Orange County pins hopes of Dana Point Harbor revitalization on a collective of three firms

Light at the end of the redevelopment tunnel could be in sight with selection of public-private partnership vendor.

Editor’s Note: This story has been updated from its previous, original version.

DANA POINT — Dana Point boaters and Orange County officials certainly hope a second go-around with revitalization plans will be a charm, as the Board of Supervisors took a significant step forward, Oct. 17, with the selection of Dana Point Harbor Partners to realize a waterfront redevelopment project (at least) 20 years in the making.

Dana Point Harbor Partners, a collection of three firms, is the second developer to work with Orange County in trying to bring a major waterfront development to life. The firms behind Dana Point Harbor Partners are Burnham Ward Properties (commercial core), Bellwether Financial Group (dry and wet marina) and R.D. Olson Development (hotel).

Of course there is still some more work to be done before Dana Point Harbor Partners starts digging shovels into the ground and revitalizing South Orange County’s waterfront and boating venue. Both the county and developer must now proceed with contract negotiations.

Yet the county’s Board of Supervisors are hopeful the trio of firms will, after 20 years of delays, finally bring Dana Point Harbor’s revitalization plans to life.

“As master developer, [Dana Point Harbor Partners] has extensive experience developing and operating retail, marina and hotel properties along the coast, including large-scale and complex ground-up developments and the refurbishment of existing projects,” county staff said in a released statement. “While there will be one master lease between the county and [Dana Point Harbor Partners], each co-managing member will be responsible for their respective product type while working in collaboration with the other co-managing members.”

Hope might spring eternal, but Orange County and Dana Point Harbor have been down this path before.

Project Dimensions Inc. and O.C. Grand Jury

The harbor revitalization’s previous project manager, Project Dimensions Inc., or PDI, was initially hired to help oversee the South Orange County waterfront update. The company’s relationship with PDI soured, as the project manager was eventually taken off the revitalization plan – after several million dollars had been poured into project.

Boaters and county officials certainly believe Dana Point Harbor Partners will achieve different results.

A grand jury was convened in 2014 and studied, among other items, the revitalization’s project management company – (PDI) and the multiple contract extensions – worth millions of dollars – it was granted along the way.

“The budget for the revitalization project has increased from $6,982,000 approved for an initial five-year term in 2003, to the new maximum financial obligation of $13,183,310, through June, 25, 2018. The actual cost is yet to be determined,” Orange County’s Grand Jury stated in its 2014 Dana Point Harbor Revitalization report. “At this time, there is no visible sign of construction.”

The grand jury also asked why a project management company – PDI – would have been allowed to remain on the revitalization project “when a shovel of dirt [had] not been turned” during its 11-year tenure.

Grand jury members also pondered whether Orange County officials were being transparent with revitalization plans.

“There also appeared to be reticence among some County employees as well as a general reluctance to share information about Dana Point Harbor. This mind-set spurred an interest with the Grand Jury,” the 2014 grand jury report stated. “[Dana Point Harbor] is an asset to be shared by all County residents and transient boaters, hence its future hinges on the safeguards of transparency to minimize failures and ensure a successful return on taxpayer monies.”

Almost $20 million was spent on Dana Point Harbor’s revitalization between 2003 and 2014, according to the grand jury – with no construction work started or completed.

What lessons did Orange County – both elected representatives and staff – learn from its experience with PDI? What steps, if any, would the county take to make sure Dana Point Harbor Partners/Burnham Ward Properties won’t repeat the financial and planning mistakes committed by PDI in the early to mid 2000s?

These questions – and a few more – were presented to Supervisor Lisa Bartlett, whose district includes Dana Point, and members of the Dana Point Harbor Partners team.

Bartlett’s office replied back to The Log with a pair of press releases – one from the Board of Supervisors and a second, shorter release from Bartlett, herself. Both releases praised the board’s approval of Dana Point Harbors. Questions of lessons learned – and whether the county would avoid a repetition of history – were left unanswered.

Byron Ward, president of Burnham Ward Properties, also responded to The Log’s inquiry, stating his firm is not yet prepared to answer any questions since the development team is still in negotiations with the county.

“We are busy working through documentation with the county and think it would be premature to meet at this time,” Ward told The Log. “We are anxious to connect with everyone in the local community but the county is keeping us focused on first completing the negotiations with them.”

Dana Point Harbor Partners – The Plan

Revitalizing Dana Point Harbor will carry a price tag of at least $250 million (not factoring in the millions already spent). County officials hope Dana Point Harbor Partners will carry through on its plans to realize an updated marina with 2,296 marina slips, 388 dry stack boat storage and valet boat slips.

Plans also call for the construction of two new hotels (a 136-room affordable hotel and a 130-room boutique hotel) and a $20 million government subsidy for the construction of a parking structure.

“[Dana Point Harbor Partners] has estimated that rent payments to the County over the initial 10 lease years will be $47,130,352 and over the initial 20 lease years will be $117,190,251,” county staff said in a released statement.

Additional details of the Dana Point Harbor Partners plan will emerge as negotiations take shape during the next few weeks and months. What we do know, so far: Burnham Ward Properties, Bellwether Financial Group and R.D. Olson Development are on track to collectively bring Orange County’s revitalization of Dana Point Harbor to life.

Burnham Ward Properties developed several properties within Orange County, including the Stadium Infield complex near Angel Stadium, Hobby Lobby in Laguna Niguel and The Well on 17th Street in Santa Ana.

Bellwether Financial Group’s portfolio, meanwhile, focuses on marine services, while R.D. Olson Development is known for developing hotels such as Lido House in Newport Beach, Paséa Hotel in Huntington Beach, Renaissance Clubsport in Aliso Viejo and Residence Inn by Marriott in Oceanside.

Additional insight of each company will be featured in The Log as negotiations between Orange County and Dana Point Harbor Partners continues.

Rendering courtesy of R.D. Olson Development

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