U.S. housing crisis stifles Great park

Nearly three years after the city approved a massive residential and commercial development at the closed El Toro Marine base in exchange for a grand park in the heart of suburban Orange County, Irvine officials and struggling home builder Lennar Corp. are in talks about revising the landmark agreement.

No homes or businesses have been built. No grassy fields have been planted. And the runways -- so hated by opponents of a proposed regional airport at the base -- still sit mostly intact.

Designers are planning a dramatic landscape of lakes, orchards, athletic fields, museums and a rugged, man-made canyon in what they promise will be one of the nation's largest municipal parks. In a mailer in 2003, city officials boasted that "children will be playing in the county's largest sports park" by summer 2008.

But for now, no timeline exists for when each park feature will be developed. Most of the future park's 1,347 acres remain off limits to the public, with a balloon ride and a visitor's center being the only public facilities -- although a 27-acre "preview park" is under construction.

"To have nothing more than a balloon and the possibility of a 27-acre park is disappointing," said county Supervisor Bill Campbell, whose district includes Irvine. "They're spending a lot on engineers, PR people and other things, and they're not delivering."

When Lennar and Irvine officials signed the deal in the summer of 2005 to develop the Great Park, city officials heralded it as an innovative way to fund the swift construction of the $1.1-billion park without dipping into public coffers.

The key was a plan that would trade home building for parks money. Lennar would get the right to build thousands of homes as well as millions of square feet of commercial, industrial and office space on the former base. It would pay $200 million in development fees and donate the land for the park. A redevelopment agency and a community facilities district bond together would capture at least $400 million from the increased value generated by the new homes.

The idea seemed smart when California's housing market was red hot. But as the sub-prime mortgage business imploded, home prices plummeted and developers -- already saddled with a glut of inventory -- backed away from starting new projects. Today, the formula for funding the Great Park is a major problem.