When the city of Santa Ana, Calif., submitted a request for proposals to turn a three-block infill site with a vacant office building and community parking lot into a revitalized mixed-use area, it was The Olson Company, based in Seal Beach, Calif., which presented a unique solution to fit their needs. "We are the solution provider to a lot of cities," says Alex Hernandez, senior vice president and managing director for Olson. "[Once] we were selected we began the process of developing their vision into reality."
Primarily a Latino shopping district, the site is located close to two major freeways, all major amenities, and is walking distance to 12,000 jobs. Recognizing that downtown markets don't always provide an appropriate spot for major retailers, the builder/developer used the success of European shopkeeper units as an influence. "Cities today don't want to lose the retail tax dollar," says Steve Olson, chairman. "At the same time, there is an important requirement to add residential infrastructure in downtown areas. Mixed use gives them the opportunity to do both."
By offering a residence above and a shopkeeper unit below, the company sold the city on the combined elements of live/work, which might have a business tax, a retail sales tax, and a residence above. "We've tried to slice it and dice it differently to present things that might have more appeal on a broader front in an urban area," says Olson.
While the company has always had an urban focus, Olson admits the demand for mixed use has provided an opportunity for his company to evolve. Building only in California, the Olson Company has become the largest for-sale residential provider in the state's urban markets. With experience in high-density, attached, and detached residential units in downtown markets, it's no surprise that the company is becoming more involved in mixed-use projects. "Five years ago, about 5 percent of our work was in mixed use," says Olson. "Today, we're at 18 percent."
As the company has shifted its business focus, they have also had to find different partners for expertise. "We have had to expand our knowledge on design, construction, and trade base -- to make sure that we have the expertise as we are designing and developing these new communities," says Hernandez. "The efficiency, the design, and the code perspective, making sure our architects and trades are all on the same page to promote construction efficiency; this has been a big focus for the company."
Since mixed use of the past has typically included for-rent properties, Hernandez says the sub-base for these types of projects tends to be more from the commercial trades or apartment trades versus traditional single-family trade. "That expertise is definitely beneficial when you move into this kind of product."
The philosophy seems to be working. The Artists Lofts in Santa Ana includes three phases of development with 86 units entitled and the potential for another 50 units. The first phase is complete and occupancy began in June. Today, 80 of the project's units are sold.
Each unit is essentially a box with concrete floors and exposed ductwork -- all the traditional elements of an old commercial building, but with the modern amenities of a full bath, basic kitchen, and parking garage. The unique features included the ability to provide retail or office on the ground floor and the opportunity to customize the space for a buyer's individual needs. "The design gives you separation but the advantage of only going down the stairs," says Olson.
Floor plans range from 1,334 to 2,706 square feet and began selling in the $270,000 to $340,000 range. "Today we're selling remaining units in the high $400,000s," says Olsen.
To facilitate the mixed-use philosophy, the city provided zoning for the units to encompass approximately 10 uses including galleries, home-based small businesses, and eateries that require no mass ventilation. For anything else, residents need to seek a conditional-use permit through the city. While the plan was to create a community for the "creative arts", the project attracted everything from a true component of artists that will feature galleries on the ground floor of their unit, to creative professionals from a variety of trades such as architects, interior designers, and attorneys.
Says Hernandez: "This is the newest housing built in Santa Ana in quite some time and it has exceeded our expectations."
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Learn more about markets featured in this article: Los Angeles, CA.