to veview by the Planning Div eclat: 'Requires an entertainment permit Permitted Uses Chart �► Exhibit 13a �V The Crossings at Huntington Beach Specific Plan 67 The following temporary and seasonal events may be permitted outdoors within the common areas only,subject to approval of the Fire Department and Police Department. All temporary and seasonal events within the parking lot shall follow permit procedures t described in the Huntington Beach zoning and subdivision ordinance. Art Shows Auto shows Carnivals Circus Commercial Filming Concerts Contests Farmer's Market Fund Raisers Health Fairs Live Entertainment Miscellaneous Exhibitions Outdoor Retail Sales Pet Shows Seasonal Displays and Events Theatrical Performances Note: Other sinular temporary uses maybe permitted subject to review by the Planning Director. Temporary and Seasonal Events Chart Exhibit 13b The Crossings at Huntington Beach Specific Plan 68 � l Minimum project area (AC) 50 Minimum lot size (AC) None Minimum lot frontage None Maximum building height 75 feet Maximum number of stories 4 stories Maximum additional height for parapet walls, mechanical 15 feet equipment,communication antennas etc. Maximum architectural feature height 120 feet Maximum lot coverage 50% Maximum floor area ratio Comply with zoning and subdivision ordinance Maximum setback (see No. 3 below) Street side (Edinger Ave., Beach Blvd. and Center Ave.) 50 feet,or 25 feet if setback if fully landscaped Interior side (West PLO) 10 feet Minimum landscaping 5% of total site Minimum perimeter landscaping Street side (Edinger Ave., Beach Blvd. and Center Ave.) 10 feet Interior side (West PLO) 5 feet Minimum standard parking stall size 9 feet x 18 feet Minimum compact parking stall size 8 feet x 17 feet Minimum drive aisle width 25 feet for 90 degree stalls Minimum parking required Shared analysis based upon joint use of parking analysis Maximum compact spaces 20%of total spaces Parking lot layout Primarily 90 degree stalls Parking structure design Comply with zoning and subdivision ordinance Public art requirement lAt least one piece of public art and one fountain on site Wireless communication facilities IComply with zoning and subdivision ordinance Development Regulations Chart Exhibit 14 The Crossings at Huntington Beach Specific Plan 69 i 1 • A compact parking stall size of eight feet zero TYPICAL PARK/NG LAYOUTS inches W-0") wide by seventeen 0 7) feet deep 1 may be proposed for up to a maximum of twenty � (20) percent of the total proposed parking spaces. Total parking required by the Huntington Beach Zoning and Subdivision Ordinance (see below) 0* shall be installed for each phase of the project prior to final building inspection. • Parking shall be provided in accordance with the New Shared Parking Study. A shared parking program may allow for a reduction of the code required parking by up to twenty five (25) NDARD STA PAMMM SAACS ACC&"1Ml PARMMQ SPACii STANDARD PAMUN0 SPACS percent,based upon a shared parking analysis. It is estimated that the New Shared Parking Study will Parking Standards & Detail provide a ratio of 4.5 spaces for every 1,000 Exhibit 15 square feet of development. • Handicap accessible parking spaces shall be provided as required by the Uniform Building 3.3.8 Parking. All developments will be required to meet the Code and Title 24. minimum on-site parking standards as provided in this Specific Plan document. The following shall apply: _ • Standard parking stall size may be nine (9) feet wide by eighteen (18) feet deep and may be reduced to provide a landscape curb or wheel stop (in parking structure) at sixteen 0 6) feet with a two (2) foot overhang to expand the landscaping. This additional landscape area will not be credited toward the required landscape percentage or minimctm landscape width. The Crossings at Huntington Beach Specific Plan 70 lij IniY en F.A.F.tensity ( ) Building Height Setback Front Interior Side Exterior ,Side Landscape Perimeter Landscape Front Interior Side Exterior Side Arterial Highway Development Regulations Check .List � 1 Exhibit 16 The Crossings at Huntington Beach Specific Plan 71 r ter' "r .,w• p " •� I ( fl`i.r`. 'yi'.f.�".r- �c ��-+� .- �� .I'' .. !i ti !• � i� ��1(,{I _ __tll� r:`•c� �✓'\ ..\. , t.i�'•'�'� `�L ...—� ,',:•''•..p. , __ _ ry+_ :1 l,i��•.! Y•.•'.�tu(��i r••i1�e�,1� I. .:ti,l �_:.�: • '.I •'i��, ...��•••��:•1' .•��.••'ll 1:. ���,:. `r1^.—�.,:1 1'.�:.:.f�.�.4 .b*j:.�:•i. •.•+.w.••.4.. .�w/.w.......v•:`w • � ! ' y r!'�•�'t. — _ lL` Jam. .,�� � • ���1, ..r.«.) I+ ,_ '• 711� I f•!I�.i ili IUI i• I ���' �tt� 1 i.1 , yr' 1 m; — `�_i �. ;i ° 1 jl_�'�:'I'� ''•� hI , ... 1I1'A = '' r i1, =i i�-._� I--(' •t 'll. J L� •`i- `■Y — riree�es '. �( .mot ... •... r -.,..•.::. •� • �f19 :r�_r�'��`'�_`-•___V,i..,,—-— '•• �, Ira■����un■i:�.� ,-.,.:� :o!!'�! �!'�_ �II1'.. plt'®�a e �' �!' T! I �,�L1'L'7;51 Ira oei��� 1�,�_:L vI_I��I, o ,.y ml.,rTirm!�. � rYa 1 1 IMPLEMENTATION Guidelines, or Development Regulations. Major modifications require a Zoning Text Amendment and action by the Planning Commission and City Council. 4.0 ADMINISTRATION 4.1 DEVELOPMENT CONSTRUCTION PHASING PLAN The City's Planning Director shall administer the provisions of the Crossings at Huntington Beach The proposed Specific Plan project is anticipated to Specific Plan in accordance with the State of California occur in one (1) phase. The existing strip center Government Code, Subdivision Map Act, the (Barnes & Noble, Staples, and Circuit City) will receive Huntington Beach Municipal Code, and the City's a facelift, new enhanced paving,and landscaping. The General Plan. demolition, infrastructure and utility work of the new construction, will be scheduled and built such that the The Specific Plan development procedures, remaining center remains in operation with minimum regulations, standards and specifications shall inconvenience to the remaining tenants. Construction supersede the relevant provisions of the City's Zoning is anticipated to take 1,-18 months from start of Code (Huntington Beach Zoning and Subdivision demolition. Ordinance) as they currently exist or may be amended in the future. Any development regulation and 4.2 METHODS AND PROCEDURES building requirement not addressed in the Specific Plan shall be subject to the City's adopted regulations The methods and procedures for implementation of in place at the time of an individual request. the Specific Plan shall be on a project by project basis. The adoption of the Specific Plan alone will not The Specific Plan may be amended. The Planning require infrastructure improvements to the project Director shall have the discretion to determine if area. Physical improvements will only coincide with requests for modification to the Specific Plan are the commencement of the first .project. The Specific minor or major. Minor modifications may be Plan is a regulatory document and is not intended to accomplished administratively by the Director with a be a Development Agreement. report to the Planning Commission. Major modifications will require the processing of a Zoning 4.3 MASTER PLAN Text Amendment, subject to the City's processing regulations in place at the time of the request. A Master Plan Concept (Exhibit 3) for the project area identifying primary land uses, circulation system, Minor modification is a simple amendment to' the infrastructure layout, public facilities and landscape exhibits and /or text which does not change the scheme has been prepared in conjunction with the meaning or intent of the Specific plan. Major Specific Plan. All proposed projects shall be consistent t� modifications are amendments to the exhibits and/or with the intent of the Master Plan Concept. text which are intended to change the meaning or intent of either the Master Plan Concept, Design The Crossings at Huntington Beach Specific Plan 73 - -�- - _ -_•ice_-�.- Tj `. till - ; r �,. �::;, ��r., ; -!.i 1 t - '% .,. i,' ..`•<: SAN D1Er4O FREEWAY-405 =i - ZT. rCITERAVEN1,lE',•.t :,�= a `► f4HHWH+Hi�f!�' +.. MU 11. 11 ,1. [ �:.• l,lgt,.,,,.� ;�t yr..- •: - - , �• it IO2 •1 , .911111111 �•r Site Plan Review Process Exhibit 17 The Crossings of Hunfin^ton Beach Specific Plan 74 1 4.4 SITE PLAN REVIEW materials and exterior colors. An application fee for this service shall be established by a separate Following the implementation of Phase I and Phase II resolution of the City Council. development described in Exhibit 4 individual development projects within the Crossings at The Planning Director has the authority to approve, Huntington Beach Specific Plan project area shall be conditionally approve, or deny a Site Plan Review. A implemented through a Site Plan Review process. A Site Plan Review application may also require analysis Site Plan Review shall be required for all new and comments from various departments of the City. development activity, with the exception of interior In order to approve a Site Plan Review application, the improvements, general maintenance and repair or Planning Director shall make the following findings: other minor construction activities that do not result in an intensification of the use. These exceptions may 0 The request is consistent with the City's be subject to other Building and Public Works permits General Plan and all applicable requirements and approvals prior to commencement. of the Municipal Code;and Application to the City for a Site Plan Review shall a The requested activity will not be detrimental include a narrative of the proposed activity along with to the general welfare of persons working or preliminary development plans and drawings. The residing in the vicinity nor detrimental to the narrative shall consist of a project description value of the property and improvements in the identifying the intended services offered with square neighborhood;and feet, hours and days of operation, number of employees, and other information as appropriate. 0 The requested activity will not adversely affect Supplemental to the application submission, project the Circulation Plan;and plans shall be prepared including the following preliminary plans: site plan, floor plans, elevations, 0 The requested activity will comply with the landscaping,grading,fencing and signage plans;other provisions of the Crossings at Huntington plans may be required depending on the complexity of Beach Specific Plan and other applicable the project. The entire parcel shall be plotted with regulations or special conditions required of dimensions and all pertinent data and include the project. dimensions to the nearest intersecting public street and identify all street names. In addition, all existing The action of the Planning Director shall be final and proposed physical features and structures on the unless appealed to the Planning Commission by the subject property and abutting properties shall be applicant within ten calendar days of action. Such plotted. Appeals for a Site Plan Review shall be subject to the procedures outlined in the City's Zoning and The application shall also include a legal description of Subdivision Ordinance. the property, identification of the uses for each room on the floor plans and a list of all the building ° The Crossings at Huntington Beach Specific Plan 75 1 A Site Plan Review approval shall be valid for a period Development project requests consistent with the of one year. Additional one year extensions may be Specific Plan shall not be subject to additional I requested for a maximum of two years. Such an environmental review unless otherwise required by extension request must be made in writing by the C.E.Q.A. However, the Planning Director may request original applicant, property . owners, and/or an additional environmental assessment for unique or authorized designee,a minimum of thirty days prior to unusual circumstances, that have not been previously -J the expiration of the current approval. If construction addressed in the environmental review. activity does not commence within the approval or extension period, the entitlement shall be terminated. The Planning Director 'shall impose any applicable environmental mitigation measures,as specified in the All final decisions on site plan review proposals shall environmental analysis, as conditions of approval on be the responsibility of the Planning Director. individual Site Plan Reviews. Such conditions of approval shall describe the time period and manner in 4.5 REUSE/CHANGE OF USE REVIEW which the mitigation measure must be satisfied. Any proposal to reuse and/or change the use of a 4.7 REQUEST FOR DEVIATION previously approved and constructed development, within the project area, will be subject to additional The Crossings at Huntington Leach Specific Plan review by the Planning Department. The additional Development Regulations are intended to encourage review will follow the same procedures outlined in the projects which create an aesthetically pleasing Site Plan Review process. A "like for like" change of appearance, enhance the environment, and facilitate use shall only be subject to the requirements for a new innovative quality architectural design with an certificate of occupancy; however any new adaptation to the surrounding environment. construction beyond that shall require a new Site Plan Review. In addition any proposed physical Deviations pertain only to the Development modifications to the existing structure and/or site Regulations of the Specific Plan and may be granted at shall be subject to additional review and approval of the time of Site Plan Review for special circumstances the Planning Director prior to the issuance of building and/or unique architectural features. permits. The Planning Director may refer individual projects to Design Review Board for review and as Requests for Deviation may include but are not limited final arbiter of compliance with the Specific Plan. Any to building height, setbacks, open space, parking, and decision by the Planning Department may be appealed landscaping. Deviation requests, up to ten (10) within ten calendar days to the Planning Commission. percent of any single standard, may be considered by the Planning Director. Deviations greater than ten 4.6 ENVIRONMENTAL DETERMINATION (10) percent must be approved by a Variance The extent and intensity of all anticipated development application before the Zoning Administrator, subject activity for the Crossings at Huntington Reach area has to the procedures outlined in the City's Zoning and been identified in the Specific Plan. Subdivision Ordinance. Development and construction The Crossings at Hunt ~'on Beach Specific Plan 7F. phasing of selected provisions and features may be approved by the Director concurrent with a Site Plan 4.8 SPECIFIC PLAN AMENDMENTS Review and shall not require a Request for Deviation or Variance to the Specific Plan. Specific Plan Amendments, other than a Minor Modification as previously described (Section.4.0), Deviations shall be allowed when, in the opinion of shall be made through the Zoning Text Amendment the Planning Director, significantly greater benefits process; subject to consideration and approval of the from the project can be provided than would occur if Planning Commission and City Council in accordance all the minimum requirements were met. Some with the provisions of the Huntington Beach Zoning additional benefits which may make a project eligible and Subdivision Ordinance. Such Amendments may for consideration include: greater open space, greater include changes to the Master Plan Concept, Design setbacks, unique or innovative designs, public open Guidelines policies and the introduction of alternative space, and the use of energy conservation or Development Regulations. innovative technology. The Planning Director may approve the Request for Deviation in whole or in part upon making the following findings. 4.9 SEVERABILITY • Promotes better design, environmental and land If any section, subsection, sentence, clause, phrase, or planning techniques and contribute to the portion of this title, or any future amendments or economic viability of the community, through additions hereto, is for any reason held to be invalid or aesthetically pleasing architecture, landscaping unconstitutional by the decision of any court of and site layout; and competent jurisdiction, such decision shall not affect the validity of the remaining portions of this title, or • Will not be detrimental to the general health, any future amendments or additions hereto. The City welfare, safety and convenience of the hereby declares that it would have adopted these titles neighborhood or City in general,nor detrimental and each sentence, subsection, clause, phrase, or or injurious to the value of property or portion or any future . amendments or additions improvements of the neighborhood or of the City thereto, irrespective of the fact that any one or more in general;and sections, subsections, clauses, phrases, portions or any future amendments or additions thereto may be • Is consistent with objectives of the Specific Plan declared invalid or unconstitutional. in achieving a project adapted to the area and compatible with the surrounding environment; and • Is consistent with the goals and policies of the 1\ 1 City's General Plan, and comply with State and `v Federal Law. The Crossings at Huntington Beach Specific Plan 77 1 The Crossings at Huntinnton Beach Specific Plan 78 Huntington Crossing Huntington Beach,CA. TENANT NAME SQ.FT. SlSQ.FT. RENT i ANNUAL - ANNUAL MONTH RENT THEATRE 100,000 $20.00 ! $166,666.67 $2,000,000.00 RETAILI 10,000 $23.00 ! $19,166.67 $230,000.00 i RETAIL2 40,000 $19.00 $63,333.33 $760,000.00 RETAIL3 24,000 $19.00 . $38,000.00 $456,000.00 RETAIL 4 32,500 $18.00 ! $48,750.00 $585,000.00 RETAIL 5 9,650 $19.00 $15,279.17 $183,350.00 RETAIL 6 28,400 $19.00 $44,966.67 $539,600.00 RETAIL 7 42,583 $19.00 $67,423.08 $809,077.00 RETAIL 8 129,488 $3.11 ; $33,558.97 $402,707.68 RETAIL 14,430 $17.00 ! $20,442.50 $245,310.00 RETAIL 10 25,000 $16.00 i $33,333.33 $400,000.00 RETAIL I1(THIRD PARTY OWNER) 140,000 $0.00 $0.00 $0.00 RETAIL 12 35,000 $18.00 $52,500.00 $630,000.00 RETAIL 13 4,800 $18.00 $7,200.00 $86,400.00 -- -- RETAIL 14 12,600 $17.00 i $17,850.00 $214,200.00 RETAIL 15 8,500 $17.00 j $12,041.67 $144,500.00 RETAIL 16 6,000 $17.00 I $8,500.00 $102,000.00 RETAIL 17 7,700 $19.00 $12,191.67 $146,300.00 - - RETAIL 18 1,855 $25.00 $3,864.58 $46,375.00 RETAIL 19 10,000 $19.00 $15,833.33 $190,000.00 RETAIL20 10,000 $19.00 $15,833.33 $190,000.00 RETAIL 21 7,000 $19.00 I $11,083.33 $133,000.00 RETAIL22 7,000 $19.00 ! $11,083.33 $133,000.00 RETAIL 23 7,760 $20.00 $12,933.33 $155,200.00 RETAIL24 37,160 $18.00 $55,740.00 $668,880.00^ RETA[L25 - 31,160 $18.00 $46,740.00 $560,880.00 ----__ -_ -- i RETAIL 2G _ __- 26,300- _$18.00 i $39,450.00 $473,400.00_ __ _ -____. -, •__ RETAIL A _ _ - 82,000 $8.76 $59,860.00 $718,320.00' RETAIL B --- 40,300 $13.96 i $46,882.33 $562,588.00 - _- 1 RETAIL C 8,240 $19.80 $13,596.00 $163,152.00 Page 1 Huntington Crossing Huntington Beach,CA. I I i i REST.1 I 7,300 i $14.27 ! $8,680.92 $104,171.00 I i REST , 4,200 $25.00 $8,750.00 ! $105,000.00 REST B 10,000 $19.00 $15,833.33 $190,000.00 REST C i 7,000 $19.00 ! $11,083.33 $133,000.00 REST D 3,149 i $29.00 $7,610.08 $91,321.00 REST E 24,000 $20.00 $40,000.00 $480,000.00 REST F 12,600 $20.00 $21,000.00 ! $252,000.00 I REST G 16,920 $20.00 $28,200.00 $338,400.00 i SHOPS 76,045 $23.00 $145,752.92 $1,749,035.00 i TOTAL SQUARE FOOTAGE 1,100,640 VACANTSQUAREFOOTAGE 0 I i %OCCUPIED 100.00% i I GROSS SCHEDULED INCOME $15,372,166.68 RECAPTURE(CAM) $ 1,688,896.60 VACANCY(5%of shopspace) i $152,115.60 PERCENTAGE RENT $ 105,000.00 TOTAL INCOME $17,013,947.68 EXPENSES- 1. TAXES(NEW) ; : $1,500,000.00 ; INSURANCE $ 75,000.00 MANAGEMENT(1.5%) I •. $ 230,582.50 CAM&UTILITIES($.40 sq.ft.Mo.) ' $ 178 368.00 RESERVE($.15 s .ft.Annually ! $ 165,096.00 i TOTAL EXPENSES $ 2,149,046.50 NET OPERATING INCOME $14,864,901.18 i I I - - i Huntington Crossing Development Budget (Detail) ' Land Costs Purchase Price 48,000,000 Commission 240,000 Legal 25,000 Closing 150,000 Total Land Costs 48,415,000 Fees, Permits & Studies Building Fees & Permits(687,014 X $5.00) 3,435,070 Soils, Surveys 50,000 Environmental/Toxic 50,000 Architectural: Site & Building 900,000 Landscape 50,000 Engineering: Site Civil 150,000 Electrical 70,000 Geotechnical 75,000 Consultants 250,000 Legal 125,000 Total Engineering Contingency (5%) 257,754 Total Fees, Permits & Studies 5,412,824 Direct Construction Costs Demolition(470,034 X $3.00) 1,410,102 Site Work($3.50 X 30acres) 3,920,400 Offsite Work 1,500,000 Pilings (300,000sq.ft. X$12.50) 3,750,000 Landscaping 450,000 Hardscape (200,000-sq.ft. X$18) 3,600,000 Signs & Public Art 800,000 Buildings: Fagade work for existing buildings 2,500,000 Theater(100,000 X$125) 12,500,000 1 Story Majors (greater than 10,000 sq.ft.) 108,430 sq.ft. @ $65 per sq.ft. 7,047,950 2 Story Majors (greater than 10,000 sq.ft.) 270,703 sq.ft. @ $75 per sq.ft. 20,302,725 2 story Shop Space ( less than 10,000 sq.ft.) 36,200 sq.ft. @ $80 per sq.ft. 2,896,000 1 story Shop Space ( less than 10,000 sq.ft.) 100,110 sq.ft. @ $70 per sq.ft. 7,007,700 —� Parking Deck 6,831,000 Restaurant Row(53,520 X $70) 3,746,400 _ Insurance (Builders Risk) 35,( Total Direct Construction Costs 78,297,277 Indirect Construction Costs Administrative Costs 500,000 Unrecaptured Real Estate Taxes (8 Months) 200,000 Legal 375,000 Leasing Commissions 2,750,000 Accounting 25,000 Liability Insurance 35,000 Total Indirect Construction Costs 3,885,000 Financing Costs Construction Loan Costs 7,208,448 Appraisal Fees 30,000 Loan Title &.Recording 15,000 Legal 50,000 Lender Inspection Fees 10,000 Total Financing Costs 7,313,448 Total Development Costs 143,323,549 i i - � if ��"}• . ' , i! f 17 fit .r� � ;1.1 : ems♦ ; ;' ';� _ r , ' . '�� is i�,�, .�l'.�•i; 1'• _ THE EZ' HALO {. 1� C OM PANY L s • �+•}• ,`L it , ' - ,•1' r' THE EZRI "OW C-Oi iY •tom• ' , � r -23622 Calabasas Road,, Site lop, Calaba s Cr\ 91302-1549 Phone:. (81. ) 223-3535 I �t� 1`1 � '� � ''..:, 1j fit` •Ih 1 ' '.'�'• � - I�G��i',Q.1 �i. .'t�`'I•ITR � ' �,t.�(.0 •� /�C,,)(�`'ti t ��1i�4•yt •�,M,r.��� ', '�o. 41 IL N71 .'Y'.• ; j•�,'• Q,diY� a.�� -i, •`�'.1' /■/■ SSSSSSjj, ,�.w '••�(\t?• . 77. ` t;•t Mom' �.�• �',�.�`. ... . ; VA. - - - --� - ----- _ WHEN YOU - FUNDAMENTALS 1 1 c BUILD FOR PHILOSOPHY AND APPROACH LONG-TERM SINCE THE EZRALOW COMPANY�S INCEPTION,THE FIRM HAS MAINTAINED ONE FOCUS: 4 - THE ACQUISITION,DEVELOPMENT, REDEVELOPMENT, FINANCING,OWNERSHIP, LEASING t OWNERSHIP. _ AND MANAGEMENT OF REAL ESTATE PROPERTIES IN CALIFORNIA AND THE WESTERN r . UNITED STATES. CREATION AND PRESERVATION OF PROPERTY ASSET VALUES WITHIN i YOU'RE OUR INVESTMENT PORTFOLIO HAS ALWAYS BEEN OUR ULTIMATE GOAL. I '- t , MOTIVATED BY A • Expertise in diverse geographic markets,a breadth of property type experience,and a * depth of active relationships with financial institutions,tenants,and real estate professionals VERY DIFFERENT within those markets allow us to take advantage of market trends and opportunities. • Our philosophy is to take a long term business approach that adapts to changing market SET OF CRITERIA; conditions'and economic and financial factors that affect property marketing, leasing, financing,and investment decisions. WEAVE ALWAYS • Our entrepreneurial spirit and commitment to the highest standard of excellence contribute KNOWN WE'RE IN to creative asset management and our ability to capture opportunities as they arise I� IT FOR THE LONG I THE ORGANIZATION HAUL! R I THE EZRALOW COMPANY ESTABLISHED ITS REPUTATION AS A DEVELOPER, OWNER AND MANAGER OF MULTIFAMILY RESIDENTIAL PROPERTIES IN SOUTHERN CALIFORNIA SOME 30 YEARS AGO. BUILDING ON THAT FOUNDATION, THE COMPANY )� r - DIVERSIFIED INTO OTHER GEOGRAPHIC AREAS AND PRODUCT TYPES INCLUDING BUSINESS PARKS, MID.-RISE OFFICE BUILDINGS, SHOPPING CENTERS.AFFORDABLE HOUSING,SELF STORAGE FACILITIES AND LUXURY ! ESTATE HOMES. ~ i • Our investment portfolio through the years has reflected our acquisition, ! =� development and redevelopment of more than 6 million square feet of f commercial and industrial space,over 20,000 apartment units,and 250 saes of luxury estate homes and lots. The longevity of the organization and the 1 professionalism and experience of the key executives and employees assures our continued success even in the toughest of real estate i markets. The Ezralow Company currently employs over 200 people,including 70 real estate and related professionals,and support staffwith headquarters in Calabasas and project i offices located throughout Southern California. ' • All real estate services,including acquisition analysis,financing,development,redevelopment, construction,supervision,budgeting,leasing, i marketing, and management are provided } s" in-house to insure financial control,state r i of the art information processing and efficiency of operations. t� �v • 'THE PEOPLE PERFORMANCE - HERE POSSESS A THE CONTINUED SUCCESS OF THE EZRALOW COMPANY IN A VARIETY OF REAL ESTATE - CYCLES IS SUPPORTED BY OUR PORTFOLIO OF PROJECTS WITH PERFORMANCE LEVELS - RARE HIGHER THAN THE MARKET AVERAGES IN BOTH OCCUPANCY AND TENANT RETENTION RATES. - F THIS FOUNDATION FOR ACHIEVEMENT CAN BE CREDITED TO THE FOLLOWING FACTORS: CAMARADERIE— • The Ezralow Company's reputation and financial strength allows the company to sustain growth through the acquisition and redevelopment of diverse complex projects by s seizing opportunities in changing submarkets,staying competitive,and closing deals in a ' timely manner. • A group of professionals with expertise in the full range of real estate disciplines from planning through construction to marketing supports the development and asset management of an intricate real estate portfolio. This group was responsible for the development of Beverly Park,the largest subdivision of estate homes on the west side of Los Angeles, comprising more than 250 acres having valued in excess of$300 million. • The flexible organizational structure t contributes to the company's responsiveness to E r the needs of sellers, financial partners, and tenants. Each senior executive performs a separate function within the company,operating autonomously with decision making authority Fan kft III'$t and concurrently,as part of a team,to meet the demands of any task. The Ezralow Company DaridAt Lek G•i6wAgra•Nughe; can modify the functional structure to focus all financial and human resources to complete Gary EheedmmtAl-WiEudw, a project successfully. 8W R ardw • Our strength and diversity of business relationships with a well established group of. outside professional resources enhances our in-house expertise. THEY ARE,IN THE COMPANY EXPERTISE TRUEST SENSE, THE EZRALOW COMPANY HAS A WIDE ARRAY OF EXPERIENCED,FOCUSED PROFESSIONALS - A FAMILY OF WHO ARE EXPERTS WITH RESPECT TO THE PROPERTIES AND PEOPLE WITHIN THEIR SUBMARKETS AND HAVE THE ABILITY TO ANALYZE AND EVALUATE EACH PROPERTY ON ITS PROFESSIONALS OWN MERITS, IN ADDITION TO THE MARKET AND ECONOMIC FACTORS IN A BROADER -ECONOMIC CONTEXT. OUR BELIEF IN SUPERIOR PERFORMANCE AND A LONG TERM E COMMITMENT TO THE ORGANIZATION IS ENHANCED BY OUR SENIOR EXECUTIVES DIRECT tj WHOSE EFFORTS PARTICIPATION IN THE OWNERSHIP OF THE COMPANY'S PORTFOLIO. COMPLEMENT • The longevity of the organization and the continuity of the key executives have allowed the development of the in-house skills necessary to promote the firm's ability to function EACH OTHER smoothly and efficiently. t • The Ezralow Company develops new divisions as required to meet the demands of a ' i changing real estate environment. j .....�.-.. :• .- .r..... .. •. •.•A4�Yu"vx:a.•:+y';l�•w.r'rvtii•;:vx.{..�tt..:.w.�y+•n �{o t i •: ��.. Marshal S Eirakr 1 DIVERSITY AND I i GOOD TIMING I ARE A STRONG i HEDGE AGAINST ••? �� '.i THE CYCLES OF =! i OUR BUSINESS' i STRATEGY FOR 7 THE FUTURE OUR STRATEGY FOR FUTURE GROWTH 15 TO CAPITALIZE ON MARKET, ECONOMIC, AND FINANCIAL OPPORTUNITIES BY REACTING QUICKLY TO THE CONSTANTLY CHANGING REAL ESTATE ENVIRONMENT. OUR FORMULA FOR CONTINUED SUCCESS IS AS FOLLOWS: - I • Continue to innovate and I expand into new geographic regions and products where market opportunities exist. � v. Utilize The Ezralow Company's financial strength, longevity and track record, p p strategic alliances and affiliations within the real estate community n- for the acquisition or joint venture of individual assets,investment properties, loans and loan 4 portfolios. The underlying assets for the transactions can be commercial or residential, performing and non-performing, and owned by financial institu- tions,private investment groups,or private individuals. • Capitalize on o-ur access to capital through an extensive network of relationships with investment firms and financial institutions. • Apply our depth of market, financing and product t expertise to act quickly and close transactions in a timely manner. Employ our ability to evaluate,restructure,improve performance and skillfully manage assets for long term value enhancement. • Work on a principal-to- principal basis, ensuring ? confidentiality,and the highest �.^ degree of success and prob- ability of closing. ■ i 1 COMPANY EXPERTISE Marshall S. Ezralow,founder of The Ezralow Company,is its key decision maker and the person who ultimately determines its philosophy, direction, and goals. Under his leadership, the Company has developed more than 20,000 apartment units in Southern California and over 6,000,000 square feet of industrial,office, retail, and other residential projects, most of which the Company retains for its investment portfolio.Mr.Ezralow's insight and determination are the driving force behind the Company's continued success in diverse real estate products in a variety of markets. Bryan R. Ezralow develops and implements the Company's strategic planning decisions, including determining liquidity requirements,sourcing acquisitions,evaluating equity and financing opportunities,and managing the Company's investment portfolio. Gary E. Freedman structures, negotiates, and manages the Company's major equity and financing relationships and is a key participant in the formulation and implementation of strategic planning as relates to such relationships. He is also responsible for the implementation of operating strategies for the company. lotDavid M. Leff directs the acquisition and disposition of real estate assets and manages the leasing operations for Brymarc Management, the in-house management affiliate for the Company's residential, commercial and industrial properties. Cristina Agra-Hughes controls the integrated business operations of all functions of the Company,ranging from acquisition and financing to development and disposition, as well as heading the Company's affordable housing affiliate. Lara S. Bridges directs the property management function of Brymarc Management and is the manager of the Company's management information systems,responsible for the Company's operating,accounting,and financial management systems and procedures. Jeannie A. Nolan is the Company's human resources director, responsible f development and administration of personnel-related programs, policies, training, a. recruitment procedures. . , � _ •. :� • 4•� i+i ''•� • { S '' I ( � °; j\ � { i �,� s>� � �!� � � � .(�1.• �� is •i (e �` ;��. � 1 . ,. ����,• 1•� (� �2 ! ,��+ _ �.� , r • ;L�i 4�.std� .. � . l ,..' i �S. i, �i �� t;• .i � j� � of% . • `I�: �.. _� �� -y :� ,;: t i r ti,�t, ,1 ��� � • � i j , ��, t. �,,/ ��. iJfJ( '� t.� �"j�� i •� N' , •• •• 949949 • ..too•000000 C y 060000 ••-•:•• - •••• 0 \ /, t�SunAnrcrica 1 .0309 11.000 (NYSE$All 10.000 8.000 7,000 6.000 5,000 4,000 3,000 2.000 LOW 1990 1991 1992 1993 1994 1995 1996 1997 1998 Index:1990=100 THE BEST-PERFORMING STOCK ON THE NYSE 1990 TO 1998 SunAmerica has established itself as a leader in one of the country's fastest-growing markets: retirement savings.Today,SunAmerica provides IX million Americans with a broad range of high=quality retirement savings products"and services designed,to help them secure a sound. financial future. Along the way.SunAmerica has exceeded virtually every financial services industry benchmark . for performance and has consistently provided a return on shareholders'equity far above industry averages. SunAmerica's commitment to the highest performance standards—and investors' recognition of this commitment- is perhaps best exemplified by its stock price which,adjusting for splits, has appreciated more than 10,0000/0 during the decade, from a low in November 1990 of$0.78 to a high as of November 23, 1998 of.$81.19. SunAmerica is fully confident of the retirement savings market's growth potential in the coming decades,particularly as the full impact of the aging baby boom generation is realized. Similarly,SunAmerica is highly confident of its own ability to maintain a leadership position in the market.The company's inherent strengths,combined with the many new opportunities presented by its pending merger with American International Group, Inc..set the stage for continued strong growth and a prosperous future. E COMPANY OVERVIEW EQUITY SunAmerica is a financial services companyCAPITAL specializing in retirement savings and invest (In Billions) 7 ment products and services.The company has approximately $110 billion of assets on which it earns fee or spread income.The SunAmerica life companies (SunAmerica Life, Anchor M National, CalAmerica, First SunAmerica and ,'-z,, SunAmerica National) collectively rank among the largest issuers of fixed and variable annu- $1.9 �y ities and guaranteed investment contracts in - *See foqtnote 5 of Financial Highlights. MARKET CAPITALIZATION an Billions) $17.6 the nation. These companies also rank in the top 2% of all U.S. life insurance companies based on assets. SunAmerica's broad-based distribution encompasses its six wholly owned •'` broker-dealers: Royal Alliance, SunAmerica Securities, Advantage Capital, FSC Securities. Sentra Securities and Spelman & Co., collec- lively known as the SunAmerica Financial Network.SunAmerica's distribution also includes an extensive network of independent broker- dealers, national and regional securities firms, insurance agencies and major financial institu- tions. SunAmerica Asset Management Corp. manages more than $3 billion of mutual fund assets and serves as an investment advisor for SunAmerica's variable 2nnuities. Resources Trust Company, which focuses exclusively on self-directed retirement plans, provides trust services to .more than 200,000 retirement accounts with combined assets of$13 billion. Imperial Premium Finance is one of the nation's ?% leading insurance premium finance companies. TABLE OF CONTENTS $4.5n letter to Stakeholders page 1 ys. American International Group,Inc.Profile page3 *At November 23,1998,Including the companys The Retirement Savings Market page 4 Growth page 6 Strategies page 10 Investments page 14 Financials page 17 i; ... ... .... . . .. . .. HISTORY OF GROWTH 1971 SunAmerica Inc. (formerly Kaufman and Broad, Inc.) diversifies into financial services with its acquisition of Sun Life Insurance Company of America(founded in 1890 and renamed SunAmerica Life Insurance Company in 1995). 1983 SunAmerica Life Insurance Company begins the shift to retirement-oriented savings products by establishing an annuity marketing division. 1986 The company enters the variable annuity market with the acquisition of Anchor National Life Insurance Company and its affiliated broker-dealer. 1988 SunAmerica Life Insurance Company and Anchor National initiate an 18-month divestiture of all mortality-based life insurance operations. 1989 The company is established as a stand-alone financial services firm marketing its products under the name of "SunAmerica:' 1990 With the acquisition of $4 billion of assets under management, the company expands to encompass mutual funds, investment counseling, retirement trust services and an additional broker-dealer. 1995 SunAmerica acquires Imperial Premium Finance and establishes SunAmerica National Life Insurance Company, rated "AAA' by Standard & Poor's. 1996 The company acquires $5 billion of annuity business and adds a broker-dealer. 1997 SunAmerica is added to the S&P 500 Index and acquires $5 billion of annuity business. 1998 The company adds three broker-dealers and enters into an agreement to acquire$5 billion of annuity and life business. SunAmerica agrees to an$18.5 billion merger with New York-based American International Group,Inc. FINANCIAL HIGHLIGHTS As of and for the years ended September30. (In millions,except per-share amounts and percents) 1994 1995 1996 1997 1998 Total sales $2,371 $ 3,423 $ 3.165 $ 5,329 $ 8,541 Annuity sales 989 1,516 •1,923 2,798 3,680 Net investment income $ 294 $ 366 $ 493 $ 679 $ 842 Fee income 171 199 248 318 459 Pretax income 240 280 392 537 707 Net income' 165 194 274 379 516 Net income per diluted share'•= 0.80 0.96 1.32 1.81 2.34 Operating earnings per diluted share'-'-' 0.88 1.08 1.42 1.91 2.47 Average invested assets $8,920 $ 9,897 $14,355 $20,859 $ 25,031 Variable annuity assets 4,513 5,263 6,380 9,515 11,405 Total assets 14.656 16,844 23,727 35,637 39,200 Assets on which fees or spread income is earned' $33,118 40,025 56.503 91,173 109,817 Equity capital' $ 961 $ 1,266 $ 1,898 $ 3,510 $ 3,918 Market capitalization1.' 1,690 2,522 4,477 8,675 13,220 Book value per share' 4.20 5.93 7.80 13.40 16.02 Return on average equity 16.9% 17.7% 18.8% 21.2% 19.9% Average diluted shares outstanding' 186 186 199 206 220 'Before$33.5 million($0.18 per diluted shoe)cumulative effect of change in accounting for income taxes in 1994. 'As restated to reflect a change in calculation of earnings per share. 'Defined as after-tax income per share before net realized investment gains and losses-a common performance measure used by financial analysts. 'Includes total investments and variable annuity assets held in separate accounts on the Company's balance sheet;assets managed in mutual funds and private accounts;assets under custody in retirenknt trust accounts;and non-proprietary and advisory assets in the SunAmerica Financial Network. 'Includes preferred securities of grantor tests and the company's VA%PERCS•Units •Includes the Company's 8%%PERCS•Units and net unrealized gains on debt and equity securities available for sale. 'Market capitalization at November 23,1998 totaled$17.6 billion. /go F- 2 . - 1 — • TO OUR STAKEHOLDERS I I 1998 WAS A WATERSHED YEAR FOR SUNAMERICA as The result has been a history of performance of we signed a definitive agreement to merge with American which we are exceedingly proud,and more importantly, International Group,Inc.(AIG),the leading U.S.-based which now positions us for continued growth and international insurance company.This merger positions success in the coming millennium. our combined operation as a global leader in the two Our strong performance in fiscal 1998 represents a fastest-growing sectors of financial services:retirement continuation of notable achievements throughout the savings and international markets.For SunAmerica,it is decade. In fact,as we close the year we report record a passport to future growth. operating earnings,while also achieving record sales and We established our company with the simple yet high return on shareholders'equity. prescient vision that America's vast population of baby Operating earnings per share rose 29%in the past boomers would soon be faced with the difficult year.Total sales increased 60%to a record$8.5 billion, challenge of saving for retirement.We built SunAmerica with our variable annuity product sales rising 40% i on the notion that people would need long-term to$3.5 billion. investment products and, equally important, financial In addition to strong internal growth in 1998,we ! advice to guide them to a secure future. also announced the acquisition of the life and annuity We also built this enterprise on the belief that the business of MBL Life Assurance Corp., which will give financial services industry would undergo rapid and us$3 billion of fixed annuity reserves,and$2 billion of irrevocable change.As regulatory reforms weakened the universal life policy reserves.This acquisition will also walls between financial services sectors,technological give us a foothold in the 4O3(b) qualified retirement innovations began to redefine everything from distribution savings market. channels to product features to customer service. 1998 also saw several major milestones achieved. ti We knew our company must be agile,opportunistic. We recorded our first two quarters of billion-dollar vari- flexible and unhindered by the status quo.We did not able annuity product sales. Our guaranteed investment want to be bound by the traditions and paradigms that contract (GIC) sales exceeded $4 billion for the year. have defined many large financial institutions.In short, Market capitalization passed the$17.6 billion mark,and we instilled in our company a new culture—and it became the company now earns fee or spread income on nearly our single greatest competitive advantage. $110 billion of assets. .2 # All 4. .y •. J -2 — technology and artificial intelligence. This investment 21%.Our return on ec OPERATING EARNINGS has helped us keep a lid on costs, boost productivity, to nearly 20% in 19S PER SHARE* assimilate new blocks of business cost-effectively,and has grown from$184 improve our service to policyholders. to more than $17.6 And we've been relentless in building a brand name. performance,SunAme In 1998 we continued our national network television stock on the NYSE c advertising campaign,which has helped us achieve a ' than 10,000%from f lgGo $2.47 dramatic increase in consumer awareness of our company. high on November 2F We made the bold decision this past year to embark It has been a pie i on a partnership with AIG. Our reasoning was simple: this past decade. I We believed that the two most important market sectors directors for its guid in financial services going forward would be retirement to thank our manage $1•42 savings and international markets. their dedication anc $t 08 Our partnership with AIG is one of complementary results they have pro, 50.88 `'" strengths.It's also a partnership of growth. The combi- into the new millenr nation of AIG and SunAmerica creates a global financial ; the strength of our services powerhouse that will have unparalleled domes- ; powerful synergies it tic and international distribution.And with its "AAA" It is indeed a pi 7 rating,it will not only have lower cost of capital,but will t i also be a beacon for cwstomers in the current flight to 94 95 96 97 98 quality caused by volatile economic times. j *Calculated an a diluted basis. SunAmerica will become a standalone subsidiary of AIG, and serve as its flagship retirement savings F[MERGERcompany in the U.S. and abroad. SunAmerica will retain its family of retirement savings businesses, This stellar performance comes as a result of our as well as its valuable brand name. This structure commitment to three core strategies: distribution, will enable us to maintain a culture that is decisive, ! branding and technology.These strategies,coupled with aggressive,quick and opportunistic. ' superior product performance and our extensive network Our company has come a long way from the time we of financial professionals, have allowed us to grow spun off our homebuilding business in 1989 and staked quickly,consistently and ahead of expectations. our claim as The Retirement Specialist.Since 1990,our j We realized early that in order to succeed over operating earnings have grown at a compound annual the long-term,we had to be more than just a product rate of 32%,and our assets held have grown at a rate of j manufacturer. We had to have access to, and i control of,broad-based distribution. In 1993 we i I set a goal to grow our distribution ranks to 10,000 financial professionals by the end of the decade. OUR CULTURE ' At the time,we had two broker-dealers with about r 3,400 affiliated representatives. I'm pleased to OUR GREATEST I report that this year the number of registered IS V U R I representatives within the SunAmerica Financial Internal- COMPETITIVE { Network reached 9,700,giving us the fifth-largest u e(,FU.S.-based inte retail securities sales force in the country. ADVANTAGE- We I We also invested early—and significantly—in industrial coverEG technology. We were one of the first financial services companies to make extensive use of imaging i I i I i i f I �Rr.•..... ;,+...ew.•...,........:.........>r,..•.�............................. �92 hr 3 — j21%.Our return on equity has grown from 10%in 1990 j to nearly 20°k in 1998,and our market capitalization RETURN ON EQUITY :. has grown from$184 million at the start of the decade to more than $17.6 billion today. As a result of this performance,SunAmerica has been the fastest-growing stock on the NYSE during this decade, growing more ;r F Tu + than 10,000%from its low in 1990 of 78 cents to a PRO i �+ `n i high on November 23,1998,of$81.19. i u It has been a pleasure leading SunAmerica through .�w J 1 ' this past decade. I would like to thank our board of 21 2% directors for its guidance and vision. I would also like 19.9% " 18.8% to thank our management team and our employees for 16.9% their dedication and hard work, and for the superb results they have provided our shareholders.As we head into the new millennium,we see great opportunity in the strength of our existing businesses, and in the ! 1 powerful synergies from our union with AIG. It is indeed a passport to future growth. c i } J, AMr *Ow "0 NIP i MERGER OPENS sa 95 96 97 sa :I DOOR TO GLOBAL EXPANSION. ELI BROAD CHIEF,EXECUTIVE OFFICER I December 4, 1998 i I I s , , INTERNATIONAL GROUP, . t i I WORLD LEADERS IN INSURANCE AND FINANCIAL SERVICES ; Group,American International Igo ! U.S.-based international insurance organization and financial services insurance in approximately . industrial coverages in the United States. Its member of financial services businesses. among the largest underwriters of commercial and countries and jurisdictions,and are engaged in a range t t f THE 0. ETI REM ENT SAVINGS MARKET i THE CHANGING LANDSCAPE-� OF ' RETIREMEN-T SAVI N GS I f —5 — »»»»»»»»SPURRED BY AN UNPRECEDENTED CONFLUENCE OF DEMOGRAPHICS AND SOCIETAL TRENDS, RETIREMENT SAVINGS HAS EMERGED AS THE FASTEST-GROWING SECTOR OF THE FINANCIAL SERVICES MARKET.«««««««««««««««««« >CONSIOER THAT: outside of employer-sponsored qualified plans and • The life expectancy of Americans continues to Individual Retirement Accounts available to individ- rise.A person born In 1900 lived to be about 47 ual investors. The company also offers guaranteed years old.However,a man born in 1940 can expect investment contracts,trust services,mutual funds and to live to at least age 75;a woman can expect to brokerage services. live to age 77 or older. Lifespans are expected to SunAmerica has experienced significant growth continue increasing thanks to medical innovations during the past several years as an increasing number and improved quality of life. of Americans have realized that tax deferred annuities • Company-funded defined benefit plans are rapidly can play an important role in their retirement savings being replaced by defined contribution plans that strategy. The company now faces its newest— and require employees to contribute to and manage largest— potential customer base in the baby boom their own retirement savings. generation. SunAmerica possesses the strategies, • The U.S. remains one of the most undersaved workforce, products and.services to meet the needs countries in the industrialized world. of this extraordinary emerging customer base as its ' members strive to ensure a secure financial future for >HERE COME THE BABY BOOMERS themselves and their families. Added to these issues is the aging of the largest demo- graphic group in the history of our country: the baby boom generation. As the oldest of the 76 million individuals born between 1946 and 1964 come within U.S. VARIABLE shouting distance of retirement, they are making j ANNUITY SALES their presence felt as the newest customer base for i retirement savings products and services. an Bill m) Baby boomers' growing focus on their financial ' future is well-founded.Perhaps more than any previousy onfi � $87 generation, they will have to rely significantly i Q�0 $74 i personal savings in order to ensure financial security during retirement.Indeed,many financial professionals believe that individuals will require up to 80%of their $50 $51 pre-retirement income to sustain a comparable standard ? :.� of living during retirement. $29 ' i h >SUNAMERICA. $12 $17 I i<: THE RETIREMENT SPECIALIST SunAmerica is uniquely positioned to serve this burgeon- 9 5 ing baby boomer market because it is focused solely on 's retirement savings. Its high-quality lineup of products 90 91 92 93 94 95 96 97 and services includes fixed-rate and variable annuities, the only long-term tax-deferred investment products I , I lb • ...• • .� .. :: .•... ._. � ; .: :? :.:..:•:..:ytiill�l•?f� i"�iafMy�}4 TOM 'M1.i•O. 7 •}'i S!'•id'+rwEt:i7: �:i:::,w'' �':' t'�!•�r":v='i:,;' ,t t t . °t-• 1 y. rz. y c� x: • L• 3 »»»»SUNAMERICA ESTABLISHED ITSELF NEARLY A DECADE AGO AS A FINANCIAL SERVICES FIRM FOCUSING SOLELY ON THE BURGEONING RETIREMENT SAVINGS MARKET.««««««« Since then, the retirement savings market has experi- Depending on their investment goals, investors can ; enced tremendous growth.A strong indicator of America's choose from among the following investment options: retirement savings boom is the strong growth of the growth,moderate growth,balanced growth or conserva- variable annuity market. tive growth. Each option is co-managed by five highly SunAmerica itself has also grown rapidly to meet respected portfolio managers. Customers can simply the demands of this expanding market, providing a choose a new investment option as their investment broad range of retirement savings products and services. needs change over time.In 1999,SunAmerica expects - to launch Seasons Select, an enhanced version of >AN N U IT I E S Seasons that will include large-,medium-and small-cap a.N SunAmerica's annuity sales were a record$3.7 billion portfolios,as well as international and bond portfolios— in 1998.Variable annuity product sales represented the each of which will be co-managed by three leading vast majority of this year's total annuity sales,reaching investment firms. a record $3.5 billion. In fact, SunAmerica's variable Most recently, SunAmerica launched Polaris Plus, annuity product sales have more than quadrupled a variable annuity designed specifically for the qualified during the past five years, and its market share has 403(b)market. Polaris Plus offers customers a similar more than doubled, from 1.7% to 4% in the most array of variable portfolios and dollarcost-averaging recent quarter.The continued strength of SunAmerica's variable annuity product sales reflects the quality of its products, the strength of its distribution network, the effectiveness of its strategies to increase awareness ANNUITY AND G I C ` of the SunAmerica brand, and consumers' increasing RESERVES willingness to tap the equity market to accumulate long-term tax-deferred savings. X. $'20.2 ) , Polaris", SunAmerica's flagship variable annuity, $32.8 offers investors 26 variable portfolios managed by nine $29.5 highly respected money managers. Nine of Polarisns15 domestic equity portfolios have one-year returns wellabove the Morningstar averages for domestic stock funds. Similarly, seven of the 10 Polaris" domestic stock portfolios established at least three years ago have three-year returns that soundly beat the Morningstar $13.7 average for domestic stock funds. As testament to $11.8 consumer demand. Polarisu is now the top-selling . individual multi-manager variable annuity in the nation. Polarisu also features five fixed-rate options, a choice of death benefits and two dollar-cost-averaging options,which enable investors to systematically trans- fer funds from fixed accounts to equity and bond 010 aw Im 480 WW portfolios during six-or 12-month periods. • 94 95 96 97 98 Polarisu is joined in the SunAmerica variable Fused Annuity %; Variable Annuity M 6ICs annuity lineup by Seasons, a first-of-its-kind product that offers four simple "check the box" strategies. %97 _. .. • i' SunAmerica also continues to enhance its #"�M �W»•»�"•""""" ••--•••••»«_... 8 products with new features. The company added r a its Income Protector feature to Polarishf and Polaris S U N A M E R 1 CA'S Plus in 1998.and expects to add this"living benefit" MUTUAL FU feature to Seasons in early 1999. Income Protector ND provides variable annuity policyholders with a guar- SALES�'jn b anteed minimum level of income for the rest of their NEARBY �+V UBLED lives,regardless of equity market performance.* = THIS Y •SunAmeria's variable annuities and mutual funds are offered ISM EA R by prospectus only.The prospectus includes detailed information, ISM. .. f including charges and fees. Investors should read the prospectus ' •• .. . •'1�8 carefully before investing. ' »». » >THE SUNAMERICA accounts provided by Polaris", as well as three fixed-rate options. FINANCIAL NETWORK And in 1999, SunAmerica anticipates the intro- In recent years, SunAmerica has focused intently on duction of a new variable life product. The product expanding its network of wholly owned broker-dealers, marks the company's entry into the variable life market, collectively called the SunAmerica Financial Network. and its first joint product marketing effort with AIG. This growth strategy is driven by the company's ever-increasing need for guaranteed "shelf space" for its retirement savings products, as well as consumers' awareness that they need assistance from financial professionals to manage their retirement savings strategy. S U N A M E R I C A In 1993, the company established an ambitious ANNUITY SALES goal of increasing the number of independent regis- tered representatives affiliated with the SunAmerica an Billions) s Financial Network from a then-modest 3,400 to .•- -• 10,000 by the end of the decade.In the ensuing years, ;3.7 the company stepped up its recruitment of experienced if•.Gi[�,N�N� + _ financial professionals and also acquired several well- _ A SxARE 1 established broker-dealers,including Financial Service j 1tAARKE�i 52.8 j47 Corp., Keogler Morgan, Advantage Capital, Sentra Securities and Spelman & Co. These acquisitions brought the total number of financial professionals affil- iated with the SunAmerica Financial Network to 9,700, $1.5 � placing the company solidly ahead of schedule to ! i �I ;1 0 � • j ;•, meet its growth goals.Today,the SunAmerica Financial '• I i j' ,� Network represents the fifth-largest retail securities I 1 sales force in the nation. i >MUTUAL FUNDS aw 40 d SunAmerica's registered investment advisor,SunAmerica 94 95 96 97 98 Asset Management Corp., manages more than $3 ®Variable Annuity (♦yixed Annuity billion of assets, including a family of 21 mutual Products Product: funds available for sale through the SunAmerica Financial Network, financial institutions and other broker-dealers across the country.The firm also provides 4. err r:.Y•iwAvi,;r;=iWl.:;u•:.ss�..:•'.;a:Jr::•AC.ia1t.':r{r.:. nr.�:.;:,rr.,k�'!. ...:.:•r:.R_.•,,.. .. .�a...�..::..::=•.� - •� I r r private account management services and serves as investment advisor for most of SunAmerica's ASSETS ON WHICH variable annuities. SUNAMERICA EARNS FEE SunAmerica Asset Management Corp.posted record OR SPREAD INCOME sates during fiscal 1998, nearly doubling sales over the previous year. (!n Billiour) The firm's outstanding performance was driven largely by its Style Select Series of mutual funds, which more than doubled in assets, and by solid Ef`350'GEC` $110 performance in many of its internally managed funds. Style Select Series offers several different core P G�GwS� ..• "'~ $91 investment styles and asset classes,each co-managed by tt three highly respected,top-rated mutual fund managers. This year,the number of"style"portfolios available $57 in the Style Select Series was increased to nine,including .. . . the Style Select Series focus Portfolio.This portfolio $40 seeks long-term growth by using three leading inde- $33 pendent money managers, each of whom manages one-third of the portfolio by choosing 10 favorite stocks. All of the SunAmerica mutual funds, as well as the Style Select Series, were enhanced by a new asset 4W fD 1W AM 4W protection plan, the first to be offered in connection 94 95 96 97 98 with a mutual fund. This option ensures that in the event of the investor's death, the beneficiary will receive — between insurance proceeds and account value —an amount equal to the original investment, such as new"AAA"-rated products for investors with very plus a 4%annual growth rate. low tolerance for credit risk, and products designed for international investors. SunAmerica issued more than pc� $4 billion of new GICs in fiscal 1998,making it the largest U.S. issuer of new GICs for the year and increasing its i GIC reserves by 51%,to$8.4 billion.SunAmerica is the SUNAMERlGA f largest international issuer of GICs and the fifth-largest ISSUED $4 B 1 LL I 0 N GIC provider in the country based on reserves. OF NEW GIGS >TRUST SERVICES AND PREMIUM FINANCE IN1998■ Resources Trust is one of the largest trust companies in i 1�8 the U.S.focused exclusively on self-directed retirement -••• """""""""""" plans. It earns fees by providing custodial services to more than 200,000 IRA, Keogh, 401(k) and pension >GUARANTEED INVESTMENT and profit-sharing accounts,collectively holding nearly $13 billion of assets. CONTRACTS Imperial Premium Finance is one of the nation's The company complements its retail annuity and mutual leading insurance premium finance companies.In fiscal fund businesses with guaranteed investment contracts ,1998, the company financed more than $1.6 billion (GICs), which are sold to institutional customers. of property and casualty insurance premiums for small- SunAnerica has distinguished itself through innovations and medium-sized U.S.businesses. i r —12— s • f among national brokerages, and will gain a solid SUNAMERICA foothold in the qualified 403(b)retirement savings mar- FINANCIAL NETWORK ket through its acquisition of the individual life and AFFILIATED REPRESENTATIVES individual and group annuity business of MBL Life Assurance Corp. A total of 70,000 financial professionals are now »�---- licensed to sell SunAmerica annuity products. Collectively, this diverse group of distributors gives # D1STRl�N SunAmerica access to customers coast-to-coast. { =� , 9,700 SunAmerica also continues to invest in its .� marketing organization to enhance the sales potential in each of its distribution channels. The company 6,600 increased its ranks of field marketing representatives 5,200 and its internal wholesaling force significantly this j 4,300 year.In addition,it successfully implemented programs I within its internal wholesaling organization to increase sales of SunAmerica products. One program focuses on enhancing relationships among registered represen- tatives with whom SunAmerica has ongoing relation- ships in order to earn a greater share of their business. 94 95 96 97 gg Internal wholesalers are also increasing the total number of professionals who sell SunAmerica products by identifying qualified registered representatives. As a result of this effort, more than 4,400 registered In addition to the SunAmerica Financial Network, representatives sold SunAmerica products for the first the company markets its products through a broad time during the year.The effectiveness of the company's range of distribution channels,including other indepen- internal wholesaling initiatives was underscored by a dent broker-dealers, national and regional securities recent survey of brokers in multiple distribution channels firms, financial institutions and general insurance who ranked SunAmerica's outbound telemarketing first agencies.In fact,these distributors account for approx- in the industry. imately two-thirds of SunAmerica's annuity sales. During the 1998 fiscal year,SunAmerica increased sales in virtually all of these »».....«••••••. channels.For example,the company saw a major expansion of shelf space for its THE SUNAMERICA € j variable annuity products among financial j institutions as it launched Polarise in ; FINANCIAL NETWORK Opp[K _ several new markets. Expanded shelf t space,combined with continued popularity IS THE FIFTH LARGEST , of SunAmerica's products, resulted in a IL SECURITIES doubling of variable annuity sates within BETA this channel during the year.The company = E SALES FAR = is now ranked among the top 10 sellers of i variable annuities in financial institutions. t IN THE U S •.. • The company significantly increased sales volume of its proprietary products r »............ '»" ""»»" •»" » 00 :y -13— >BRAND-NAME AWARENESS jggg.••......................... SunAmerica for many years achieved stellar sales ._._..._....•_"""" results and improved its market share without a THE S UNAI►+ERICA j well-recognized brand name.However,the com- pany realized that it was imperative to establish WEB SITE GIVES strong brand-name awareness as a way to achieve market leadership and distinguish itself POLICYHOLDERS from a rapidly increasing number of competi- tors. Thus in 1995, it launched its first SECURED ACCESS TO national television advertising campaign, fol- e towing it up in 1997 with a second multi-year, ACCOUNT INFORMATION r multimillion-dollar national advertising pro- gram that will continue through 1999. VIA THE I N T The current campaign features a trio 1 1 ER N ET. of ads that position SunAmerica as The ' �......•.................. i Retirement Specialist and remind consumers . not to"leave your future to chance."The ads have appeare d during major sports events such as SunA merica's use of technology has also been of Wimbledon, Super Bowl Sunday,the World Series,the critical importance as it has acquired blocks of annuity NBA Eastern Conference Finals and the U.S.Open golf business and integrated them into its existing opera- tournament.Another key component of the campaign tions. Including the pending addition of the individual is a multi-year partnership with NBC Sports.The pact life and individual and group annuity businesses of includes The SunAmerica NBC Sports Desk,a national MBL Life Assurance Corp.,SunAmerica during the past sports highlights segment hosted by NBC sportscasters. few years has acquired$13 billion of annuity reserves, SunAmerica's national advertising campaign has representing approximately 540,000 individual investors. y proven highly effective:Since the program's inception, The company's technological capability enables it to consumer awareness of the company has increased assimilate these businesses with virtually no disruption dramatically. to day-to-day business.Even more impressive is the fact that per-unit servicing costs continue p�+� to decline even as these businesses are added. SunAm' a ICu. The company has enhanced customer service by providing its policyholders secured access to a broad range of account information via its Internet site,wwwsunamerica.com.The i site also offers a forms library for registered representatives,and several financial planning tools, including interactive retirement plan- ning calculators and a wide range of real-time >TECHNOLOGY financial data. I SunAmerica has continued to improve upon and expand SunAmerica also launched Vision 2020, a fully ' 1 its technology platforms to reduce costs, improve integrated front-end system that enables representa- service and increase productivity—critical competitive tives affiliated with the SunAmerica Financial Network advantages as the company has increased its customer to manage a wide range of client information and base and expanded its businesses. transactions on-line. I - r Y INVESTMENTS i SUNAMERICA HAS • ACHIEVED CONSISTENT i INVESTMENT i' • PERFORMANCE DESPITU. VOLATILE MARKETS Mt y7 z• . ::v.A�q .•v..;'"y,}�cjortivnx><1 iciah+i::}.'d,`.•:tiiD}(:v 'r:j�'•'•:;5.. •^'.'9`lavrC:� .. i r »»»»SUNAMERICA'S INVESTMENT PORTFOLIO IS MANAGED BY AN EXPERIENCED GROUP OF PROFESSIONALS REPRESENTING A BROAD RANGE OF INVESTMENT EXPERTISE. ««««««< This internal team implements the company's public issues. Significant portions of the mortgage- strategy of seeking long-term investment return. backed securities have limited prepayment or extension Every investment is evaluated on a risk-adjusted, risk,allowing cash flows to be more predictable and less total-return basis, which has helped the 'company sensitive to changes in interest rates. consistently achieve investment spreads that are well Underlying SunAmerica's investment approach is a above the industry average. stringent credit review process designed to maximize Today, the majority of the company's total assets total returns, and disciplined asset-liability matching carry little or no credit risk,including$11.4 billion of that helps ensure liquidity and principal protection variable annuity assets in separate accounts, approxi- under a variety of interest rate scenarios.As a result, mately$6.7 billion of U.S.government agency and high- the company's investment portfolio performs very well ly rated mortgage-backed securities and approximately under stress tests analyzing its sensitivity to changing $1.8 billion of cash and short-term investments. economic and market conditions. The investment portfolio contains primarily fixed- Perhaps the best evidence of this strategy's rate investments that produce highly predictable success is SunAmerica's investment spread perfor- income. Investment-grade bonds represent 64%of the mance. The Eompany's investment spread has held portfolio, while non-investment-grade bonds represent steady at about 300 basis points during the past five less than 7%.The company's bond portfolio includes years despite pronounced interest rate fluctuations $5.9 billion of mortgage-backed securities,or 23%of during that time.SunAmerica's spread performance is invested assets,the majority of which are highly liquid substantially higher than that of its peers and,equally STABILITY OF SUNAMERICA'S INVESTMENT SPREADS 8.29% SunAmerica Investment Spteadt 2.93% Treasu Rate= / REjUR 1.86^� ry tN�EStiN� 5.51% 90 91 92 93 94 95 96 97 98 I Affn k-m—d i yW w a—g kmud cnn-d die,ce Mil M n<.r kww-k iNZ U"da .. 'i aA•eeyea d.w eeJi py UST. 7him, . - .Y.! . - • Zo3 ;; -• . R ' DEFAULTED ASSETS* >CAPITAL STRENGTH Thanks to its disciplined capital-raising approach. SunAmerica has achieved a strong capital position.The DLI risk-based capital ratios of its life insurance companies 0.6% 0.6% far exceed industry averages and the regulatory require- tttt ments of the life insurance and annuity industries. SunAmerica has an excellent track record of issuing ; innovative,cost-effective securities to raise capital,and in recent years has taken advantage of the market for new types of securities, such as tax-deductible 0.2% 0.2% 0.2% preferred securities.The company's total capital is now s $4.7 billion. Its equity capital currently stands at $3.9 billion and it holds approximately $4 billion of invested assets outside its regulated entities. 40 4W 4M 40 4W The company also maintains high ratings among 94 95 96 97 98 the principal rating agencies:The SunAmerica flagship *As a percent of Invested assets at amortized cost life companies' financial strength is rated "A+" at September 30. ' (Superior)by A.M.Best,"AA-"(Excellent)by Standard &Poor's,"AA"(Very High)by Duff&Phelps,and"A2" (Good) by'Moody's. SunAmerica anticipates ratings important,has been achieved while maintaining default upgrades to the highest levels from the principal rating levels well below industry norms. agencies when its merger with AIG is consummated. Although it reflects a relatively small portion of the company's total portfolio, investing "wholesale" P98 is an important — and unique — element of " " ................ SunAmerica's investment strategy. The company's WE REDUCE R I S K investment team works directly with various funding AND intermediaries and direct issuers to originate assets "IMPROVE SPREADS and structure securities that are compatible with = its own investment guidelines.This strategy enables BY ORIGINATING the company to reduce credit risk and achieve 7 ASSET S purchased = OURS higher returns than it would if it only p AS ELVES. investments originated by intermediaries. SunAmerica also invests about 6%of its invested •I assets in partnerships,which have consistently generated returns in the high teens or above. The company's SunAmerica's effective issuance and use of partnership portfolio is diversified. It is composed of capital,as well as its strong earnings performance, is approximately 660 separate partnerships, including reflected in its return on average shareholders'equity, those managed by independent money managers which has been well above the industry average during . investing in a broad array of equity and fixed-income the past several years and was nearly 20%in 1998. securities, tax-advantaged affordable housing, and partnerships that invest in mortgage loans and income- •:i,. y. producing real estate. i •i. jf•"1Sr�N;....yyn•rira:v:.::••rv..w!�pw��liik,:4.ri�.+M••wviJ.rt::rs::.�.. .:...;. s :_. .... r. � ��`� f :ir �'6 MANAGEMENT ' S OISCUSSIO N• OPERATING EARNINGS INCREASED NEARLY 30% IN 1998 i MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Management's discussion and analysis of financial Forward-looking statements are necessarily based condition and results of operations of SunAmerica Inc. on estimates and assumptions that are inherently sub- (the"Company")for the three years in the period ended ject to significant business,economic and competitive September 30, 1998 follows. In connection with the uncertainties and contingencies, many of which are "safe harbor" provisions of the Private Securities beyond the Company's control and many of which are Litigation Reform Act of 1995,the Company cautions subject to change.These uncertainties and contingen- readers regarding certain forward-looking statements Gies could cause actual results to differ materially from contained in this report and in any other statements those expressed in any forward-looking statements made made by,or on behalf of,the Company,whether or not by,or on behalf of,the Company.Whether or not actual in future filings with the Securities and Exchange results differ materially from forward-looking statements Commission (the "SEC"). Forward-looking statements may depend on numerous foreseeable and unforesee- are statements not based on historical information and able developments. Some may be national in scope, which relate to future operations, strategies, financial such as general economic conditions,changes in tax law results,or other developments.Statements using verbs and changes in interest rates.Some may be related to such as "expect," "anticipate," "believe" or words of the insurance industry generally,such as pricing com- similar import generally involve forward-looking state- petition,regulatory developments and industry consoli- ments. Without limiting the foregoing, forward-looking dation. Others may relate to the Company specifically, statements include statements which represent the such as credit,volatility and other risks associated with Company's beliefs concerning future levels of sales and the Company's investment portfolio. Investors are also redemptions of the Company's products, investment directed to consider other risks and uncertainties dis- spreads and yields,or the earnings and profitability of cussed in documents filed by the Company with the the Company's activities. SEC.The Company disclaims any obligation to update forward-looking information. EARNINGS PER SHARE* RESULTS OF OPERATIONS s $2.34 Net Income totaled'$516.3 million ($2.61 per basic share and$2.34 per diluted share)in 1998,compared 3l% with$379.1 million($2.01 per basic share and$1.81 ggEOGE $1.81 per diluted share)in 1997 and$274.4 million($1.44 CO>�pOUN per basic share and$1.32 per diluted share)in 1996. pliN�jlkLR0-- On March 31, 1997, the Company acquired certain annuity contracts from John Alden Life Insurance $1.32 Company and all of the outstanding common stock of i $0.96 John Alden Life Insurance Company of New York(col- $0.80 ;t lectively, the "John Alden Acquisition"). During fiscal 1996, the Company acquired CalAmerica Life :r �:... Insurance Company("CalAmerica")on December 29,1995. ^` Ford Life Insurance Company ("Ford Life") one , February 29, 1996; and certain annuity contracts from The Central National Life Insurance Company of '!* Im r r Omaha (the "Central National Annuity Contracts")on 94•• 95 96 97 98 April 1, 1996 (collectively,the "1996 Acquisitions"). . `�^' ' *Calculated on a diluted basis The John Alden Acquisition and the 1996 Acquisitions s "` • —Before$0.18 per share cumulative effect of change in (collectively, the "Acquisitions") were accounted for accounting for Income pxea. under the purchase method of accounting,and,there- fore, results of operations include those of the Jw. . .% .67! %% .9WNt.Y:aw..e!YY.�:;1..�: .:Y:M. .S •:�!:M p1i:1+�j.Y..;i '�+ •� -' Z. -19- Acquisitions only from their respective dates of acquisi- and$1.25 billion(8.74%)in 1996.Investment income lion. Consequently, operating results for fiscal years and the related yields reflect the effects of the 1998, 1997 and 1996 are not comparable. On a pro Acquisitions from their respective dates of acquisition. forma basis,using the historical operating results of the The invested assets associated with the Acquisitions acquired businesses and assuming the Acquisitions had included high-grade corporate,government and govern- been consummated on October 1, 1995,the beginning ment/agency bonds and cash and short-term invest- of the earliest period discussed herein, net income ments, which are generally lower yielding than a would have been$397.4 million($2.11 per basic share significant portion of the invested assets that comprise and$1.90 per diluted share)in 1997 and$323.2 mil- the remainder of the Company's portfolio. On a pro lion ($1.73 per basic share and $1.56 per diluted forma basis,assuming the Acquisitions had been con- share)in 1996. summated on October 1, 1995, the yield on related average invested assets would have been 8.53% in Pretax Income totaled$707.3 million in 1998, $537.1 1997 and 8.37%in 1996.Thus,the increased yields million in 1997, and $392.0 million in 1996. The in 1998 and 1997,when compared to the pro forma 31.7%improvement in 1998 over 1997 and the 37.0% 1996 yield,reflect a partial reallocation of lower-yield- improvement in 1997 over 1996 primarily resulted from ing invested assets acquired as part of the Acquisitions increased net investment income and fee income.These into generally higher-yielding asset classes in which the favorable factors were partially offset by increased amor- Company has historically invested a portion of its port- tization of deferred acquisition costs,higher general and folio.The increases in investment income also reflect administrative expenses and,only with respect to 1998, increased income from the Company's investment in higher net realized investment losses. partnerships, as well as the effects of increases in average invested assets (in excess of those acquired Net Investment Income,which is the spread between the through the Acquisitions). income earned on invested assets and the interest paid Partnership income increased to $371.1 million on fixed annuities and other interest-bearing liabilities, (a yield of 23.42%on related average assets of$1.58 increased to $841.6 million in 1998 from $679.4 billion)in 1998,compared with$241.5 million(a yield million in 1997 and $492.8 million in 1996. These of 21.00%on related average assets of$1.15 billion)in amounts equal 3.36%on average invested assets(com- 1997 and$178.6 million(a yield of 19.04%on related puted on a daily basis) of $25.03 billion in 1998, average assets of$937.8 million)in 1996.Partnership 3.26%on average invested assets of$20.86 billion in income includes income recognized by using the cost 1997 and 3.43% on average invested assets of method of accounting, which amounted to $211.2 $14.36 billion in 1996.On a pro forma basis,assum- million in 1998, $114.7 million in 1997 and $82.1 ing the Acquisitions had been consummated on million in 1996.Such income is based primarily upon October 1, 1995, net investment income on related cash distributions received from limited partnerships, average invested assets would have been 3.14% in the operations of which the Company does not influ- 1997 and 2.97%in 1996. ence.Consequently,such income is not predictable and Net investment spreads include the effect of there can be no assurance that the Company will realize income earned on the excess of average invested assets comparable levels of such income in the future. over average interest-bearing liabilities. This excess The Company has historically sought to enhance f amounted to $1.88 billion in 1998, $1.15 billion in investment yield through total return bond swap agree- 1997 and $1.06 billion in 1996. The difference ments (the "Total Return Agreements"). However, between the Company's yield on average invested assets because of recent significant market declines in the '• and the rate paid on average interest-bearing liabilities non-investment-grade bond sector, the Company (the"Spread Difference")was 2.93%in 1998,2.95% recorded losses of $33.7 million on Total Return in 1997 and 3.01% in 1996. On a pro forma basis. Agreements in 1998. The Company recorded income assuming the Acquisitions had been consummated on of $35.4 million in 1997 and $32.5 million in October 1, 1995, the Spread Difference would have 1996 on Total Return Agreements. (See "Asset- been 2.91%in 1997 and 2.82%in 1996. Liability Matching" for additional discussion of Total Investment income(and the related yields on aver- Return Agreements.) age invested assets)totaled $2.16 billion (8.63%) in Total interest and dividend expense equalled$1.32 1998,compared with $1.80 billion (8.61%) in 1997 billion in 1998, $1.12 billion in 1997 and $761.5 .:: 2-07 i�, i r -20- million in 1996.The average rate paid on all interest- for the fixed accounts of variable annuities totaling bearing liabilities was 5.70%in 1998,compared with $1.59 billion, $1.17 billion and $782.6 million, in 5.66%in 1997 and 5.73% in 1996. Interest-bearing 1998, 1997 and 1996, respectively. Increases in liabilities averaged $23.15 billion during 1998. com- premiums for the fixed accounts of variable annuity pared with$19.71 billion during 1997 and$13.29 bil- products principally reflect higher variable annuity Gt` lion during 1996.On a pro forma basis,assuming the product sales and the use of the fixed accounts for Acquisitions had been consummated on October 1,1995. dollar cost averaging into the variable accounts. : the average rate paid on all interest-bearing liabilities GIC premiums increased to$4.01 billion in 1998 c:- would have been 5.62%in 1997 and 5.55%in 1996. from$2.08 billion in 1997 and$1.02 billion in 1996. These increases in overall rates paid primarily reflect These amounts represent 72%, 50%and 28%of the year-over-year increases in the percentage of average GIC reserve balance at the beginning of the respective interest-bearing liabilities composed of guaranteed periods: The increases in GIC premiums reflect an investment contracts("GICs"),which,on average,bear expansion of the GIC client base due, in part, to a higher interest rates while generally bearing lower acqui- broadening of the Company's products and distribu- sition costs,than the Company's other interest-bearing tion channels, including its AAA-rated company, liabilities. SunAmerica National Life Insurance Company,and its AAA/Aaa-rated credit-enhanced GIC products, and an Growth In Average Invested Assets since 1996 primarily expansion of its international client base.The size of the reflects the impact of the Acquisitions and growth of Company's GIC reserves increased over the three-year the Company's GIC reserves. The Company acquired period to $8.38 billion at September 30, 1998 from $722.5 million of invested assets of CalAmerica on $3.61 billion at September 30, 1995. December 29,1995,$3.10 billion of invested assets of The GICs issued by the Company generally guaran- Ford Life on February 29, 1996, $908.8 million of tee the payment of principal and interest at a fixed rate ' invested assets associated with the Central National for a fixed term of three to twelve years with an average i Annuity Contracts on April 1,1996 and$5.00 billion of of approximately 7 years. In the case of GICs sold to invested assets associated with the John Alden Acquisition pension plans,certain withdrawals may be made at book on March 31, 1997.The Company intends to continue value in the event of circumstances specified in the plan to pursue a strategy of enhancing its internal growth document,such as employee retirement,death,disabil- with complementary acquisitions. On July 15, 1998, ity, hardship withdrawal or employee termination. The the Company entered into a definitive agreement to Company generally imposes surrender penalties in the acquire MBL Life Assurance Corporation's individual life event of other withdrawals prior to maturity.GICs pur- and individual and group annuity business(which has chased for their long-term portfolios by banks, asset approximately$2 billion of individual life reserves and management firms, certain trusts and state and local $3 billion of fixed annuity reserves)for a purchase price governmental entities either prohibit withdrawals or per- of approximately$130 million in cash.The acquisition mit scheduled book value withdrawals subject to the is subject to customary conditions and required regula- terms of the underlying indenture or agreement. GICs tory approvals,and is expected to be completed by the purchased by asset management firms for their short- end of December 1998. term portfolios either prohibit withdrawals or permit Average invested assets also increased as a result of withdrawals with notice ranging from 90 to 270 days.In sales of the Company's fixed-rate products,consisting of pricing GICs,the Company analyzes cash flow informa- both fixed annuity premiums (including those for the tion and prices accordingly so that it is compensated for fixed accounts of variable annuity products) and GIC possible withdrawals prior to maturity. premiums. Fixed annuity premiums totaled $1.80 ` billion in 1998,compared with$1.49 billion in 1997 Net Realized Investment Losses totaled$41.7 million in and$993.4 million in 1996.These amounts represent 1998,compared with$29.2 million in 1997 and$30.3 12%, 15%and 20%of the fixed annuity reserve bal- million in 1996.Net realized investment losses include •:+ ante at the beginning of the respective periods. The impairment writedowns of $109.8 million in 1998, decreases in percentages in 1998 and 1997 reflect the $65.3 million in 1997 and $34.9 million in 1996. impact of the Acquisitions,which increased fixed annu- Thus, net gains from sales and redemptions of invest- ity reserve balances at the beginning of the respective ments totaled$68.1 million in 1998.$36.1 million in periods. Fixed annuity premiums include premiums 1997 and$4.6 million in 1996. + c f 20� t -21— • The Company sold or redeemed invested assets, 20%.20%and 18%of variable annuity reserves at the principally bonds and notes,aggregating$22.90 billion beginning of the respective periods. in 1998.$19.13 billion in 1997 and$11.21 billion in Sales of variable annuity products(which include 1996,respectively.Sales of investments result from the premiums allocated to the fixed accounts) ("Variable active management of the Company's investment port- Annuity Product Sales") amounted to $3.47 billion, folio.Because redemptions of investments are generally $2.47 billion and $1.71 billion in 1998, 1997 and involuntary and sales of investments are made in both 1996, respectively, and primarily reflect sales of the rising and falling interest rate environments, net gains Company's flagship variable annuity,Polaris.Polaris is a from sales and redemptions of investments fluctuate multi-manager variable annuity that offers investors a from period to period, and represent 0.27%, 0.17%, choice of 26 variable funds and 7 guaranteed fixed-rate and 0.03%of average invested assets for 1998, 1997 funds. Increases in Variable Annuity Product Sales are and 1996, respectively. Active portfolio management due, in part, to market share gains through enhanced involves the ongoing evaluation of asset sectors, indi- distribution efforts and growing consumer demand for vidual securities within the investment portfolio and the flexible retirement savings products that offer a variety reallocation of investments from sectors that are per- of equity, fixed income and guaranteed fixed account ceived to be relatively overvalued to sectors that are per- investment choices.In recent weeks,subsequent to the ceived to be relatively undervalued. The intent of the Company's fiscal year end, sales of variable annuities Company's active portfolio management is to maximize have slowed as investors paused to reevaluate their total returns on the investment portfolio, taking into investment decisions in light of volatile markets. The account credit,option,liquidity and interest-rate risk. Company believes that fluctuating market conditions Historically, impairment writedowns primarily have increase the value of financial planning services and been applied to defaulted bonds. However,in 1998,as make the flexibility and security of variable annuities a result of equity market declines in the later part of the even more attractive. fiscal year, impairment writedowns were also applied The Company has encountered increased competi- to various cost-method partnerships. Impairment write- tion in the variable annuity marketplace during recent downs represent 0.44%, 0.31%and 0.24%of average years and anticipates that the market will remain highly invested assets for 1998, 1997 and 1996,respectively. competitive for the foreseeable future. Also, from For the five years ended September 30, 1998, impair- time to time, Federal initiatives are proposed which ment writedowns as a percentage of average invested could affect the taxation of variable annuities and assets have ranged from 0.24% to 0.63% and have annuities generally. averaged 0.41%.Such writedowns are based upon esti- mates of the net realizable value of the applicable assets. Net Retained Commissions are primarily derived from : Actual realization will be dependent upon future events. commissions on the sales of non-proprietary investment products by the Company's broker-dealer subsidiaries, Variable Annuity Fees are based on the market value of after deducting the substantial portion of such commis- assets in separate accounts supporting variable annuity sions that is passed on to registered representatives.Net contracts. Such fees totaled $204.5 million in 1998, retained commissions totaled$114.5 million in 1998. $141.2 million in 1997 and$104.7 million in 1996. $64.9 million in 1997 and $49.8 million in 1996. These increased fees reflect growth in average variable Broker-dealer sales(mainly sales of general securities, annuity assets, due to increased market values, the mutual funds and annuities)totaled $29.31 billion in receipt of variable annuity premiums and net exchanges 1998, $17.52 billion in 1997 and $12.78 billion in into the separate accounts from the fixed accounts of 1996.The increases in sales and net retained commis- variable annuity contracts,partially offset by surrenders, sions reflect a greater number of registered representa- Variable annuity fees represent 1.9%, 1.8%and 1.8% tives,higher average production per representative and of average variable annuity assets for 1998, 1997 and generally favorable market conditions.The greater num- f 1996, respectively. Variable annuity assets averaged ber of registered representatives was primarily due to fE $10.93 billion during 1998,$7.66 billion during 1997 acquisitions,including the April 2,1998 acquisition of and$5.75 billion during 1996.Variable annuity premi- Sentra Securities Corporation and Spelman&Co. Inc. i ums, which exclude premiums allocated to the fixed ("Sentra-Spelman"),the October 1,1997 acquisition of ? accounts of variable annuity products,have aggregated Financial Service Corporation and the January 22,1997 $1.88 billion in 1998. $1.31 billion in 1997 and acquisition of The Financial Group,Inc.At their respec- $929.2 million in 1996. These amounts represent tive dates of acquisition, these acquired companies i Z0 9 vy i t -22- siS i licensed through their subsidiaries approximately 500, $29.6 million on average assets managed of $2.89 1,500 and 400 independent registered representatives, billion in 1998.$25.8 million on average assets man- 6 respectively.Increases in net retained commissions may aged of $2.34 billion in 1997 and $25.4 million on not be proportionate to increases in sales primarily due average assets managed of$2.14 billion in 1996.Asset to differences in sales mix. management fees are not proportionate to average assets managed,principally due to changes in product Surrender Charges on fixed and variable annuities totaled mix. Sates of mutual funds, excluding sales of money ; $54.4 million (including$37.4 million attributable to market accounts, aggregated$853.6 million in 1998, the Acquisitions) in 1998, $35.2 million (including compared with $454.8 million in 1997 and $223.4 $24.5 million attributable to the Acquisitions)in 1997 million in 1996.The significant increases in sales prin- and$22.1 million(including$11.1 million attributable cipally resulted from sales of the Company's "Style to the Acquisitions)in 1996.Surrender charges gener- Select Series" product (which was introduced in ally are assessed on annuity withdrawals at declining November 1996)and the introduction in June 1998 of rates during the first seven years of an annuity contract. the"Dogs"of Wall Street.The"Style Select Series"is Withdrawal payments, which include surrenders and a group of mutual funds which are each managed by lump-sum annuity benefits, totaled $3.12 billion three industry recognized fund managers.The"Dogs"of (including $1.85 billion attributable to the Acqui- Wall Street fund contains 30 large capitalization value sitions)in 1998,compared with$2.28 billion(includ- stocks which are selected by strict criteria. Sales of ing $1.00 billion attributable to the Acquisitions) in these products totaled $611.1 million in 1998, com- 1997 and $1.42 billion (including $245.8 million pared with$267.8 million in 1997,reflecting the addi- attributable to the Acquisitions) in 1996. These pay- tion of five new Style Select funds, which more than ments represent 13.2%(23.7%of average fixed annu- doubled the number of Style Select funds to nine,and ity reserves associated with the Acquisitions), 12.0% generally favorable market conditions. Redemptions (15.0% of average fixed annuity reserves associated of mutual funds, excluding redemptions of money with the Acquisitions) and 11.1% (9.3% of average market accounts,amounted to$402.5 million in 1998, fixed annuity reserves associated with the 1996 $412.8 million in 1997 and$379.9 million in 1996, Acquisitions), respectively, of average fixed and vari- which represent 17.5%, 22.0% and 21.4%, respec- able annuity reserves. Withdrawals include variable tively,of average mutual fund assets. annuity withdrawals from the separate accounts total- ing$964.9 million (8.8%of average variable annuity Loan Servicing Fees are earned by Imperial Premium reserves), $827.3 million (10.8% of average variable Finance,Inc.("Imperial").Imperial provides short-term annuity reserves)and$637.0 million(11.1%of average installment loans for borrowers to fund their property variable annuity reserves) in 1998, 1997 and 1996, and casualty insurance premiums. These loans are respectively. Consistent with the assumptions used in secured by the unearned premium associated with the connection with the Acquisitions, management antici- underlying insurance policies. Currently, Imperial sells pates that the level of withdrawal payments will con- most of the loans it originates and earns fee income by tinue to reflect higher relative withdrawal rates in the servicing the sold loans.Such fee income totaled$23.4 near future because of higher surrenders on the million on average loans serviced of$483.0 million in acquired annuity businesses. 1998,compared with $24.3 million on average loans Excluding the effects of the Acquisitions, with- serviced of$490.5 million in 1997 and$23.8 million i drawal payments represented 8.7%in 1998,10.4%in on average loans serviced of$457.8 million in 1996. 1997 and 11.6%in 1996 of related average fixed and _. 1 variable annuity reserves.These lower surrender rates in Trust Fees are earned by Resources Trust Company for the current periods reflect the continued decreases in providing administrative and custodial services primar- ' the percentage of non-acquisition-related annuity con- ily for individual retirement accounts, as well as for tracts that are free of surrender charges. other qualified retirement plans.Trust fees increased to $18.1 million in 1998(on an average of 208,000 trust " Asset Management Fees,which include investment advi- accounts)from$17.9 million in 1997(on an average of sory fees and 12b-1 distribution fees,are based on the 204,000 trust accounts) and $16.7 million in 1996 market value of assets managed in mutual funds by (on an average of 202,000 trust accounts). ' SunAmerica Asset Management Corp.Such fees totaled 2e V. -23— General And Administrative Expenses totaled $310.3 and AIG's shareholders at special meetings on million in 1998,compared with$265.7 million in 1997 November 18,1998.The merger is expected to be com- and$210.7 million in 1996.General and administra- pleted in late 1998 or early 1999. tive expenses reflect the impact of the Acquisitions,as On September 22, 1998.the Company announced well as the acquisitions of Sentra-Spelman. Financial that it would redeem all of its Series E Preferred Stock. Service Corporation and The Financial Group, Inc. As The redemption was completed on October 30, 1998 a result, the number of employees has increased to and resulted in the issuance of approximately 11.3 approximately 2,500 at September 30, 1998 from million shares of common stock. For the year ending approximately 2,000 at September 30, 1997 and September 30, 1998,the Series E Preferred Stock was approximately 1,600 at September 30, 1996. As a included in the computation of diluted earnings per result,compensation(net of deferrals)has increased to share as 12.2 million of common stock equivalents, $174.8 million in 1998 from$145.3 million in 1997 On October 7,1998,subsequent to the Company's and $123.5 million in 1996. General and adminis- fiscal year end, the Company announced that it will trative expenses remain closely controlled through a redeem all of its 8-'/2% Premium Equity Redemp- company-wide cost containment program and continue tion Cumulative Security Units ("PERCS Units") on to represent less than 1%of average total assets. December 6,1998.In connection with this redemption, the Company will issue approximately 10.1 million Amortization Of Deterred Acquisition Costs totaled$241.2 shares of common stock and will receive$431.3 million in million in 1998, compared with $165.1 million in cash proceeds.For the year ending September 30.1998, 1997 and $108.2 million in 1996. The increases in the PERCS Units were included in the computation of amortization primarily reflect the amortization of the diluted earnings per share as 4.3 million of common deferred acquisition costs attributable to the Acqui- stock equivalents. sitions, which aggregated $133.0 million in 1998, $65.2 million in 1997 and $16.8 million in 1996. Book Value Per Share amounted to$14.45 at September Amortization has also increased due to additional fixed 30, 1998, up from $12.40 at September 30, 1997. and variable annuity and mutual fund sales and the sub- Excluding net unrealized gains on debt and equity secu- sequent amortization of related deferred commissions rities available for sale,book value per share amounted and other direct selling costs. to $13.50 at September 30, 1998 and $11.39 at September 30, 1997.On a pro forma basis,assuming Income Tax Expense totaled $191.0 million in 1998, that the PERCS Units were converted to Common Stock, compared with $158.0 million in 1997 and $117.6 book value per share would have been $16.02 million in 1996,representing effective tax rates of 27% at September 30, 1998, compared with $13.40 at in 1998, 29%in 1997 and 30%in 1996.These tax September 30, 1997 and, excluding net unrealized rates reflect the favorable impact of tax credits associ- gains on debt and equity securities available for sale, ated with tax-advantaged investments in affordable would have been$15.10 at September 30, 1998 and housing partnerships owned by the Company. $12.47 at September 30, 1997. FINANCIAL CONDITION AND LIQUIDITY Invested Assets at September 30, 1998 totaled $26.07 billion, compared with $24.41 billion at Shareholders'Equity increased 15.8%to $2.99 billion September 30, 1997.The Company manages most of at September 30, 1998 from $2.58 billion at its invested assets internally. The Company's general September 30, 1997,primarily due to$516.3 million investment philosophy is to hold fixed-rate assets for of net income recorded in 1998,which was partially off- long-term investment.Thus, it does not have a trading set by$100.5 million of dividends paid to shareholders. portfolio.However,the Company has determined that all On August 20,1998,the Company entered into an of its portfolio of bonds,notes and redeemable preferred agreement to merge with American International Group, stocks(the"Bond Portfolio")is available to be sold in Inc. ("AIG").The merger will be treated as a pooling response to changes in market interest rates,changes in of interests for accounting purposes,and will be a tax- relative value of asset sectors and individual securities, free reorganization.Each share of the Company's Com- changes in prepayment risk,changes in the credit qual- mon Stock(including Nontransferable Class B)will be ity outlook for certain securities,the Company's need for exchanged for 0.855 shares of AIG's common stock. liquidity and other similar factors. The transaction was approved by both the Company's Z!/ - I ) —24— t The Bond Portfolio, which constitutes 72% of the investment grade. These non-investment-grade bonds Company's total investment portfolio,had an aggregate accounted for 4.5%of the Company's total assets and fair value that exceeded its amortized cost by$399.2 6.8% of its invested assets. In addition to its direct million at September 30, 1998, compared with an investment in non-investment-grade bonds, the 1 excess of$398.8 million at September 30,1997. Company has entered into Total Return Agreements with At September 30, 1998, the Bond Portfolio an aggregate notional principal amount of $533.0 (excluding $292.0 million of redeemable preferred million at September 30, 1998 (see "Asset-Liability stocks) included $17.21 billion of bonds rated by Matching"). ' Standard & Poor's Corporation ("S&P"), Moody's Non-investment-grade securities generally provide Investors Service ("Moody's"), Duff & Phelps Credit higher yields and involve greater risks than investment- Rating Co. ("DCR"), Fitch Investors Service, L.P. grade securities because their issuers typically are more ("Fitch") or the National Association of Insurance highly leveraged and more vulnerable to adverse + Commissioners ("NAIC"), and $1.30 billion of economic conditions than investment-grade issuers. In bonds rated by the Company pursuant to statutory addition,the trading market for these securities is usu- ratings guidelines established by the NAIC. At ally more limited than for investment-grade securities. September 30, 1998,approximately$16.73 billion of The Company had no material concentrations of non- the Bond Portfolio was investment grade, including investment-grade securities at September 30, 1998. $6.71 billion of U.S.government/agency securities and The following table summarizes the Company's mortgage-backed securities("MBSs"). rated bonds by rating classification as of September At September 30, 1998, the Bond Portfolio 30,1998(dollars in thousands): included $1.78 billion of bonds that were not Issues tot rated by SWMoody'st I Issues rated by S&P/Mood/slDCR/Fdcb OCR/Fitch,By NAIC category Total Estimated Estimated Estimated Percent of . UPAMooMYjDCRY Amortized fair NAIC Amatiad fair Amattsed fair bneste0 li'dch)atetory° cost slue atetory' cost value cost value assets AAA+to A- f Wato0 i (AAA to A-) 1 (AAA toA-1 $10,D50,902 $10,397,846 1 Sz260,032 $2.436.591 S1z320,934 $12,834,437 49.24% t 888+to BOB- (Bell I to Baa3) I888+to BBB-) IBBB+to BBB-) 3,189,664 3.246.243 2 653,558 646.319 3.843.222 3.897,562 14.93 BB+to BB- (Sal to Ba3) [BB+to BB-1 (BB+to Be-) 216,920 193,649 3 73,663 73.835 290,583 272.484 1.05 i B+to B- (Bl to 83) [B+to B-) (8+toB-) 1,257,636 1,154,397 4 285.700 261,659 1,543,336 1,416,056 5.43 CCC+to C (Caa to C) ICCC1 � ' (CCC+to C-) 35,491 31.274 5 73,349 61.032 108,840 92,306 0.35 C1 to 0 ; 1 [DD] _ (D) — — 6 1,436 968 1,436 968 0.00 Total rated issues $14,760.613 $15.028,409 $3,347,739 $3.490,404 $18,108.351 $18.508,813 'S&P and Frfch rate debt securities to atint ategaries ratting from AAA(the highest)to D to payment delaal0.A On 1+)or mires H indicates the debtl relative standing Within .. the rating alegary.A sec**rated 888-or higher is considered imstme d grade."Is rates debt scarifies in rating cafeterias ranging tram Am(the highest)to C ledrwell poor prospects of ever atuinint any feat investment standing).The aumbr L 2 or 3(Witte I the highest and 3 the bta0 inflates the*we ret*m standing Within the rating Cal• r :: ogory.A socuft rated Baa3 or higher is considered investment trade.OCR rates debt secorBies in riling categories raging been AM Ne higbal)to 00 f m payment Wank).A pin ' (+)or minus H indicates the debts relative s4mdiat within the rating cotegn Asomitg rated 888-or higher is considered investment trade.Issues are categorized based on the highest of the S&P,Mo*Aa,OCR and Filch ratings B rated by multiple agencies. 'Bonds and sherl-lorm promissory insWmads are divided into sIs quality atetaia for NAIC rating paposes,amgiag ben I MW*A to 5 Oweso for tendetaufted balls on and ;`• = category,6.far bonds In or oar defuL These sB categories tsnapond With the SWAAoadf VJVFdch rating gangs listed AM With Cafeterias 1 and 2 ansiel fed investmed grade.The t1AIC autaria Include 1130 billion if assets that urea rated by the Company porsuent to app6csbk NAI6 aunt gaidef fees. Z/Z --.2 • -25— k Senior secured loans ("Secured Loans") are mortgage loans were seasoned loans underwritten to the included in the Bond Portfolio and aggregated $1.89 Company's standards and purchased at or near par from billion at September 30, 1998. Secured Loans are other financial institutions. Such loans generally have senior to subordinated debt and equity,and are secured higher average interest rates than loans that could be by assets of the issuer. At September 30, 1998, originated today.The balance of the mortgage loan port- Secured Loans consisted of$982.0 million of publicly folio has been originated by the Company under strict traded securities and$903.5 million of privately traded underwriting standards.Commercial mortgage loans on securities.These Secured Loans are composed of loans properties such as offices,hotels and shopping centers • to 310 borrowers spanning 44 industries,with 26%of generally represent a higher level of risk than do these assets concentrated in financial institutions and mortgage loans secured by multifamily residences.This 15%concentrated in utilities. No other industry con- greater risk is due to several factors,including the larger centration constituted more than 6% of these assets. size of such loans and the more immediate effects of While the trading market for the Company's privately general economic conditions on these commercial traded Secured Loans is more limited than for publicly property types.However,due to the seasoned nature of traded issues,management believes that participation in the Company's mortgage loan portfolio,its emphasis on these transactions has enabled the Company to improve multifamily loans and its strict underwriting standards, its investment yield. As a result of restrictive financial the Company believes that it has prudently managed covenants, these Secured Loans involve greater risk of the risk attributable to its mortgage loan portfolio while technical default than do publicly traded investment- maintaining attractive yields. grade securities.However,management believes that the risk of loss upon default for these Secured Loans is mit- Partnership investments totaled $1.65 billion at igated by such financial covenants and the collateral val- September 30, 1998, constituting investments in ues underlying the Secured Loans. The Company's approximately 661 separate partnerships with an aver- Secured Loans are rated by S&P, Moody's, DCR, Fitch, age size of approximately $2.5 million. This portfolio the NAIC or by the Company, pursuant to comparable includes:(i)$867.7 million of partnerships managed by statutory ratings guidelines established by the NAIC. independent money managers that invest in a broad selection of equity and fixed-income securities, cur- Mortgage Loans aggregated $3.41 billion at rently including approximately 4,700 separate issuers; September 30, 1998 and consisted of 1,538 com- (ii)$640.7 million of partnerships that make tax-advan- mercial first mortgage loans with an average loan taged investments in affordable housing properties,cur- balance of approximately $2.2 million, collateralized rently involving approximately 540 multifamily projects by properties located in 47 states.Approximately 27% in 41 states; and (iii) $136.7 million of partnerships of this portfolio was multifamily residential, 23% was that invest in mortgage loans and income-producing real retail,17%was office,11%was manufactured housing, estate.The risks generally associated with partnerships 7% was industrial and 15% was other types. At include those related to their underlying investments September 30, 1998, approximately 19%, 12% and (i.e. equity securities, debt securities and real estate), 10% of this portfolio was secured by properties plus a level of illiquidity, which is mitigated, to some located in California,New York and Texas,respectively, extent,a)for the affordable housing partnerships,by the and no more than 7%of this portfolio was secured by marketability of the tax credits they generate,and b)in properties located in any other single state. At the case of many of the other partnerships,by the exis- September 30, 1998, there were 59 mortgage loans tence of contractual termination provisions. with outstanding balances of $10 million or more, which loans collectively aggregated approximately 30% Asset-Liability Matching is utilized by the Company to of this portfolio.At September 30,1998,approximately minimize the risks of interest rate fluctuations and dis- 31%of the mortgage loan portfolio consisted of loans intermediation.The Company believes that its fixed-rate with balloon payments due before October 1, 2001. liabilities should be backed by a portfolio principally During 1998,1997 and 1996 loans delinquent by more composed of fixed-rate investments that generate pre- than•90 days,foreclosed loans and restructured loans dictable rates of return.The Company does not have a have not been significant in relation to the total mort- specific target rate of return.Instead,its rates of return gage loan portfolio. vary over time depending on the current interest rate At September 30,1998,approximately 40%of the environment,the slope of the yield curve,the spread at ..>::!........:. .................r.n ....C:rke�.K"'r:•..r�.:!Y.•:�........, ........ .. ........ . fir: t -26— which fixed-rate investments are priced over the yield interest rates change by 100 basis points,recognizing`- curve, and general economic conditions. Its portfolio the changes in cash flows resulting from embedded',: strategy is constructed with a view to achieve adequate options such as policy surrenders, investment prepay. risk-adjusted returns consistent with its investment ments and bond calls.It also incorporates the assump•: objectives of effective asset-liability matching,liquidity tion that the Company will continue to utilize its existing and safety.The Company's fixed-rate products incorpo- strategies of pricing its fixed annuity and GIC products,'.` rate surrender charges, two-tiered interest rate strut- allocating its available cash flow amongst its various.` ' tures or other restrictions in order to encourage investment portfolio sectors and maintaining sufficied,.. persistency.Approximately 86%of the Company's fixed levels of liquidity. Because the calculation of duration annuity and GIC reserves had surrender penalties or involves estimation and incorporates assumption;, other restrictions at September 30, 1998. potential changes in portfolio value indicated by the`. As part of its asset-liability matching discipline,the portfolio's duration will likely be different from the': Company conducts detailed computer simulations that actual changes experienced under given interest rate­ model its fixed-rate assets and liabilities under com- scenarios,and the differences may be material. monly used stress-test interest rate scenarios.With the As a component of its asset and liability manage-;' results of these computer simulations,the Company can ment strategy,the Company utilizes interest rate swap,'." measure the potential gain or loss in fair value of its agreements("Swap Agreements")to match assets more, interest-rate sensitive instruments and seek to protect closely to liabilities.Swap Agreements are agreement its economic value and achieve a predictable spread to exchange with a counterparty interest rate payment. between what it earns on its invested assets and what it of differing character (for example, variable-rate palm, pays on its liabilities by designing its fixed-rate products merits exchanged for fixed-rate payments)based on Ili and conducting its investment operations to closely underlying principal balance (notional principal) IoF match the duration of the fixed-rate assets to that of its hedge against interest rate changes. The Company'.: fixed-rate liabilities. The Company's fixed-rate assets typically utilizes Swap Agreements to create a hedge that i.. include:cash and short-term investments;bonds,notes effectively converts floating-rate assets and liabilitiesy: and redeemable preferred stocks;mortgage loans; and into fixed-rate instruments. At September 30. 199$ - investments in limited partnerships that invest primarily the Company had 38 outstanding Swap Agreement in fixed-rate securities and are accounted for by using with an aggregate notional principal amount of$1.87 the cost method.At September 30,1998,these assets billion.;These agreements mature in various yearst, had an aggregate fair value of $24.36 billion with through 2010 and have an average remaining maturily a duration of 3.7. The Company's fixed-rate liabilities of 43 months. include:fixed annuities;GICs;trust deposits;long-term The Company also seeks to provide liquidity from notes and debentures;and preferred securities of sub- time to time by using reverse repurchase agreement sidiary grantor trusts. At September 30, 1998, these ("Reverse Repos") and by investing in MBSs. It also liabilities had an aggregate fair value (determined by seeks to enhance its spread income by using Reverse discounting future contractual cash flows by related Repos and Total Return Agreements. Reverse Repos market rates of interest)of$23.10 billion with a dura- involve a sale of securities and an agreement to repur• tion of 3.4.The Company's potential exposure due to a chase the same securities at a later date at an agreed 10% increase in prevailing interest rates from their upon price and are generally over-collateralized.Total September 30,1998 levels is a loss of$50.8 million in Return Agreements effectively exchange a fixed rated fair value of its fixed-rate assets that is not offset by a interest on the notional amount for the coupon income decrease in the fair value of its fixed-rate liabilities. plus or minus the increase or decrease in the fair value Because the Company actively manages its assets and of specified non-investment-grade bonds. MBSs are . liabilities and has strategies in place to minimize its generally investment-grade securities collateralized by .'< ►• exposure to loss as interest rate changes occur, it large pools of mortgage loans.MBSs generally pay prig• expects that actual losses would be less than the esti- cipal and interest monthly.The amount of principal and . mated potential loss. interest payments may fluctuate as a result of prepay { Duration is a common option-adjusted measure for ments of the underlying mortgage loans. the price sensitivity of a fixed-maturity portfolio to There are risks associated with some of the tech changes in interest rates. It measures the approximate niques the Company uses to provide liquidity,enhance percentage change in the market value of a portfolio if its spread income and match its assets and liabilitiesiL •fit .."rwa•a,.• ............. . .:. ..:�.y.; ... 'C.•f^ .., •!•.. ...- ,. ii I��ERc.�..!GL'K"a= s?� ;;e. r� • _27- 1 The primary risks associated with Total Return erty and,among other things,factors impacting the cur- Agreements are the credit risk on the underlying non- rent and expected payment status of the loan and, > investment-grade bonds,the risk of potential loss due to if available, the current fair value of the underlying . bond market fluctuations and the risk associated with collateral.For investments in partnerships,management counterparty nonperformance.The primary risk associ- reviews the financial statements and other information ated with the Company's Reverse Repos and Swap provided by the general partners. f Agreements is counterparty risk.The Company believes, The carrying values of investments that are deter- however, that the counterparties to its Total Return mined to have declines in value that are other than tem- Agreements, Reverse Repos and Swap Agreements are porary are reduced to net realizable value and, in the financially responsible and that the counterparty risk case of bonds,no further accruals of interest are made. associated with those transactions is minimal.It is the The provisions for impairment on mortgage loans are Company's policy that these agreements are entered based on losses expected by management to be realized into with counterparties who have a debt rating of A/A2 on transfers of mortgage loans to real estate,on the dis- or better from both S&P and Moody's. The Company position and settlement of mortgage loans and on mort- continually monitors its credit exposure with respect to gage loans that management believes may not be these agreements. In addition to counterparty risk, collectible in full.Accrual of interest is suspended when Swap Agreements also have interest rate risk.However, principal and interest payments on mortgage loans are the Company's Swap Agreements typically hedge vari- more than 90 days past due. able-rate assets or liabilities,and interest rate fluctua- tions that adversely affect the net cash received or paid Defaulted Investments,comprising all investments that under the terms of a Swap Agreement would be offset are in default as to the payment of principal or interest, by increased interest income earned on the variable-rate totaled$55.0 million at September 30, 1998,includ- assets or reduced interest expense paid on the variable- ing$19.7 million of bonds and notes and$35.3 million - rate liabilities.The primary risk associated with MBSs is of mortgage loans.At September 30, 1998,defaulted that a changing interest rate environment might cause investments constituted 0.2%of total invested assets. prepayment of the underlying obligations at speeds At September 30, 1997,defaulted investments totaled slower or faster than anticipated at the time of their pur- $38.0 million, including $15.1 million of bonds and chase.As part of its decision to purchase an MBS,the notes and$22.9 million of mortgage loans,and consti- Company assesses the risk of prepayment by analyzing tuted 0.2%of total invested assets. the security's projected performance over an array of interest-rate scenarios.Once an MBS is purchased,the Sources Of liquidity are readily available to the Company Company monitors its actual prepayment experience in the form of the Company's existing portfolio of cash monthly to reassess the relative attractiveness of the and short-term investments,Reverse Repo capacity on security with the intent to maximize total return. invested assets and,if required,proceeds from invested asset sales. At September 30, 1998, approximately Invested Assets Evaluation is routinely conducted by the $15.74 billion of the Company's Bond Portfolio had Company.Management identifies monthly those invest- an aggregate unrealized gain of$717.0 million,while ments that require additional monitoring and carefully approximately$3.06 billion of the Bond Portfolio had reviews the carrying values of such investments at least an aggregate unrealized loss of$317.8 million.In addi- quarterly to determine whether specific investments tion,the Company's investment portfolio currently pro- should be placed on a nonaccrual basis and to deter- vides approximately $209.4 million of monthly cash mine declines in value that may be other than tempo- flow from scheduled principal and interest payments. rary. In making these reviews for bonds, management Further,$3.23 billion remains available to the Company principally considers the adequacy of any collateral, to issue securities under a shelf registration statement compliance with contractual covenants,the borrower's filed in July 1997.Historically,cash flows from opera- recent financial performance, news reports and other tions and from the sale of the Company's annuity and externally generated information concerning the credi- GIC products have been more than sufficient in amount tor's affairs.In the case of publicly traded bonds,man- to satisfy the Company's liquidity needs. agement also considers market value quotations, .if Management is aware that prevailing market inter- available. For mortgage loans, management generally est rates may shift significantly and has strategies in considers information concerning the mortgaged prop- place to manage either an increase or decrease in w.... :, ............. ...... JC.,,�,r'•?v:N.::.4)i:...::Iw YTY:....«. '.':.:'�cx..T.•-.'..7.rr?nm1RAwvn,.^.•lwvf.r.•• ' y 215 .�Mr.•an„-.,.: — -:aa..,•r-.:�eew:..T.TeSX)t'--�—:w..::.t:.�::, r7 —28— 3 ri prevailing rates.In a rising interest rate environment,the September 1998, $118.7 million in April 1997 and Company's average cost of funds would increase over $94.3 million in March 1996.The Parent also received time as it prices its new and renewing annuities and dividends of$12.9 million in fiscal 1998,$17.5 million GICs to maintain a generally competitive market rate, in fiscal 1997 and$16.0 million in fiscal 1996 from its Management would seek to place new funds in invest- other directly owned subsidiaries. The ability of the ments that were matched in duration to, and higher Company's life insurance subsidiaries to pay dividends yielding than, the liabilities assumed. The Company is limited by statute.For the remainder of calendar year believes that liquidity to fund withdrawals would be 1998, no amounts are available for dividends to the available through incoming cash flow,the sale of short- Parent from its regulated life insurance subsidiaries. term or floating-rate instruments or Reverse Repos on The Company has sold, through three separate the Company's substantial MBS segment of the Bond coinsurance transactions:G)the general agency division Portfolio,thereby avoiding the sale of fixed-rate assets of SunAmerica Life Insurance Company to Savers Life in an unfavorable bond market. Insurance Company (in 1989) which subsequently In a declining interest rate environment, the transferred the business to Winterthur Life Re Insurance Company's cost of funds would decrease over time, Company; 60 the credit life business of Ford Life to reflecting lower interest crediting rates on its fixed Vista Life Insurance Company(in 1996); and (iii)the annuities and GICs. Should increased liquidity be mortality-based business of CalAmerica Life Insurance required for withdrawals,the Company believes that a Company to Protective Life Insurance Company (in significant portion of its investments could be sold 1996).With respect to these coinsurance transactions, without adverse consequences in light of the general SunAmerica-entities could become liable for in-force strengthening that would be expected in the bond market. amounts ceded of$894.7 million,$962.2 million and On a parent company stand-alone basis, $1.90 billion, respectively, at September 30, 1998, SunAmerica Inc.(the"Parent"),at September 30,1998, if the coinsurers were to become unable to meet the had invested assets with a fair value of $2.53 billion obligations assumed under the respective coinsurance and outstanding senior indebtedness of $1.22 billion, agreements. However, the Company considers these comprising all of the Company's outstanding senior contingencies to be remote because the coinsurers are indebtedness.Additionally,as of September 30, 1998, strong credit-worthy institutions and,in the case of the the Parent had three GICs purchased by local govern- 1989 transaction,assets substantially equal to the pol- ment entities,which aggregated$213.7 million. icyholder reserves assumed by the coinsurer are held During November 1996 and October 1995,respec- in trust to secure the obligations of the coinsurer. At tively, the Parent purchased the common securities of September 30, 1998, related policyholder reserves SunAmerica Capital Trust III and SunAmerica Capital carried by the coinsurers were $59.3 million, $10.9 Trust II (collectively, the "Grantor Trusts") and issued million and$157.3 million,respectively. an aggregate of$511.9 million of junior subordinated The Company has transferred to third-party debentures(the"Debentures")to the Grantor Trusts in investors certain of its interests in various partnerships connection with the public issuance of the preferred that make tax-advantaged affordable housing invest- securities of the Grantor Trusts(see Note 10 of Notes ments. As part of these transactions, the Parent has to Consolidated Financial Statements). agreed to advance monies to support the operations of The Parent's annual debt service (principal and the underlying housing projects, if required, and has interest payments)with respect to its senior indebted- guaranteed that the transferred partnerships will pro- ness, GIC obligations and Debentures totals $292.0 vide,as of the transfer date and under then current tax ,L million for fiscal 1999,$563.5 million for fiscal 2000, laws, a specified level of associated tax credits and $139.0 million for fiscal 2001,$297.4 million for fis- deductions to the third-party investors. Based on an cal 2002,$112.3 million for fiscal 2003 and$4.14 bil- evaluation of the underlying housing projects,manage- lion,in the aggregate,thereafter.On December 6,1998. ment does not anticipate any material cash payments the Company is contractually scheduled to receive with respect to the guarantees. ;. $431.3 million upon delivery of 10.1 million stares of In the ordinary course of business, the Company ". • the.Company's Common Stock in accordance with the has agreed to make capital contributions, if required, terms of the Company's PERCS Units. aggregating approximately $670.2 million, to 121 The Parent received dividends from its regulated limited partnerships over the next 5 years in exchange life insurance subsidiaries totaling $143.0 million in for ownership interests in such partnerships. - -^sY7.: i.;Qijiriy)/.'Vi.;%.iv:;i i.rti!•:p!ci•.'::�T�• ...X:�X>:••.;�i•v:•- ... ... �•�%. �" " %,��_ r ',:};�; j,��• -29— YEAR 2000 The Company relies significantly on computer systems In addition, the Company has distributed a year and applications in its daily operations. Many of these 2000 questionnaire to certain of its significant suppli- systems are not presently year 2000 compliant,which ers,distributors,financial institutions,lessors and oth- means that because they have historically used only two ers with which it does business to evaluate their year , digits to identify the year in a date, they will 2000 compliance plans and state of readiness and to fail to distinguish dates in the "2000s"from dates in determine the extent to which the Company's systems the"1900s"The Company's business,financial condi- and applications may be affected by the failure of oth- tion and results of operations could be materially and ers to remediate their own year 2000 issues.To date, adversely affected by the failure of the Company's sys- however, the Company has received only preliminary tems and applications (and those operated by third feedback from such parties and has not independently parties interfacing with the Company's systems and confirmed any information received from other parties applications)to properly operate or manage these dates. with respect to the year 2000 issues.Therefore,there The Company has a coordinated plan to repair or can be no assurance that such other parties will com- replace these noncompliant systems and to obtain sim- plete their year 2000 conversions in a timely fashion or ilar assurances from third parties interfacing with the will not suffer a year 2000 business disruption that may Company's systems and applications. In fiscal 1997, adversely affect the Company's financial condition and the Company recorded a $15.0 million provision for results of operations. estimated programming costs to make necessary repairs of certain specific noncompliant systems.Management is making expenditures which it expects to ultimately total$15.0 million to replace certain other specific non- compliant systems,which expenditures will be capital- ized as software costs and amortized over future t periods. Both phases of the project are currently pro- ceeding in accordance with the plan and management expects them to be substantially completed by the end of calendar 1998. Testing of both the repaired ' and replacement systems will be conducted during calendar 1999. I IWI�•�Sl.9W�lRM AO(::.::/f.t..M�'��i(�" 'C�:.: .n.v V:i\': :1:::::h' 7 '•' >':Zr'�!•',i.1^S.'/r. ..!!4''i; �+-. '..q..rrlwvraw�.vr.r..4......v 217 -30- FIVE-YEAR SUMMARY Years ended September 30, (In thousands,except per-share amounts) 1998 1997 1996 1995 1994 Sales* $8,540.682 S 5,329,227 $3,165,210 $3,422.934 $2,370,646 Results of operations Net investment income $ 841,646 $ 679,377 $ 492,756 $. 365,555 $ 294,454 Net realized investment losses (41,721) (29,203) (30,314) (33,012) (21.124) Fee income 458.827 317,703 248.411 198,604 171,085 General and administrative expenses (310,273) (265.738) (210,650) (165,434) (135,161) Amortization of deferred acquisition costs (241,167) (165.089) (108,176) (86.107) (69,253) Pretax income 707,312 537,050 392,027 279,606 240,001 j Income tax expense (191,000) (158,000) (117.600) (85,400) (74.700) Income before cumulative effect of change In accounting for income taxes 516,312 379,050 274,427 194,206 165,301 Cumulative effect of change in accounting for £ ' j income taxes - - - - (33,500) Not Income $ 516,312 $ 379,050 $ 274.427 S 194,206 $ 131.801 Basic earnings per share: Income before cumulative effect of change in accounting for income taxes $ 2.61 $ 2.01 S 1.44 $ 1.04 $ 0.87- Cumulative effect of change in accounting for _ income taxes - - - - (0.18) Net Income $ 2.61 S 2.01 S 1.44 $ 1.04 $ 0.69 Diluted earnings per share: Income before cumulative effect of change in accounting for income taxes $ 2.34 $ 1.81 $ 1.32 $ 0.96 $ 0.80 Cumulative effect of change in accounting for income taxes - - - - (0.18) Net income $ 2.34 S 1.81 $ 1.32 $ 0.96 $ 0.62 Cash dividends per share paid to common shareholders: Nontransferable Class B Stock $ 0.4050 $ 0.2400 $ 0.1800 $ 0.1200 $ 0.0800 Common Stock $ 0.4500 $ 0.2668 $ 0.2000 $ 0.1333 $ 0.0889 *Premiums and mutual fund sales,excluding sales of money market accounts. (continued) .. ;-�s Z. :e%�hr-�i�?A2i?X?�?�n,�:r,?s%$6C�',•w�.x'`�'4?'.-:,.�. .... .:dr.> `' •r:;i. ;..i f v. - _ - .z :iL «_:; 1 hac t 7': •..:: •'���•••:::VC • .t•; w-\•.-Jt l ..ww� .�•• •y�-e - ._�: 00 _ }may 1.ji:.�.•t_. -31— FIVE-YEAR SUMMARY (continued) At September 30. 0n thousands) 1991 1997 1996 1995 1994 Financial position Investments $26,065,407 $24,408,178 $16,199,784 $10,808,959 $9,280,390 Variable annuity assets held in separate accounts 11,405,434 9,514,675 6,380,458 5.263,006 4,513,093 Deferred acquisition costs 996,503 1,118,582 782,300 526,415 581,874 Other assets 733,063 595,451 364.279 245,787 280,868 Total assets $39,200,407 $35.636.886 $23.726.821 $16,844.167 $14,656,225 Reserves for fixed annuity contracts $12,970,549 $14,445,126 $ 9,654,674 $4.862,250 $4,519,623 Reserves for guaranteed investment contracts 8,380.844 5,553,292 4,169,028 3,607,192 2,783,522 Variable annuity liabilities related to separate accounts 11,405,434 9,514,675 6,380,458 5,263,006 4,513,093 Trust deposits 439,918 427,433 436,048 426.595 442,320 Other payables and accrued liabilities 905,202 1,097,418 489,672 747,733 860,763 Long-term notes and debentures 1.216.483 1,136,072 573,335 524,935 472,835 Other senior indebtedness — — — — 28,662 Deferred income taxes 394,910 383,764 125,417 146,947 74,319 Preferred securities of grantor trusts 495,000 495,000 237,631 52.631 — Shareholders'equity 2,992,067 2,584,106 1.660.558 1,213,078 961,088 Total liabilities and shareholders'equity $39,200,407 $35,636,886 $23,726,821 $16.844,167 $14,656,225 1t Y' I i. U� .,. ....'•'h,`•R>;L`.:�'.1 •4?N'�`.'1,��.'r`,}•-y�.{,�.K;:n_",f. -�'i_..i:�, .�,."`�•, aF``-x ..�•• .. ♦� 's 's4.S�',• a 'f t ;g' »�:. •'' } yds. . :s::r. _ .c,. -��� .t r —32— , CONSOLIDATED INCOME STATEMENT Years ended September 30, On thousands,except per-share amounts) 1991 1997 1996 Investment income $2,160,463 $1,795.826 $1,254.288 Interest expense on: Fused annuity contracts (721,490) (644,426) - (410.269) Guaranteed investment contracts (426.496) (314,144) (252,027) f Trust deposits (9,400) (9,726) (9,968) Senior indebtedness (120,253) (106,279) (69,033) Total interest expense (1,277,639) (1,074,575) (741,297) f Dividends paid on preferred securities of grantor trusts (41,178) (41,874) (20,235) 1- Met Investment income 841,646 679,377 492,756 (` Net realized Investment losses (41,721) (29,203) (30,314) {� Fee income: t Variable annuity fees 204,474 141,204 104,661 j Net retained commissions 114,461 64,911 49,824 Surrender charges 54,361 35,241 22,086 Asset management fees 29,592 25.764 25,413 Loan servicing fees 23.398 24.264 23,846 Trust fees 18.080 17,912 16,684 Otherfees 14,461 8,407 5,897 Total fee income 458,827 317,703 248,411 General and administrative expenses (310,273) (265,738) (210,650) Amortization of deferred acquisition costs (241,167) (165,089) (108,176) _ Pretax income 707,312 537,050 392,027 Income tax expense (191,000) (158,000) (117,600) Net income $ 516.312 5 379.050 $ 274,427 Net income per share: Basic $ 2.61 $ 2.01 $ 1.44 Diluted $ 2.34 $ 1.81 $ 1.32 See accompanying notes 4 III l� •�.. •/!.-Kh?T7%M�n'1Yr•'a'y'�`'ev�-;'.!�K;G.•`r":;JtZ�tt`.:..�. .. .. >•`:. 'F":4a:r ... '�C.+.:�:;•-�„5;•:i- Wr vw. _ •"• ••'• 72 •. • ••w, i f, 0'S'•, i tr` :�li t•.. ft -33- � r;> ' CONSOLIDATED BALANCE SHEET September 30, 4: Y. On thousands) 1998 1997 i' Assets Investments: Cash and short-term investments $ 1,796,132 S 993,349 Bonds,notes and redeemable preferred stocks available for sale,at fair value 8 4 1 6 91 18124 831 18,800,847 amortized cost:1998 $l 0 65 19 S ) 18,523,655 Mortgage loans 3.412,449 3.139.309 ." Common stocks available for sale,at fair value(cost:1998,$34,843;1997,$32,821) 82,808 96,541 Equity-method partnerships 779.098 561,336 Cost-method 865 953 725 457 partnerships Real estate 53,605 81,569 Other invested assets 274,515 286,962 Total investments 26,065,407 24,408,178 Variable annuity assets held in separate accounts 11,405,434 9,514,675 Accrued investment income 297,313 296,637 Deferred acquisition costs 996.503 1,118,582 Other assets 435,750 298,814 Total assets $39,200,407 $35,636,886 j Liabilities and shareholders'equity } Reserves,payables and accrued liabilities: - Reserves for fixed annuity contracts $12,970,549 $14,445,126 Reserves for guaranteed investment contracts 8,380.844 5,553,292 Trust deposits 439.918 427,433 Payable to brokers for purchases of securities 91,463 266,477 Income taxes currently payable 2,684 2,025 Other liabilities 811,055 828,916 Total reserves,payables and accrued liabilities 22,696,513 21,523,269 Variable annuity liabilities related to separate accounts 11,405,434 9.514,675 Long-term notes and debentures 1,216.483 1,136,072 i Deferred income taxes 394,910 383,764 Company-obligated mandatorily redeemable preferred securities of subsidiary grantor trusts whose j sole assets are junior subordinated debentures of the Company 495,000 495,000 i Shareholders'equity: Preferred Stock 248,000 248,000 Nontransferable Class B Stock 16,273 16,273 Common Stock 179,526 179,076 Additional paid-in capital 755,776 750,401 Retained earnings 1,596,220 1,180,446 Net unrealized gains on debt and equity securities available for sale 196,272 209,910 Total shareholders'equity 2,992,067 2,584,106 Total liabilities and shareholders'equity $39,200,407 $35.636,886 See accompanying notes 4p ?c?k;;:<}}::•;\j•.a; :.>:'?at�:.':2•::...•:ir.. R:..:xc4;: :4i:••rw:: ::w..: ; :;; Z 1/ -34- i a CONSOLIDATED STATEMENT OF CASH FLOWS Years ended September 30, (In thousands) 1298 1997 1996 Cash Bows from operating activities: Net income $ 516,312 ; 379.050 S 274,427 Adjustments to reconcile net income to net cash provided by operating activities: Interest credited to: 1t' Fixed annuity contracts 721.490 644,426 410.269 Guaranteed investment contracts 426,496 314,144 252,027 Trust deposits 9,400 9,726 9,968 Net realized investment losses 41,721 29,203 30,314 Accretion of net discounts on investments (61,691) (38,684) (28:610) £» Provision for deferred income taxes 22,477 128,001 (3,457) Change in: Accrued investment income (881) (59,214) (10,347) !f` ." •' Deferred acquisition costs (48,187) (78,564) (50.495) ° Other assets (47,894) (32,846) (18,958) [ '; Income taxes currently payable (3,687) (84,424) 19,052 Other liabilities (15,653) 157,598 38.275 !•: Other,net 1,247 (1,652) 15.721 =1j' Net cash provided by operating activities 1.561,150 1,366,764 938,186 Cash Bows from investing activities; Purchase of: -•_ Bonds,notes and redeemable preferred stocks (21,020.936) (19.506,303) (11.476,827) Mortgage loans (1,048,059) (990,408) (320,748) - Partnerships (1,372,571) (1,062,133) (712.749) Other investments,excluding short-term investments (398,387) (269,538) (132,711) Net assets of acquired businesses ' (44.784) 173,239 62,790 Sales of. Bonds,notes and redeemable preferred stocks 16,978,966 13,108,441 7,490,441 Mortgage loans - 333.763 - Partnerships 786,919 679,169 318,303 s '' Other investments,excluding short-term investments 73,676 92,626 63:556 Redemptions and maturities of: Bonds,notes and redeemable preferred stocks 3,704.503 4,425,246 2,891,448 y Mortgage loans 774,408 428,636 199.564 =r' Partnerships 156,708 321,901 183,014 Other investments,investments,excluding short-term investments 373,178 180.868 50,819 "''`• Net cash used by Investing activities (1,036,379) (2,084,493) (1,383,100) r See accompanying notes (continued) .IP Ij -7-2 .'•:r.vkiZ4!.•"2.Sv4;anCii''•Aii(�iS^: ... w .. - -. y. i��.`:'tiv�1 �'`�:' -35- L CONSOLIDATED STATEMENT OF CASH FLOWS (continued) Years ended September 30• On thousands) 1998 1997 1996 Cash flows from financing activities: Payments of cash dividends to shareholders S (100.538) S (67.819) S (61,721) , Premium receipts on: rmed annuity contracts 1,797,798 1,490,556 993.376 Guaranteed investment contracts 4.007,476 2,076.941 1.019.275 Net exchanges from the fixed accounts of variable annuity contracts (1,365,106) (660.332) (260,635) Receipts of trust deposits 877,698 787,599 454.237 Withdrawal payments on: Fixed annuity contracts (2,158,737) (1,454,718) (786,724) Guaranteed investment contracts (1,607.875) (1,010,127) (708,743) Trust deposits (874,615) (805,937) (454,718) Claims and annuity payments on fixed annuity contracts (474,851) (387,181) (232,361) Net proceeds from issuances of long-term notes and debentures 98.544 559,332 47,478 Net proceeds from issuances of preferred securities of subsidiary grantor trusts — 299,586 179.476 Payment for redemption of preferred securities of a subsidiary grantor trust — (52,631) — Net proceeds from issuance of Preferred Stock — — 240,547 Payments for redemptions of Preferred Stock (136.549) — Net proceeds from issuance of Common Stock — 577,268 — Other,net 78,216 (34,273) (310,560) Net cash provided by financing activities 278,012 1,181,715 118,927 Net increase(decrease)in cash and short-term investments 802.783 463,986 (325.987) Cash and short-term investments at beginning of period 993.349 529,363 855,350 Cash and short-term investments at end of period $ 1.796.132 $ 993,349 $ 529,363 Supplemental cash flow information: Interest paid on indebtedness $ 156,511 $ 130,461 $ 66,037 Income taxes paid,net of refunds received $ 172.441 E 114,423 $ 102,005 See accompanying notes � ,qy/rr.,!'ryc•� ;>:�;��..•::•._.. ., s �.;-. v�:..::gem:rn+yc;•..,..,...r.•�:.:v�::. . .•:.:...�. .. .'�a..r.••jsi::d'•.;wFr.{.n:.:ijCi:. %.'fir.:faSti±, ,tlt: 2 T� -36— NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: NATURE OF OPERATIONS NOTE 2: SUMMARY OF SIGNIFICANT SunAmerica Inc.(the"Company")conducts its business ACCOUNTING POLICIES f through five segments: annuity operations, asset Basis of Presentation. The accompanying consolidated management, retirement trust services, broker-dealer financial statements have been prepared in accordance operations and premium financing.Annuity operations, with generally accepted accounting principles and ' which include the sale and administration of fixed and include the accounts of the Company and all of `. variable annuities and guaranteed investment contracts, its wholly owned subsidiaries. All significant inter- are conducted through the Company's five life insurance company accounts and transactions are eliminated in subsidiaries: SunAmerica Life Insurance Company; consolidation. `: Anchor National Life Insurance Company; CalAmerica The preparation of financial statements in confor- Life Insurance Company ("CalAmerica"); First mity with generally accepted accounting principles SunAmerica Life Insurance Company;and SunAmerica requires the use of estimates and assumptions that National Life Insurance Company.Asset management, affect the amounts reported in the financial statements � which includes the sale and management of mutual and the accompanying notes.Actual results could differ funds,Is conducted by SunAmerica Asset Management from those estimates. � = Corp. Retirement trust services are provided by On August 29,1997,the Company paid a three-for- Resources Trust Company and include custodial and two stock split;on August 30,1996,the Company paid ;'+.•; administrative services for self-directed retirement a two-for-one stocks lit;and on November 10, 1995. r plans.Broker-dealer operations include the sale of secu- the Company paid a three-for-two stock split (collec- x rities and financial services products, and are con- tively, the "Stock Splits"). The Stock Splits were ducted by the Company's six broker-dealer subsidi- effected in the form of stock dividends on the aries: Royal Alliance Associates, Inc.; SunAmerica Company's Common Stock and Nontransferable Class B ' fit.• .. Securities, Inc.; Advantage Capital Corporation; FSC Stock.The par value of the shares paid in connection e: = Securities Corporation; Sentra Securities Corporation; with the Stock Splits was charged to Additional Paid-In and Spelman&Co.,Inc.Premium financing is provided Capital In the balance sheet.Per-share amounts,aver- by Imperial Premium Finance, Inc. and involves the age shares outstanding, stock option plan data and origination, sale and servicing of short-term premium related prices have been restated, for all periods pre- finance loans. rented,to reflect the Stock Splits. : The operations of the Company are influenced by P Y many factors, including general economic conditions, Investments. Cash and short-term investments pri- 3 monetary and fiscal policies of the federal government, marily include cash,commercial paper,money market and policies of state and other regulatory authorities. investments, repurchase agreements and short-term The level of sales of the Company's financial products is bank participations.All such investments are carried at influenced by many factors, including general market cost plus accrued interest, which approximates fair " rates of interest, strength, weakness and volatility of value, have maturities of three months or less and are ,+ equity markets,and terms and conditions of competing considered cash equivalents for purposes of reporting financial products.The Company is exposed to the typ- cash flows. ical risks normally associated with a portfolio of fixed- Bonds, notes and redeemable preferred stocks °:•-t income securities,namely interest rate,option,liquidity available for sale and common stocks are carried at �;. �� :;: ,v' and credit risk.The Company controls its exposure to aggregate fair value and changes in unrealized gains or these risks by,among other things, closely monitoring losses, net of tax, are credited or charged directly to and matching the duration of its assets and liabilities, shareholders'equity.Bonds,notes and redeemable pre- '':;•,;;y t . _ _ K.. ,�..` monitoring and limiting prepayment and extension risk terred stocks are reduced to estimated net realizable •,��,:...�•:�- in its portfolio, maintaining a large percentage of its value when necessary for declines in value considered to - ,..:� . portfolio in highly liquid securities,and engaging in a be other than temporary. Estimates of net realizable disciplined process of underwriting,reviewing and mon- value are subjective and actual realization will be ` P P g B 1 •�'%fig •"::r; •:..� itoring credit risk.The Company also is exposed to mar- dependent upon future events. ket risk,as market volatility may result in reduced fee Mortgage loans are carried at amortized unpaid income in the case of assets managed in mutual funds balances, net of provisions for estimated losses. Real :=;^+: ,1� : ': •' and held in separate accounts. estate is carried at the lower of cost or fair value. a: -ew o %.:"••: .'k;;�Aj. '•.fit':'.... W. .. .t. .. .., � \ - - '� C�i•:t,k�.!.:',.. � Y/:•:ra.1.1V•�A'ryp•:Y.:.y :•:�;.�. wi ! -A-.l.• .:\� -... .. "'�.�.^' t��: •;S _ �� fi"� YS cam'~ • �\y. .., ..:ri. -37— Partnerships are accounted for by using the equity classified with any gain/loss realized on the disposition method if the Company exercises significant influence of the hedged asset/liability. Subsequently, the Swap over their operating affairs;otherwise,the cost method Agreement is marked to market and the resulting is used. For partnerships that invest in tax-advantaged change in fair value is included in Investment Income in affordable housing units, interest is capitalized during the income statement.When a Swap Agreement that is construction.The Company invests in such partnerships designated as a hedge is terminated before its contrac- principally with the intent to syndicate them to third- tual maturity,any resulting gain loss is credited/charged party investors once construction of the underlying pro- to the carrying value of the assettliability that it hedged jects is completed. Investments in such partnerships and is treated as premium/discount for the remaining are accounted for by using the equity method and sales life of the asset/liability. of such partnerships are accounted for as sales of real , estate.Because the Company provides certain operating Total Return Corporate Bond Swap Agreements. Total and yield guarantees to the buyers, the gain realized return corporate bond swap agreements("Total Return upon sale is deferred, after recognition of syndication Agreements") have been entered into for investment compensation, and amortized over a 15-year period. purposes,and,accordingly,are marked to market with Syndication compensation, imputed interest and amor- the related gainAoss classified as Investment Income in tization of deferred gains are included in Investment the income statement. Income in the income statement.The carrying value of ' partnerships that are determined by the general partner Deferred Acquisition Costs. Policy acquisition costs are to have declines in value that are other than temporary deferred and amortized,with interest,in relation to the are reduced to net realizable value. incidence of estimated gross profits to be realized over Realized gains and losses on the sale of invest- the estimated lives of the annuity contracts. Estimated ments are recognized in operations at the date of sale gross profits are composed of net interest income, net and are determined using the specific cost identifica- realized investment gains and losses, variable annuity Lion method. Premiums and discounts on investments fees, surrender charges and direct administrative are amortized to investment income using the interest expenses.Costs incurred to sell mutual funds are also method over the contractual lives of the investments. deferred and amortized over the estimated lives of the Prior to September 24, 1998, the Company funds obtained. Deferred acquisition costs consist of entered into certain combined structured note trans- commissions and other costs that vary with, and are actions which have been accounted for as separate primarily related to, the production or acquisition of notes and in accordance with the provisions of new business. Consensus No. 96-12 of the Emerging Issues Task As debt and equity securities available for sale are Force.At its November 1998 meeting, the task force carried at aggregate fair value,an adjustment is made to issued Consensus No. 98-15 which concludes that deferred acquisition costs equal to the change in amor- combined structured note transactions entered into tization that would have been recorded if such securities after September 24,1998 should be accounted for as a had been sold at their stated aggregate fair value and unit. If the Company had accounted for these notes as the proceeds reinvested at current yields.The change in a unit,net income for 1998 would have been increased this adjustment,net of tax,is included with the change by $72,103,000 (or $0.33 per diluted share) to in net unrealized gainstlosses on debt and equity $588,415,000(or$2.67 per diluted share). securities available for sale that is credited or charged directly to shareholders'equity.Deferred Acqui- Interest Rate Swap Agreements. The net differential to sition Costs have been decreased by $145,200,000 be paid or received on interest rate swap agreements at September 30, 1998 and $139,600,000 at ("Swap Agreements")entered into to reduce the impact September 30,1997 for this adjustment. of changes in interest rates is recognized over the lives of the agreements,and such differential is classified as Variable Annuity Assets and Liabilities. The assets and Investment Income or Interest Expense in the income liabilities resulting from the receipt of variable annuity statement.Initially,Swap Agreements are designated as premiums are segregated in separate accounts. The hedges and, therefore, are not marked to market. Company receives administrative fees for managing the However,when a hedged asset/liability is sold or repaid funds and other fees for assuming mortality and cer- before the related Swap Agreement matures,the Swap tain expense risks.Such fees are included in Variable Agreement is marked to market and any gain/loss is Annuity Fees in the income statement. PIP - : 225 -38- Goodwill. Goodwill, amounting to $91,886,000 at SFAS 131 establishes standards for the disclosure September 30, 1998, is amortized by using the of information about the Company's operating seg- straight-line method over periods ranging from 25 to 40 ments. SFAS 131 is effective for the year ending years and is included in Other Assets in the balance September 30,1999 and is not included in these finan- sheet.Goodwill is evaluated for impairment when events cial statements. f. or changes in economic conditions indicate that the Implementation of SFAS 130 and SFAS 131 will t. carrying amount may not be recoverable. not have an impact on the Company's results of opera- tions,financial condition or liquidity. Contractholder Reserves. Contractholder reserves for In June 1998, the FASB issued Statement of fixed annuity contracts and guaranteed investment con- Financial Accounting Standards No. 133, "Accounting tracts are accounted for as investment-type contracts for Derivative Instruments and Hedging Activities" F: in accordance with Statement of Financial Account- ("SFAS 133").SFAS 133 addresses the accounting for ing Standards No. 97, "Accounting and Reporting by derivative instruments, including certain derivative f Insurance Enterprises for Certain Long-Duration Con- instruments embedded in other contracts,and hedging tracts and for Realized Gains and Losses from the Sale activities.SFAS 133 is effective for the Company as of of Investments,"and are recorded at accumulated value October 1, 1999 and is not included in these financial (premiums received, plus accrued interest, less with- statements.The Company has not completed its analy- ' drawals and assessed fees). sis of the effect of SFAS 133,but management believes that it will not have a material impact on the Company's Fee Income. Variable annuity fees,asset management results of operations,financial condition or liquidity. fees, trust fees and surrender charges are recorded in income as earned.Net retained commissions are recog- NOTE 3: PENDING MERGER WITH AMERICAN nized as income on a trade date basis. Loan servicing INTERNATIONAL GROUP, INC. fees are recognized as income ratably over the life of the On August 20, 1998,the Company announced that it serviced loans and include the difference between the has entered into a definitive agreement to merge with loan yield and the rate earned by the purchasers of and into American International Group, Inc. ("AIG"). the loans. Under the terms•of the agreement, each share of the j Company's Common Stock (including Nontransferable Recently Issued Accounting Standards. In June 1997, Class B) will be exchanged for 0.855 shares of AIG's the Financial Accounting Standards Board(the"FASB") common stock.The transaction will be treated as a pool- issued Statement of Financial Accounting Standards ing of interests for accounting purposes and will be a No. 130, "Reporting Comprehensive Income" ("SFAS tax-free reorganization.The transaction was approved by 130") and Statement of Financial Accounting both the Company's and AIG's shareholders on Standards No. 131,"Disclosure about Segments of an November 18, 1998,and,subject to various regulatory Enterprise and Related Information"("SFAS 131"). approvals,will be completed in late 1998 or early 1999. SFAS 130 establishes standards for reporting com- prehensive income and its components in a full set of ; general purpose financial statements. SFAS 130 is effective for the Company as of October 1, 1998 and is j not included in these financial statements. OR II - t�.�ii7?or.3YfC!6r.::�.�Cxr.�;3wg.��K.:::;�:u:•ri:f:•i.;:<::.... .-:h�. .... .. � �•+t -. o;•.7 . 2ZG: .. - j -39— NOTE 4: EARNINGS PER SHARE NOTE 5: ACQUISITIONS The calculations of basic and diluted earnings per share On March 31,1997,the Company completed the acqui- are as follows:- sition of G)a block of annuity contracts from John Alden Years ended September 30. Life Insurance Company, a subsidiary of John Alden Financial Corporation, and (ii) all of the outstanding an thousands.rrings pa Per-share amounts) 1l91 1991 1996 common stock of John Alden Life Insurance Company of Be*S1C earrings per shoo: Net income $518.312 $379.050 $274.427 New York, for a total cash purchase price of approxi- Less preferred stock dividends: mately $238,282,000 (collectively, the "John Alden 9%X Preferred Stock Series B — (5,754) (8.124) Acquisition").As part of this transaction,the Company Adjustable Rate Cumulative acquired assets having an aggregate fair value of Preferred Stock Series C — (28) (3,408) $5,056,098,000, composed primarily of invested Series D Mandatory Conversion assets totaling $5,000,822,000. Liabilities assumed Premium Dividend Preferred Stock — — (4,713) Series E Mandatory Conversion in this transaction totaled $5,218,828,000, including Premium Dividend Preferred Stock (12.400) (12,400) (10,815) $5,161,538,000 of fixed annuity reserves.An amount Total preferred stock dividends (12,400) (18.182) (27,060) equal to the sum of the purchase price and the fair Income available to common value of the net liabilities assumed, amounting to shareholders $503,912 $360.868 $247.367 $291,786,000 at September 30,1998.is included in Average common shares issued Deferred Acquisition Costs in the balance sheet. On and outstanding 195.405 182.640 175.118 October 31, 1997,John Alden Life Insurance Company Less common shares issued and of New York was nLerged with and into the Company's outstanding but not vested to participants under various other New York-chartered life insurance subsidiary,First employee stock plans (2,382) (3,259) (3,527) SunAmerica Life Insurance Company. Average shares outstanding 193,023 179.381 171,591 On April 1, 1996, the Company completed the Basic earnings per share S 2.61 $ 2.01 S 1.44 acquisition of a $958,672,000 block of annuity con- tracts(the "Central National Annuity Contracts')from Net incomuted e gsper share: The Central National Life Insurance Company of Net income $516,312 $379,050 $274,427 - - Less preferred stock dividends: Omaha,a subsidiary of Beneficial Corp.for a purchase 9%X Preferred Stock,Series B — (5,754) (9,124) price of$20,806,000.As part of this acquisition,the Adjustable Rate Cumulative Preferred Company acquired assets having an aggregate fair value Stock Series C — (28) (3.408) of $939,006,000, composed primarily of invested Total preferred stock dividends — (5,782) (11,532) assets totaling$929,561,000.An amount equal to the Income available to common excess of the sum of the purchase price and fair value shareholders $516,312 $373.268 $262,895 of the annuity reserves assumed over the fair value Average common shares issued of the assets acquired, amounting to $19,715,000 and outstanding 195.405 182,640 175.119 at September 30, 1998, is included in Deferred Plus incremental shares from potential Acquisition Costs in the balance sheet. common stale: Average number of shares arising On February 29, 1996, the Company completed from outstanding employee the acquisition of all of the outstanding stock of Ford stockplans 8.472 5,612 4.147 Life Insurance Company ("Ford Life") for a cash Average number of shares issuable purchase price of $172,500,000. The Company upon conversion of Series 0 Mandatory Conversion Premium acquired assets having an aggregate fair value of Dividend Preferred Stock — , — 3,876 $3,146,072,000, composed primarily of invested Average number of shares issuable assets totaling $3,097,151,000. Liabilities assumed upon conversion of Series E in this acquisition totaled $3,090,123,000, including Mandatory Conversion Premium Dividend Preferred Stock 12,216 14.301 16,212 $3,050,575,000 of fixed annuity reserves.An amount Average number of shares issuable equal to the excess of the purchase price over the fair upon conversion of Premium value of the net assets acquired, amounting to Equity Redemption Cumulative $57,121,000 at September 30, 1998, is included in Security Units 4.311 3,173 — Average shares outstanding 220,404 205,126 199,353 Deferred Acquisition Costs in the balance sheet. On . December 31, 1996, Ford Life was merged with and Diluted earnings per share $ 234 $ 1.81 S 1.32 into SunAmerica Life Insurance Company. ?_77 :Yi r —40— On December 29, 1995.the Company completed NOTE 6: INVESTMENTS the acquisition of all of the outstanding stock of The amortized cost and estimated fair value of bonds, CalAmerica for a cash purchase price of$120,000,000. notes and redeemable preferred stocks available for sale The Company acquired assets having an aggregate fair by major category follow: y value of $739,852,000, composed primarily of Arm3 invested assets totaling $722,461,000. Liabilities � Es6outed pnthouuads) cost fail value assumed in this acquisition totaled $662,316,000, At September30,1998: } including$645,379,000 of fixed annuity reserves.An Securities of the united States Government f 791.W f 821,e09 £ ' amount equal to the excess of the purchase price over Mortgage-backed securities 5.152,003 5,911,623 the fair value of the net assets acquired,amounting to Securities of public utilities 1.125,568 1,136,032 i- $28,897,000 at September 30, 1998, is included in Corporate bonds and notes 1,056.639 1.208,342 Deferred Acquisition Costs in the balance sheet. Redeemable securities 1,293.305 1,292.034 E Redeemable preferred storks 293.305 292,0]4 These acquisitions have been accounted for by Other debt securities 613.749 633,970 ` using the purchase method of accounting.Accordingly, Total available for sale $18.401,656 $18,300,847 T the income statement includes the operating results of C the John Alden Acquisition for only the period from r At September 30,1997: April 1, 1997 through September 30, 1998;the oper- Securities of the United States Government S 1,111,064 $ 1,126,463 f ating results of the Central National Annuity Contracts Mortgage-backed securities 6,208.610 6,344.036 . for only the period from April 1, 1996 through Securities Of Public utilities 532,577 542,583 Corporate bonds and notes 8,086,802 8,288,921 September 30, 1998; Ford Life's operating results a. for only the period from March 1, 1996 through Asset-backed securities 1,566,605 1,586,242 t Redeemable preferred stocks 152.449 162.955 September 30, 1998; and CalAmerica's operating Other debt securities 466.730 472,450 results for only the period from January 1,1996 through Total available for sale 218,124,837 $18,523,655 g September 30,1998.On a pro forma(unaudited)basis, assuming the John Alden Acquisition occurred on 1. October 1, 1996, revenues (investment income, net The amortized cost and estimated fair value of bonds, realized investment losses and fee income)would have notes and redeemable preferred stocks available for sale by been $2,269,135,000 and net income would have contractual maturity,as of September 30, 1998,follow: been$397,402,000($1.90 per diluted share)for the Amortized Estimated year ended September 30,1997. an thousands) ! cost fair valw At September 30, 1998, the deferred acquisition Due in one year or less f 283.675 i 27SA57 j costs arising from these transactions aggregated Due after one year through five years 3.903,566 4,094,035 e Due after five years through ten years 6.026,726 6,053,320 $397,519,000,and are being amortized,with interest, Due aftu ten years 2,435,686 2,462,512 z. in relation to the incidence of estimated gross profits to Z ' Mortgage-backed securities 5,152,003 5,911,623 be realized over the estimated lives of the assumed ictal available Casale $18,401,656 $18.800,847 SW annuity contracts. Future annual amortization is projected to be as follows: 1999, $92,504,000; 2000, $69,717,000; 2001, $52,786,000; 2002, Actual maturities of bonds, notes and redeemable $39.481,000;2003,$30,641,000;and thereafter,in preferred stocks will differ from those shown above due the aggregate,$112,390,000.The deferred acquisition to prepayments and redemptions. costs are substantially less than computations of the present values of estimated future profits discounted at ' the related weighted average crediting rates. On July 15, 1998, the Company entered into a definitive agreement to acquire MBL Life Assurance Corporation's individual life and individual and group annuity business(which had approximately$3 billion of fixed annuity reserves and$2 billion in reserves for uni- versal life policies) for approximately$130 million in cash.The acquisition is subject to customary conditions and required regulatory approvals,and is expected to be completed by the end of December 1998. 4 2 201 -41- • Gross unrealized gains and losses on bonds,notes The sources and related amounts of investment and redeemable preferred stocks available for sale by income are as follows: major category follow: Tears ended September 30, Gross cross (In thousands) 1191 1997 1996 tunaliind unrealized Short-term investments $ 90.994 S 83.021 S 66,378 (in thousands) pins buses Bonds,notes and redeemable At September 30.1998: preferred stocks 1,413,205 1,169.631 819,812 Securities of the United States Government $38,126 $ .(861) Mortgage bans 287,829 222,403 149.476 Mortgage•backed securities 177.753 (18.133) Equity-method partnerships 159,948 126,865 96,452 Securities of public utilities 40,185 (29,721) Cost-method partnerships 211.228 114,667 82,116 Corporate bonds and notes 400.157 (24SA54) Other invested assets (2,639) 79.239 40,054 Asset-backed securities 34.942 (13,753)Redeemable preferred stocks 5,532 (6,803) Total investment income f2,160,163 51,195,826 $1,254,288 Other debt securities 20,345 (124) Total available for sale $717,040 S017,849) Expenses incurred to manage the investment port- folio amounted to $30.653,000 for the year ended At September 30,1997: September 30, 1998,$26,801,000 for the year ended Securities of the United States Government S 16,393 S (989) September 30, 1997 and $21,475,000 for the year Mortgage-backed securities 158.989 (23.562) ended September 30,1996 and are included in General Securities of public utilities , (1) Corporate bonds and notes 23636,038 (33,919) and Administrative Expenses in the income statement. 038 Asset-backed securities 20,261 (624) Investments in unconsolidated partnerships Redeemable preferred stocks 10,564 1% accounted for by using the equity method of accounting Other debt securities 6.018 (298) totaled$779,098,000 at September 30,1998.At that Total available for sale $458.843 S(60.025) date,total combined assets of these partnerships were $3,033,520,000 (consisting entirely of investments) At September 30, 1998, gross unrealized gains and total combined liabilities were $2,156,368,000 on equity securities available for sale aggregated (including $1,379,117,000 of nonrecourse notes $49,631,000 and gross unrealized losses aggregated payable to banks). For the year then ended, total $1,666,000.At September 30, 1997,gross unrealized combined revenues and expenses of such partnerships gains on equity securities available for sale aggregated were$446,412,000 and$214,010,000, respectively, II $64,635,000 and gross unrealized losses aggregated resulting in $232,402,000 of total combined pretax $915,000. income. Gross realized investment gains and losses on sales Investments in unconsolidated partnerships of investments are as follows: accounted for by using the equity method of accounting totaled $561,336,000 at September 30, 1997. At Years ended September 30. that date, total combined assets of these partnerships on thousands) list 1997 1996 were $2,220,060,000 (including $2,211,405,000 of Bands,notes and redeemable investments) and total combined liabilities were preferred stocks: Available for sale: $1,593,596,000(including$1,543,148,000 of nonre- Realized gains f 306,251 $155,610 $81,323 course notes payable to banks).For the year then ended, Realized losses (259,249) (141,513) (93,261) total combined revenues and expenses of such partner- ships were$290,406.000 and$146,104,000,respec- Realized gains 13.768 22,755 8,765 tively, resulting in $144,302,000 of total combined Realized losses (614) (760) (5,365) pretax income. Other Investments Reara d gains 8,858 2.286 13,234 At September 30, 1998, no investment exceeded Realized losses (943) (2,268) (72) 10% of the Company's consolidated shareholders' Impairment writedowns (109.787) (65,313) (34,938) equity. Total net realized At September 30, 1998, mortgage loans were investment losses $(41.721) $(29,203) $00,314) collateralized by properties located in 46 states, with loans totaling approximately 19%,12%and 10%of the aggregate carrying value of the portfolio secured by properties located in California, New York and Texas, respectively. F-,2. �7 e � -42— At September 30, 1998, bonds, notes and tions,equal to the Payment Amount plus any reduction jredeemable preferred stocks included$1,781.814,000 in the aggregate fair value of the Bonds below the of bonds and notes not rated investment grade. Notional Amount. The Company is also exposed to The Company had no material concentrations of potential credit loss in the event of nonperformance by non-investment-grade assets at September 30, 1998. the investment-grade-rated counterparty with respect to At September 30, 1998, the carrying value of any increase in the aggregate market value of the Bonds investments in default as to the payment of principal or above the Notional Amount. However, nonperformance interest was$55.009,000.consisting of$19.672,000 is not anticipated and,therefore,no collateral is held or of non-investment-grade bonds and $35.337.000 of pledged. Net amounts received (paid) are included in mortgage loans. Investment Income in the income statement and totaled As a component of its asset and liability manage- ($33,716,000), $35,368,000, and $32,490,000 for ment strategy,the Company utilizes Swap Agreements the years ended September 30,1998,1997 and 1996. to match assets more closely to liabilities. Swap respectively. Agreements are agreements to exchange with a counter- party interest rate payments of differing character NOTE 7: FAIR VALUL OF FINANCIAL (for example, variable-rate payments exchanged for INSTRUMENTS fixed-rate payments) based on an underlying principal The following estimated fair value disclosures are lim- balance (notional principal) to hedge against interest ited to reasonable estimates of the fair value of only rate changes. The Company typically utilizes Swap the Company's financial instruments. The disclosures Agreements to create a hedge that effectively converts do not address the value of the Company's recognized floating-rate assets and liabilities into fixed-rate instru- and unrecognized nonfinancial assets (including its ments.At September 30. 1998,the Company had 38 partnerships accounted for by using the equity outstanding Swap Agreements with an aggregate method, real estate investments and other invested notional principal amount of $1,870,427,000. These assets) and liabilities or the value of anticipated agreements mature in various years through 2010 and future business. The Company does not plan to sell have an average remaining maturity of 43 months.With most of its assets or settle most of its liabilities at respect to swaps that hedge assets,net interest received these estimated fair values. (paid) amounted to ($6,706,000), ($1,091,000) and The fair value of a financial instrument is the $5,214,000 for the years ended September 30. 1998, amount at which the instrument could be exchanged in 1997 and 1996, respectively, and is included in a current'transaction between willing parties,other than Investment Income in the income statement. With in a forced or liquidation sale. Selling expenses and respect to swaps that hedge liabilities,net interest paid potential taxes are not included. The estimated fair amounted to$5,430,000,$1,706,000 and$168.000 value amounts were determined using available market for the years ended September 30, 1998, 1997 and information,current pricing information and various val-' 1996,respectively,and is included in Interest Expense uation methodologies. If quoted market prices were not on Guaranteed Investment Contracts in the income readily available for a financial instrument, manage- statement. ment determined an estimated fair value.Accordingly, For investment purposes, the Company also has the estimates may not be indicative of the amounts the entered into various Total Return Agreements with an financial instruments could be exchanged for in a cur- aggregate notional principal amount of$533,000.000 rent or future market transaction. (the"Notional Amount')at September 30, 1998.The The following methods and assumptions were used Total Return Agreements effectively exchange a fixed to estimate the fair value of each class of financial rate of interest(the"Payment Amount')on the Notional instruments for which it is practicable to estimate Amount for the coupon income plus or minus the that value: increase or decrease in the fair value (the "Total Return")of specified non-investment-grade bonds(the Cash and Short-Term Investments: Carrying value is con- r "Bonds"). The Total Return Agreements mature in sidered to be a reasonable estimate of fair value. i March 1999; however, the Company intends to enter into other similar agreements.The Company is exposed Bonds, Notes and Redeemable Preferred Stocks: Fair , to potential loss,due to credit risk on the underlying value is based principally on independent pricing ser- non-investment-grade lt:•:.'bonds and bond market fluctua- vices,broker quotes and other independent information. A 230 . -43— Fair values include the market value,determined from Long-Term Notes and Debentures: Fair value is esti- independent broker quotes, of Swap Agreements that mated based on the quoted market prices for the same hedge certain bonds and notes. or similar issues. Mortgage Loans: Fair values are primarily determined Preferred Securities of Subsidiary Grantor Trusts: Fair by discounting future cash flows to the present at cur- value is based upon independent pricing services. rent market rates,using expected prepayment rates. The estimated fair values of the Company's finan- cial instruments at September 30, 1998 and 1997. Common Stocks: Fair value is based principally on compared with their respective carrying values, are independent pricing services, broker quotes and other as follows: independent information. carrying Fair On thousands) value ra)ue Cost-Method Partnerships: Fair value of limited partner- 1998: ships accounted for by using the cost method is based Assets: upon the fair value of the net assets of the partnerships Cash and short-term investments S 1.796,132 f 1.796.132 as determined by the general partners. Bonds,notes and redeemable preferred stocks 18.800,847 18,300,947 Mortgage bans 3,412.449 3.543.314 Variable Annuity Assets Held in Separate Accounts: Common stocks 82,808 82.908 Variable annuity assets are carried at the market value Cost-method partnerships 865,953 1,213.668 of the underlying securities. variable annuity assets held.in separate accounts 11.405.434 11,405,434 Reserves for Fixed Annuity Contracts: Deferred annuity Liabilities: contracts and single premium life contracts are Reserves for fixed annuity contracts 12.970,549 12,487.632 assigned a fair value equal to current net surrender Reserves for guaranteed investment value,which includes the estimated fair value of hedg- contracts 8.380,844 8,618.089 ing Swap Agreements, determined from independent Trust deposits 439.918 439,918 broker quotes. Annuitized contracts are valued based Payable to brokers for purchases of- on the present value of future cash flows at current securities 91,463 91,463 Variable annuity liabilities related,to pricing rates. separate accounts 11,405.434 10.951,726 Long-term notes and debentures 1,216.483 1.330.568 Reserves for Guaranteed Investment Contracts: Fair value Preferred securities of subsidiary is based on the present value of future cash flows at cur- grantor trusts 495.000 507.256 rent pricing rates and is net of the estimated fair value of hedging Swap Agreements, determined from inde- pendent broker quotes. Trust Deposits: Trust deposits are carried at the fair value of deposits payable upon demand. Payable to Brokers for Purchases of Securities: Such obligations represent net transactions of a short-term nature for which the carrying value is considered a rea- sonable estimate of fair value. Variable Annuity Liabilities Related to Separate Accounts: Fair values of contracts in the accumulation phase are based on net surrender values.Fair values of contracts in the payout phase are based on the present value of future cash flows at assumed investment rates. L�i � -44— carrying Fair Subsequent to these offerings, $3,225,000,000 onUwsanasl value Value remains available to the Company to issue securities 1917. under the July 1997 shelf registration statement. kettu Short-term borrowings, which include short-term Cash and short-term investments S 993.349 S 993,349 Bonds,notes and redeemable bank notes, reverse repurchase agreements and bor- preferred stocks 18.523,655 18,523,655 rowings under a commercial paper program, averaged MoNageban$ 3.139.309 3.269,079 $514,055,000 at a weighted average interest rate of , Common stocks 96,541 96.511 5.0%during 1998 and$611,719.000 at a weighted Cost-method partnerships 725,457 1,158,833 average interest rate of 6'/.%during 1997.The high- l: Variable annuity assets held in separate accounts 9.514.675 9,514.675 est level of short-term borrowings at any month-end was $1,167,676,000 at 5'/.% during 1998 and ` LiabOities: $1,019,754.000 at 5'/e% during 1997. There were ` Resems for fixed annuity contracts 14.445,126 13.805.124 no short-term borrowings outstanding at either Reserves for guaranteed investment September 30,1998 or September 30.1997. contracts 5,553.292 5,515,335 Principal Trust deposits 427,433 427,433 P payments on long-term borrowings Payable to broken tar purchases of securities 266,477 266,471 are due as follows: 1999. $17,775,000; 2000, ' Variable annuity liabilities related to $570,250,000; 2001. $24,000.000; 2002, separate accounts 9,514.675 9,240.245 $24,000,000; 2003, $18,900,000; and thereafter. Long-term notes and debentures 1,136,072 1,172,392 $604,635,000. Preferred securities of subsidiary Y grantortrusts 495,000 507.375 NOTE 9: COOINGENT LIABILITIES F . The Company is involved in various kinds of litigation NOTE 8: INDEBTEDNESS l• common to its businesses.These cases are in various ). Indebtedness consists of the following long-term notes stages of development and,based on reports of counsel, and debentures(interest rates are as of September 30): management believes that provisions made for potential seplember30. losses are adequate and any further liabilities and costs - will not have a material adverse impact u On thousands) 1l91 199y P Pon the 5.6%debentures due July 31,2097 Company's financial position or results of operations. (net of unamortized discount of In 1989 and 1996. the Company sold, through $43.077 at September 30,1998 three separate 100% coinsurance transactions, the */ and$43,513 at September 30,1997) $ 131,923 $ 131.487 general agency division of SunAmerica Life Insurance Medium-term notes due 1999 through 2026 Company,the credit life business of Ford Life and the (5%%to7YX) 228,310 243.335 BYX debentures due April 28,2023 100,000 10000.000 000 mortality-based business of CalAmerica. With respect x 9.95%debentures due February 1.2012 26.791 100,000 to these coinsurance transactions, SunAmerica Life i 9.95%debentures due August 1.2009 73,209 — Insurance Company and CalAmerica could become liable 6.2%notes due October 31.1999 431.250 QL250 for in-force amounts ceded of $1,856,928,000 and 9%notes due January 15,1999 125.000 125.000 $1,897,974,000,respectively,at September 30,1998. 6.75%debentures due October 1,2007 100,000 — if the coinsurers were to become unable to meet ' Total indebtedness $1.216,483 $1,136.072 the obligations assumed under the respective coinsur- ance agreements. At September 30, 1998, related 1 In July 1997,the Company filed a shelf registra- policyholder reserves carried by the coinsurers were x' tion statement under which it may issue up to $70,123,000 and$157.278,000,respectively.As part ' 'c $3,500,000,000 of securities in the form of debt; of the 1989 SunAmerica Life Insurance Company coin- ' preferred stock; common stock; warrants to purchase surance transaction, assets substantially equal to the debt, preferred stock or common stock; stock pur- policyholder reserves assumed by the coinsurer are held chase contracts or stock purchase units; or preferred in trust to secure the obligations of the coinsurer. securities of the Company's subsidiary grantor trusts.On The Company has transferred to third-party ~: July 28, 1997,the Company issued$175,000,000 of investors certain of its interests in various partnerships its 5.6%debentures,due July 31.2097,and received that make tax-advantaged affordable housing invest- discounted proceeds of approximately$130,000,000, ments.As part of these transactions,the Company has ` and on October 7, 1997, the Company issued agreed to advance monies to support the operations of -x $100,000,000 of 6.75%notes due October 1,2007. the underlying housing projects, if required, and has :=. •'•w _!�}.:.' -45- r y guaranteed that the transferred partnerships will pro- guarantee of payments due on the preferred securities. vide,as of the transfer date and under then current tax The grantor trusts are wholly owned subsidiaries of laws, a specified level of associated tax credits and the Company. The debentures issued to the grantor deductions to the third-party investors. Based on an trusts and the common securities purchased by the evaluation of the underlying housing projects,manage- Company from the grantor trusts are eliminated in the ment does not anticipate any material cash payments balance sheet. with respect to the guarantees. In the ordinary course of business, the Company NOTE 11: SHAREHOLDERS' EQUITY has agreed contingently to make capital contributions, The Company is authorized to issue 20,000,000 shares aggregating approximately$670,192,000,to 121 lim- of preferred stock ('Preferred Stock"). All preferred ited partnerships over the next 5 years (4.5 years on shares of the Company rank on a parity with each other a weighted average basis) in exchange for ownership and rank senior to Common Stock and Nontransferable interests in such partnerships. Class 8 Stock of the Company as to payment of divi- dends and distribution of assets upon dissolution,liqui- NOTE 10: COMPANY-OBLIGATED PREFERRED dation or winding up of the Company. SECURITIES OF GRANTOR TRUSTS On November 1, 1995, the Company issued Preferred securities of subsidiary grantor trusts com- 4,000,000 $3.10 Depositary Shares (the "Series E prise$185,000,000liquidation amount of 8.35%Trust Depositary Shares"), each representing one-fiftieth of Originated Preferred Securities issued by SunAmerica a share of Series E Mandatory Conversion Premium Capital Trust 11 in October 1995 and $310,000,000 Dividend Preferred Stock,with a liquidation preference liquidation amount of 8.30%Trust Originated Preferred of $62 per share. On September 22. 1998, the Securities issued by SunAmerica Capital Trust III in Company announced that it would redeem all of its November 1996. Series E Depositary Shares.The redemption was com- In connection with the issuance of the 8.35%Trust pleted on October 30, 1998 and resulted in the Originated Preferred Securities and the related purchase issuance of 11,250,709 shares of the Company's by the Company of the grantor trust's common securities, Common Stock and cash payment of all accrued and the Company issued to the grantor trust$191,224,250 unpaid dividends through the redemption date. principal amount of 8.35%junior subordinated deben- On March 10, 1993, the Company issued tures, due 2044, which are redeemable at the option 5,002,500 $2.78 Depositary Shares (the "Series D of the Company on or after September 30, 2000 at a Depositary Shares"), each representing one-fiftieth of redemption price of$25 per debenture plus accrued and a share of Series D Mandatory Conversion Premium unpaid interest. Dividend Preferred Stock,with a liquidation preference In connection with the issuance of the 8.30%Trust of $37 per share. On January 2, 1996,the Company Originated Preferred Securities and the related purchase redeemed all of the Series D Depositary Shares for a call by the Company of the grantor trust's common securities, price equal to $49.95 per share plus accrued and the Company issued to the grantor trust$320,670,000 unpaid dividends to the redemption date.The call price principal amount of 8.30% junior subordinated deben- was paid with 5,112,529 shares of the Company's tures, due 2045, which are redeemable at the option Common Stock. of the Company on or after November 13, 2001 at a At September 30, 1996, the Company had out- redemption price of $25 per debenture plus accrued standing 486,800 shares of Adjustable Rate Cum- and unpaid interest. ulative Preferred Stock, Series C (the "Series C ' The interest and other payment dates on the deben- Preferred Shares"), with a liquidation preference of tures correspond to the distribution and other payment $100 per share. On October 4, 1996. the Company dates on the preferred and common securities.The pre- redeemed all of the Series C Preferred Shares for a cash ferred and common securities will be redeemed on a pro payment equal to the total liquidation amount of rata basis, to the same extent as the debentures are $48,680,000 plus accrued and unpaid dividends to the repaid.Under certain circumstances Involving a change redemption date. in law or legal interpretation,the debentures may be dis- In,1992, the Company issued 5,620,000 shares tributed to holders of the preferred and common securi- of 9'/.% Preferred Stock, Series B (the "Series 8 ties in liquidation of the grantor trust(s).The Company's Preferred Shares"),with a liquidation preference of$25 obligations under the debentures and related agree- per share.On June 13, 1995,the Company exchanged ments,taken together,provide a full and unconditional 2,105,235 Series 8 Preferred Shares with a liquidation $.:... 'aYi%:':.:Y/.Y'•:'!.�r:T:,::vi•,7�Ci:.,v.viri'l.::ii 1i t~ —46— preference of $52,630,875 for $52.630,875 Changes in shareholders'equity are as follows: liquidation amount of 9.95% Trust Originated Preferred Securities of SunAmerica Capital Trust 1.On p"thousands,esceptpu•shart leartendedSeptember30, and short amounts) 1398 1991 I996 June 16, 1997, the Company redeemed all 01 the Beginnin remaining Series B Preferred Shares for a cash payment balance Beginningbalarrce j248,000 $394,549 j 321,642 equal to the total liquidation amount of approximately Issuance of4,000,000 $87,869,000 plus accrued and unpaid dividends to Series E Preferred Shares — — 248,000 the redemption date. Redemption of 5,002,5D0 The Company is authorized to issue 350.000,000 Series D Depositary Shares — Redemption of 3,514,765 shares of its $1.00 par value Common Stock and is Series B Preferred Shares — (87,869) — authorized to repurchase 15,000,000 shares of such Redemption of 486.800 stock. At September 30, 1998, 179.526,000 shares Series C Preferred Shares — (48,680)were outstanding and at September 30, 1997, Ending balance $248,000 $248,000 $384549 3 179,076,000 shares were outstanding. >.. On November 6, 1996, the Company issued Nontransferable Class B Stock 11,500,000 8'/2% Premium Equity Redemption Beginning balance $16,273 $10,948 $ 10.240 Cumulative Security Units (the "Units")with a stated Conversion of 4,816.000 shares t amount of $37.50 per Unit. Each Unit consists of a to Common Stock — — (4,816) stock purchase contract(the"Contract")and a United Stock Splits — 5.425 5,424 States Treasury Note (the "Treasury Note") having a Ending balance f 16.273 S 16.273 S 10,848 r principal amount equal to the stated amount and matur- ing on October 31, 1999.The holders of the Units will Common Stock ; receive interest on the Treasury Notes payable by the Beginning balance $179.076 $108,604 j 44,175 f Issuance of 10,669,745 United States Government at a rate of 7'/2%per annum shares of Common Stock <' and Contract fees payable by the Company at a rate of at S54/per share — 10.670 — 1%per annum(both,the"Unit Payments")based upon Issuance of 5,112,529 shares the stated amount.The Contract obligates the Company to redeem the Series D. to deliver on October 31, 1999 to the holder of each Depositary Shares — — 5.113 z Unit one and one-half shares of Common Stock of the Conversion of NontransferableClassaStockto ? Company,subject to adjustment under certain defined — � d,776,000 shares — 4,776 f it circumstances,and obligates the holder of the Unit to Stock options and other ;. pay to the Company $37.50 per Unit. The Treasury employee benefit plans 450 115 252 Notes will be held by a collateral agent to secure pay- Stock Splits — 59,687 54,288 ment to the Company as required under the Contract, Ending balance $179.526 $179,076 S 108,604 ; but may be redeemed by the holders of the Units under } certain defined circumstances. On October 7, 1998, } I subsequent to the Company's fiscal year end, the k. Company announced that it will redeem all of its Units on December 6, 1998.In connection with this redemp- tion,the Company will issue 10,108,229 shares of the Company's Common Stock and will make a cash pay- ment for all accrued and unpaid Contract fees. The Company is authorized to issue 25,000,000 e shares of its$1.00 par value Nontransferable Class 8 Stock. Holders of this stock have rights identical to those of the Company's common stockholders except that they have ten votes per share and are entitled to only 90%of any cash dividend paid on the Common Stock.This stock is convertible at any time into shares of Common Stock.At September 30, 1998 and 1997, 16,273,000 shares were outstanding. �ute•t,�,.�cs-.----...w err.►.ww.•ww-..r--2LoY�t<:•.-.... r•.v- _...—. �_ � —4/— Y: X. 0n thousands.&aptper-share Tears ended September 30, September 30, 1998. restricted net assets of these _ and share amounts) Mll 1997 1996 consolidated life insurance subsidiaries totaled approxi- Additional paid-in capital: mately$1.934,653,000,none of which is available for Beginning balance $ 750,401 S 304,P95 $195,211 the payment of dividends until calendar year 1999. Issuance of Common Stock — 566,598 — The combined statutory equity of the Company's Cpst ofref issuance five life insurance subsidiaries totaled$1,415,095,000 Preferred Shares — — p,4531 Excess of redemption value of at September 30, 1998, $1,430,935,000 at Series 0 Preferred Shares December 31, 1997, and $1,187,013,000 at over par value of shares December 31,1996.The combined statutory net income of Common Stock issued, of these subsidiaries totaled$294,413,000 for the nine net of transaction costs — — 179.972 months ended September 30, 1998.$257,049,000 for Cost of issuance of 7,400,000the year ended December 31,1997,and$210,791,000 shares of Trust Originattedd - Preferred Securities of for the year ended December 31, 1996. SunAmerica Capital Trust II — — (5,524) Cost of issuance of12,400,000 NOTE 12: STOCK COMPENSATION PLANS shares of Trust Originated At September 30, 1998,the Company had five stock- Preferred Securities of based compensation plans,which are described below. SunAmerica Capital Trust III — (10,414) — Cost of issuance of 11,500.000 The Company applies APB Opinion No.25."Accounting Premium Equity Redemption for Stock Issued to Employees"and related interpreta- Cumulative Security Units — (44,605) — tions in accounting-for such plans, and, accordingly, Stock options and other no compensation cost has been recognized for stock employee benefit plans 5,375 (361) 11,801 options granted pursuant to these plans. If compensa- Stock Splits — (65.112) (59,712) lion cost for such stock options had been recognized, ' Ending balance $ 755.776 S 750,401 $304,295 based on the fair value at the grant dates and computed in a manner consistent with a method described by Retained earnings: Statement of Financial Accounting Standards No. 123, Beginning balance $1,180.446 $ 869.215 $656,509 Net income 516.312 379,050 274,427 "Accounting for Stock-Based Compensation," ("SFAS Dividends on: 123")then the Company's net income would have been Preferred Stock (12,400) (18,808) (27.063) $486,345,000($2.46 per basic share and$2.21 per Nontransferable diluted share), $366,825,000($1.94 per basic share Class 8 Stock (6,589) (3,906) (4,878) and $1.75 per diluted share) and $269,878,000 Common Stock (81,549) (45.105) (29.780) ($1.42 per basic share and$1.30 per diluted share)for , Ending balance $1,596,220 $1,180,446 $869,215 the years ended September 30,1998,1997 and 1996, respectively.The weighted average per share fair value Net unrealized gains/losses used to compute compensation cost for the year ended on debt and equity securities September 30,1998 was$19.78 and reflects weighted available for sale: Beginning balance S 209,910 S (16.953) S (4,699) average assumptions including a dividend yield of Change in net unrealized 0.7%,a volatility of 40.6%,a risk-free interest rate of gainstiosses on debt 5.9%and an option life of 8.0 years.The weighted aver- securities available for sale 373 474.414 (41.464) age per share fair value used to compute compensation Change in net unrealized cost for the year ended September 30, 1997 was e gain on equity securities available for sale (15.755) 27,206 18.011 $11.92 and reflects weighted average assumptions Change in adjustment to including a dividend yield of 0.9%, a volatility of deferred acquisition costs (5,600) (152,600) 7,600 39.3%,a risk-free interest rate of 6.2%and an option Tax effects of net changes 7,344 (122.157) 6.599 life of 7.0 years. The weighted average per share fair Ending balance S 196.272 S 209,910 S(16,9531 value used to compute compensation cost for the year ended September 30, 1996 was $6.32 and reflects Dividends that the Company may receive from its weighted average assumptions including a dividend life insurance subsidiaries in any year without prior yield of 1.3%,a volatility of 40.3%,a risk-free interest approval of the Arizona, California or New York rate of 6.0%and an option life of 6.6 years. insurance commissioners are limited by statute. At i r ,......... e?35 , -48- x x The Company's five stock plans are the 1997 net income for 1998 would have been$415,539.000 Employee Incentive Stock Plan (the "1997 Plan"), ($2.09 per basic share and$1.89 per diluted share). the 1995 Performance Stock Plan(the"1995 Plan"), Under its CEO Plan,the Company may grant shares the 1988 Employee Stock Plan (the "1988 Plan"), of its Common Stock to the Company's Chief Executive the Long-Term Performance-Based Incentive Plan (the Officer("CEO") in the form of stock options. Prior to "CEO Plan") and the Non-Employee Directors' Stock amendment of the CEO Plan, which was approved by Option Plan.The 1988 Plan has been replaced by the shareholders in fiscal 1997. awards under this plan , 1997 Plan.Under these stock plans,the Company may were also made in*the form of restricted stock or {r , grant an aggregate of 42,632,550 shares to its employ- deferred shares.The actual number of options granted ees in the form of either stock options,restricted stock is predicated upon defined performance of the or stock units. At September 30, 1998, 10,298,429 Company's Common Stock relative to defined perfor- shares remain available for future grant. Options mance of the S&P 500 Index.Restricted shares are held granted under the plans have an exercise price equal to in escrow until the earlier of the CEO's death,disability the market price at the date of grant,have a maximum or retirement or change in control of the Company. term of 10 years and generally become exercisable rat- Deferred shares are held in escrow until 18 months after ably over a five-year period. the earlier of the CEO's death, disability or retirement Under the terms of the stock option agreements, or change in control of the Company. Stock options the pending merger with AIG(See Note 3)constitutes a granted under this plan have an exercise price equal to change in control of the Company and,when consum- the market price at the date of grant,have a maximum mated,will cause all unvested stock options to become term of 10 years and are immediately exercisable. immediately exercisable. If the pending merger had A summary of the status of the Company's stock been completed in 1998,an additional $70,806,000 option plans as of September 30, 1998, 1997 and of compensation cost would have been recognized for 1996 and changes during the years then ended follows: purposes of the SFAS 123 pro forma disclosures,and 1998 1997 1996 - Weighted Weighted Weighted - - average averap average . Shares exercise Shares exercise Shares exercise (000's) price (000's) price (000's) price .. Options outstanding at beginning of year 14,995 $14.27 12,452 ; S 9.23 10,320 S 6.82 Options granted 2,87I 45.99 3,438 30.51 2,593 19.32 Options exercised (942) 8.29 (762) 4.63 (306) 5.00 Options forfeited (690) 21.80 (133) 16.92 (155) 8.83 Options outstanding at end of year 16,235 19.91 14,995 14.27 12,452 9.23 Options exercisable at end of year 11,709 $15.07 9,710 $9.65 8,022 S 6.69 IV s-z v?: A:3 ��• Y 4+ _ -49- r The following table summarizes information about NOTE 13: INCOME TAXES stock options outstanding at September 30. 1998: The components of the provisions for income taxes on optionsoutstanding optiensexemisable pretax income consist of the following: Weighted (In thousands) Federal State Tout . amp Weighted Weighted - remaining away average 1998: ' Range of Shares contractual exercise shares exercise Currently payable $155A41 $12,682 $168.523 exercise prices (000's) fife price (000's) price Deferred 20.746 1,731 22,477 ' $0.86 to$2.35 Z163 1.8 years $2.08 Z163 $2.00 Total income tax expense $175.587 $14.413 $191.000 $4.50 to$7.15 1,643 4.2 5.74 1,643 5.74 $8.11 to$12.31 4,160 62 10.02 3.402 9.73 1997; $1497 to$20.46 2286 7.4 19.08 1.434 16.86 currently payable S 28,281 $1,718 $29,999 $25.33 to$33.33 Z134 8.1 2629 1,124 25.41 Deterred 128.281 718 129.999 $39.35 to$60.41 3,849 92 4429 1,943 39.55 8.001 Total 16,235 6.5 19.91 11,109 15.07 Total income tax expense $155,628 $2.372 $158,000 1996: At September 30, 1998, 2,169,284 shares of Currently payable $110.531 $10,526 $121.057 unvested restricted stock are outstanding,and deferred Deferred (991) (2,466) (3,457) shares and stock units representing 2,121,375 shares Total income tax expense $109.540 $8.060 $117,600 of stock are outstanding. The Company granted restricted stock and stock units aggregating 370,116 Income taxes computed at the United States fed- shares in the year ended September 30, 1997 and eral income tax rate of 35%and income taxes provided 527,634 shares in the year ended September 30,1996. differ as follows: No restricted stock or stock units were granted in the year ended September 30,1998.The weighted average Years ended September 30, per share fair value of such stock at the date of grant On thousands) 1298 1997 1996 was$23.08 in 1997 and$15.83 in 1996.Restrictions Amount computed at generally lapse either on an accelerated basis, upon statutory rate $247,56.0 $187,968 $137.209 achievement of defined performance goals, upon a Increases(decreases) resulting from: change in control of Company,or over a defined length Affordable housing ' of service.Compensation cost charged to operations for tax credits (38,806) (24,436) (21,742) all outstanding restricted stock, deferred shares and State income taxes,net stock units amounted to $10,988,000 for the year of federal tax benefit 9,368 1,542 5.238 ended September 30,1998,$23,940,000 for the year Dividends-received ended September 30, 1997 and$21,124,000 for the deduction (19,292) (12,634) (U77) Other,net (7,830) 5,560 5,172 year ended September 30, 1996. Total income tax expense $191,000 $158,000 $117,600 The pending merger with AIG(See Note 3)consti- tutes a change in control of the Company under the terms of the various stock compensation plans and, when consummated, all unvested restricted stock and 630,000 stock units will vest.As a result,unamortized compensation cost, aggregating $26,306,000 at September 30, 1998, will be charged to operations i upon completion of the merger. ..... ..r, n.. ... :..ti•y�:if/Sjfi.;i;.;:i..'r . -50— Deferred income taxes reflect the net tax effects of On thmaralt temporary differences between the carrying amounts of aep1 per-sh71ei"0a"ts1 rust Second Third Fourth assets and liabilities for financial reporting purposes 1997- Net investment income $143.669 $152.004 $185.760 $197,944 and the amounts used for income tax reporting pur- Net realised investment poses. The significant components of the liability of gains losses) (9,304) (9,442) (12,136) 1,679 Deferred Income Taxes are as follows: Fee income 70,067 73,510 81,796 92.330 General and September 30, administrative 1991 1997 expenses (59,254) (62,035) (70,419) (74,030) Deterred lax fiabilitl. Amortization of deferred Investments f 105.896 f 125,852 acquisition costs (30,410) (30,003) (52.080) (52,596) Deferred acquisition costs 388.234 341.131 pretax income 114,768 124,034 132,921 165,327 << State income taxes 4,56E 3,428 income tax expense (34.400) 07.2001 (38,600) (47,800) Other liabilities 143,453 125.928 Net unrealized gains on certain debt Net income f BOX8 f 86.834 f 94,321 $117,527 J and equity securities 105.686 113,028 Per basic share f 0.43 f 0.46 f 0.51 S 0.60 t Total deferred tax liabilities 747,837 709,367 Per diluted share f 0.39 f 0.42 f 0.46 f 0.54 Deferred to assets: Contracthdlderreserves (298.719) (299.905) NOTE 15: BUSINESS SEGMENTS Other assets (54,208) (25.698) Total deferred tax assets (352,921) (325,603) Summarized data for the Company's business segments follows: Deferred income taxes f 394,910 f 383.764 Total depreciation NOTE 14: QUARTERLY FINANCIAL DATA +^a (UNAUDITED) Tow amortization Pretax Total On thousands) revenues expense 1100171,11 assets •.. Quarterly financial data for the years ended 1990: September 30, 1998 and 1997 follow: Annuity operations $2.340,933 $236,298 $652.112 $38,355,034 on fta'sands, Broker-dealer except per-share amounts) Fart second Third Fourth operations 119,865 1,276 34.141 19SA22 1998: Retirement trust Net investment income $198,153 $205.190 $214,185 $224,118 services 50,774 1,796 6.133 499.121 Asset management 41A40 14,180 9,171 104,476 Net realized investment Premium financing 24,957 1,050 5,155 45,954 gains(losses) 3,104 2,258 5.772 (52,945) Fee income 100,822 108,971 123.566 125,468 Total $2.577.569 $261.200 $707,312 $39.200,407 General and administrative 1997: expenses (77,362) (77,398) (81.219) (74.294) Annuity operations f1,9C5,412 $155.714 $490,949 $34,909,441 Amortization of deferred Broker-dealer , acquisition costs (55.468) (55.628) (63.386) (66.685) operations 67,052 2,401 72.622 101.049 Pretax Income '169.339 183,393 198,918 155.662 Retirement trust Income tax expense (45.700) (49.500) (54,000) (41,800) services 49.279 1,497 13,001 487.598 Net income $123.639 f133,893 $144.918 $113,862 Asset management 35.661 16,357 2,798 81,518 )' . Premium financing 26,922 1,039 8.280 57,280 Per basic share f 0.63 f 0.68 f 0.73 f 0.51 t : Total f204,326 $177,008 f537,050 $35.636.886 , :•�.. . Per diluted share f 0.56 f 0.60 S 0.66 f 0.52 Annuity operations $1.315,553 S 97,806 $350.183 $23,032,076 r Broker-dealer *G operations 51,906 1,228 17.253 74.140 Retirement trust services 45,216 1.166 13.570 481,974 Assetmanagement 33,047 18.295 2.448 74,410 — `.e Premium financing 26.663 962 8.573 64.221 Total $1,472,385 $119.457 f392,027 $23,726,821 =•.; 1..-. : v —51— MANAGEMENT'S REPORT REPORT OF INDEPENDENT ACCOUNTANTS The management of SunAmerica Inc. and its subsidiaries has the responsibility for preparing the accompanying consoli- To the Board of Directors and dated financial statements and for their integrity and objectiv- Shareholders of SunAmerica Inc. ity.The statements were prepared in accordance with generally accepted accounting principles applied on a consistent basis In our opinion,the accompanying consolidated.balance sheet and are not misstated due to material fraud or error. The and the related consolidated income statement and statement consolidated financial statements include amounts that are of cash flows present fairly, in all material respects, the based on management's best estimates and judgments. financial position of SunAmerica Inc.and its subsidiaries at Management is also responsible for the other information in September 30,1998 and 1997.and the results of their'oper- the annual report. ations and their cash flows for each of the three years in the The Company's consolidated financial statements have period ended September 30,1998,in conformity with gener- been audited by PricewaterhouseCoopers I.I.P. independent ally accepted accounting principles. These financial state- certified public accountants. Management has made avail- ments are the responsibility of the Company's management; able to PricewaterhouseCoopers LLP all the Company's our responsibility is to express an opinion on these financial financial records and related data, as well as the minutes statements based on our audits. We conducted our audits of shareholders'and directors' meetings. Furthermore, man- of these statements in accordance with generally accepted agement believes that all representations made to auditing standards which require that we plan and perform the PricewaterhouseCoopers LLP during its audit were valid and audit to obtain reasonable assurance about whether the finan- appropriate. cial statements are free of material misstatement.An audit Management has established and maintains a system includes examining,on a test basis,evidence supporting the of internal control that provides reasonable assurance as to amounts and disclosure{in the financial statements,assessing the integrity and reliability of the consolidated financial the accounting principles used and significant estimates made statements,the protection of assets from unauthorized use or by management,and evaluating the overall financial statement disposition, and the prevention and detection of fraudulent presentation.We believe that our audits provide a reasonable financial reporting.The Company maintains a strong internal basis for the opinion expressed above. auditing program that independently assesses the effectiveness of the internal controls and recommends possible improve- ments thereto.In addition,as part of its audit of the Company's �vn consolidated financial statements, PricewaterhouseCoopers, LLP completed a study and evaluation of selected internal PRICEWATERHOUSECOOPERS LLP accounting controls to establish a basis for reliance thereon in Los Angeles,California determining the nature, timing, and extent of audit tests to November 9, 1998 be applied. Management believes that the Company's system of internal control is adequate to accomplish the objectives discussed herein. Management also recognizes its responsibility for fostering a strong ethical climate so that the Company's affairs are conducted according to the highest standards of conduct.This responsibility is reflected in the Company's code of corporate conduct,which is periodically distributed to all employees.The code of conduct addresses,among other things,the necessity of ensuring open communication within the Company;potential conflicts of interest;compliance with all laws,including those relating to financial disclosure; and the confidentiality of proprietary information.The Company maintains a systematic program to assess compliance with these policies. a SCOTT L. ROBINSON Senior Vice President and Controller November 9, 1998 239 xy - _ -- - -52- DIRECTORS f Ell Broad,65,Chairman,President and Chief Executive Officer, Lester Pollack,65,Managing Director,Lazard Frlres 6 Co.LLC SunAmerica Inc.Co-lounded the company in 195Z and Managing Director of Centre Partners Management LLC. William E Aldinger,51,Chairman and Chief Executive Officer, Appointed a director of the company in 1981. Household International,Inc.Appointed a director of the Carl E.Reichardt,67,Retired Chairman and Chief Executive company in 1996. Officer,Wells Fargo 6 Company and its principal subsidiary,Wells Karen Hastie-Williams,54,Partner,the law firm of Crowell Fargo Bank.Appointed a director of the company in 1995. 6 Moring.Appointed a director of the company in 1994. Sanford C.Sigoloff,68,Chairman,President and Chief Executive Philip G.Heasley,49,Vice Chairman,U.S.Bancorp and Officer.Sigoloff 6 Associates,Inc.Former vice Chairman and President Retail Banking Croup.Appointed a director of the Chief Operating Officer of the company(1979-82).Appointed a director of the company in 1979. company in 1998. David 0.Maxwell,68,Retired Chairman and Chief Executive Harold M.Williams,70,Of Counsel,Skadden,Ares,State, Officer,Federal National Mortgage Association.Appointed a Meagher 6 Flom.President Emeritus,The J.Paul Getty Trust. director of the company in 1985. Former Chairman,United States Securities and Exchange Commission(1977-81).Appointed a director of the company Barry Munitz,57,President and Chief Executive Officer, in 1992. The J.Paul Getty Trust.Appointed a director of the company Jay S.Wintrob,41,vice Chairman and Chief Operating Officer, in 1994. SunAmerica Inc.Appointed a director of the company in 1997. -53- OFFICERS Eli Broad,65,Chairman,President and Chief Executive Officer. Scott H.Richland,36,Senior Vice President.Executive Vice Co-founded the company in 1957. President,SunAmerica Financial.Responsible for annuity service Jar S.Wintrob,41.Vice Chairman and Chief Operating Officer. operations and human resources.Joined the company in 1990. President SunAmerica Investments.Joined the company in 1987. Scott L Robinson,52,Senior Vice President and Controller. Executive Vice President,SunAmerica Financial.Responsible for James R Belardi,41.Executive Vice President.President financial reporting,actuarial,tax and audit functions.Joined the SunAmerica National Life Insurance Company.Has executive company in 1978. responsibility for the company's finance,treasury,product devel- opment and investor relations functions,and its guaranteed lames W.Rowan,36,Senior Vice President.Has executive investment contract and mutual fund businesses.Joined the responsibility for information technology,electronic commerce company in 1986. and Resources Trust Company.Joined the company in 1992. Marc H.Gamsin,43,Senior Vice President.Executive Vice David R.Bechtel,31,Vice President and Treasurer.Joined the President SunAmerica Corporate Finance.Has responsibility for investment partnerships and corporate development,and company in 1998. executive responsibility for legal and regulatory affairs.Joined Karel Carnohan,42,Vice President,Investor Relations. the company in 1996. Responsible for shareholder and analyst relations.Joined Jana Waring Greer,46,Senior Vice President.President, the company in 1995. SunAmerica Retirement Markets,Inc.As chief marketing officer, Michael L Fowler,44.Vice President.President,SunAmerica has responsibility for the company's retirement savings marketing, Affordable Housing PaRners.Joined the company in 1988. advertising and safes functions,as well as executive responsibility for its annuity service operations.Joined the company in 1974. Scott Gillis,45,Vice President.Senior Vice President and Controller, Susan L Harris,41,Senior Vice President,General Counsel and SunAmerica Life Companies.Joined the company in 1985. Secretary.Responsible for legal and regulatory affairs.Joined the George L Holdridge,Jr.41,Vice President.Executive Vice company in 1985. President,SunAmerica Financial.Responsible for information Gary W.Kra%51,Senior Vice President.Chairman and Chief technology.Joined the company in I983. Executive Officer of the SunAmerica Financial Network.Joined Donald E.Spetner,39,Vice President,Corporate Communications. the company in 1990. Responsible for public and media relations.Joined the company in 1997. L: r z .stet•; ' - - s -sa- OTHER SENIOR MANAGEMENT Yncent 1.Asaro,41,President SunAmerica Securities. Peter McMillan III,41,Executive Vice President and Chief Joined the company in 1987. Investment Officer,SunAmerica Investments.Joined the ; Matthew Autterson,41.President Resources Trust Company. company in 1989. Joined the company in 1990. J.Steven Neamtz,40,Executive Vice President,SunAmerics Hy Cohen,51,President Royal Alliance Associates. Asset Management Corp.Joined the company in J 996.. Joined the company in 1990. Alan J.NussenblV4 49,Senior Vice President.SunAmerka Robert J.Cycon,64,President Imperial Premium Finance. Investments.Joined the company in 1987. Joined the company in 1994. Robert L Sydow,43.Senior Vice President SunAmerics Peter A.Harbeck,44,President,SunAmerica Asset Management Investments,Joined the company in 1989. Corp.Joined the company in 1990. E.lames Wisner,56,President,financial Service Corporation. Kevin 1.Hart,44.Executive Vice President and National Sales Joined the company in 1997. Manager,SunAmerica Retirement Markets,Inc.Joined the Richard P.Waltman,69,President,Sentra Securities Corporation company in 1995. and Spelman 6 Co.,Inc.Joined the company in J 998. James K.Hunt,47,President SunAmerice Corporate finance. lea 2eitman,51.President Advantage Capital.Joined the Executive Vice President SunAmerica Investments. company in 1996. Joined the company in 1990. .• . i� Z. 1:. �i 1�•• .•*., t / 's,�;_ � � �. y,fie i•.G. rC SUNAMERICA SHAREHOLDER INFORMATION EQUITY SECURITIES PROFILE COMMON STOCK PRICES AND DIVIDEND DATA' SunAmerica's common stock is listed on the New York fiscal Tear IGah toe Dividends Paid Stock Exchange and Pacific Stock Exchange under the 1598 ticker symbol"SAI"and is also traded on the Boston, Fourth Quarter $767. $54% $0.15 Midwest and Philadelphia Exchanges.Options are trad- Third Quarter $58 $461/. $0.10 ed on the Philadelphia Exchange.There is no market for Second Quarter $50e $37 $0.10 SunAmerica's Nontransferable Class B Stock. FustQuarter $451/. $32 $0.10 As of the date of this report,SunAmerica has entered into an agreement to merge with American International 1997 Group, Inc. (AIG). Upon completion of the merger, Fourth Quarter $40% $3211 $0.067 SunAmerica will merge with and into AIG, with AIG Third Quarter $341/" $24% $0.067 being the surviving corporation and SunAmerica ceasing Second Quarter $34 $241/. $0.067 to be a separate, publicly held company. Holders of First Quarter $30"/" $23% $0.067 SunAmerica common stock will receive 0.855 of a .Stxk pric,,,WeegMeM.T,,,yockExi rL share of AIG common stock in exchange for each share oWiwls owm i"i wa 34a•2 shd&K of SunAmerica common stock.AIG is traded under the INQUIRIES REGARDING YOUR STOCK HOLDINGS symbol"AIG"on the New York Stock Exchange. Copies of the joint proxy statement/prospectus describing Registered Shareholders(Shares held in your name) the transaction were mailed to shareholders on or about Questions about your account statement, dividend October 13, 1998. A special meeting of shareholders Payments or related inquiries should be directed to was held to approve the merger on November 18,1998. SunAmerica's transfer agent: Upon consummation of the merger, shareholders will The Bank of New York be mailed written instructions for exchanging their Shareholder Relations Department-11E SunAmerica share certificates for AIG share certificates P.O.Box 11258 as detailed in the proxy/prospectus. Shareholders may Church Street Station obtain copies of the proxy/prospectus by contacting New York, NY 10286 SunAmerica's investor relations department. (800)524-4458 RELATED EQUITY SECURITIES LISTED ON In all correspondence or phone inquiries, please men- THE NEW YORK STOCK EXCHANGE tion SunAmerica Inc.,your name as it is printed on your SAI E SunAmerica Inc.$3.10 Depositary Shares,Each stock certificate,your account number(Social Security P ry number),your address and tglephone number. Representing One-Fiftieth of a Share of Series E Mandatory Conversion Premium Dividend Beneficial Shareholders (Shares held by your broker in Preferred Stock" the name of the brokerage company) Questions on all administrative matters should be direct- ed to your broker. Redemption Cumulative Security Units (PERCS•Units)"' INQUIRIES ABOUT THE COMPANY SAIpV SunAmerica Capital Trust II—8.35% If you have questions about SunAmerica or if you would Trust Originated Preferred Securities like to receive additional investor materials published by (TOPrS'") the company, including a Farm 10-K and quarterly reports,please contact: SAIpW SunAmerica Capital Trust III—8.30% Karel Carnohan Trust Originated Preferred Securities Vice President,Investor Relations (TOPrS'") SunAmerica Inc. ^'Redeemed on October 30.1993. 1 SunAmerica Center , Red«med on December e.199e. Los Angeles,CA 90067-6022 (310)772-6535 investor®sunamerica.com CREDIT RATINGS S&P Moody's Duff&Phelps A.M.Best SunAmerica National Life Insurance Co. AAA — — — SunAmerica Life Insurance Co. AA- A2 AA A+ Anchor National Life Insurance Co. AA- A2 AA A+ CatAmerica Life Insurance Co. AA- — — A First SunAmerica Life Insurance Co. AA- A2 — A+ SunAmerica Inc.Senior Debt A Baal A — SunAmerica Inc.Short-Term Debt A-1 P-2 D-1 — SunAmerica Inc.Preferred Stock A- Baa2 A- — s I Stn:Awerica Centel Los Angeles,CaGfonda 90067-6022 _ (310) 772-6000 htrp://aatntunrranterica.mnt 1 �x r 1 SunAmerica WORLD LEADERS IN INSURANCE AND'�F�NANC�IAL SERVICES AM INTER- AT 0 GROUP INC 15, REPRINTED FROM THE 1998 ANNUAL REPORT ational Group, Inc 1G) is the leading US.-based international in, nce American Intern p ~organization and the largest underwriter of commercial and industrial coverages in the United States.Its member companies write property, casualty, marine, life and financial lines insur- ance in approximately 130 countries and jurisdictions, and are engaged in a range of financial services and investment management businesses: i'- � ''-1" .v i sir^ K. a h�i(,>l��-.-F+`rC.� -.s• .?,�%' __ �7'yi: - :�Y.,�tiv .;.�-_ - e -j,r%v.•<. 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' .1 � L � -.:..,.. "L ^�"".f 4.?�:v~M:�G. :+ •l"'C, iy, 'ut ,1c,�•..+ e:j .: rtLi� -'•;��T�* �,�g_ne i-a.`n: (i.�.,�.tt dr �r _ .4sr..•.ii+:4.� �,y ". ...•rd I ,r?.a„c�.[z�,..,fr as r.r� Y � .mot• ti �,.t ', i'��',i,•Ji:t'�:+i,?r:b�Y`,�.r:�y'Jf, 1 Financial Highlights' = - = :. 2 l etter.to:Shareholders - . 11 Profile of SunAmenoa 12 Eleven Year Summary of Consolidated Operations 14 Eleven Year Summary of Selected Financial Information 16 .:.:. .. Supplemental financial Information 18 .''::; '. 'Corporate Directory� 21 Shareholder Information;': i F'-pancial Highlights l (in milfions,except per share data and ratios) 1998 1997 %Change General insurance operating income' $ 2,723 $ 2,344 1F.. Life insurance operating income` 1,815 1,550 17:. Financial services operating income 913 701 30.2 Income before taxes and minority interest 5,529 4,731 16.9 Net income 3,766 3,332 13.0 Net income per common share" 3.57 3.15 13.3 Book value per common share 25.85 22.87 13.0 Cash dividends per common share .21 .19 10.5 Revenues $' 33,296 $ 30,602 8.8 Assets 194,398 163,971 18.6 Capital funds(shareholders'equity) 27,131 24,001 13.0 Combined loss and expense ratio 96.36 96.20 Excluding realized capital gains posses) Based on diluted shares IncomeNet(Millions of dollars) 1998 3,766 1997 3.332 1996 2,897 1995 2.510 1994 2,176 Revenues (Millions of dollars) 1998 Y ' - �'.._ 33,296 1997 �u��S '`fo a"'e.y?"► 'frt 'S�_spa.x.ac x ssz v�.xccra. - aeS130.602 1996c" :a ;:z. = ear r..r..: :' "", `us z*�•v 27,943 1995 25.614 1994 ,a ; s 22.122 (Millions of dollars) 1998 194,398 1997 163,971 1996 148,431 1995 134,136 1994 1114.346 ' Capital Funds(Shareholdere Equity) (Millions of dollars) 1998 127.131 1997 24,001 1996 22,044 1995 19,827 1994 16.422 Letter .to Sharehdders AIGhad record earnings in 1998,a year characterized by financial and economic turmoil in Asia,volatility in world financial markets,and an ebbing of investor confidence,particu- larly in emerging markets.As the year progressed,however,there were a number of positive signs that global problems were finally being addressed in a more constructive manner, and the outlook is somewhat brighter than it was a year ago. AIG's net income rose 13.0 percent to$3.77 billion,or$3.57 per share.Other financial highlights of 1998 included: • Income before taxes and minority interest gained 16.9 percent to$5.53 billion; • Revenues increased 8.8 percent to$33.3 billion; • Assets rose 18.6 percent to$194 billion; • At year-end,AIG's shareholders'equity totaled $27.1 billion;and • AIG's return on equity was 15.0 percent. At December 31, 1998,AIG's stock market capitalization passed the$100 billion mark, reaching $101.4 billion,or$119.6 billion, reflecting the acquisition of SunAmerica Inc. on January 1, 1999.This ranked AIG 15th in market capitalization among all U.S.public corporations,and 26th among all global companies. In mid-March 1999,as this annual report went to press,AIG's market capitalization had risen to approximately S 149 billion. Worldwide general insurance operations generated$2.0 billion of new cash flow in 1998, including interest and reinvested dividends,and our life insurance cash flow totaled S8.0 billion. AIG holds Triple-A ratings from the principal racing services,Moody's and Standard&Poor's. Review of 1998 Operating in global markets roiled by unprecedented volatility,especially in Asia,was the order of the day in 1998. The widely publicized financial dislocations that occurred unsettled investors,as many institutions and hedge funds reported significant losses.Late in the year,Russia defaulted on its debt,which led to a sharp devaluation of the Russian currency. In addition,shortly after year-end,Brazil devalued its currency and interest rates rose,propelling the country into recession.It became apparent that political forces in Brazil were resisting the fiscal plans that President Cardoso recommended,plans which in the long run would benefit the economy.We are cautiously optimistic that he will be successful in achieving economic stability for Brazil. On the positive side,the G-7 countries responded to the global financial uncertainty by reducing interest rates,and the IMF altered its approach to affected countries by moderating the severe policies and measures it had earlier advocated.Trade surpluses increased in 1998 in a number of countries,largely as a result of sharply reduced imports,while in Southeast Asia,progress is being made toward enacting legislation on bankruptcy and foreclosure procedures. 2 2 2 , Maurice R.Greenberg Chairman and Chief Executive Officer The United States property-casualry market continues to be very competitive.There are now signs,however, that certain classes of business may have reached a level where prices are stabilizing,and,as reported in our year-end 1998 earnings press release,in a number of specialty classes we are obtaining rate increases.During the year,AIG non-renewed $450 million of domestic business that failed to meet our underwriting and pricing standards.We also made a number of changes in our Domestic Brokerage Group to enable it to confront the challenges of the domestic marketplace more effectively. As a result,we have a more responsive organization and one that is better able to operate in the intensely competitive world we face today. Consolidation in the insurance industry continued in 1998 with a number of mergers, acquisitions and international alliances.In some cases,consolidations resulted from weakness rather than strength,with little strategic rationale.AIG has primarily focused on internal growth as a basic strategy,although we have made both opportunistic and strategic acquisitions on occasion.That was the case with our acquisition of SunAmerica Inc. in a pooling-of- interests transaction for AIG stock valued at approximately$18 billion.SunAmerica,an outstanding performer and a leader in asset accumulation products for both the retirement and pre-retirement markets,officially became a wholly owned subsidiary of AIG on January 1, 1999. (Seepage I 1 for an amview of SunAmerica.) Retirement savings is a worldwide issue,as state-run pension plans are inadequately funded in many countries,and the baby boom generation is becoming concerned about retirement income. The privatization of government-run pension plans taking place in many countries is an indication that state-run plans are seeking to change their historic structure, thus forcing individuals to provide increasingly for their own retirement. 3 Letter to SharehQders (C O N T I N U E D ) SunAmerica's strength is in the US. market for retire- Retum on Equity ment savings products.We believe a major opportunity (Percent) exists to introduce its products and marketing skills into overseas markets where AIG has extensive and longstand- 2s.o ing operations. By capitalizing on our global network,we 20.0 plan to introduce SunAmerica products into a number of such markets in the near future.Steps are already underway 15.0 to implement this strategy.There are also opportunities 10.0 domestically to utilize SunAmerica's nearly 10,000 inde- pendent financial advisers and their nationwide distribution s.o system to market AIG's domestic life insurance products. 0.0 In addition,the mutual fund business of SunAmerica com- plements AIG's fund business and will strengthen our s.o product offerings and distribution in this area. We were 88 89 90 91 92 93 94 95 96 97 98' also attracted to SunAmerica because of the company's strong entrepreneurial culture,creativity,dynamic lead- AIG t+.Industry a® S&P 500 ership,strict expense control and sharp bottom line focus, characteristics that will blend well with the AIG culture. 'Industry and S&P 500 Estimated Industry and S&P 500 Source:Coming b Company During 1998,AIG made three other important investments,acquiring over 50 percent ownership of both Transatlantic Holdings, Inc.and 20th Century Industries,and purchas- ing all of the outstanding shares of SELIC Holdings, Ltd.,parent company of Starr Excess Liability Insurance Company,Ltd.All three companies are now consolidated subsidiaries of AIG,whereas they had formerly been minority-owned investments. Another significant move in 1998 was our long term investment agreement with The Blackstone Group Holdings, L.P.,whereby AIG acquired a limited partnership interest in Blackstone.AIG has had a long and very successful relationship investing with Blackstone,and we intend to continue to do so in the future. Another priority for us during 1998 was our continued emphasis on developing and cap- italizing on technology to enhance AIG's distribution networks and levels of service to broken,agents and customers.Electronic commerce,and in particular the use of the Internet to attract new customers and improve service to existing customers,is an important focus for AIG worldwide. Business Segment Results In AIG's general insurance business,worldwide net premiums written increased 8.8 per- cent in 1998 to$14.59 billion,including the consolidated half-year results of Transatlantic Holdings,Inc. and 20th Century Industries. Income before income taxes, realized capital gains and minority interest for general insurance gained 16.2 percent to$2.72 billion.AIG posted a record adjusted underwriting profit of$530.8 million for the year,and a combined ratio of 96.36,compared to an estimated 103.7 for the property-casualty industry. AIG's general insurance operations have one of the lowest expense ratios in the industry,which provides us with a distinct competitive advantage. AIG added S551.6 million to our general insurance net loss and loss adjustment reserves in 1998,and at December 31,these �Sr) reserves stood at $24.6 billion. 4 left to right f Evan G.Greenberg \; 1kj President and Chief Operating Officer Thomas R.Tizzio Senior Vice Chairman, General Insurance Industry catastrophe losses increased in 1998,as Hurricane Georges caused insured losses of approximately$3.0 billion in the Caribbean and the Southeastern United States.This was the largest single catastrophe to impact the insurance industry in several years. Overall, industry catastrophe losses totaled an estimated S 10.1 billion in 1998,compared to a relatively modest $2.6 billion in 1997. For AIG, net catastrophe losses amounted to$110 million,compared to only $16 million the prior year. During 1998,AIG's Domestic Brokerage Group maintained its focus on underwriting discipline and strict expense control.Our mergers and acquisitions insurance unit has become a leader in assisting clients with strategic alternatives to eliminate, manage or reduce the impact of liabilities in M&A transactions,including solutions to environmental issues, litigation,accrued liabilities and retirement benefit obligations.Meanwhile,AIG Risk Finance has carved out a profitable role in structuring advanced risk management solutions and managing strategic risks.The Domestic Brokerage Group companies also developed tailored management liability programs for both Nasdaq and New York Stock Exchange listed companies,underscoring AIG's leadership and innovation in both products and distribution. Our Domestic Personal Lines business had a very successful year,with net premiums written rising 75.2 percent to$1.42 billion, including the consolidated operations of 20th Century Industries.The AIG Auto Insurance Program is achieving strong results nation- wide based on targeted underwriting,excellent customer service,state-of-the-arc technology and high visibility marketing and advertising support.The Specialty Auto Division had a 25.4 percent gain in net premiums written,offering products for the non-standard auto mar- ker in 27 states. 20th Century Industries had satisfactory operating results,despite an increasingly competitive auto insurance market on the West Coast and an additional $40. million provision for potential claim payments relating to the Northridge earthquake.On a global basis,AIG now has approximately $3 billion in personal auto net premiums written. 5 Letter to SharehQders - t C 0 N T I N U E D ) United Guaranty Corporation(UGC),AIG's subsidiaryCombined Loss and Expense for mortgage guaranty insurance,also had a strong increase tAfter"ends topo6cyfgfders) in net premiums written and a 24.5 percent gain in oper- ating income to$221.9 million.In its first major investment 1zs outside the United States,UGC and its joint venture partners 120 have formed a new mortgage insurance company in Israel. 115 AIG's overseas property-casualty insurance operations 110 reported outstanding underwriting results,an increase in local currency net premiums written of 17.5 percent, 105 including the now consolidated foreign operations of 100 Transatlantic Holdings, Inc., and a 10.8 percent gain in operating income to $960.1 million. American 95 International Underwriters(AIU)continued its emphasis 90 91 92 93 94 95 96 e7 98• on opportunities created by technological advances, increased privatization and infrastructure development. AIG r.Industry*• In Japan,AIU's largest country market,our business Industry Estimated •Stock Companies continues to flourish despite the weak Japanese economy. Industry source:conning&Company The "flight to quality" has benefited AIG's Japanese opera— A combined ratio of less than 100 reflects an underwriting prorR tions,which have their own Triple-A financial strength ratings from Standard& Poor's. Our direct auto business through the Japan branch of American Home Assurance Company had a very successful first full year of operations. In Southeast Asia and China,AIU did well,reflecting our long-established market post- dons and outstanding agency force.The concern over financial stability throughout the region has provided AIU with opportunities to attract new commercial and consumer clients. Operating results in the United Kingdom and Continental Europe were very good. In the Central Europe and Commonwealth of Independent States Division,where AIG has the most extensive network of an international insurer,we expanded with new general insur- ance � P 8 r ante operations in Lithuania,Kazakhstan and Slovakia.Operations in the Middle East and Africa also had good growth in 1998, and our direct marketing joint venture company in Israel,AIG Golden Ltd.,is off to an encouraging start.In Latin America,results improved over the prior year,and our strategic plans should produce stronger performance in the future. Our Latin American insurance network expanded in 1998,with the acquisition of a majority interest in a life and non-life insurer in El Salvador. Transatlantic Holdings,Inc.,in which we have long held a minority ownership interest, became a consolidated subsidiary in 1998 when AIG acquired over 50 percent of the company. Transatlantic is the largest broker-market reinsurance organization in the United States and a recognized leader in the specialty casualty field.Its extensive overseas operations account for a growing share of Transatlantic's business.Transatlantic had a solid year,with an increase in net premiums written and good contributions from both its domestic and overseas reinsurance operations. 25Z 6 Ord. e',iyt v,;{;i`-'':`rr.• � ...,:`:: ... left to right r Frank G.Wisner Vice Chairman,External Affairs Howard I.Smith ^ze f Executive Vice President, Syr Chief Financial Officer and Comptroller Edward E.Matthews Vice Chairman,Investments and Financial Services Robert M.Sandler Executive Vice President, Senior Casualty Actuary and Senior Claims Officer Edmund S.W.Tse Vice Chairman,Life Insurance AIG's Life Division reported 1998 premium income rose 16.4 percent in local currency. Operating income before realized capital gains increased 17.1 percent to $1.81 billion. Our life premiums continued to be impacted adversely by foreign exchange fluctuations for most of the year. However, if the turnaround in financial and currency markets that took place late in 1998 continues,the impact on future life premium growth in U.S.dollars would be moderated. Our Asian life business did extremely well in 1998 in a very difficult environment. American International Assurance Company,Ltd. (AIA), which is the largest life insurer in Southeast Asia,turned in a very creditable performance,benefiting from its many years in the region and its network of thousands of agents. Nan Shan Life Insurance Company, Ltd.,one of the largest life companies in Taiwan and a strong,consistent performer,also had a very good year. ALICO Japan,as with our operations throughout Asia, benefited from its Triple-A ratings,and had-double-digit premium growth despite a stagnant Japanese life insurance industry. In an expansion of AIG's network in Central Europe,American Life Insurance Company (ALICO)and our joint venture partner acquired a majority interest in the Bulgarian Post Bank,A.D.ALICO,one of the largest international life insurance companies in the world, with$202.8 billion of life insurance in-force,has the most extensive international life net- work in Central and Eastern Europe,with operations in Poland,Hungary,Czech Republic, Slovakia and Romania. The AIG Life Companies(US.)achieved a 20 percent gain in operating income to$150 million.The addition of SunAmerica to the AIG family will provide important new growth opportunities for our existing U.S. life business,and plans are well underway to mobilize the SunAmerica distribution network to market AIG's U.S. life products. 7 Letter to Shareh,j-ders (C O N T I N U E D The Financial Services Group had a 30.2 percent increase in operating income to a record $913.1 million. International Lease Finance Corporation(ILFC)had an outstanding year. Its aircraft leasing business was particularly strong in Europe,and aircraft sales were also very satisfactory. ILFC's widely diversified global client base is an important asset,ensur- ing the company is not overly reliant on income from any single region of the world.ILFC is the premier company in its industry;its outstanding relationships with airlines and aircraft manufacturers, excellent order positions,skilled management,and financial strength combine to ensure continued success. AIG Financial Products Corp.(AIGFP)also produced record operating results.AIGFP's focus is on structured financial transactions tailored to specific client needs.It is a recognized leader in its field,and increasingly teams with other AIG units, including AIG Risk Finance, to structure creative risk management solutions for its multinational client base. AIG Trading Group Inc.(AIGTG)faced a difficult operating environment in the latter part of 1998,but was able to post reasonable results despite declines in trading markets for both its currency and metals businesses.AIGTG is a leading participant in the field of hedged trading and market making in foreign exchange, interest rates and base and precious metals,with a growing global network of offices and relationships. AIGTG also works closely with AIG Risk Finance and other AIG companies in structuring transactions to meet its clients' financial and risk management requirements. AIG Global Investment Group,Inc.'s investment management business continued to expand, in both its third-party marketable securities business'and its direct investment funds. We intend to integrate our third-party marketable securities business with that of SunAmerica in 1999,while continuing to expand our direct investment fund business. AIG's global network,in-depth knowledge of emerging markets and strong asset manage- ment skills,combined with years of experience operating in Asia,Latin America,Europe and the United States,provide an excellent platform for further growth in the asset man- agement business. During the year,several new direct investment funds were launched. AIG now has nearly $14 billion of direct investment funds and third-party assets under management worldwide. AIG Consumer Finance Group,Inc. introduced its first AIG credit card in the Philippines in 1998.The Group also expanded its consumer finance operations into Poland,acquiring Bank Podlaski S.A.,a Polish bank with all the requisite licenses for consumer finance,and taking a majority interest in an originator of installment sales financing to consumers through Polish retailers. It also entered the Argentine consumer finance market with the purchase of a majority interest in Compania Financiera Argentina,S.A.The consumer finance business represents an opportunity for AIG to market additional financial products and services through our existing network. s Investment Results and Financial Market Developments AIG's global investment portfolios did well in 1998.General insurance net investment income, including partial year results of Transatlantic Holdings,Inc.and 20th Century Industries,gained 18.3 percent to$2.19 billion,while life insurance net investment income rose 11.6 percent to $3.23 billion.At year-end,AIG's insurance investment portfolios totaled$87.6 billion,of which$38.9 billion was derived from general insurance and $48.7 billion from life insurance. The US. economy turned in a strong performance in 1998,as gross domestic product grew at a 3.9 percent annual rate with negligible inflation,capping the best three-year period since the mid-1980's. In this environment,U.S. financial markets did well and the Federal Reserve held interest rates steady for the first half of 1998. In the third quarter,the Federal Reserve announced a succession of three rate cuts which were deemed a preemptive strike against fears of a widening global economic slowdown,combined with concern of a possible credit crunch. The interest race cuts resulted in restored market confidence and enhanced liquidity,paving the way for rate reductions around the world.The US. bond market also benefited with one of the lowest 30-year bond'races in years,closing 1998 at 5.09 percent. For the year,the Standard&Poor's 500 Stock Index posted a total return of 28.6 percent. _ In spite of slow growth in corporate earnings and overall economic activity,European equity indices rose, although experiencing a correction in the third quarter. European bond markets posted positive returns in local currency as inflation pressures remained low. In Japan,the long-awaited economic turnaround has still nor materialized,as the Japanese government has adopted only a piecemeal approach to implementing the policies necessary to restore confidence in the economy and solve the serious problems still afflicting Japanese banks and ocher financial institutions.The Nikkei index closed the year down 9.28 percent, a new nine-year low.Japan's policy with respect to its currency changed several times during the year.early in 1998,a new bank bailout plan and easier monetary policy led to a weaker yen,while later in the year the yen strengthened by approximately 20 percent,and more recently,has tended to weaken.Consumers in Japan remain reluctant to spend,and the U.S. trade deficit with Japan rose sharply in 1998. 255 r� 9 i Letter to Shareholders ( C O N T I N U E D ) Stock Split,Dividend Increase and Stock Performance 'Cumulative Total Shareholder Return* 0� The Board of Directors declared a three-for-two split of (Douars) AIG's common stock in the form of a 50 percent common 400 stock dividend,which was paid on July 31, 1998 to share- holders of record on June 26, 1998.The Board also increased 350 the regular quarterly dividend to 5.6 cents per share,effective 300 with the September dividend,an increase of 12.0 percent. 250 AIG's common stock gained 33.3 percent during 1998, Z_40_001�1" compared to a decrease of 3.2 percent for a group of peer 200 companies,and an increase of 26.7 percent for the Standard 150 &Poor's 500 Stock Index. Over the past five years,with - .------ — _ dividends reinvested,AIG stock has appreciated 278 percent, 100 compared to 126 percent for the peer group and 194 percent 93 94 95 96 97 98 for the S&P. AIG S&P 500 t-=-m AIG Peer Group Source:Standard&Pooes Compustat Services,Inc. Board of Directors Changes •Value of 5100 invested on December 31,1993,including reinvested diMends. We would like to note with special thanks the contri- butions made over the past several years by AIG Director Lloyd M. Bentsen,who retired from our Board in 1998. Senator Bentsen was an important voice in our deliberations and we will miss his counsel and support in the future. In early 1999,Eli Broad,Chairman and Chief Executive Officer of SunAmerica Inc.,and Jay S.Wintrob,SunAmerica Vice Chairman and Chief Operating Officer,were elected to the AIG Board. In addition, Ellen V. Futter, President of the American Museum of Natural History,joined the Board in March. We are pleased to nrelcome these new Directors to our Board. Conclusion 1998 will go down in the history books as a very challenging year,but one in which AIG performed well. We faced both a global economic crisis and a soft property-casualty insurance market in the United States—twin challenges for our managers,which they confronted extremely well. AIG has never been stronger or better positioned to capitalize on the many opportunities we see ahead.On behalf of the Board of Directors and man- agement,we thank our employees,agents and brokers around the world for their contributions this past year. M.R. Greenberg Evan G. Greenberg Chairman and President and 25�0 Chief Executive Officer Chief Operating Offuer i 10 SunAmerica THE RETIREMENT SPECIALIST SunAmerica Inc., which became the newest member of the AIG family of companies on January 1,1999, is a leader in one of the country's fastest-growing markets:retirement feiwornsofdollars] savings. In 1998, SunAmerica earned fees or investment income on approximately$110 8.75 billion of assets and provided 1.8 million Americans with a broad range of high-quality 7.50 retirement savings products and investment services. In its 1998 fiscal year, SunAmerica's 6.25 total sales increased 60 percent to a record $8.5 billion. 500 Products and Services 3.75 SunAmerica offers a wide variety of products and services including: 2.50 • fixed and variable annuities • mutual funds 1.25 • investment counseling 94 95 96 97 98 • trust services •guaranteed investment contracts •For years ended September 30. The SunAmerica family of companies includes: Total Assets* SunAmerica Life Companies—The SunAmerica Life Companies(SunAmerica Life,Anchor (Billions of dollars) National,CalAmerica,First SunAmerica and SunAmerica National)collectively rank 42 among the largest issuers of fixed and variable annuities and guaranteed investment contracts _ in the United States and rank in the top 2 percent of all U.S. life insurers, based on assets. 36 SunAmerica Asset Management Corp.—SAAMCO manages a family of 21 retail mutual 30 funds,with more than $3 billion of assets. 24 Resources Trust Company—RTC,which focuses exclusively on self-directed retirement 18 plans,provides trust services to more than 200,000 retirement accounts,with combined 12 assets of$13 billion. 6 The SunAmerica Financial Network—SunAmerica's six wholly owned broker-dealers (Royal Alliance,SunAmerica Securities,Advantage Capital,FSC Securities,Sentra 94 95 96 97 98 Securities,and Spelman&Co.)comprise the nation's largest network of independent As of September 30. registered representatives,with more than 9,700 representatives under contract. right to left EG Broad iChairman and Chief Executive Officer Jay S.Wintrob Vice Chairman and Chief Operating Officer 2-57 11 Eleven Year Sumn_ary of Consolidate(: Dperations nrillioru) ' .tars Ended December 31, 1998 1997 1996 1995 General insurance operations Gross premiums written $20,684 $18,742 $18,319 $17,895 Net premiums written 14,586 13,408 12,692 11,893 Net premiums earned 14,098 12,421 11,855 11,406 Adjusted underwriting profit(loss) 531 490 450 417 Net investment income 2,192 1,854 1,691 1,547 Realized capital gains 205 128 65 68 General insurance operating income 2,928 2,472 2,206 2,032 Life insurance operations Premium income 10,247 9,926 8,978 8,038 Net investment income 3,232 2,896 2,676 2,265 Realized capital gains(losses) (35) 21 35 33 Life insurance operating income 1,780 1,571 1,324 1,091 Financial services operating income 913 701 524 418 Equity in income of minority-owned insurance operations 57 114 99 82 Other realized capital gains(losses) (5) (30) (12) (29) Other income(deductions)-net (144) (97) (85) (92) Income before income taxes,cumulative effect of accounting changes and minority interest 5,529 4,731 4,056 3,502 Income taxes 1,594 1,367 1,116 956 .ncome before cumulative effect of accounting changes and minority interest 3,935 3,364 2,940 2,546 Cumulative effect of accounting changes(b) - - - - Minority interest (169) (32) (43) (36) Net income S 3,766 S 3,332 $ 2,897 S 2,510 WThe data presented for 1988 has been restated as a result of the adoption of Financial Accounting Standards Board Statement No.97"Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments"(FASB 97). N Represents a net benefit for the cumulative effect of adoption of accounting pronouncements related to postretirement benefits(FASB 106)and income taxes (FASB 109)by minority-owned insurance operations in 1993 and by AIG in 1992. Earnings per Common Share-Diluted, (Millions of dopars) (Dopars) 4,200 4.20 3,600 3.60 3,000 3.00 2,400 2.40 1,800 1.80 1.200 1.20 600 0.60 88 89 90 91 92 93 94 95 96 97 98 88 89 90 91 92 93 94 95 96 97 98 12 i ^rican International Group,Inc.and Subsidiaries Annual Compound Growth Race 1994 1993 1992 1991 1990 1989 1988tat 1988- $16,392 $14,901 $13,616 $13,336 $11,927 $11,616 $11,373 62.. 10,866 10,026 9,139 9,146 9,267 8,940 8,471 5.6 10,287 9,567 9,209 9,105 9,149 8,529 8,154 5.6 201 69 (145) 37 107 86 120 - 1,436 1,342 1,255 1,168 1,064 961 838 10.1 51 61 67 89 120 85 22 - 1,688 1,472 1,177 1,294 1,291 1,132 980 11.6 6,724 5,746 4,853 4,059 3,478 2,995 2,620 14.6 1,748 1,500 1,314 1,140 977 806 612 18.1 87 55 43 23 (6) 42 30 - 952 782 667 562 463 454 387 16.5 405 390 346 222 132 150 88 26A 56 39 28 29 24 21 20 - (51) (8) (11) (14) (14) (4) 9 - (68) (47) (59) (61) (77) (44) (23) - 2,982 2,628 2,148 2,032 1,819 1,709 1,461 1442 776 683 512 470 369 338 249 - 2,206 1,945 1,636 1,562 1,450 1,371 1,212 - 21 32 - - - - - (30) (27) (11) (9) (8) (4) (3) - $ 2,176 $ 1,939 $ 1,657 $ 1,553 $ 1,442 $ 1,367- $ 1,209 12.09, General Insurance Net Premiums Written 'Net Investment Income 0-dex Factor) (M7iions of dogars) 1.8 5,600 4,800 1.6 4.000 3,200 1.4 or , 2,400 1.2 1,600 800 i 88 89 90 91 92 93 94 95 96 97 98' 88 89 90 91 92 93 94 95 96 97 3. t�AIG tiiiiiiimiiiI Industry General insurance Life insurance Industry Estimated 2 S 9 13 Industry Source:Conning 8 Company -2- Eleven Year Sump Lary of Selected Fin_,LZcial Information 'in nsiltions,except per share amounts and ratios) Years Ended/As of December 31, 1998 1997 1996 1995 Balance Sheer Data: Total invested assets(a) $144,931 $122,452 $108,618 $ 96,338 Total assets(b) 194,398 163,971 148,431 134,136 Total reserves(t) 55,187 46,341 45,060 41,130 Total general insurance reserves 24,619 21,171 20,407 19,693 Total long-term debt(d) 21,504 17,814 17,506 14,453 Total liabilities 166,867 . 139,570 125,987 113,909 Total capital funds(shareholders'equity) 27,131 24,001 22,044 19,827 Income Statement Data: Revenues(e) $ 33,296 $ 30,602 $ 27,943 $ 25,614 Loss Ratio 75.59 75.33 75.89 75.93 Expense Ratio 20.77 20.87 20.58 20.65 Combined ratio 96.36 96.20 96.47 96.55 Return on equity M 15.0396 15.047c 14.54% 14.22% Per Common Share Data: Net income(g)(h) Basic S 3.59 $ 3.16 $ 2.73 $ 2.35 Diluted 3.57 3.15 2.72 2.35 Cash dividend(h) .21 .19 .17 .14 Book value(h) 25.85 22.87 20.87 18.58 Market price(h) 96.63 72.50 48.11 41.11 Pro forma market price G) 334.97 251.33 166.79 142.52 Market capitalization at December 31, $101,430 $ 76,073 $ 50,817 $ 43,862 Average shares outstanding W Basic 1,050 1,053 1,060 1,066 Diluted 1,055 1,057 '1,064 1,070 13)Including flight equipment under operating leases,real estate,nec of accumulated depreciation,and investment income due and accrued. (b)Assets with respect to December 31,1992 and subsequent years conform to the requirements of FASB 113. 10Including net general insurance reserves for losses and loss expenses,life future policy benefits and policy and contract claims. tdi Including commercial paper and excluding chat portion of long-term debt maturing in less than one year. 4)Represents the sum of general insurance net premiums earned,life premium income,nec investment income,financial services commissions,transactions and other fees,equity in income of minority-owned insurance operations and realized capital gains(losses).In 1997,agency operations were presented as a compo- nent of general insurance and for years prior to 1997 agency results have been reclassified to conform to this presentation. M Return on equity is net income,before realized capital gains(losses),expressed as a percentage of average shareholders'equity, exclusive of unrealized appreciation(depreciation)of investments,net of taxes. Total Assets and Invested Assets Ondex Factor) (Billions of dollars) 2.6 210 180 2.2 150 120 -.goo/ 1.8 90 60 1.4 ' 4 30 88 89 90 91 92 93 94 95 96 97 98' 88 89 90 91 92 93 94 95 96 97 98 \ O .�AIG >_ Industry Total �Invested 2 . 14 'Industry Estimated Industry Source:Conning&Company rican International Group,Inc.and Subsidiaries Annual Compound Growth Rs - 1994 1993 1992 1991 1990 1989 1988 1988- $ 78,975 $ 68,033 $63,420 $53,082 $42,918 $32,138 $26,394 18.696 114,346 101,015 92,722 69,389 58,202 46,037 37,317 17.9 36,075 32,308 28,605 25,894 22,752 19,402 16,325 13.0 18,419 17,557 16,757 15,840 14,699 12,958 11,086 8.3 12,614 10,956 9,518 7,591 6,780 4,061 2,823 22.5 97,724 85,591 79,840 57,926 48,297 31,632 30,354 18.6 16,422 15,224 12,782 11,463 9,904 8,405 6,963 14.6% $ 22,122 $ 19,831 $18,163 $16,671 $15,496 $13,940 $12,656 10.296' 77.82 79.19 81.48 78.93 78.17 79.50 79.13 20.44 20.30 20.34 21.04 21.06 20.13 19.81 98.26 99.49 101.82 99.97 99.23 99.63 98.94 13.8876 13.889 13.2796 14.0296 15.39% 17.439 18.87% $ 2.04 S 1.81 $ 1.54 $ 1.44 $ 1.37 $ 1.31 $ 1.16 12.0% 2.03 1.80 1.54 1.43 1.36 1.31 1.16 11.9 .13 .11 .10 .09 .08 .07 .06 13.3 15.41 14.20 11.79 10.53 9.08 7.97 6.59 14.6 29.01 26.00 22.91 19.43 15.19 16.35 10.71 24.6 100.66 90.13 79.43 67.36 52.64 56.70 37.11 2A $ 30,952 S 27,872 $24,549 $20,882` 516,308 $16,941 $11,074 1,069 1,071 1,072 1,075 1,048 1,035 1,034 1,072 1,075 1,075 1,078 1,051 1,039 1,037 40See Note l(u)of Notes to Financial Statements.Average shares outstanding have been retroactively adjusted to reflect all stock dividends and stock splits. Earnings per common share calculated after deductions in 1993, 1992,1991, 1990,1989, 1988 and 1987 of preferred stock dividends of S 1.0 million, S4.5 million,S7.3 million,S9.7 million,S10.9 million,S8.9 million and S7.1 million,respectively.Per share amounts for all periods presented reflect the adoption of the Statement of Financial Accounting Standards No. 128"Earnings Per Share." (n)As at December 31,retroactively adjusted for all stock dividends and splits. G)Reflects the price appreciation,as at December 31,of one share of common stock purchased on December 31,1988,assuming that no stock dividends or stock splits occurred after such date. Capital Funds(Shareholdere Equity) ' Book (billions of dollars) (Dollars) 28 28 24 24 20• 20 16 16 12 12 8 8 41JJ 4 L. 88 89 90 91 92 93 94. 95 96 97 98 88 89 90 91 92 93 94 95 96 97 98 2• 15 Supplemental Financial In ®r° ati®n 211urs in millions) rears Ended December 31, Consolidated(a) General Insurance Operating Results 1998 1997 Gross premiums written S20,684 $18,742 Net premiums written 14,586 13,408 Net premiums earned 14,098 12,421 Statutory underwriting profit(loss) 412 266 Adjusted underwriting profit(loss) 531 490 Net investment income 2,192 1,854 Realized capital gains 205 128 Operating income S 2,928 $ 2,472 Total columns may not equal the sum of individual group totals due to consolidating adjustments. 1998 1997 Net Percent Net Percent Premiums of Premiums of General Insurance by Major Segment Written Total Written Total Foreign S 4,799 32.9/ $ 4,370 32.617c Brokerage 8,002 54.9 7,885 58.8 Personal lines 1,422 9.7 812 6.1 Mortgage guaranty 363 2.5 341 2.5 Total S 14,586 100.0%. $13,408 100.0% 1998 General Insurance Net Premiums Written by Major Segment ®Domestic Brokerage 54.9% ®Foreign 32.9% —Domestic Personal Lines 9.7% ®Domestic Mortgage Guaranty 2.5% 16 nerican International Group,Inc.and Subsidiaries Domestic Foreign Mortgage Total(a) Brokerage Personal Lines Guaranty 1998 1997 1998 1997 1998 1997 1998 1997 1998 1997 $13,362 $12,024 $12,018 $11,272 $1,485 $855 $381 $349 $7,367 ,$6,756 9,787 9,038 8,002 7,885 1,422 812 363 341 4,799 4,370 9,471 8,352 7,814 7,207 1,280 790 377 355 4,627 4,069 (61) (137) (269) (269) 53 16 155 116 473 403 9 (7) (217) (141) 72 18 154 116 522 497 1,754 1,485 1,570 1,356 87 52 68 63 438 369 198 57 186 53 11 1 1 3 7 71 S 1,961 $ 1,535 $ 1,539 $ 1,268 $ 170 $ 71 $223 $182 S 967 $ 937 Total Domestic Foreign Life Insurance Operating Results 1998 1997 199S 1997 1998 199- Premiums S 10,247 $ 9,926 S 738 $ 553 S 9,509 $ 9-')7: Net investment income 3,232 2,896 920 839 2,312 Realized capital gains(losses) (35) 21 (1) (2) (34) Operating income 1,780 1,571 149 123 1,631 1,441 Life insurance in-force $499,167 $436,573 S61,223 $59,517 5437,944 $377,05( 1998 General and We Revenues* Foreign Life 39.7% spa Domestic Brokerage 31.6% Foreign General 17.0% liiiiiiiiiwiii Domestic Life 5.6% t�Domestic Personal Lines 4.6% ti Domestic Mortgage Guaranty 1.5% Represents the sum of general insurance net premiums earned, fife premium income,and net investment income. Corporate Directory Corporate Officers Maurice R.Greenberg Ronald J.Anderson William P.Krivoshik Chairman and Senior Vice President and Vice President and Chief Executive Officer Chairman and Chief Executive Officer of Chief Information Officer AIG Companies in Japan and Korea Robert E.Lewis William N.Dooley Vice President Evan G.Greenberg Senior Vice President,Financial Services and Chief Credit Officer President and Chief Operating Officer Lawrence W.English Charles M.Lucas Senior Vice President,Administration Vice President and Director of Thomas R.Tizzio Market Risk Management Senior Vice Chairman Axel I.Freudmann General Insurance Senior Vice President,Human Resources Richard Merski L.Oakley Johnson Vice President,Corporate Affairs Senior Vice President,Corporate Affairs Christian M.Milton Edward E.Matthews Win J.Neuger Vice President,Reinsurance Vice Chairman Senior Vice President and Michael Mitrovic Investments and Financial Services Chief Investment Officer Vice President Edmund S.W.Tse Ernest T.Patrikis Worldwide Financial Services Claims Vice Chairman,Life Insurance Senior Vice President and Frank Petralito II Frank G.Wisner General Counsel Vice President and Director of Taxes Vice Chairman,External Affairs Kathleen E.Shannon Michael J.Critelli Vice President and Secretary Robert M.Sandler Vice President and Deputy Comptroller Joseph H.Umansky Executive Vice President, Vice President and Deputy Comptroller Senior Casual Ad Edward T.Cloonan Casualty �'an Vice President,Corporate Affairs John T.Wooster,Jr. Senior Claims Officer Vice President,Communications Vice President Howard I.Smith Stephen no Cesar C.Zalaea President m Executive Vice President, Research and Development Vice President,Investments Chief Financial Officer and Comptroller Kevin P.Fitzpatrick Louis F.Zearo Vice President,Real Estate Investments Vice President and Deputy Comptroller Harold S.Jacobowitz Carol A.McFate Vice President,Claims Litigation Treasurer Robert P.Jacobson Keith L.Duckett Senior Advisors Vice President and Deputy Comptroller Director of Internal Audit Edwin A.G.Manton Donald Kanak John J.Roberts Vice President and Ernest E.Stempel President and Chief Operating Officer of AIG Companies in Japan and Korea 18 American International Group,Inc.and Subsidiaries Domestic General Insurance Life Insurance International Advisory Board Kristian P.Moor R.Kendall Nottingham Dr.Henry A.Kissinger Executive Vice President Executive Vice President Chairman,International Advisory Board Domestic General Insurance Life Insurance Former United States Secretary of State Kevin H.Kelley Nicholas A.O'Kulich Chairman,Kissinger Associates,Inc. Senior Vice President Senior Vice President Robert L.Crandall Domestic General Insurance Life Insurance Retired Chairman David M.Hupp Frank Chan AMR Corporation and American Airlines,Inc. Vice President Vice President Dr.Otto Graf Lambsdorff Domestic General Insurance Life Insurance Former German Minister of Economics Jose L.Cuisia,Jr. Wessing&Partners Foreign General Insurance Vice President Erling S.Lorentzen Life Insurance Chairman Martin J.Sullivan Boon-Teik Koay Lorentzen Empreendimentos,S.A. Executive Vice President Vice President Suliman S.Olayan,K.B.E. Foreign General Insurance Life Insurance Founder and Chairman Hamilton C.Da Silva Gem Wyndorf Olayan Group of Companies Vice President Vice President Ambassador Khun Anand Panyarachun Foreign General Insurance Life Insurance Former Prime Minister of Thailand Jeffrey M.Kestenbaum Chairman,Saha-Union Corp.,Ltd. Vice President The Rt. Hon.Lord Prior,PC Foreign General Insurance Chairman Joseph C.Smetana,Jr. The Arab-British Chamber of Commer Vice President Moeen A.Qureshi Foreign General Insurance Chairman Robert J.Thomas Emerging Markets Corporation Vice President Dr.Stephan Schmidheiny Foreign General Insurance Chairman Nicholas S.Tyler ANOVA Holding AG Vice President Washington Sycip Foreign General Insurance Founder and Chairman Nicholas C.Walsh Sycip,Gorres,Velayo&Co. Vice President Ratan N.Tara Foreign General Insurance Chairman Tara Sons Ltd. Ambassador Bernard Vernier-Palliez Former Ambassador to the United States from France Retired President Director General Renault Automobile Company 19 Corporate Directo. ,T C O N T I N U E D) )irectors Honorary Directors M.Bernard Aidinoff Carla A.Hills Marion E.Fajen Senior Counsel Chairman Retired Vice President and Secretary Sullivan&Cromwell Hills&Company American International Group,Inc. New York,New York Former United States Des Moines,Iowa Eli Broad Trade Representative Houghton Freeman Chairman and Washington;D.C. Retired Vice Chairman Chief Executive Officer Frank J.Hoenemeyer American International Group,Inc. SunAmerica Inc. Financial Consultant Stowe,Vermont Los Angeles,California Retired Vice Chairman John I.Howell Pei-yuan Chia Prudential Insurance Company Retired Chairman of the Former Vice Chairman of America Executive Committee Citicorp and Citibank,N.A. Madison,New Jersey J. Henry Schroder Bank& New York,New York Edxvard E.Matthews Trust Company Marshall A.Cohen Vice Chairman Greenwich,Connecticut Counsel Investments and Financial Services Edwin A.G.Manton Cassels Brock&Blackwell American International Group,Inc. Senior Advisor Toronto,Ontario,Canada New York,New York Former Executive Vice President Barber B.Conable,Jr. Dean P. Phypers American International Group,Inc. Former President Retired Senior Vice President New York,New York International Business Machines World Bank John J. Roberts Vexander,New York Corporation Senior Advisor New Canaan,Connecticut Former Vice Chairman Martin S.Feldstein r Professor of Economics Howard I. Smith American International Group,Inc. Harvard University Executive Vice President, New York,New York President Chief Financial Officer and Comptroller Ernest E.Stempel National Bureau of Economic Research American International Group,Inc. Senior Advisor Cambridge,Massachusetts New York,New York Former Vice Chairman Ellen V.Futter Thomas R.Tizzio American International Group,Inc. President Senior Vice Chairman Hamilton,Bermuda American Museum of Natural History General Insurance New York,New York American International Group,Inc. Leslie L.Gonda New York,New York Chairman Edmund S.W.Tse International Lease Finance Corporation Vice Chairman,Life Insurance Los Angeles,California American International Group,Inc. Evan G.Greenberg Hong Kong President and Chief Operating Officer Jay S.Wintrob American International Group,Inc. Vice Chairman and New York,New York Chief Operating Officer SunAmerica Inc. Maurice R.Greenberg Los Angeles,California Chairman and Chief Executive Officer American International Group,Inc. Frank G.Wisner New York,New York Vice Chairman,External Affairs American International Group,Inc. New York,New York F-2 20 Shareholder Im innatlon �erican International Group,Inc.and Subsidiaries Corporate Headquarters Office Annual Meeting of Shareholders American International Group,Inc. The 1999 shareholders'meeting will be held on Wednesday, 70 Pine Street May 19, 1999 at 11:00 a.m.at the offices of AIG,72 Wall Street, New York,New York 10270 eighth floor,New York,New York. Telephone:(212)770-7000 Shareholder Assistance Stock Market Listings New York,London,Paris,Swiss and Tokyo Stock Exchanges Visit the AIG Corporate web site at http://www.aig.com Trading symbol:AIG Requests for copies of the Annual Report to Shareholders and Annua Report on Form 10-K for the year ended December 31, 1998, AIG Stock Trading&Statistical Information',) the Quarterly Statistical Supplement for Financial Analysis,and/or the Summary of Securities Held,should be directed to: Common Stock Prices(b)/Dividends High Low Dividends Director of Investor Relations 1998 American International Group,Inc. First Quarter 86% 67 SO.050 70 Pine Street Second Quarter 97%e S1'%r. 0.050 New York,New York 10270 Third Quarter 101'%, 76% 0.l56 Fourth Quarter 100 x. 66, 0.(l56 (212)770-6293 S0.212 Transfer Agent and Registrar—AIG Common Stock Fifirstrst Quarter 56 47 $0.045 First Chicago Trust Company of New York '/. "/�� Second Quarter 66'%. 50% 0.045 P.O.Box 2500 Third Quarter 71 62'%6 0.05o Jersey City,New Jersey 07303-2500 Fourth Quarter 74'/ 65%. 0.050 1-800-446-2617 $0.190• e-mail:fctc@em.fcnbd.com Number of shareholders 24,209" Trustee—SunAmerica Capital Trust II-8.35% Common shares outstanding 1,237.3 million10 Trust Originated Preferred Securities(SAIpV) Market capitalization at 111199 $119.6 billion's, and SunAmerica Capital Trust III—8.30% Trust Originated Preferred Securities(SAIpW) (.)Share information reflects the 3-for-2 split in the form of a 50 percent The Bank of New York common stock dividend,paid July 31, 1998. (b)As reported on the NYSE Composite Tape by the National Quotation 21 West Street Bureau,Incorporated. New York,New York 10015 (d Reflects the acquisition of SunAmerica Inc.on January 1, 1999. Counsel Sullivan&Cromwell - 125 Broad Street New York,New York 10004 Independent Accountants PricewaterhouseCoopers UP 1177 Avenue of the Americas New York,New York 10036 2: r, American International p,Inc. AIG, 70 Pine Street New York,New York 10270 736115/99 I Montgomery Ward's Proposal ���j,��Y`�'<• «.:`> �2"z� �� ram•" � � � � � � y ^� s �.K ;� ','s"tc„�; 'y�..G,r 1:x'!f!< A��-�. .:h r•k;..�.ie.'`Z..�" '�"^`'s?��3'"i�e.'r -3, .h +n�^!wi r:�. '.:+«:.:.s '.r. r�� x� .: 261 -Z i Wards Corporate Real Estate 535 W.Chicago Avenue Chicago,Illinois 60671 312.467.2000 April 14,2000 RECENED APR 17 2000 VIA FEDERAL EXPRESS DEPARTMENT OF City of Huntington Beach ECONOMIC DEVELOPMENT 2000 Main Street Huntington Beach, CA 92648 Department of Economic Development Attention: David C.Biggs ' Re: Statement of Interest and Request for Proposal for Redevelopment of _ Huntington Center within the Huntington Beach Redevelopment Project Area 4 Dear Mr. Biggs: U This letter shall serve as a response to the request for proposal sent to Montgomery Ward, LLC("Montgomery Ward")from the Redevelopment Agency of the City of Huntington Beach(the "Agency") dated March 3, 2000. It is the understanding of Montgomery Ward that the Agency intends for the above-referenced site to be rehabilitated and repositioned into a high quality, well integrated retail and entertainment center. This letter shall set forth Montgomery Ward's intention with respect to the Montgomery Ward's use of the portion of the site owned by Montgomery Ward (the"MW Property"). Montgomery Ward has operated a retail store in Huntington Beach Mall since 1966, owns the MW Property and has every intention of continuing to operate its retail store and automotive center in Huntington Beach Mall. The retail store and automotive center currently being operated by Montgomery Ward at Huntington Beach Mall is very valuable to Montgomery Ward's business. Pursuant to your request,we have attached the Statement of Interest for Participation in the Huntington Beach Redevelopment Project and Montgomery Ward would be very interested in renovating its retail store and automotive center as part of any redevelopment of the Huntington Beach Mall, provided that sufficient funds were made available by the Agency or any developer which owns the remaining portion of the property within the Huntington Beach Redevelopment Project Area(the"Project Area"). In order to facilitate such renovation, we have enclosed a copy of renderings and specifications that would be used as a basis to renovate Montgomery Ward's retail store and _ (586801.1-4/10100 3:52 PM) David C.Biggs April 14,2000 Page 2 automotive center. Montgomery Ward would be willing to complete a full upgrade of its retail store at Huntington Beach Mall provided that either public funds or developer funds were made available as a contribution to Montgomery Ward to renovate its retail store and automotive center. In the event Montgomery Ward were to undertake a complete renovation of its retail store and automotive center, such renovation would require the following funding: 1. Site expenses of$750,000; 2. Interior and exterior remodel between$3,000,000 and$3,500,000; and 3. Automotive Center renovation costs of approximately$250,000. Montgomery Ward would only perform a complete renovation of its retail store and automotive center if Montgomery Ward received a significant contribution either through public funding or developer funding. Montgomery Ward believes that a renovation of its retail store and automotive center would enhance the Project Area as well as provide additional sales for Montgomery Ward, however, Montgomery Ward is currently renovating a substantial number of its retail stores and in many cases such retail store is being renovated with a contribution from the developer. It is the belief of Montgomery Ward that with public funding or developer funding Montgomery Ward would undertake a complete renovation of its Huntington Beach retail store and automotive center. It has come to the attention of Montgomery Ward that Ezralow Retail Properties intends to submit a proposal that would include monies to be used to cause a condemnation of Montgomery Ward's property at Huntington Beach. Based on such information, Montgomery Ward feels it is necessary to inform the City of Huntington Beach that it will use all of its legal remedies to fight any condemnation of the MW Property as Montgomery Ward has every intention of continuing to operate its retail store and automotive center. The MW Property has an appraised value in excess of$14,000,000 in addition to the value of Montgomery Ward's business being operated on the MW Property and we believe it is in the best interest of all parties to include Montgomery Ward in any redevelopment of the Project Area and to work with Montgomery Ward to provide either public funds or developer funds to cause the renovation of its retail store and automotive center. 27/ (586801.1-4110/00 3:52 PM) David C. Biggs April 14,2000 Page 3 If you have any questions or comments regarding the enclosed matter, please contact Mr. Loren Hohman,Director of Real Estate of Montgomery Ward((312)467-6241). Very truly yours, MONTGOMERY WARD,LLC By: Z�6 Its: cc: Loren H. Hohman _ Corey E. Light, Esq. 2 7�2- �-2 . . (586801.1-4110100 3:52 PM) J • a STATEMENT OF INTEREST FOR PARTICIPATION IN THE HUNTINGTON BEACH REDEVELOPMENT PROJECT I hereby'express my interest in participating in the Huntington Beach Redevelopment Project: 1. Name of Property Owner/Tenant: Montgomery Ward Development, LLC, a Delaware limited liability company, Attn: Loren H. Hohman, Director of Real Estate Phone: (312) 467-6241 2. Home Address: 535 West Chicago Avenue, Chicago, Illinois 60671 r 3. Address of Property owned or rented in the Project Area: 7777 Edinger Avenue 4. I Name of business in the Project Area: Wards Retail Store and Automotive Center Phone: Not Applicable Wd 5. -i own (X); and-wish to rehabilitate ' nrnnarW Tf cn-nt inrliratP• **+�*+f,�} to 6iit y-eF�eAse-{—�j-O?��3 �&��9 4PAO e9Je&sew r0 7 a■ eees�e 6. My present type of business is: Retail Store 7. ?Mature of proposed participation: Renovation' of Wards Retail Store and Automotive Center I understand that submission of this Statement of Interest does not in any way obligate me to participate in the Project. Signed Retum to: Title: esident Redevelopment Agency of the City of Huntington Beach 2000 Main Street Date: April 14, 2000 Huntington Beach,California 92648 Z-73 �i•�J: r;' :$. .l..l_'.. -4_"r L' "—fit--`T-i-� _L '� 1 7=1 � :;?�:: - - .tea:✓ , ,, /j,'r;;:_�;,.:•. , .. ,.irc 77';S`eC1.�� :!wf,,lyyllp-1,.�..- ( � tir•�,� :. ••.. ter....-..... •. ._ ,•y ;,.,_ _ __ . ... __ ... � ..� � :J it� 1 t••. .,1.• - �__ ^ ._--�—^ p, ,'I1,J'1- �Ylry1�,• ,R `• � -`r / .yak I '� � ..C• . . .i i I I ' . ' :��E/F5 s/�ivFret�. _ _. 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Sn �,+.! � -� 'i1V' i '` ^�""�� ':t.•1 y y.. :''y..! [.�1''=.=Ji:.S.. .�44 ritY:�¢. • ;..� ,F titi�?,r `;:,',/.�r•'�. S ):• !�a t'v a •�•� � r.S."y'y.,�' r. ,f��� Zra- .j,:; " ;YR,•�• �V, 1:. ,•:! :F,';�,. v t '�.,�•,�: .�.I---""� I ti}�'r'.>v;�t,r?k�S;�+•�. � t i(� I r` s r� !�°� C\,: `I � '"e_� .r.r :�` 4 . . ,1tyyr:f r�� :�?��'�• 'r• � I t rs 7s � An t�11 t rJ 1.� '"..+--•_. .• :P'fC�w�^1's r �w. y s' .(L;•,1f � r�.,y,l tr;�l. •�j�;i'."�.r'r-.— L.. ..._ .. r i,e.�15 �.',; a!!e' � +'t ,`} .a.-sE.r..� aG-•r;;�' — _ �_ .; ,. ..: J I 'tT:Pa Cb'ud .. ;� •'Y' r_. t�'y' r• .__._., .. _._ ��� C r." ff �I' � :. 1tt'Y,1rC,.Ti'r':ftt'C^+'�.. - `.� .,•.••' ^' I "moo � •:aLtf^p� T-0" 7c • o . FRONT ELEVATION SCALE 3/16'=1'-0' -- 150 COLORED IMPACT-MODIFIED �� •'. ACRYLIC ' 5V HEM—�/ COLOR SPECIFICATIONS ` 115-PLASTIC UP FACES:WHITE 7328 GLUED N GROOVE �� •r RETURNS:PMS-400C CIS SCREW--�' NEON:4500 WHITE 87 .063 ALUMINUM RETURN ELECTRICAL SPECIFICATIONS 3/a•THREADED ROD tti. w/CAPTIVATED NUT ON LETTER BACK,AND ANGLE 15mm WHITE NEON BACIMM APPAM STRINGER BEHIND STUD ASOsumwff[�LiGww WALLAPPLICATIONS j r' 120V TRANSFORMERS iI 26.4 TOTAL AMPS uRl Q ,'�'a„ I EXTENDED TUBE SUPPORT (2)120V120A CIRCUITS REQUIRED AS PER NEC 600.41 !! � t 15mm NEON TUBES Z90 ALUMINUM BACK- 1.: 120V SELF-CONTAINED TRANSFORMER(PBKM) j.. - Wm1 GLR•8 FUSE AND HOLDER AS PER NEC 600.3 + _: .150 IMPACT MODIFIED ACRYLIC ! ! 1 .�N• ,I, THWN#12 WIRE AS PER NEC 60032 I LOCKABLE SWITCH ON 2x4 JUNCTION BOX AS PER NEC 600.6(U.L.LISTED) + _< ` TO PRIMARY ELECTRIC I 1 a AS PER NEC 6005(U.L LISTED) , 318•EXPANSION ANCHOR— F i•';�•7' FOR SOLID WALLS ` INDIVIDUALLY WIRED TOGGLE SWITCH WITHIN _ LETTER(2FA0476-20AMP) U.L.LISTED AS PER NEC 600-3 -' DRAINHOLE PER LOW SPOT IN EACH LETTER AS PER NEC 6003 TYPICAL PERSPECTIVE VIEW TYPICAL SECTION NOT TTTO�SCALE 2 NOT TO SCALE SELF-CONTAINEDHeath and Company- Signs Nationwide 7'-0" �-- HEA1H' f. 34'-7 3/8'- - 5/8 1T-1 3W ialuu,to 11-11 F P Advmhl A91111111111k 4' /4" WELTOO ILLUMINATED—J 20AMPDISOONNECTI--J 1 7 soN.nswrEcri SET OF LETTERS ILLUMI ATED WrOFUTms HONaLA1MINATED FRONT ELEVATION - SCALE:3/16'=1'-0" .150 COLORED COLOR SPECIFICATIONS IMPACT-MODIFIED ; ACRYLIC FACES:WARDS:WHITE 7328 ICON:BLACK 5•HEM .`� ! AUTO EXPRESS:3M#3630-33 RED 118•PLASTIC UP—�•• ��. RETURNS:WARDS:PMS-400C GLUED IN GROOVE ICON&AUTO EXPRESS:BLACK CIS SCREW— � I NEON:WARDS:4500 WHITE .063 ALUMINUM RETURN AUTO EXPRESS:CLEAR RED ...... 3/8'THREADED ROD J ELECTRICAL SPECIFICATIONS W/CAPTIVATED NUT ON_ LE17ER BACK,AND ANGLE \_ 15IT7(11 NEON STRINGER BEHIND STUD (' s�iccrluulro�saturrono WALLAPPUCAMONS 120V REMOTE TRANSFORMERS I�rosx+urmus an�Mlmt II /- — 15.2 TOTAL AMPS I 0L .,� ! STANDARD TUBE SUPPORT ELECTA C SIGN ! AS PER NEC 600-41 r (1)120V/20A CIRCUITS REQUIRED 15mm NEON TUBES .090 ALUMINUM BACK 120V REMOTE TRANSFORMER WITH GLR-8 FUSE AND HOLDER �-• = I's +•: ^� AS PER NEC 6DO-3 I� . .150 IMPACT MODIFIED—� ACRYUG _ 3 ELECTROBIT TO EMT CONNECTOR `,''i' LOCKABLE SWITCH ON 20 JUNCTION BOX AS PER NEC 600.E(U.L.LISTED) n•:•...., TO PRIMARY ELECTRIC adipImo. k� AS PER NEC 600-5(U.L LISTED) R 1 •,x; 3/8'EXPANSION ANCHOR ' �-.- FOR SOUOWALLS \ -� v,� INDMDUALLYWIRED— t ,T� TOGGLE SWITCH WITHIN LETTER(2FA04-78-20AMP) U.L LISTED AS PER NEC 6003 Ta• �.-1; i DRAINHOLE PER LOW SPOT IN EACH LETTER AS PER NEC 6003 TYPICAL PERSPECTIVE VIEW TYPICAL SECTION NOT TO SCALE NOT TO SCALE Heath I Company- SignsNationwide HEATH h- —————————— 11'-10 3/4' — _r_ I ZIx:L'r' 3'r .040 BRUSHED ALUM.FACE.J FRONT ELEVATION (CURVED TO26RADIUS) SCA-E:1/2'=l'-0' .063 ALUM.STRIP ------ BRUSHED ALUMINUM FINISH COLOR SPECIFICATIONS FACE:WARDS PUSH THRU LTRS.:CLEAR ACRYLIC ALUMINUM ANGLE i WITH 3M#3635-70 WHITE DIFFUSER(60%) BACKGROUND FACE:BRUSHED ALUMINUM .040 BRUSHED ALUM. '4% 1/8°GRID LINES: BLACK FACE .090 ALUMINUM - CABINET:BRUSHED ALUMINUM BACKER ELECTRICAL SPECIFICATIONS // 1 r (3)F108 HIGH OUTPUT COOL WHITE .063ALUM•FILERS f FLUORESCENT LAMPS � uL � � i (1)JEFF 256-3120 BALLAST L- ELECRiIC81CN I; •� --BRUSHED ALUM.FACE .- 3.5 TOTAL AMPS (CURVED TO 26 RADIUS) (1)277V/20A CIRCUITS REQUIRED 090 ALUMINUM BACKER BEHIND.040 FACE 1'SQUARE ALUM.TUBE W/ANGLE FOR HOLDING I I 1 �bt` !•t�a r t'>; ._ => T u��''a!!iiwty"`'��4 vr�j'" �¢ ACRYLIC LETTER BACK 1J2'THREADED ROD-- 41 WITH ANGLE STRINGER t$r`K'Yetc�'<„:'-•�:�;.t-; `y%�r `$ wf ; i BEHIND STUDDED WALLS �� t $MALL PAN W/— I IED ► I '1t ;. =,.;.:�:y _•'.•Y = :J-yi :< � TOMBSTONE SOCKETS 11Z EXPANSION ANCHOR FOR SOLID WALLS ® 3J4•THICK CLEAR ACRYLIC L.yy i sJ;•;��;�. ---'S" LETTER wJ WHITE DIFFUSER AND � •- WHITE ACRYLIC BACK INDIVIDUALLY WIRED " TOGGLE SWITCH U.L LISTED AS PER NEC 600-3 os3 - CONTINUOUS ALUMINM� ALUM. � ��i�'`+�a�I��-��.--<s�: ;ti;5: <�,• ,, HINGE FOR ACCESS DOORS ACCESS DOOR ' fJ TYPICAL PERSPECTIVE VIEW TYPICAL SECTION _ NOT TO SCALE 27 a NOT TO SCALE Heath 1 Company 1ns Nationwide 3'-2" INTERIO HEATHS TO: Loren Hohman FROM: Norm Abplanalp DATE: March 29, 2000 RE: HUNTINGTON BEACH, CA SCOPE OF UPGRADE WORK The following list denotes areas of potential work to upgrade the location functionally and visually. SITE • Construct 34 landscape islands in existing parking fields complete with 6"curb and new planting soil. • Construct 1,000 lineal feet of perimeter landscape areas complete with 6"curb and new planting soil. • Construct new planting areas in retail walk perimeters. • Provide irrigation system to all planting areas. • Provide landscape planting for all new and existing islands, perimeters and walkway areas. Planting material to be compatible with center master plan and meet all city standards. • Repave existing parking areas adjacent to Wards retail store and auto service center. Repair/remove all areas of deterioration and prepare surface for a new 1 1/2"layer of asphalt. R • Re-stripe Wards parking fields with appropriate handicap,compact and conventional size stalls complete with pedestrian walkways to meet all city standards. RETAIL STORE • Remodel, renovate and reconstruct existing retail sales and customer support areas to new state-of-the-art prototype standards. • Provide new perimeter wall fixture merchandise systems complete with focal walls and valance construction. • Provide new floor freestanding merchandise fixtures. • Provide new fitting room,service centers and merchandise display fixtures. • Provide new fine jewelry casework, lighting and display modules. • Install new state-of-the art general and accent lighting systems. • New prototype carpet and tile floor covering. • Prototype exterior entrance fagade design on South and North elevations,complete with bow front, entrance modules and new awnings,new aluminum entrance system. • New decorative walks paving. • New painted or EFIS wall surfaces. • New"Wards"contemporary sign program. AUTO CENTER • Remodel and reconstruct existing sales area and customer support areas to new state- of-the art prototype standards. • Refurbish and repaint service area. • New EFIS fascia system. • Paint and/or resurface all wall areas. • New aluminum entrance system. • Replace and/or renew overhead doors. • New prototype sign program. In effect,this upgrade program provides a completely new retail interior and exterior. 27 cc: Don Docken Bob Clark ;e�­ -2-