Agenda Item   

AGENDA STAFF REPORT

 

                                                                                                                        ASR Control  21-000220

 

MEETING DATE:

05/25/21

legal entity taking action:

Board of Supervisors

board of supervisors district(s):

5

SUBMITTING Agency/Department:

County Executive Office   (Approved)

Department contact person(s):

Thomas Miller (714) 834-6019 

 

 

Dylan Wright (714) 480-2788

 

 

Subject:  Conveyance of Real Property in Dana Point

 

      ceo CONCUR

County Counsel Review

Clerk of the Board

Concur

Approved Agreement to Form

Consent Calendar

 

 

3 Votes Board Majority

 

 

 

    Budgeted: Yes

Current Year Cost: N/A

Annual Cost: N/A

 

 

 

    Staffing Impact:

No

# of Positions:

Sole Source: N/A

    Current Fiscal Year Revenue: $3,700

  Funding Source: 100% (Harbor Bluff Corp.)

County Audit in last 3 years: No

 

 

    Prior Board Action: None

 

RECOMMENDED ACTION(S):

 

 

1.

Find that the project is categorically exempt from the California Environmental Quality Act (CEQA) Class 5 (Minor Alteration in Land Use Limitations) pursuant to CEQA Guidelines, Sections 15305

 

2.

Find that the 1,834-square-foot subject property is no longer required for County purposes.

 

3.

Approve and execute the Purchase and Sale Agreement and Quitclaim Deed to transfer the subject property to the buyer, Harbor Bluff Corp., and return the executed documents to County Executive Office Real Estate for further processing and recordation.

 

4.

Authorize the Chief Real Estate Officer, or designee, to execute any collateral instruments or minor changes that do not materially alter the Purchase and Sale Agreement and/or Quitclaim Deed nor result in any additional liability for the County, without further action from the Board of Supervisors.

 

 

 

 

 

SUMMARY:

 

Approval of the Purchase and Sale Agreement and the Quitclaim Deed to Harbor Bluff Corp. will reduce the County’s financial and maintenance responsibilities and support economic development within the City of Dana Point.

 

 

 

 

 

BACKGROUND INFORMATION:

 

In 1950, a private individual, L. M. Cahill, granted to the County the bluff area located just south of the intersection of Green Lantern Street and Santa Clara Avenue within an area that is now the City of Dana Point (City).  Adjacent to the bluff is the existing, but currently closed, Cannons Seafood Grill restaurant, which is slated for demolition by Harbor Bluff Corp. (Developer) to construct a new 100-room resort hotel, with a restaurant, café, spa and associated parking facilities (Project).  Per the City’s Resolution No. 18-06-11-17, approving the California Coastal Commission Coastal Development Permit (CDP) for the Project, the Developer is required to consolidate the underlying legal lots.  Consequently, the Developer approached the County about purchasing a portion of the top of the bluff (Parcel HA78H-101.1), which sits adjacent to the Project site as depicted on Attachment A – Location Map (“Subject Property”).  The Subject Property and the slope area adjacent to it are owned by the County and are located on the landward side of Cove Road and Dana Point Harbor Drive, outside of the area managed as Dana Point Harbor.  In coordination with OC Parks staff it has been determined that the property is not currently used and is not needed for County park purposes, or any other County purpose.  Additionally, the property is not restricted to park purposes and, therefore, can be transferred as County surplus property.  In addition, because the subject property is landlocked on a slope and is not able to be developed on its own, it is not independently marketable.  The appraisal of the property also found that “Due to the size of the property, the highest and best use, as vacant, would be joinder with the adjacent parcel.”  If property is unmarketable and competitive proposals would be futile or would produce no advantage for the County, the property can be sold directly without going through a competitive bidding process.  Meakins v. Steveland, Inc., 68 Cal.App.3d 490, 498 (1977).  As such, County Executive Office (CEO) Real Estate and OC Community Resources/OC Parks (OC Parks) staff have negotiated directly with the adjacent property owner to dispose of this surplus property.

 

The County has prepared a Purchase and Sale Agreement (Attachment B) and a Quitclaim Deed (Attachment C) for the sale of the subject property in the amount of $3,700.  The Quitclaim Deed includes a reservation granting County the right to review all plans associated with the Project for any impacts to the existing tie backs and slope stability.  In relation to the bluff face owned by the County that is adjacent to the Subject Property, the CDP conditions of approval states that the Project is required “to be setback a sufficient distance from the bluff edge to be safe from the threat of bluff erosion for a minimum of 50 years without relying on shoreline or bluff protection structures.”  As such, the Developer would be unable to rely upon existing bluff protection structures, including the existing crib wall at the foot of the bluff owned by the County.  Furthermore, the CDP stipulates that “no new bluff protective device shall ever be constructed to protect the blufftop development in the event that the development is threatened with damage or destruction from waves, erosion, storm conditions, bluff retreat, landslides or other natural hazards” and that the Developer “waives… any rights to shoreline armoring.”

 

The sale of the Subject Property to the Developer will support the economic development of the City and the area surrounding Dana Point Harbor through the establishment of a new hotel with many public-serving amenities.  Additionally, the sale will relieve the County of financial and maintenance obligations for property that is not required for any County purposes.

 

The subject property’s appraised value of $3,700 was based on current market data analysis, which was reviewed by CEO Real Estate to ensure the County is receiving a fair market value.  CEO Real Estate and OC Parks recommend approval of the Purchase and Sale Agreement and Quitclaim Deed to Developer to facilitate the Project.

 

 

Orange County Parks Commission: The Orange County Parks Commission considered this item and recommended it for Board of Supervisors approval at its May 6, 2021, meeting.

 

Natural Community Conservation Plan and Habit Conservation Plan (NCCP/HCP): The subject property is not located in the NCCP/HCP Reserve.  

 

Park Abandonment: This property is not restricted as County parkland and, therefore, is not subject to park abandonment laws.

 

Surplus Property: Notices of Availability were sent to County agencies on September 3, 2020, and pursuant to Government Code 54222 et. seq., Notices of Intent were sent to non-County entities on September 10, 2020. No interested parties responded to the notice. 

 

Compliance with CEQA: The proposed project is Categorically Exempt (Class 5) from the provisions of CEQA pursuant to Section 15305, because the exemption provides for minor alterations in land use limitations.

 

General Plan Conformity: This project is in conformance with the City of Dana Point’s General Plan.

 

 

 

FINANCIAL IMPACT:

 

 

Approval of the Purchase and Sale Agreement will result in an additional $3,700 in revenue to OC Parks Fund 405, which will be absorbed in the FY 2020-21 Budget.

 

 

 

STAFFING IMPACT:

 

N/A

 

 

 

REVIEWING AGENCIES:

 

OC Community Resources/OC Parks


 

ATTACHMENT(S):

 

Attachment A – Location Map
Attachment B – Purchase and Sale Agreement
Attachment C – Quitclaim Deed to Harbor Bluff Corp. for Parcel HA78H-101.1
Attachment D – City of Dana Point Resolution 18-06-11-17
Attachment E – Real Estate Conveyance Questionnaire