Cities Report Dec. ’19-Jan. ’20

Compiled by Bill Ruh, CVAR Government Affairs Director 

AZUSA

Avison Young announced the $7.5 million sale of Rockvale Apartments, a 34-unit, multifamily property located at 333 N. Rockvale Ave., Azusa.

Avison Young’s Irvine office represented the seller, a private company with offices in Covina, as well as the buyer, a private investor group based in Arcadia. The cap rate was 4.3% and the price per unit was $220,588.

Built in 1960 and situated on .8 acres of land, the property is a two-story garden-style design, consisting of 19 one-bedroom units, 14 two-bedroom units and one three-bedroom unit. Amenities include a large pool area and on-site laundry facilities.

This sale marks the third apartment property this Avison Young team has sold over the past year in the city of Azusa. In November 2019, the team completed the $16.76 million portfolio sale of The Riviera and Rainbow Gardens in Azusa. The two nearby apartment properties total 72 units and were also constructed in the early 1960s.

Over the past five years, Azusa has been the fastest-growing city in the San Gabriel Valley, with 6.6% population growth during that period. The area has also seen a significant amount of capital infusion with new planned developments in various stages of construction in all property sectors.

CHINO

The Chino City Council on Dec. 17 approved paying Gruen Associates of Los Angeles more than $240,000 to develop a master plan to improve the aging city hall complex.

The civic center was completed and went into use in the 1970s, according to Deputy City Manager Vivian Castro in a report to the council. The site comprises approximately 15.29 acres in downtown Chino, on the west side of Central Avenue, between Chino Avenue and C Street. Approximately eight acres include the city hall and vacant police and courthouse facilities. A vacant fire station and former Human Services building, owned by the city, are directly across Central Avenue.

The civic center property also includes the Chino Branch Library, the Chino Senior Center, the Seventh Street Theatre, the Chaffey College Chino Center, parking lots and open space. In addition, the city owns the Chaffey IT Center on the southwest corner of Central Avenue and C Street, as well as the Gray Building (Chamber of Commerce building) and the Chino Youth Museum building.

Three bids, ranging from $244,461 (from Gruen) to $667,560 were received. The council agreed to pay an additional $18,232 to Gruen for community input and stakeholder meetings, social media content and development of a project website, for a total contract of $262,393. Work on the plan is expected to begin in January and be completed by late July or early August, according to the contract documents. 

CHINO HILLS

The city of Chino Hills was named with three other entities in a class-action lawsuit filed Dec. 17 in San Bernardino Superior Court by the Natural Resources Defense Council (NRDC) for not submitting a water conservation report required by the state for three consecutive years.

The other entities were San Bernardino County, Rancho Cucamonga and Redlands.

The NRDC is a non-profit environmental organization established in 1970 with offices in Santa Monica, San Francisco, other states, and abroad.

The state’s Department of Water Resources began requiring cities and counties to report annually on their landscape permitting programs in 2015 to ensure that new irrigated landscapes are water efficient.

The four entities are singled out as “named respondents” and approximately 300 cities and counties are in the “proposed respondent” class.

Chino Hills and the other three entities had robust new growth and are representative of all jurisdictions that failed to file one or more of the annual reports between 2015 and 2018, according to Ed Osann, director of national water use efficiency for the NRDC.

The city of Chino Hills issued permits for approximately 1,500 units between 2015 and 2017 without submitting the required reports. According to Chino Hills building reports, new dwelling unit permits were issued as follows: 110 permits in 2015, 448 in 2016, and 1,030 in 2017.

The residential growth included Bristol Chino Hills, Vila Borba, Santa Barbara and Jade Tree in southern Chino Hills, the Founders development on Grand Avenue and Founders Drive, and The Crossings at Chino Hills on the northeast side of Fairfield Ranch Road and Monte Vista Avenue.

IRWINDALE

Molson Coors Beverage Company announced plans to cease production at its facility in Irwindale by September 2020.

The second largest U.S. beer manufacturer also announced an agreement with Pabst Brewing Co., giving the Los Angeles-headquartered beer company the option to purchase the Irwindale facility for $150 million.

The 40-year-old Irwindale facility employs about 470 workers and produced 4.8 million barrels of product last year—including Miller Lite, Coors Light, Miller High Life, Miller Genuine Draft, Steel Reserve, and Miller 64, among others—which was shipped to 261 independently owned wholesalers.

Molson Coors will begin moving production from Irwindale to its facilities in Golden, Colorado, and Fort Worth, Texas, over the next nine months.

As for Molson Coors’ arrangement with Pabst, the maker of Pabst Blue Ribbon will have 120 days after receiving notice from Molson Coors of Irwindale’s closure to exercise its option to buy the brewery, according to a U.S. SEC filing. The document notes that as part of the agreement between Molson Coors and Pabst, both companies have “executed mutual release of claims related to their ongoing litigation and dismissed the litigation with prejudice,” referencing Pabst’s lawsuit against the former MillerCoors over a nearly two-decades-old contract brewing arrangement. Both parties announced a settlement in that case in November 2018.

This past November, Pabst reached a long-term agreement to brew the majority of its production volume at City Brewing Company by December 2024 and maintain contract production at City facilities until 2040.

For Molson Coors, the announcement of Irwindale’s impending closure follows last October’s announcement of new CEO Gavin Hattersley’s sweeping restructuring and revitalization plan aimed at reinvesting $150 million annually in its core products, above-premium offerings, new beyond beer innovations and digital capabilities.

As part of that initiative, Molson Coors consolidated its corporate center and four business units into two business units–North America and Europe. Molson Coors’ Chicago office became its North American headquarters and the company closed its Denver office. The company also moved its functional support roles to its offices in Milwaukee, WI.

At the time, Molson Coors said it would cut as many as 500 jobs as part of the effort. The layoffs came a little more than a year after MillerCoors announced it would eliminate 350 salaried positions by the end of October 2018.

Although the Irwindale closure marks another major streamlining effort by Molson Coors, the planned Irwindale closure is unrelated to the larger effort, the company said.

POMONA

Construction has begun on Agoura Hills-based AMCAL’s Veterans Park Apartments at 444 W. Commercial St. in Pomona.

Veterans Park Apartments is an affordable apartment community featuring 61 multifamily units ranging from 600 to 1,000 square feet, and will serve veteran families and their needs. The 1.27-acre site is located two blocks from the Pomona Transit Center, a major hub with the regional transit authority. It is also within walking distance from Pomona’s Arts District and lively downtown area.

Non-profit Hope Through Housing Foundation will provide assistance coordinating services available to Veterans.

The community will include 25 one-bedroom/one bath units, 15 two-bedroom/two-bath units, and 20 three-bedroom/two bath units. One unit will be reserved as an unrestricted manager’s apartment.

RANCHO CUCAMONGA

Renovations to 9494 Haven in Rancho Cucamonga are finishing up and will deliver 61,000 square feet of modern office space in a two-story building. Originally built in 2004, the renovations have more than doubled available office space with the addition of second floor.

Ownership is also modernizing 9494 Haven’s building exterior, creating a new identity and curb appeal for the space. All renovations are scheduled for completion in February 2020.

The property represents the largest contiguous block of space now available in the Rancho Cucamonga/Ontario submarket.

SAN DIMAS

A Vroman’s Bookstore, a high-quality organic grocery store, and a 50-room boutique hotel could be built on vacant property near downtown San Dimas.

The project known as Pioneer Square replaces the once-proposed four-story hotel on the south side of Bonita Avenue between Acacia Street and Cataract Avenue, adjacent to Pioneer Park.

The town square would have subterranean parking, which allows for more open spaces throughout the project. The layout draws on European influences with paseos and courtyards throughout, as well as pop jet fountains in one area.

At its Dec. 10 meeting, the City Council in closed session “selected Pioneer Square LLC as a developer for the purposes of negotiating a purchase and sale, subject to validation of project viability and financing,” City Manager Ken Duran said.

The selection of Pioneer Square is a departure from the original plans for the site.

About three years ago, the council decided to designate a hotel development as the preferred use of the site, after a city-commissioned report found it was a viable option.

In November 2017, the council entered into an exclusive negotiation agreement with Fine Hospitality Group to build a 110-room Fairfield Inn by Marriott and 11,000 square feet of retail space on the vacant lot. But in December 2018, residents asked city leaders to revisit the types of development that could go there.

The city hired consultant Kosmont Companies of Manhattan Beach in February 2019 to determine if other types of businesses would be viable there.

Creative Housing Associates, which specializes in transit-integrated neighborhoods, was drawn to the property because it is a five-minute walk from the future San Dimas Foothill Gold Line stop, he said.

This proposal lends itself to those with a car-optional lifestyle, he said. Which is why there will also be a small high-end grocery store on-site. Meanwhile, the retail portion will be anchored by Vroman’s, which will be located at the center of the project.

Plans for the west corner of the site include a 50-room boutique hotel complete with a rooftop bar and restaurant. The  hotel will be a contemporary version of the historic Walker House. Next to the boutique hotel, 50 apartment units are planned. The hotel and apartments would wrap around the western and southern part of the site. A historic Oak tree will be preserved and become a dominant feature of a courtyard for the hotel.

The development may include a variety of other commercial uses, such as a Pilates or yoga studio.

UPLAND

Upland residents and members of the City Council have clashed with the developer of a proposed e-commerce logistics warehouse/distribution center over the adequacy of the project’s environmental review.

About 25 residents testified Jan. 9, against the project brought by Bridge Development Partners, telling city leaders the review—known as a Mitigated Negative Declaration (MND)— underestimates the amount of noise, air pollution, health effects and traffic they would experience. Three others spoke in favor of the project.

The review concluded that the 201,096-square-foot warehouse to be built on 50 acres on the north side of Foothill Boulevard near the terminus of Central Avenue “would not cause new substantial direct or indirect adverse effects on human beings.”

An EIR could take a year and set the project construction time frame back. The developer wants to start building in the summer. A rumored tenant is Amazon, the mega e-commerce company, but no tenant has yet been signed, Kotler said.

Originally, Bridge proposed three warehouse buildings of 275,000, 330,000 and 370,000 square feet, eliciting a hue and cry from many residents concerned about traffic, noise and pollution.

Bridge came back with a smaller project — a single warehouse building — that has been further scaled back for about an 80% reduction in size. The warehouse would operate 24/7 but trucks would be capped at 25 per day—five in the daytime and 20 at night, for a total of 50 truck trips per day.

The warehouse would have 16 dock-high doors for trucks and 16 van-loading doors; 224 parking spaces; 12 stalls for truck trailer parking; 1,104 van parking stalls and 1,000 new trees planted around the perimeter and between the parking spaces.

Of the 20 effects measured, 13 were determined to have no significant impact on the residents of northwest Upland and nearby Claremont, while seven will be fixed using 28 “mitigation measures.” These areas include noise, air pollution and traffic, of primary concern to residents.

The fix-it measures include setting back the building 700 feet from Foothill Boulevard and surrounding the perimeter with mature trees to block noise, adding electric vehicle charging stations for 6% of the parking spaces, and limiting truck idling to five minutes, according to consultant Kimley-Horn, hired by Bridge to do the MND study.

Adding substantial delays in the process could bring the larger project back onto the table, increasing the environmental impact, he said.

Though Bridge stuck to its report about the adequacy of its environmental review, others at the joint City Council, Planning Commission and Airport Land Use Committee workshop criticized the document.

As far as cars and trucks running on gasoline and diesel fuel, the study concludes no air quality impact. But Nilsson said Bridge’s consultant based that conclusion on every van from a fulfillment center traveling 6.9 miles maximum, which he said was way too low.

WEST COVINA

Months after upholding the city’s regulations on accessory dwelling units—commonly known as granny flats—West Covina is gearing up to discuss them again, this time to change them in accordance with several new state laws.

In February 2019, the City Council voted to maintain several city standards on granny flats, which are considered a quick, short-term fix to Southern California’s affordable housing crisis.

Current city regulations allow owners of properties 12,000 square feet and larger to build granny flats as large as 1,000 square feet when detached from the main house and no closer than 25 feet to the rear property line.

However, a suite of new state laws signed into law by Gov. Gavin Newsom—Senate Bill 13 and Assembly bills 68, 670 and 881—prohibits minimum lot size requirements like West Covina’s and reduces the minimum distance to property lines to 4 feet or what is “sufficient for fire safety.”

With the new laws in effect as of Jan. 1, the Planning Commission was pressed to initiate a code amendment to get city regulations in compliance, Community Development Director Jeff Anderson said. The commission voted 3-2 to start the process, with a majority of commissioners expressing disdain for the new state laws.

The 12,000-square-foot minimum lot size was intended to ensure neighborhoods could sustain increased density, and the 25-foot minimum setback was meant to ensure neighbors’ privacy, the commission decided last fall.

The commission also criticized a change allowed by the new laws that says the owner is no longer required to live on the property in either the main home or the granny flat. Commissioners believed that this change creates a speculative or “spec” market in which investors will buy up homes, build granny flats and offer little oversight over the people who rent them.