23-0815_26874 ORTEGA HWY LLC_Agenda Report_E10City of San Juan Capistrano
Agenda Report
TO: Honorable Mayor and Members of the City Council
FROM: Benjamin Siegel, City Manager
SUBMITTED BY: Matisse Reischl, Assistant City Manager
PREPARED BY: Ashley Melchor, Senior Management Analyst
Charlie View, Project Manager
DATE: August 15, 2023
SUBJECT: License Agreements with 26874 ORTEGA HIGHWAY, LLC, for
Shared Use of Two City-Owned Downtown Properties Located at
26942 Old Mission Road and 31782 El Camino Real; and, Finding
Said Actions Exempt Under California Environmental Quality Act
(CEQA) Guidelines Section 15332 (Class 32)
RECOMMENDATION:
1.Approve and authorize the City Manager to execute two License Agreements with
26874 ORTEGA HIGHWAY LLC, to allow for certain permitted activities on two
City-owned properties located at 26942 Old Mission Road and 31782 El Camino
Real; and,
2.Direct the City Clerk to record the License Agreements with the County of Orange;
and,
3. Find Said Actions Exempt Under State CEQA Guidelines, Section 15332
(Class 32) for Infill Development.
EXECUTIVE SUMMARY:
The site plan for the previously approved El Camino Specific Plan Project (on the
Downtown Playhouse and adjacent parking lot site) incorporates the shared use of two
City-owned properties adjacent to the development. To accommodate the shared use of
these properties, staff is recommending the approval of two License Agreements. A
project location map is provided as Attachment 1. The License Agreements would allow
for shared vehicular and pedestrian access, outdoor dining, landscaping and other site
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improvements, as well as comply with a code-required setback for the parking structure
element of the approved project.
DISCUSSION/ANALYSIS:
On October 4, 2022, the City Council approved the entitlement actions for the El Camino
Specific Plan Project, consisting of an approximately 27,457 square foot retail, restaurant
and office building, and an approximately 199 space, four-story parking structure. On
November 14, 2022, the City Council approved two Disposition and Development
Agreements (DDAs) for the sale of the City-owned Downtown Playhouse and adjacent
parking lot properties to facilitate the project. The DDA is a standard sales agreement
commonly utilized by public agencies for real estate transactions.
As illustrated in the project site plan shown on the following page, in addition to the land
sold through the DDAs, the project site incorporates the shared use of two adjacent City-
owned properties. To facilitate the shared use of these City-owned properties, two
License Agreements have been negotiated with the developer of the El Camino Specific
Plan Project.
A portion of City property on the corner of Old Mission Road and Del Obispo, currently
used for public parking and landscape entry features, would be utilized for circulation
(green shading), landscaping, hardscape, and a patio (yellow shading) under the terms
of the first License Agreement (Attachment 2). An approximately 19-foot-wide unimproved
portion of City property just north of the Blas Aguilar Adobe (red shading), adjacent to the
future parking structure (orange shading), would be designated as the required setback
and landscaping buffer area for the parking structure under the terms of the second
License Agreement (Attachment 3).
Both license agreements are written to retain the existing use of the properties by the
public and the Blas Aguilar Adobe Foundation. With respect to the second License
Agreement, as there will be no structure in the setback area, the operations of the Blas
Aguilar Adobe Foundation will not be impacted and the additional landscaping proposed
in the setback area will be maintained by the licensee.
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August 15, 2023
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Under the terms of the License Agreements, the developer will enhance the existing
condition of both properties through the installation of additional landscaping, lighting, and
paved pedestrian walkways and a patio open to the public on the corner of Old Mission
Road and Del Obispo. The License Agreements also call for the developer to be
responsible for the maintenance costs of the license areas. The assumption of all
maintenance costs for the license areas is provided as financial consideration for the
shared use of these areas by the licensee.
FISCAL IMPACT:
The City’s Public Works Department is currently responsible for maintenance of the
existing parking and landscape area. Pending approval of the proposed License
Agreements, the licensee would become the responsible party for that maintenance. As
a result, the City would experience cost savings with respect to irrigation, landscape and
tree trimming. Additionally, the applicant would be required to provide general liability
insurance and name the City as an additional insured on an annual basis.
ENVIRONMENTAL IMPACT:
The proposed Project is categorically exempt from further environmental review under
State CEQA Guidelines, Section 15332, In-Fill Development Projects (Class 32). The
entire Project (which includes the project approvals on October 4, 2022, adoption of a
Resolution of Intention on October 18, 2022), to sell the subject properties, the approval
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of the Disposition and Development Agreements on November 14, 2022, and any other
follow-on actions, including the proposed License Agreements, is exempt per Section
15332 because the Project meets the required conditions for Class 32. The City filed and
posted a Notice of Exemption for the Project on October 7, 2022, with the Orange County
Clerk-Recorder.
As explained in the October 4, 2022, staff report on the El Camino Specific Plan, the
Project is consistent with the applicable General Plan designation and all applicable
General Plan policies as well as with applicable zoning designations and regulations
outlined in the El Camino Specific Plan; in all respects where the El Camino Specific Plan
does not specify a development standard, the Project is consistent with the San Juan
Capistrano General Plan and Title 9 of the Municipal Code, Land Use. The Project occurs
within city limits on a project site of less than five acres and is substantially surrounded by
urban uses. Specifically, the Project is located at 31776 El Camino Real in the City of San
Juan Capistrano, consists of 1.68 acres, and is surrounded by Town Center (commercial),
Community Park (public), and Town Center Edge (commercial) zoning to the north, south,
and east, respectively, and Town Center (commercial) zoning to the west. The Project site
has no value, as a habitat for endangered, rare, or threatened species because the
majority of the Project site has already been developed and is currently improved with a
commercial building, parking lot, and associated improvements on the parcels. Therefore,
the site is not habitat for endangered, rare, or threatened species.
Approval of the Project would not result in any significant effects relating to traffic, noise,
air quality, or water quality. Analysis has been conducted to ensure the Project does not
result in any significant effects relating to traffic and water quality, including the following:
a Traffic Sensitivity Analysis accepted by the City Traffic Engineer and the Preliminary
Water Quality Management Plan approved by the Public Works Department. Further, there
is no evidence that the Project would result in significant effects relating to air quality or
noise. The site can be adequately served by all required utilities and public services; the
Project site is currently serviced by all required utilities, including but not limited to
electricity, gas, garbage, water, and sewer and therefore would remain adequately
serviced. None of the exceptions to the categorical exemptions identified in CEQA
Guidelines, section 15300.2 apply. There is nothing unusual about the Project site or the
Project itself that would lead to a potentially significant impact. And, even if an unusual
circumstance did exist (one does not), based on the studies performed, there is no
reasonable possibility that the Project would have a significant effect on the environment.
The Project site is already developed with a commercially operating playhouse, the
Project’s Traffic Sensitivity Analysis concluded that the Project would not result in a
significant increase of inbound and outbound traffic, would provide adequate access, and
would provide adequate off-street parking. Further, the Project will not result in damage
to scenic resources within a highway officially designated as a state scenic highway; the
closest officially designated state scenic highway is located near Anaheim and therefore
the Project will not result in damage to scenic resources within or near such highway.
Further, the Project is not located on a site which is included on any list compiled pursuant
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to Government Section 65962.5; the Project site has not been designated as a hazardous
waste site. Further, the Project will not cause a substantial adverse change in the
significance of a historic resource; specifically, there would be no substantial adverse
change in the significance of the Blas Aguilar Adobe, as discussed in the report, the
Agreement will not result in any physical or operational change to the Adobe. Thus, the
exceptions are not triggered, and the Class 32 categorical exemption applies.
PRIOR CITY COUNCIL REVIEW:
• On November 14, 2022, the City Council approved Disposition and Development
Agreements to sell 1.2-acres of City-owned property located at 31776 El Camino
Real and 26874 Old Mission Road (formerly Ortega Highway) to 26874 Ortega
Highway LLC.
• On November 1, 2022, the City Council continued the Public Hearing for
consideration of the purchase agreements for the properties to November 14,
2022.
• On October 18, 2022, the City Council adopted a Resolution of Intention declaring
its intent to sell the City-owned properties, declaring the properties exempt surplus
land pursuant to the Surplus Land Act, and set a hearing date of November 1,
2022, for consideration of purchase agreements to effectuate the transaction.
• On October 4, 2022, the City Council approved the entitlement actions for the
proposed development of an approximately 27,457 square foot retail, restaurant,
and office building, and an approximately 196 space, four-story parking structure.
• On October 17, 2017, the City Council approved an Exclusive Negotiation
Agreement with Frontier Real Estate Investments (26874 Ortega Highway LLC)
for the possible sale and development of the properties.
• On May 16, 2017, the City Council voted to enter into exclusive negotiations with
Frontier Real Estate Investments for the potential sale of the Parking Lot and
Playhouse properties.
• On April 26, 2017, the City Council conducted a Community Workshop to review
development proposals for the Parking Lot and Playhouse properties.
COMMISSION/COMMITTEE/BOARD REVIEW AND RECOMMENDATIONS:
• On August 24, 2022, the Planning Commission reviewed the Ortega and El
Camino Project proposed for the subject property and adopted a resolution
recommending that the City Council approve the Applicant’s requested General
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Plan Amendment, Rezone and Code Amendment and finding that said action is
categorically exempt from the California Environmental Quality Act (CEQA) under
CEQA Guidelines Section 15332, In-Fill Development Projects (Class 32).
• On July 26, 2021, the Cultural Heritage Commission reviewed the Ortega and El
Camino Project proposed for the subject property and in accordance with City
Council Policy 603, found that the proposed land use improvements associated
with the El Camino Specific Plan are physically and aesthetically compatible with
the Blas Aguilar Adobe, a structure identified on the City’s Inventory of Historic and
Cultural Landmarks, the California Register of Historical Resources, and the
National Register of Historic Places.
• On December 9, 2021, the Design Review Committee reviewed the conceptual
plans of the proposed Ortega and El Camino project proposed for the subject
property and forwarded a recommendation of approval to the Planning
Commission.
• On January 14, 2021, the Design Review Committee reviewed the conceptual
plans for the proposed Ortega and El Camino project proposed for the subject
property and provided preliminary feedback on the design aspects of the project
to the Applicant.
NOTIFICATION:
Michael W. Burnett, Almquist Development
Blas Aguilar Adobe Foundation
Adjacent Property Owners
Interested Parties Notification List
ATTACHMENT(S):
Attachment 1: Project Location Map
Attachment 2: Proposed Roundabout License Agreement
Attachment 3: Proposed Setback and Landscape Buffer License Agreement
Attachment 1- Project Location Map