The housing market slump appears to be taking a toll on two signature Orange County projects -- the efforts to create a vibrant downtown near Anaheim's sports venues and the much-anticipated plan to build a mammoth urban park on the old Marine base in Irvine.
In Anaheim, city officials were alerted last week that Lennar Corp., one of the nation's largest home builders, will halt construction on A-Town for up to a year, slowing progress on the centerpiece of what some are calling the city's new downtown.
In Irvine, Lennar's plans to build thousands of homes around the planned Orange County Great Park have been pushed back, and the city has not received an updated timeline from the developer since 2005.
City officials said Lennar had projected that it would have 781 homes for sale by next year, though the developer said it vowed only to have that number of home sites ready for construction.
A plan unveiled by Lennar last summer to nearly triple the number of homes from 3,625 to 9,500, while cutting back on commercial space and adding 400 acres to the park, hasn't even been discussed with city officials.
The delay, according to a report by City Manager Sean Joyce, is a result of disagreements about Lennar's obligations to the city under a development agreement signed in 2005, among other things.
Residential and commercial development is critical for the creation of the park. City officials are counting on property taxes to turn the El Toro Marine base into a 1,347-acre municipal park that designers compare to Manhattan's Central Park or Balboa Park in San Diego.
Although Great Park officials and designers said their funding was safe for now -- they have $160 million in the bank from $200 million in development fees paid by Lennar -- prolonged delays in home construction could slow the pace of construction of the park itself.
"The speed that the park is going to get built in will be directly proportional to the velocity of home sales," said Yehudi Gaffen, president of Gafcon, the project manager for the Great Park Design Studio.
According to the Great Park's working financial plan, the housing market slowdown may cause the city to revise its revenue projections, and the city and Lennar have both acknowledged that the development schedule has slipped from the original plan.
Emile Haddad, Lennar's chief investment officer, said the company was at best a year away from evaluating whether it would proceed with home construction at the Great Park or decide the market was not right for it.
