HomeMy WebLinkAboutPC2022-011 - ADOPTING ENVIRONMENTAL IMPACT REPORT ADDENDUM NO. 6 (ER2022-002), MAJOR SITE DEVELOPMENT REVIEW NO. SD2021-005, MODIFICATION PERMIT NO. 2022-001, CONDITIONAL USE PERMIT NO. UP2021-053, COASTAL DEVELOPMENT PERMIT NO. CD2021-077, AND VESTING TRESOLUTION NO. PC2022-011 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY
OF NEWPORT BEACH, CALIFORNIA ADOPTING ENVIRONMENTAL IMPACT REPORT ADDENDUM NO. 6 (ER2022-002), MAJOR SITE DEVELOPMENT REVIEW NO. SD2021-005, MODIFICATION PERMIT NO. 2022-001, CONDITIONAL USE PERMIT NO. UP2021-053, COASTAL
DEVELOPMENT PERMIT NO. CD2021-077, AND VESTING TENTATIVE TRACT MAP NO. NT2021-003 AND MAKING FINDINGS OF CONSISTENCY WITH COUNCIL POLICY K-4 AND DIRECTOR’S DETERMINATION NO. DD2021-001 FOR THE RITZ-CARLTON RESIDENCES PROJECT LOCATED AT 900
NEWPORT CENTER DRIVE (PA2021-296)
THE PLANNING COMMISSION OF THE CITY OF NEWPORT BEACH HEREBY FINDS AS FOLLOWS:
SECTION 1. STATEMENT OF FACTS.
1. An application was filed by Newport Center Hotel, LLC, (“Applicant”) with respect to the Vea Newport Beach, a Marriott Resort and Spa, property located at 900 Newport Center Drive, and legally described as Parcel 2 in the City of Newport Beach, County of Orange,
State of California. As per Map 2004-225 filed in Book 361, Pages 1, 2, and 3 of Parcel
Maps, in the Office of the Orange County Recorder, as modified by the Parcel Map Certificate of Correction recorded April 23, 2008, as instrument No. 2008000190230 of the official records (“Property”).
2. The Applicant proposes the conversion of up to 159 hotel units to residential units;
construction of a new building to accommodate the residential units, as well as a spa, pool, gym/fitness center and other amenities; 408-space subterranean parking structure; and 6-level (4-levels below ground and 2-levels above ground) 400-parking space parking structure to replace the existing hotel parking structure in substantially the same
location which require the following land use approvals (“Project”):
• Major Site Development Review No. SD2021-005: A site development review in accordance with Newport Beach Municipal Code (“NBMC”) Section 20.52.080 to
allow for the construction of the Project.
• Modification Permit No. MD2022-001: A modification permit to allow for the tandem parking spaces in conjunction with a parking management plan.
• Conditional Use Permit No. UP2021-053: A conditional use permit to allow
residential use as an allowed use at a resort hotel in conjunction with a parking management program consistent with the requirement of Director's Determination No. DD2021-001 and NBMC Section 20.52.020 (Conditional Use Permits and Minor Use Permits).
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• Coastal Development Permit No. CD2021-077: A coastal development permit in
authorizing the construction of the project within the Coastal Zone, consistent with
the requirement of Director's Determination No. DD2021-001.
• Vesting Tentative Tract Map No. NT2021-003: A vesting tentative tract map for the creation of a condominium map.
• Addendum No. 6 (ER2022-002) to the 2006 General Plan Update Program Environmental Impact Report: Pursuant to the California Environmental Quality Act (“CEQA”), the addendum determined there are no new significant environmental impacts resulting from the Project.
3. The Property is designated Visitor Serving Commercial (CV) by the General Plan Land Use Element and is located within the Commercial Visitor-Serving (CV) Zoning District. 4. The Property is located within the coastal zone, but outside of the California Coastal Commission Appeal Areas. The Coastal Commission does not have jurisdiction over the
Project because it is outside the Appeal Area and because prior development on the Property (e.g., Santa Barbara Condos, CDP No. 5-07-085) has been processed under a new Coastal Development Permit rather than an amendment to the original Marriott Coastal Development Permit (CDP No. 5-83-139). The subject property’s Coastal Land Use Plan category is Visitor Serving Commercial (CV-B) and it is located within the
Coastal Zone Commercial Visitor-Serving (CV) Coastal Zone District. 5. A public hearing was held on May 12, 2022, in the Council Chambers at 100 Civic Center Drive, Newport Beach. A notice of time, place and purpose of the public hearing was
given in accordance with California Government Code Section 54950 et seq. (“Ralph M.
Brown Act”), and NBMC Chapters 20.62 (Public Hearings) and 21.62 (Public Hearings). Evidence, both written and oral, was presented to, and considered by, the Planning Commission at this public hearing.
SECTION 2. CALIFORNIA ENVIRONMENTAL QUALITY ACT DETERMINATION.
All potential environmental impacts for this Project have been previously addressed and mitigated through the implementation of the policies of the General Plan as evaluated in Program Environmental Impact Report for the 2006 General Plan Update (SCH No.
2006011119) (“PEIR”); therefore, in accordance with Section 15164 of the CEQA Guidelines,
an addendum to the previously certified PEIR is the appropriate environmental documentation for the Project. Pursuant to Section 21166 of the California Public Resources Code and Section 15162 of the
CEQA Guidelines, when an environmental impact report has been certified for a Project, no
subsequent EIR is required unless the lead agency determines, on the basis of substantial evidence in the light of the whole record, one or more of the following: 1. Substantial changes are proposed in the project which will require major revisions of the
previous EIR due to the involvement of new significant environmental effects or a
substantial increase in the severity of previously identified significant effects;
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2. Substantial changes occur with respect to the circumstances under which the Project is undertaken, which will require major revisions of the previous EIR due to the involvement
of new significant environmental effects or a substantial increase in the severity of
previously identified significant effects; or 3. New information of substantial importance, which was not known and could not have been known with the exercise of reasonable diligence at the time the previous EIR was
certified as complete, shows any of the following:
a. The Project will have one or more significant effects not discussed in the previous EIR;
b. Significant effects previously examined will be substantially more severe than
shown in the previous EIR; c. Mitigation measures or alternatives previously found not to be feasible would in fact be feasible and would substantially reduce one or more significant effects of
the Project, but the Project proponents decline to adopt the mitigation measure
or alternative; or d. Mitigation measures or alternatives which are considerably different from those analyzed in the previous EIR would substantially reduce one or more significant
effects on the environment, but the Project proponents decline to adopt the
mitigation measure or alternative. On the basis of the entire environmental review record, the Project will not result in any new significant impacts that were not previously analyzed in the PEIR for the General Plan 2006
Update (SCH No. 2006011119). All potential impacts associated with this Project would either
be the same or less than those described in the PEIR. In addition, there are no substantial increases in the severity of any previously identified significant environmental impacts and no new mitigation measures are required for the implementation of the proposed Project; there are no changes in circumstances under which the proposed Project would be undertaken that
would result in new or more severe significant environmental impacts; and there is no new
information of substantial importance that would result in one or more new or substantially more severe significant impacts. Therefore, in accordance with Section 21166 of the California Public Resources Code and Section 15162 of the CEQA Guidelines, an addendum to the previously adopted PEIR is the appropriate environmental document for the Project.
SECTION 3. REQUIRED FINDINGS. In accordance with the NBMC, City Council Policy K-4, and Director’s Determination No. DD2021-001, the following findings and facts in support of such findings for each of the required
approvals is set forth below.
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I. Major Site Development Review
In accordance with NBMC Section 20.52.080(F) (Site Development Reviews), the Planning
Commission may approve or conditionally approve a site development review application, only after first finding that the Project is: Finding:
A. Allowed within the subject zoning district; Facts in Support of Finding:
1. The Property has a General Plan designation of Visitor Serving Commercial (CV), a Coastal
Land Use Plan designation of Visitor Serving Commercial (CV-B), and a zoning designation of Commercial Visitor-Serving (CV). General Plan Anomaly Number 43 allows for 611 hotel rooms at the Property. In 2012, 79 of the 611 rooms were converted to residential dwelling units leaving approved 532 allowed hotel rooms in General Plan Anomaly Number 43.
2. On March 9, 2021, the City Council adopted City Council Policy K-4 (Reducing the Barriers to the Creation of Housing) by way of Resolution No. 2021-18. City Council Policy K-4 directed City staff to develop, modify as necessary, and aggressively implement strategies and action plans designed to accelerate housing production consistent with the policy,
including encouraging the development of mixed-use hotels.
3. The goals of City Council Policy K-4 include interpreting ambiguities in the City’s General Plan, Coastal Land Use Plan, Title 20 (Planning and Zoning) and Title 21 (Local Coastal Program Implementation Plan) of the NBMC to allow hotels and motels, located outside the
Coastal Commission Appeal Areas, to convert up to 30% of their approved hotel rooms into
residential units on a one-for-one basis. 4. On April 30, 2021, the Community Development Director issued Director’s Determination No. DD2021-001. The Director’s Determination implemented City Council Policy K-4 and
found that residential uses are allowable accessory use within four resort hotels, including
the Newport Beach Marriott Resort Hotel. The Director’s Determination also found that such residential uses are consistent with a hotel’s and motel’s underlying General Plan, Zoning Code, and Local Coastal Plan Program land use and zoning designations. Director’s Determination No. DD2021-001 was considered on appeal by the Planning Commission on
July 8, 2021 and was considered by the City Council on appeal on August 24, 2021. Both
the Planning Commission and the City Council denied the appeal and upheld the Director’s Determination. The time to challenge the Director’s Determination has lapsed, all applicable statutes of limitations has run, and the Director’s Determination is now final.
5. Project is located within the Newport Beach Marriot Resort Hotel which was identified in
Director’s Determination No. DD2021-001 as one of the properties where conversion of hotel rooms to residential units is allowable in order to spur housing.
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6. The primary use of the Property will remain a hotel which is identified as an allowable use within the Commercial Visitor-Serving (CV) zone.
7. Additionally, the Project is allowed as an accessory use within the zoning district in that it would allow a maximum of 30% (up to 159 hotel units) of the 532 existing units to be converted to residential units at the Property. As such, the Project, as an accessory use to the primary use as a hotel, is consistent with the applicable Commercial Visitor-Serving
(CV) zoning district.
Finding:
B. In compliance with all of the following applicable criteria:
a. Compliance with this Section, the General Plan, this Zoning Code, any applicable
specific plan, and other applicable criteria and policies related to the use or structure;
b. The efficient arrangement of structures on the site and the harmonious relationship of the structures to one another and to other adjacent developments; and whether
the relationship is based on standards of good design;
c. The compatibility in terms of bulk, scale, and aesthetic treatment of structures on the
site and adjacent developments and public areas;
d. The adequacy, efficiency, and safety of pedestrian and vehicular access, including drive aisles, driveways, and parking and loading spaces;
e. The adequacy and efficiency of landscaping and open space areas and the use of
water efficient plant and irrigation materials; and
f. The protection of significant views from public right(s)-of-way and compliance with
Section 20.30.100 (Public View Protection).
Facts in Support of Finding:
1. The Property has a General Plan designation of Visitor Serving Commercial (CV), a Coastal Land Use Plan designation of Visitor Serving Commercial (CV-B), and a zoning designation of Commercial Visitor-Serving (CV). All CV designations allow for overnight
accommodations and accessory land uses.
2. The Project is an allowable accessory land use to the primary use as a hotel based upon the facts and findings set forth in finding I.A above. As such, the Project is consistent with the applicable CV land use designations.
3. The Project is designed so as to be harmonious with the existing hotel and other adjacent developments. 4. The residential building will be setback 15 feet from Newport Center Drive and 5 feet from
the westerly (interior) property line, in excess of City development standards. The height of
the 22-story building would be 279 feet with additional accessory improvements and rooftop appurtenances such as elevator overruns and screened mechanical equipment up to 295 feet consistent with the existing high-rise 300 ft height limitation zone. Lastly, although there
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is no minimum standard for open space, the proposed site plan provides approximately 42% of the site as open space consisting of hardscape and landscaping.
5. The Project is compatible with surrounding development and public spaces in terms of bulk, scale and aesthetic treatments. The existing buildings at the Property range from 30 feet to 151 feet in height and overlook the Newport Beach Country Club golf course. The Project is located in Newport Center which is characterized by high- and mid-rise office buildings
surrounding Fashion Island. The majority of the high-rise buildings are located nearby in
Blocks 400-600, with building heights exceeding 300 feet above ground level. Low- and mid-rise buildings are concentrated in the southeastern portion of Newport Center closest to MacArthur Boulevard and Pacific Coast Highway. Several other residential communities, including Meridian, Granville, the Colony Apartment Homes, Villas at Fashion Island,
Vivante Senior Housing (currently under construction), and other approved projects, are
located in Newport Center. The residential building will be constructed using high-quality materials including stone, metal, wood, steel, and glass glazing accents. 6. The Project draws inspiration from the California Post Modernism architectural style which
is embedded in the original vision of Fashion Island as set forth by Master Architect William
Pereira. William Pereira’s nautical inspired building forms, most prevalent in Pereira’s work at the Pacific Life Building at Block 700 in Newport Center, combined with the vision from the original vessels of The Ritz-Carlton Yacht Collection helped form the design of the Residences. Authentic Yacht inspired detailing is integrated into the architecture through
the abundant use of natural materials and the emphasis on indoor and outdoor spaces. The
building architecture respects the design pillars rooted in the formation of Fashion Island, while showcasing a modern interpretation that exemplifies the enduring qualities of The Ritz -Carlton brand.
7. The Project has been designed as a 22-story building structure constructed to include a
range of indoor and outdoor common space and amenities. The indoor open space amenities will include gym and fitness facilities, locker rooms, spa treatment rooms, on-site private storage, concierge services, an owners room featuring billiards, a library and other uses. The outdoor amenities will include a resort style pool and spa, lounge seating, tranquil
gardens, and a dog relief area. Common indoor amenities totaling 32,424 square feet will
be located at the ground floor, basement level (B2), and on floors 16 and 17. Common outdoor amenities totaling 9,496 square feet will be located on the ground level and on floor 16. In addition to outdoor amenity areas, there will be 65,534 square feet of hardscape and landscape area. Each unit will contain private open space via a balcony. There is 143,038
square feet of private open space, which averages 899 square feet per unit.
8. The Project is integrated as a unified development through the use of similar architectural style and design elements, on-site parking, and adequate vehicular and pedestrian circulation with adjacent properties. The residential building will replace an existing building
at the Property where setbacks along each street frontage are appropriate to support
pedestrian connectivity within Newport Center and reduce the appearance of bulk. The street setbacks are consistent with surrounding zoning districts and afford a greater interface with the adjacent rights-of-way to ensure compatibility with the pedestrian environment.
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9. The Project includes extensive landscape and hardscape areas with pedestrian circulation
throughout the Property with a variety of plant materials including trees, vines, shrubs, and
turf throughout the site and in open space areas. Evergreen specimen trees (Pinus species or similar) will be planted at the outer portions of the site while canopy shade trees will be planted around the motorcourt and event lawn. Smaller accent trees (such as Olea europea or similar) are proposed around the pool area.
10. The height, bulk, and scale of the Project buildings are comparable to heights of existing buildings within Newport Center. The Property is located within the City’s High-Rise Height Limitation Zone, which in Newport Center includes the Property, and the seven surrounding blocks to the north and east. Building heights in these blocks range from approximately 100
feet to 315 feet above ground level. The Property was originally contemplated to have
buildings with a height of 375 feet; however, this height limit was reduced in 2010 to the current height limit of 300 feet above ground level. 11. Mechanical equipment for the residential units has been located within the parking garage
as well as enclosures at the roof level to reduce noise impacts and minimize aesthetic
impacts. The rooftop equipment, stairways, and elevator overrun will be screened from street view. 12. The Project has been designed to avoid conflicts among uses, such as noise, vibration,
lighting, odors, and similar impacts. The Project’s new residential building will replace an
existing hotel building and is designed to maintain privacy and protection for the surrounding residential and commercial uses as well as its residential tenants. Walkways and egress are sufficient throughout the Project as reviewed by the Building Division and the City Traffic Engineer. Existing pedestrian easements will be maintained at an appropriate width along
the eastern property line and along Newport Center Drive to ensure adequate access
across the site. 13. Pursuant to Title 20 (Planning and Zoning) of the NBMC, the Project exceeds the minimum standard requirements for parking. All of the parking is provided on-site via a subterranean
valet-served parking structure with tandem parking approved by Modification Permit 2022-
001 and the Ritz-Carlton Residences Parking Management Plan dated April 13, 2022 (“Parking Management Plan”) that was prepared for the Project. 14. Access to the site, on-site circulation, and parking areas are designed to comply with City
standards. Vehicle traffic will be directed to an entrance on the south side of the Property
along Newport Center Drive (separate from the hotel entrance). The new access will align with the existing intersection and direct vehicles to the new porte cochere to valet services. Service and fire access will be maintained by a new secondary driveway constructed along the southern boundary of the site. All parking will be valet-served with a new 5-level, 408-
space subterranean parking structure constructed under the porte cochere and entry drive
area. 15. On-site circulation, project access, and parking areas are designed to provide standard sized parking spaces (with the exception of a number of tandem parking spaces), a
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minimum 44’ wide driveway, 26’ wide drive aisles, and the minimum vehicle turning radius to provide adequate access for residents and guests, including a new secondary drive for
emergency vehicles, delivery trucks, and refuse collections vehicles, as determined by the
City Traffic Engineer. 16. The site design provides a new curb cut for emergency access along Newport Center Drive. The Project provides adequate sight distance at each driveway, as determined by the City
Traffic Engineer.
17. The Project’s material palate consists of a neutral stone and glass building façade compatible with the surrounding development in Newport Center. The design will complement, enhance, and be compatible with the adjacent retail and office properties. The
exterior will be comprised predominantly of concrete, metal finishes and glass; design
accents at the ground elevation such as finished wood coverings and other stone and metal accents are integrated to enhance the expression of a modern architectural style. 18. The Project is subject to the City's Water-Efficient Landscape Ordinance (Chapter 14.17 of
NBMC) and compliance will be confirmed at plan check prior to issuing building permits.
19. Addendum No. 6 prepared for the Project analyzed whether the Project would conflict with applicable zoning and other regulations governing scenic quality. The Project uses would be consistent with the CV zoning designation. The PEIR emphasizes that the General Plan
Update would concentrate infill development and redevelopment in several specific
subareas, including Newport Center/Fashion Island (i.e., high-density residential uses are proposed in the Newport Center/Fashion Island area). The Project will demolish a 1970s building and replace it with new hotel branded residences, and remove the existing structured parking on-site to develop a new parking structure and subterranean parking for
the hotel branded residences. The Project’s new residential building will be aesthetically
compatible with existing surroundings and will not have a material impact on visual character or public views. 20. The Project will be visible from SR-1, which is designated a Coastal View Road, and also
from several public view points within the City. The majority of these view points feature
views of the Newport Back Bay, and Newport Harbor, and are generally oriented in a westerly orientation. The Project is located more than 3,000 feet from the water, and will not block views from a Coastal View Road or public viewpoints because the predominate view from SR-1 is to the coastline, which is in the opposite direction compared to the Project.
When the Project is developed as proposed, it would be of a comparable height to other
nearby structures in Newport Center with no potential impact to scenic resources visible from SR-1. The photo simulations provided in Section 3.2 of Addendum No. 6 depict the new structure from several view points and demonstrate that Project will not impact or degrade coastal views.
Finding:
C. The proposed development is not detrimental to the harmonious and orderly growth of the City, nor endanger, jeopardize, or otherwise constitute a hazard to the public convenience,
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health, interest, safety, or general welfare of persons residing or working in the neighborhood of the proposed development.
Facts in Support of Finding: 1. The Project has been designed to ensure that potential conflicts with surrounding land uses are minimized to the extent possible to maintain a healthy environment for both businesses
and residents by providing an architecturally pleasing Project with articulation and building
modulations to enhance the urban environment consistent with development in Newport Center. 2. The Project provides an architecturally pleasing nautical/contemporary design theme, which
is consistent with the original master plan design for Newport Center, and features
articulation and building modulation to enhance the urban environment consistent with existing buildings in Newport Center. The Project provides pedestrian paths and landscape areas that will create connectivity to surrounding uses.
3. The Property is located in a developed commercial area with limited sensitive land uses
located nearby. The overall height of the Project is consistent with the High-Rise Height Limitation Zone and will not materially impact any public views from General Plan designated vantages or significantly shade surrounding properties as demonstrated in Section 3.1, Aesthetics, of Addendum No. 6.
a. The Property is located in close proximity to the Granville Condominiums and will introduce a new high-rise residential building where existing low-rise hotel rooms are developed. Section 20.20.030 of the NBMC requires a 5-foot setback in the CV zone when adjacent to residential development. The property line is located within a sloped
landscape area between the hotel and the Granville Condominiums. The nearest point
of the residential structure will be setback approximately 35 feet from the property line. There will be a 5-foot setback from the internal property line to a 24’ to 30’ wide emergency access and service drive. The service drive will gradually slope downward and provide access to the subterranean parking structure. The service drive will provide
a buffer between the development at grade level.
b. A shade and shadow analysis was prepared to assess the impacts of the new residential building on the Granville Condominiums and the Meridian condominium complex. The Project would cast shadow on the garage portion of one residence at the Grandville
community at 9:00 a.m. during Midsummer Solstice (June 21), and over some
residences at the Meridian condominium complex at 9:00 a.m. during Midwinter Solstice (December 21), as shown in Section 3.1.C, Aesthetics of Addendum No. 6 Exhibit 3.1-1b and 3.1-1d, respectively. By 10:00 a.m., the shadows would not cover these residences and there would be no impact from shade/shadow to people residing in the
area. Due to the short duration of anticipated shadows on off-site properties, Addendum
No. 6 concluded that the Project would result in less than significant shade and shadow impacts and that no mitigation is required.
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4. The proposed subterranean parking structure provides 408 parking spaces including ADA accessible spaces, standard spaces and tandem parking spaces, and through the use of
valet parking will accommodate 100% of the Project's anticipated parking demand based
upon the Parking Management Plan. Additionally, the parking lot and vehicular access thereto has been designed to accommodate and provide safe access for passenger vehicles, emergency vehicles, delivery trucks, and refuse collection vehicles, as analyzed in Section 3.17 (Transportation) of Addendum No. 6.
5. The Project includes a new parking structure including four levels below ground and 2 levels above ground to serve the existing hotel. The new parking structure will replace the existing parking structure in substantially the same location and provide 400 parking spaces. A total of 808 parking spaces (408 for hotel-branded residence and 400 for hotel use) are proposed
for the Project which will adequately serve the Property. The Project will not result in any
changes in vehicular circulation for the hotel. 6. Direct vehicular access to the Project will be provided from an existing driveway on Newport Center Drive along the south side of the Property. Vehicles will be directed along a new
access drive to the new porte cochere where valet service will deliver cars into a new
subterranean parking structure. A new secondary driveway will be constructed along the southern boundary of the Property to provide service and fire access from Newport Center Drive along the western boundary of the Property to the Event Lawn.
7. Emergency vehicles would access the Property along Newport Center Drive and onto the
new service drive. The staging area will be marked for exclusive use by the Fire Department. 8. The Project has been designed to accommodate and provide access for delivery trucks,
moving trucks, and refuse collections vehicles, as determined by the City Traffic Engineer.
Delivery trucks will utilize the entry off of Newport Center Drive, while refuse collections vehicles will load trash along the service driveway. The Project includes the provision of freight elevators to ensure that residents can safely move in and staff can adequately service the building.
9. The Project is subject to the City's Outdoor Lighting requirements contained within NBMC Section 20.30.070 (Outdoor Lighting) of the Zoning Code. Condition No. 14 requires the preparation of a photometric study based on the final lighting plans to ensure that site and architectural lighting conforms with lighting requirements that the project is not excessively
illuminated. Condition No. 15 also provides additional protection where the Community
Development Director can order the diming of lighting should it be necessary. 10. The construction will comply with all Building, Public Works, and Fire Codes. All ordinances of the City and all conditions of approval shall be complied with. The Project includes a Fire
Master Plan to ensure enhanced public safety and fire access to the property.
II. Modification Permit
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This Project requires a modification permit, consistent with Section 20.52.050 (Modification Permits) of the NBMC. In accordance with Section 20.52.050(E), the Planning Commission
may approve or conditionally approve a modification permit if on the basis of the application,
materials, plans, and testimony (orally and/or in writing) submitted, the Planning Commission first finds all of the following: Finding:
A. The requested modification will be compatible with existing development in the
neighborhood; Facts in Support of Finding:
1. The Project requires the demolition of an existing hotel building and parking structure, and construction of a new residential building, a new 408-space subterranean parking structure and new 400-space above grade parking structure.
2. The residents will be served by valet service that will deliver vehicles into a new 408-space
subterranean parking structure that includes tandem parking. The Project is required to provide 398 parking spaces, and 408 will be provided. 3. Tandem spaces reduce the footprint and depth of the subterranean garage, making it a
more efficient use of land. The Project will be adequately served by the new subterranean
parking structure. At grade, parking features include a porte cochere where residents and guests will be met by a valet for vehicle drop off. Tandem parking in a subterranean parking garage is compatible with the existing commercial, retail, residential, and hotel uses in Newport Center.
4. Valet and tandem parking arrangements for hotel, commercial, and high-end residential building operations are used within the City. When operated according to an approved valet plan and by a professional valet service, valet parking has proven a proficient way to maximize parking efficiency and on-site parking demand.
5. Access to the Property and valet-services is from Newport Center Drive and has been determined to be adequate for the use and is compatible with the other commercial lots in the area.
Finding:
B. The granting of the modification is necessary due to the unique physical characteristic(s) of
the property and/or structure, and/or characteristics of the use;
Facts in Support of Finding:
1. The Project is located in Newport Center which is characterized by high- and mid-rise office buildings surrounding Fashion Island. The Property was originally developed in 1975 and the existing parking garage was built in 1984. Because Newport Center Drive is circular,
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many of the properties fronting it are not a precise square or rectangular shape. However, the Property’s shape is even more unique in that it is elongated and can be characterized
as a cross between rhombus and trapezium shaped.
2. Due to the lot size, width and depth of the site, subterranean parking with tandem parking spaces is necessary to accommodate the parking.
3. The Project’s 100% valet service for all residents and guests is consistent with the use of
the Property as a Ritz-Carlton Residence. Finding:
C. The granting of the modification is necessary due to practical difficulties associated with the
property and that the strict application of the Zoning Code results in physical hardships that
are inconsistent with the purpose and intent of the Zoning Code; Facts in Support of Finding:
1. The Project is located in Newport Center which is characterized by high- and mid-rise office buildings surrounding Fashion Island. The Project will provide parking in excess of the City’s residential parking requirements to ensure that all residents, guests and employees will have adequate access to parking.
2. However, as indicated above, the shape of the Property is unique. Given its unique shape of the property combined with the building setback requirements, landscaping, vehicular access and open space requirements at the Property, tandem parking is appropriate.
3. The available on-site area to provide parking has been maximized and can accommodate
a maximum of 408 parking spaces in the Project’s subterranean parking structure while still providing landscaping, adequate vehicular access, and open space at the Property. 4. Granting Modification Permit No. 2022-001 meets the intent of the NBMC by providing the
required number of parking spaces on-site without the need to use off-site parking spaces.
Finding: D. There are no alternatives to the Modification Permit, that could provide similar benefits to
the applicant with less potential detriment to surrounding owners and occupants, the
neighborhood, or to the general public; and Facts in Support of Finding:
1. An alternate solution would be to expand the footprint of the subterranean residential
parking structure or increase the size of the hotel parking structure. Both of those options would require a significant change to the scope of work and may result in a structure with undesirable bulk, or scale.
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2. Vehicles for the Project will access the property from an existing driveway on Newport Center Drive that will take residents and guests to the porte cochere where valet services
will park vehicles in the subterranean parking garage. On-site circulation is not expected to
be impacted by the use of tandem spaces for valet parking 3. The inclusion of tandem parking stalls will not be a detriment to the surrounding neighborhood or general public because the number of parking spaces will exceed the code
requirement. Valet operations will manage all resident and guest parking, thereby
eliminating any impact to the general public or surrounding owners, occupants and the neighborhood. The subterranean parking structure takes up the majority of the property to the east of the building and allows for the above grade surface to contain substantial setbacks, open space, and landscape treatments. Because the parking will be managed by
valet operations, as is standard for a Ritz-Carlton Residence, there is no alternative to the
tandem parking that would provide similar benefits of increased open space and landscape treatments. Finding:
E. The granting of the modification would not be detrimental to public health, safety, or welfare
to the occupants of the property, nearby properties, the neighborhood, or the City, or result
in a change in density or intensity that would be inconsistent with the provisions of this Zoning Code.
Facts in Support of Finding: 1. The parking lot has been reviewed for adequate access and circulation for use by residents, guests, employees, and access by emergency vehicles.
2. Prior to implementation of the Project a final valet parking management plan is required to be reviewed and approved by the Public Works Department and Community Development. 3. The inclusion of tandem parking will not be a detriment to public health, safety, or welfare
to the occupants of the property or nearby properties, the neighborhood or the City because
the parking will be managed by valet operation, and will exceed the required number of parking spaces which will ensure that there is adequate parking on-site and that off-site parking will not be required by residents, guests or employees. Tandem parking is allowed by the zoning code, subject to a modification permit. The addresses the provision of valet
parking for the Project.
III. Conditional Use Permit This Project requires a conditional use permit, consistent with NBMC Section 20.52.020
(Conditional Use Permits and Minor Use Permits) and the requirements of Director’s
Determination No. DD2021-001. In accordance with Section 20.52.020(F), the Planning Commission may approve or conditionally approve a conditional use permit, only after first finding all of the following:
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Finding:
A. The use is consistent with the General Plan and any applicable specific plan;
Facts in Support of Finding: 1. The conversion of up to 159-hotel branded residences is consistent with General Plan
designation of Visitor Serving Commercial (CV); a Coastal Land Use Plan designation of
Visitor Serving Commercial (CV-B); and a Zoning designation of Commercial Visitor-Serving (CV), which allows for the Project site to provide overnight accommodations and accessory land uses. City Council Policy K-4 and Directors Determination No. DD2021-001 permit residential dwellings as an accessory use to the primary use of the Property as a
resort hotel. The Director’s Determination contains regulations and restrictions to ensure
the allowance of residential accessory units within a hotel property does not change the primary land use, which remains resort hotel. 2. The Project site is not located within a Specific Plan area.
Finding:
B. The use is allowed within the applicable zoning district and complies with all other applicable provisions of this Zoning Code and the Municipal Code;
Facts in Support of Finding: 1. On March 9, 2021, the City Council adopted Resolution No. 2021-18 Reducing the Barriers to the Creation of Housing (City Council Policy K-4). City Council Policy K-4 directed City
staff to develop, modify as necessary, and aggressively implement strategies and action
plans designed to accelerate housing production consistent with the policy, including encouraging the development of mixed-use hotels. 2. The goals of City Council Policy K-4 include interpreting ambiguities in the City’s General
Plan, Coastal Land Use Plan, Title 20 (Planning and Zoning) and Title 21 (Local Coastal
Program Implementation Plan) of the NBMC. City Council Policy K-4 allows hotels and motels, located outside the Coastal Commission Appeal Areas, to convert up to 30% of their approved hotel rooms into residential units on a one-for-one basis.
3. On April 30, 2021, the Community Development Director issued Director’s Determination
No. DD2021-001. The Director’s Determination implemented City Council Policy K-4 and found that residential uses are allowable as an accessory use within four resort hotels, including the Newport Beach Marriott Resort Hotel. The Director’s Determination also found that such residential uses are consistent with a hotel’s and motel’s underlying General Plan,
Zoning Code, and Local Coastal Plan Program land use and zoning designations.
Director’s Determination No. DD2021-001 was considered on appeal by the Planning Commission on July 8, 2021, and was considered by the City Council on appeal on August 24, 2021. Both the Planning Commission and the City Council denied the appeal and upheld
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the Director’s Determination. The time to challenge the Director’s Determination has lapsed, the statute of limitations has run, and the Director’s Determination is now final.
4. The conversion of hotel units to residential as an accessory use is consistent with City Council Policy K-4 and Director’s Determination No. DD2021-001. The City has already identified the Property as a qualifying resort hotel offering destination accommodations, including restaurant and recreation facilities.
5. The Project complies with City Council Policy K-4 and Director’s Determination No. DD2021-001 for a conversion of up to 30% (up to 159 hotel units) of the 532 existing units to hotel branded residences. The conversion will result in a 30% decrease in number of hotel rooms. The total number of units at the property will remain the same, at 532 units.
The VEA Newport Beach, A Marriott Resort and Spa is located outside the California
Coastal Commission Appeal Areas, identified in California Public Resources Code Section 30603(a). 6. The new hotel-branded residence building complies with the CV zoning district design
standards. The proposed building will be setback 15 feet from Newport Center Drive and 5
feet from the southerly (interior) property line all in excess of the standards. The height of the 22-story building would be 279 feet with additional accessory improvements and rooftop appurtenances such as elevator overruns and screened mechanical equipment up to 295 feet consistent with the existing high-rise 300 ft height limitation zone. Lastly, although there
is no minimum standard for open space, the proposed site plan provides approximately
42% of the site as open space consisting of hardscape and landscaping. Finding:
C. The design, location, size, and operating characteristics of the use are compatible with the
allowed uses in the vicinity; Facts in Support of Finding:
1. The Project is located in Newport Center which is an area characterized by high- and mid-
rise office buildings surrounding Fashion Island. The majority of the high-rise buildings are located nearby in Blocks 400-600, with building heights exceeding 300 feet above ground level. Low- and mid-rise buildings are concentrated in the southeastern portion of Newport Center closest to MacArthur Boulevard and Pacific Coast Highway. The Project height is
consistent with the City’s High-Rise Height Limitation Zone established in the Zoning Code.
2. The design of the structure will include high-quality materials including wood, stone, steel and metal accents, and glass fiber reinforced concrete (GFRC), and expansive openings, which is consistent with the high-quality design in Newport Center. The new hotel-branded
residence building will be oriented on the site in such a manner as to reduce the bulk and
scale as viewed from Newport Center Drive, and from surrounding properties. 3. The Project is compatible with the existing resort hotel, and the surrounding area. There are several other residential communities, including Meridian, the Colony, Villas at Fashion
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Island, Vivante Senior Housing (currently under construction), and other approved residential projects, located in Newport Center.
4. The Project will provide residents the opportunity to access the shopping, dining and other resident-serving amenities within the Fashion Island/Newport Center area. Finding:
D. The site is physically suitable in terms of design, location, shape, size, operating
characteristics, and the provision of public and vehicle (e.g., fire and medical) access and
public services and utilities; and
Facts in Support of Finding:
1. The proposed improvement area consists of 2.775 acres within the 9.53-acre VEA Newport Beach, A Marriott Resort and Spa property. The new hotel-branded residence building will replace an existing hotel building. The site can accommodate the new hotel-branded
residence building and provide adequate parking. The Project would result in less traffic
compared to the existing 532 room hotel. The hotel branded residences would generate 43 AM peak hour trips, 51 PM peak hour trips, and 722 average daily trips (ADTs). Combined, the existing hotel and new hotel branded residences would generate 215 AM peak hour trips and 271 PM peak hour trips, while the existing hotel generates 245 AM peak hour trips
and 314 PM peak hour trips. The ADT generation for the combined existing hotel and new
hotel branded residences is 3,702, and the ADT for the existing hotel is 4,251. The anticipated trip generation for the combined existing hotel and the proposed hotel branded residences would result in a trip reduction of 549 ADTs.
2. The Project is compatible with surrounding development and public spaces in terms of bulk,
scale and aesthetic treatments. The existing buildings at the Project site range from 30 feet to 151 feet in height and overlook the Newport Beach Country Club golf course. The Project is located in Newport Center which is characterized by high- and mid-rise office buildings surrounding Fashion Island. The majority of the high-rise buildings are located nearby in
Blocks 400-600, with building heights exceeding 300 feet above ground level. Low- and
mid-rise buildings are concentrated in the southeastern portion of Newport Center closest to MacArthur Boulevard and Pacific Coast Highway. Several other residential communities, including Meridian, Villas at Fashion Island, Vivante Senior Housing (currently under construction), and other approved projects, are located in Newport Center. The residential
building will be constructed using the highest quality materials including stone, metal, wood,
steel, and glass glazing accents. 3. Service and fire access will be maintained by a new secondary driveway from Newport Center Drive and drive aisle along the southern boundary of the site. All parking will be
valet-served with a new 5-level, 408-space subterranean parking structure constructed
under the porte cochere and entry drive area. 4. The Project includes a new parking structure (4-levels below ground, 2-levels above ground) to serve the existing hotel. The new parking structure will replace the existing
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parking structure in substantially the same location and provide 400 parking spaces via four subterranean levels and two above ground levels. A total of 808 parking spaces (408 for
hotel-branded residence and 400 for hotel use) are proposed for the Project which will
adequately serve the site. The Project will not result in any changes in vehicular circulation for the hotel. Finding:
E. Operation of the use at the location proposed would not be detrimental to the harmonious
and orderly growth of the City, or endanger, jeopardize, or otherwise constitute a hazard to
the public convenience, health, interest, safety, or general welfare of persons residing or working in the neighborhood of the proposed use.
Facts in Support of Finding: 1. The Project provides an architecturally pleasing theme with articulation and building modulation to enhance the urban environment consistent with existing buildings in Newport
Center. The Project provides pedestrian paths and landscape areas that will create
connectivity to surrounding uses. 2. The Project will redevelop an old building with high-density hotel branded residences and remove the existing surface parking on-site to develop a parking structure and subterranean
parking for the hotel branded residences.
3. The Project includes extensive landscape and hardscape areas with pedestrian circulation throughout the site with a variety of plant materials including trees, vines, shrubs, and turf throughout the site and in open space areas. Evergreen specimen trees (Pinus species or
similar) will be planted at the outer portions of the site while canopy shade trees will be
planted around the motorcourt and event lawn. Smaller accent trees (such as Olea europea or similar) will be planted around the pool area. 4. Access to the site, on- site circulation, and parking areas are designed to comply with City
standards. Vehicle traffic will be directed to an entrance on the south side of the property
along Newport Center Drive (separate from the hotel entrance). The new access will align with the existing intersection and direct vehicles to the new porte cochere to valet services. Service and fire access will be maintained by a new secondary driveway constructed along the southern boundary of the site. All parking will be valet-served with a new 5-level, 408-
space subterranean parking structure constructed under the porte cochere and entry drive
area. 5. The Project provides parking in excess of the parking requirements via the inclusion of tandem parking spaces. The use of valet parking will allow for the active management of
tandem parking without resident or guests facing the task of tandem parking themselves.
The tandem parking combined with the valet parking program will accommodate 100% of the Project' s anticipated parking for residents, guests and employees. Additionally, a service drive is included to provide safe and separate access for emergency vehicles,
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service and delivery trucks, moving vans, and refuse collection vehicles as detailed in the Parking Management Plan.
IV. Coastal Development Permit This Project requires a coastal development permit, consistent with NBMC Section 21.52.015 (Coastal Development Permits) and the requirement of Director's Determination No. DD2021-
001. In accordance with Section 21.52.015(F), the Planning Commission may approve or
conditionally approve a coastal development permit, only after first finding that the proposed development: Finding:
A. Conforms to all applicable sections of the certified Local Coastal Program (e.g.
development standards, no impacts to public views, natural resources, etc.); and Facts in Support of Finding:
1. The hotel branded residences are consistent with the General Plan designation of Visitor Serving Commercial (CV); a Coastal Land Use Plan designation of Visitor Serving Commercial (CV-B); and a Zoning designation of Commercial Visitor-Serving (CV), which allows for the Project site to provide overnight accommodations and accessory residential
uses as part of a resort hotel land use.
2. The proposed Project is consistent with City Council Policy K-4 (Reducing the Barriers to the Creation of Housing) and Director’s Determination No. DD2021-001, which allows for accessory residential uses within resort hotels subject to seven separate requirements
including the following:
a. Accessory residential is only allowed within resort hotels, a self-contained destination that provides for all needs in one location. The Project is part of the VEA Newport Beach, A Marriott Resort and Spa, which is a self-contained destination providing restaurant,
bar, recreational facilities including a pool, spa, and a variety of other guest-serving
uses. b. Must be located outside the appeal area identified in California Public Resource Code Section 30603(a). The Project is located outside the appeal area identified in California
Public Resources Code Section 30603(a) as depicted on the Post-LCP Certification
Permit and Appeal Jurisdiction Map, and is located at the northeastern most boundary of the coastal zone. c. Approved hotel rooms may be converted to residential units but only on a one-for-one
basis. PA2012-020 set the General Plan limit for hotel rooms at 532 in Anomaly 43
where the Project is located, which is consistent with the Coastal Implementation Plan. The proposed hotel branded residences would include up to 159 hotel branded residences with a corresponding reduction in the number of hotel rooms. No new intensity would be created, rather the units would be converted on a one-to-one basis
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via the reduction in the existing number of approved hotel rooms. The total units at the VEA Newport Beach, A Marriott Resort and Spa would remain at 532. Of the 532 units,
373 would be traditional hotel rooms and up to 159 would be hotel branded residences.
d. The residential use shall at all times be accessory to the hotel use, and the residential units shall comprise no more than 30% of the approved hotel rooms. The hotel branded residences will be part of the resort hotel campus and are accessory to the hotel use.
The Project will result in up to 159 hotel branded residences which represents the
conversion of up to 30% of the existing 532 hotel rooms. e. The residential units may be located within a repurposed hotel or in a new residential structure. The proposed hotel branded residences will be located within a new hotel-
branded residential structure.
f. A conditional use permit and coastal development permit is required to ensure adequate parking through surplus parking, shard parking, or the adoption of a parking management plan. The Project exceeds the parking requirements for both the project
itself and the hotel. The parking will be managed via valet operations as detailed in the
Parking Management Plan, and the Parking Management Plan for the VEA Newport Beach, A Marriott Resort and Spa, dated April 13, 2022. g. Potential impacts to public access, affordable housing, and the loss of transient
occupancy tax must be mitigated by entering into a Development Agreement with the
City of by some other means deemed appropriate. (1) The Project does not result in impacts to public access insomuch as the property is an existing resort hotel which is available to paying guests. The property does not
provide public access to the coast or public access to other recreational
opportunities. In addition, the existing resort hotel does not provide low-cost accommodations, and the Project will not result in an impact to existing low-cost accommodations as analyzed in NBMC Section 21.48.025 Feasibility and Impact Analyses for The Ritz-Carlton Residences dated March 18, 2022, and attached as
Exhibit I.
(2) The Project will result in the creation of new housing consistent with the purpose and intent of City Council Policy K-4 and Director’s Determination No. DD2021-001. The City does not have an Inclusionary Housing Ordinance or an Affordable Housing
Implementation Plan. Nevertheless, it is recognized that affordable housing is an
important component of any new residential housing project, and the proposed Project will provide an in-lieu fee related to affordable housing as a condition of approval to the Vesting Tentative Tract Map as detailed in those findings.
(3) The Transient Occupancy Taxes (TOT) Analysis Consistent with Newport Beach City
Council Policy K-4 for Conversion of Hotel Rooms to Project dated March 18, 2022 and attached as Exhibit J analyzed the potential loss of TOT associated with the reduction of up to 159 hotel rooms. The analysis concludes that although the reduction in hotel rooms associated with Project implementation would affect TOT
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receipts to the City, this reduction in TOT would be fully mitigated because the 373 remaining hotel rooms would be significantly upgraded compared to the existing 532
hotel rooms, and each upgraded room is expected to rent for a higher room rate –
and thus, generate higher TOT- than would the existing unrenovated rooms. The analysis concludes that the projected 20-Year combined TOT and property taxes to be generated by the Project would result in total tax receipts to the City of approximately $136,413,736, which is $7,694,975 more than the City would
otherwise receive if the Project was not built. This represents a net increase in
revenue for the City compared to the hotel alone. As such, no mitigation is necessary because the overall assessment of TOT and property taxes will result in a net financial benefit to the City.
3. The proposed Project complies with the CV zoning district design standards including
setback, height, parking, open space as further detailed in the Site Development Review findings. The proposed hotel-branded residence building will exceed all required setbacks. The height of the 22-story building would be 279 feet with additional accessory improvements and rooftop appurtenances such as elevator overruns and screened
mechanical equipment up to 295 feet which is within the existing high-rise height limitation
zone of 300 feet. Parking for the hotel branded residences will be subterranean, and the Project will provide parking in excess of the code requirement. Although there is no minimum standard for open space, the proposed site plan provides approximately 42% of the site as open space consisting of hardscape and landscaping and provides parking in
excess of the parking requirements. The Project will include the construction of a new
parking structure to replace the existing hotel parking structure in a similar location but with a smaller footprint and enhanced vehicular circulation. The hotel parking structure will include four subterranean levels and two above ground levels and be setback from Newport Center Drive approximately 15 feet.
4. The Project is compatible with surrounding development and public spaces in terms of bulk, scale and aesthetic treatments. The property is within the High-Rise Height Limitation Zone, allow for buildings up to 300 feet. The existing buildings at the Project site range from 30 feet to 151 feet in height and overlook the Newport Beach Country Club golf course. The
Project is located in Newport Center which is characterized by high- and mid-rise office
buildings surrounding Fashion Island. The majority of the high-rise buildings are located nearby in Blocks 400-600, with building heights exceeding 300 feet above ground level. Low- and mid-rise buildings are concentrated in the southeastern portion of Newport Center closest to MacArthur Boulevard and Pacific Coast Highway. Several other residential
communities, including Meridian, Villas at Fashion Island, Vivante Senior Housing (currently
under construction), and other pending projects, are located in Newport Center. The residential building will be constructed using high quality materials including stone, metal, wood, steel, and glass glazing accents.
5. The Project site is not abutting a coastal view road, public access way, or Coastal Viewpoint
as identified in the Coastal Land Use Plan. Extensive photo simulations were prepared to depict the proposed Project from more than 10 locations throughout the City, from vantage points near and far. These photo simulations depict the proposed Project within the broader context of large buildings in Newport Center. Public views and viewpoints were assessed
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including views from Newport Harbor, Castaways Park, Back Bay View Park, and many other prominent locations. The proposed Project does not inhibit public views of the bay nor
do they inhibit views from public viewpoints or parks.
6. The Project includes extensive landscape and hardscape areas with pedestrian circulation throughout the site with a variety of plant materials including trees, vines, shrubs, and turf throughout the site and in open space areas. Evergreen specimen trees (Pinus species or
similar) will be planted at the outer portions of the site while canopy shade trees will be
planted around the motorcourt and event lawn. Smaller accent trees (such as Olea europea or similar) will be planted around the pool area. 7. Access to the site, on- site circulation, and parking areas are designed to comply with City
standards. Vehicle traffic will be directed to an entrance on the south side of the property
along Newport Center Drive (separate from the hotel entrance). The new access will align with the existing intersection and direct vehicles to the new porte cochere to valet services. Service and fire access will be maintained by a new secondary driveway constructed along the southern boundary of the site. All parking will be valet-served with a new 5-level, 408-
space subterranean parking structure constructed under the porte cochere and entry drive
area. 8. The Project includes the replacement of the existing hotel parking structure with a new parking structure to serve the hotel. The new parking structure will replace the existing
parking structure in substantially the same location but with a smaller footprint and
increased internal circulation. The parking structure will include four levels subterranean and two levels above ground, with a total of 408 parking spaces. A total of 808 parking spaces (408 for hotel-branded residence and 400 for hotel use) are proposed for the Project which will exceed the parking requirements. The Project will not result in any changes in
vehicular circulation for the hotel.
9. The Project is subject to the City's Water-Efficient Landscape Ordinance (Chapter 14.17 of NBMC) and compliance will be confirmed at plan check prior to issuing building permits.
10. Addendum No. 6 analyzed whether the Project would conflict with applicable zoning and
other regulations governing scenic quality. The Project uses would be consistent with the CV zoning designation. The 2006 EIR emphasizes that the General Plan Update would concentrate infill development and redevelopment in several specific subareas, including Newport Center/Fashion Island (i.e., high-density residential uses are proposed in the
Newport Center/Fashion Island area). The Project will redevelop an old building façade with
new hotel branded residences and remove the existing surface parking on-site to develop a parking structure and subterranean parking for the hotel branded residences. The new building will be aesthetically compatible with existing surrounding and will not have a material impact on visual character or public views
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Finding:
B. Conforms with the public access and public recreation policies of Chapter 3 of the Coastal
Act if the project is located between the nearest public road and the sea or shoreline of any
body of water located within the coastal zone. Facts in Support of Finding:
1. The Project is not located between the nearest public road and the sea or shoreline of any body of water located within the coastal zone. The Project site is located approximately 3,300 feet from Newport Harbor. As such, it is not necessary to assess the consistency with the public access and public recreation policies of Chapter 3 of the Coastal Act. The Project
site does not provide public access or public recreation opportunities and will not impact
any public access or public recreational opportunities as detailed in Chapter 3 of the Coastal Act. V. Vesting Tentative Tract Map
This Project requires a vesting tentative tract map, consistent with NBMC Section 19.20.040 (Filing and Review). In accordance with Section 19.12.070(A), the Planning Commission may approve a vesting tentative tract map, only after first making the following findings:
Finding:
A. That the proposed map and the design or improvements of the subdivision are consistent
with the General Plan and any applicable specific plan, and with applicable provisions of the Subdivision Map Act and this Subdivision Code;
Facts in Support of Finding: 1. Refer to Facts A. 1-2 and B. 1-2 under Site Development Review that discuss the Project’s consistency with the Commercial Visitor (CV) General Plan land use designation.
2. The Tentative Tract Map (for condominium purposes) provides a cohesive development with a pattern of dwelling unit orientations and vehicle circulation that provides a pedestrian-friendly environment with strong connectivity to adjacent commercial and office areas.
3. The Public Works Department has reviewed the proposed tentative map and found it
consistent with Title 19 (Subdivisions) of the NBMC and applicable requirements of the Subdivision Map Act as set forth in California Government Code Section 66410 et seq. 4. Conditions of approval have been included to ensure compliance with Title 19
(Subdivisions) of the NBMC.
Finding: B. That the site is physically suitable for the type and density of development;
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Facts in Support of Finding:
1. The site is not located in a flood zone. The geotechnical feasibility study and geotechnical report will provide additional recommendations for construction of the Project to ensure the suitability for the proposed development that will be required for construction prior to the issuance of building permits.
2. The 2.775-acre site is large enough to accommodate the proposed new residential building while providing sufficient landscape setbacks, open space areas, as well as vehicle access and guest parking areas that meet applicable standards. The existing developed site is devoid of natural resources and it is located in an area that provides adequate access to
roadways and utilities.
3. Noise levels at the Project site are up to 58.3 dBA CNEL. Per the City’s General Plan Noise Element, noise levels of up to 60 dBA CNEL are considered clearly compatible. Additionally, the outdoor activity/amenity area including the proposed pools, lounge, and deck would be
set back from the adjacent roadways. With appropriate noise control measures under
conventional construction and design of the Project (e.g., closed windows, fresh air supply systems or air conditioning), the interior noise levels will be well below the City and State interior noise standard of 45 dB CNEL for residential units.
Finding:
C. That the design of the subdivision or the proposed improvements are not likely to cause
substantial environmental damage nor substantially and avoidably injure fish or wildlife or their habitat. However, notwithstanding the foregoing, the decision making body may
nevertheless approve such a subdivision if an environmental impact report was prepared
for the project and a finding was made pursuant to Section 21081 of the California
Environmental Quality Act that specific economic, social or other considerations make
infeasible the mitigation measures or project alternatives identified in the environmental impact report;
Facts in Support of Finding: 1. Under existing conditions, the Property and surrounding land areas are fully developed with urban uses and do not contain sensitive biological resources. The vegetation that occurs
on-site is ornamental in nature, including trees and ornamental shrubs, groundcover, and
vines growing on the existing building’s facades and screen walls. A Mitigation Measure is provided by the 2006 EIR to ensure adequate protection of nesting birds during the construction process. The Project will have no substantial change from the previous EIR analysis, as documented in the EIR Addendum.
2. No drainages traverse the property and no potential jurisdictional waters or wetlands areas are present on or immediately adjacent to the Property.
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3. Addendum No. 6 to the City of Newport Beach General Plan Update Environmental Impact Report (SCH No. 2006011119) was prepared for the Project. On the basis of the entire
environmental review record, Addendum No. 6 concludes that the Project will have no
substantial change to biological resources, cultural resources, geology and soils, and tribal cultural resources from the previous EIR analysis, as documented in the EIR Addendum. Finding:
D. That the design of the subdivision or the type of improvements is not likely to cause serious
public health problems; Facts in Support of Finding:
1. At full build-out, air quality and Green House Gas (“GHG”) emissions associated with construction of the Project will have no substantial change from the previous EIR analysis, as documented in the EIR Addendum.
2. Potential impacts associated with biological resources, cultural resources, geology and
soils, and tribal cultural resources will have no substantial change from the previous EIR analysis, as documented in the EIR Addendum. 3. No evidence is known to exist that would indicate that the planned subdivision pattern will
generate any serious public health problems.
4. All construction for the Project complies with Building, Public Works, and Fire Codes. Public improvements will be required of the developer per NBMC Section 19.28.010 and Sections 66410 et seq. of the Subdivision Map Act. All ordinances of the City and all conditions of
approval will be complied with.
The anticipated trip generation for the combined existing hotel and the proposed hotel branded residences would result in a trip reduction of 549 ADTs relative to the existing uses on site.
Finding:
E. That the design of the subdivision or the type of improvements will not conflict with easements, acquired by the public at large, for access through or use of property within the
proposed subdivision. In this connection, the decision-making body may approve a map if
it finds that alternate easements, for access or for use, will be provided and that these
easements will be substantially equivalent to ones previously acquired by the public. This
finding shall apply only to easements of record or to easements established by judgment of a court of competent jurisdiction and no authority is hereby granted to the City Council to
determine that the public at large has acquired easements for access through or use of
property within a subdivision;
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Facts in Support of Finding:
1. Public improvements, consisting of the reconstruction of the curb, gutter, and sidewalks,
one (1) new driveway along the Newport Center Drive frontage, and street trees along Newport Center Drive will be required of the applicant per Title 19 (Subdivisions) and the Subdivision Map Act. A common sewer and water connection will be provided for the Project as approved by the Public Works Department that will connect to an existing main that
serves the existing hotel.
2. There are no easements that will be impacted by this Project. Finding:
That, subject to the detailed provisions of Section 66474.4 of the Subdivision Map Act, if the
land is subject to a contract entered into pursuant to the California Land Conservation Act of
1965 (Williamson Act), the resulting parcels following a subdivision of the land would not be too small to sustain their agricultural use or the subdivision will result in residential development
incidental to the commercial agricultural use of the land;
Fact in Support of Finding: The Property does not contain prime farmland, unique farmland, or farmland of statewide
importance and no portion of the Property is covered by a Williamson Act contract.
Finding: F. That, in the case of a “land project” as defined in Section 11000.5 of the California Business
and Professions Code: (1) There is an adopted specific plan for the area to be included
within the land project; and (2) the decision-making body finds that the proposed land project is consistent with the specific plan for the area; Facts in Support of Finding:
1. California Business and Professions Code Section 11000.5 has been repealed by the Legislature. However, this Property is not considered a “land project” as previously defined in Section 11000.5 of the California Business and Professions Code because the Property does not contain 50 or more parcels of land nor is it located within the boundaries of a
specific plan.
Finding: G. That solar access and passive heating and cooling design requirements have been satisfied
in accordance with Sections 66473.1 and 66475.3 of the Subdivision Map Act;
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Fact in Support of Finding:
Tentative Tract Map No. 19222 and improvements are subject to Title 24 of the California Code
of Regulations, referred to as the California Building Code or CBC, which requires new construction to meet minimum heating and cooling efficiency standards depending on location and climate. The Newport Beach Community Development Department ensures compliance with the CBC through the plan check and inspection process.
Finding:
H. That the subdivision is consistent with Section 66412.3 of the Subdivision Map Act and Section 65584 of the California Government Code regarding the City’s share of the regional
housing need and that it balances the housing needs of the region against the public service
needs of the City’s residents and available fiscal and environmental resources;
Facts in Support of Finding:
1. The Property is improved with hotel uses, and there are no residential units on the Property.
The Project includes the construction of up to 159 hotel-branded residence units to contribute to the City’s population needs consistent with City Council Policy K-4, Reducing the Barriers to the Creation of Housing and Director’s Determination No. DD2021-001 which allows for accessory residential uses within resort hotels subject to seven separate
requirements including the following:
a. Accessory residential is only allowed within resort hotels, a self-contained destination that provides for all needs in one location. The Project is part of the VEA Newport Beach, A Marriott Resort and Spa, which is a self-contained destination providing restaurant,
bar, recreational facilities including a pool, spa, and a variety of other guest-serving
uses. b. Must be located outside the appeal area identified in California Public Resource Code Section 30603(a) as depicted on the Post-LCP Certification Permit and Appeal Areas
Map. The Project is located outside the appeal jurisdiction, at the northeastern most
boundary of the coastal zone. c. Approved hotel rooms may be converted to residential units on a one-for-one basis. The existing resort hotel is allowed a maximum of 532 rooms in the Coastal Implementation
Plan. The proposed hotel branded residences would include up to 159 hotel branded
residences with a corresponding reduction in the number of hotel rooms. No new intensity would be created, rather the units would be converted on a one-to-one basis via the reduction in the existing number of approved hotel rooms. The total units at the VEA Newport Beach, A Marriott Resort and Spa would remain at 532. Of the 532 units,
373 would be traditional hotel rooms and up to 159 would be hotel branded residences.
d. The residential use shall at all times be accessory to the hotel use, and the residential units shall comprise no more than 30% of the approved hotel rooms. The hotel branded residences will be part of the resort hotel campus and are accessory to the hotel use.
Planning Commission Resolution No. PC2022-011 Page 27 of 72
The Project will result in up to 159 hotel branded residences which represents the conversion of 30% of the existing 532 hotel rooms.
e. The residential units may be located within a repurposed hotel or in a new residential structure. The proposed hotel branded residences will be located within the existing resort hotel property, within a new residential structure.
f. A conditional use permit and coastal development permit is required to ensure adequate
parking through surplus parking, shard parking, or the adoption of a parking management plan. The proposed Project exceeds the parking requirements for both the hotel branded residences and the hotel. The parking will be managed via valet operations as detailed in the Parking Management Plan, and the Parking Management
Plan for the VEA Newport Beach, A Marriott Resort and Spa, dated April 13, 2022.
g. Potential impacts to public access, affordable housing, and the loss of transient occupancy tax must be mitigated by entering into a Development Agreement with the City of by some other means deemed appropriate.
(1) Any reduction in public access is limited to the reduction of hotel rooms available to the general public to paying guests. The property does not provide public access to the coast or public access to other recreational opportunities in the area. The existing resort hotel does not provide low-cost accommodations, and the Project will not
result in an impact to existing low-cost accommodations as analyzed in NBMC
Section 21.48.025 Feasibility and Impact Analyses for The Ritz-Carlton Residences dated March 18, 2022, and attached as Exhibit I. The general decrease of access associated with the reduction of up to 159 high-cost hotel rooms is mitigated through the payment of $10,700 per unit fee to the City that will be used a condition of
approval of the Vesting Tentative Tract Map.
(2) The Project will result in the creation of new housing consistent with the purpose and intent of City Council Policy K-1 and Director’s Determination No. DD2021-001. The City Council is considering adoption of an inclusionary housing ordinance in light of
the City’s RHNA allocation and State mandated housing requirements. As a result,
the Project will provide an in-lieu fee related to affordable housing as a condition of approval to the Vesting Tentative Tract Map as detailed in those findings. (3) The Transient Occupancy Taxes (TOT) Analysis Consistent with Newport Beach City
Council Policy K-4 for Conversion of Hotel Rooms to Residential dated March 18,
2022, and attached as Exhibit J analyzed the potential loss of TOT associated with the reduction of up to 159 hotel rooms. The analysis concludes that although the reduction in hotel rooms associated with Project implementation would affect TOT receipts to the City, this reduction in TOT would be fully mitigated because the 373
remaining hotel rooms would be significantly upgraded compared to the existing 532
hotel rooms, and each upgraded room is expected to rent for a higher room rate – and thus, generate higher TOT- than would the existing unrenovated rooms. The analysis concludes that the projected 20-Year combined TOT and property taxes to be generated by the Project would result in total tax receipts to the City of
Planning Commission Resolution No. PC2022-011 Page 28 of 72
approximately $136,413,736. This represents a net increase in revenue for the City compared to the hotel alone. As such, no mitigation is necessary because the overall
assessment of TOT and property taxes will result in a net financial benefit to the City.
Finding: I. That the discharge of waste from the proposed subdivision into the existing sewer system
will not result in a violation of existing requirements prescribed by the Regional Water
Quality Control Board; and
Facts in Support of Finding:
1. A National Pollutant Discharge Elimination System (“NPDES”) permit is required from the
Regional Water Quality Control Board (“RWQCB”) for the proposed construction activities. A permit is required for all construction activities that include clearing, grading, and/or excavation that disturb at least 1 acre of total land area. Additionally, a Preliminary Water Quality Management Plan (“WQMP”) has been prepared, pursuant to the requirements of
the NPDES permit.
2. Compliance with the NPDES permit and the Santa Ana River Basin Water Quality Control Program involves the preparation and implementation of a stormwater pollution prevention plan (“SWPPP”) for construction-related activities, which would specify the Best
Management Practices (“BMP”) that the Project would be required to implement during
construction activities to ensure that all potential pollutants of concern (including sediment) are prevented, minimized, and/or otherwise appropriately treated prior to being discharged from the Property.
3. Sewer connections will be installed per City Standards, the applicable provisions of NBMC
Chapter 14.24 (Sewer Connection, Permits), and the latest revision of the Uniform Plumbing Code. 4. There is adequate sewer system capacity to serve the requirements of the Project. The
Project is served by existing sewer service. The Project will not adversely affect the system,
or cause any water quality affects, or violate existing requirements prescribed by the Regional Water Quality Control Board. 5. NBMC Section 14.24.020 (Dwelling Unit and Business Structure Sewer Connection
Required) requires each dwelling unit to maintain individual water meter and sewer
connections. The Project has received a waiver of this requirement from the Utilities Director since the units are located in one building and will together connect to the existing water and sewer systems.
Finding:
J. For subdivisions lying partly or wholly within the Coastal Zone, that the subdivision conforms
with the certified Local Coastal Program and, where applicable, with public access and recreation policies of Chapter Three of the Coastal Act.
Planning Commission Resolution No. PC2022-011 Page 29 of 72
Facts in Support of Finding:
The Property is located in the Coastal Zone but outside of the California Coastal Commission appeal jurisdiction. The subdivision conforms with the certified Local Coastal Program as detailed in the Findings for the Coastal Development Permit. Public access and recreation policies of Chapter Three of the Coastal Act are not applicable to the Project. Additionally,
pursuant to Section 19.16.010(A) of the NBMC, an approved tentative tract map expires 24
months after the date of its approval or conditional approval. Under Section 19.16.020(A), the subdivider shall have the right to request an extension of the map for up to 5 years. The subdivider has submitted an application for an extension of Vesting Tentative Tract Map No. NT2021-003 and has requested that the extension be granted after the Planning Commission
adopts Resolution No. PC2022-011; thus, providing for an initial term of the vesting tentative
tract map of 24 months, followed by extension of 5 years, for a total term of 7 years from the date of approval of Resolution No. PC2022-011. VI. Consistency with Council Policy K-4 and Director’s Determination No. DD2021-001
The Project is consistent with City Council Policy K-4 (Reducing the Barriers to the Creation of Housing) and Director’s Determination No. DD2021-001, which allows for accessory residential uses within resort hotels subject to seven separate requirements including the following:
1. Accessory residential is only allowed within resort hotels, a self-contained destination that
provides for all needs in one location. The Project is part of the VEA Newport Beach, A Marriott Resort and Spa, which is a self-contained destination providing restaurant, bar, recreational facilities including a pool, spa, and a variety of other guest-serving uses.
2. Must be located outside the appeal area identified in California Public Resource Code
Section 30603(a). The Project is located outside the appeal area identified in California Public Resources Code Section 30603(a) as depicted on the Post-LCP Certification Permit and Appeal Jurisdiction Map, and is located at the northeastern most boundary of the coastal zone.
3. Approved hotel rooms may be converted to residential units but only on a one-for-one basis. PA2012-020 set the General Plan limit for hotel rooms at 532 in Anomaly 43 where the Project is located, which is consistent with the Coastal Implementation Plan. The Project would include up to 159 hotel branded residences with a corresponding reduction in the
number of hotel rooms. No new intensity would be created, rather the units would be
converted on a one-to-one basis via the reduction in the existing number of approved hotel rooms. The total units at the VEA Newport Beach, A Marriott Resort and Spa would remain at 532. Of the 532 units, 373 would be traditional hotel rooms and up to 159 would be hotel branded residences.
4. The residential use shall at all times be accessory to the hotel use, and the residential units shall comprise no more than 30% of the approved hotel rooms. The hotel residential units will be part of the resort hotel campus and are accessory to the hotel use. The Project will
Planning Commission Resolution No. PC2022-011 Page 30 of 72
result in up to 159 hotel branded residences which represents the conversion of up to 30% of the existing 532 hotel rooms.
5. The residential units may be located within a repurposed hotel or in a new residential structure. The proposed hotel branded residences will be located within a new hotel-branded residential structure.
6. A conditional use permit and coastal development permit is required to ensure adequate
parking through surplus parking, shard parking, or the adoption of a parking management plan. The Project exceeds the parking requirements for both the project itself and the hotel. The parking will be managed via valet operations as detailed in the Parking Management Plan, and the Parking Management Plan for the VEA Newport Beach, A Marriott Resort and
Spa, dated April 13, 2022.
7. Potential impacts to public access, affordable housing, and the loss of transient occupancy tax must be mitigated by entering into a Development Agreement with the City of by some other means deemed appropriate.
(1) Any reduction in public access is limited to the reduction of hotel rooms available to the general public to paying guests. The property does not provide public access to the coast or public access to other recreational opportunities in the area. The existing resort hotel does not provide low-cost accommodations, and the Project will not result in an
impact to existing low-cost accommodations as analyzed in NBMC Section 21.48.025
Feasibility and Impact Analyses for The Ritz-Carlton Residences dated March 18, 2022, and attached as Exhibit I. The general decrease of access associated with the reduction of up to 159 high-cost hotel rooms is mitigated through the payment of $10,700 per unit fee to the City that will be used a condition of approval of the Vesting Tentative Tract
Map.
(2) The Project will result in the creation of new housing consistent with the purpose and intent of City Council Policy K-4 and Director’s Determination No. DD2021-001. The City is consideration adoption of an Inclusionary Housing Ordinance or an Affordable
Housing Implementation Plan. Council Policy K-4 recognized that affordable housing is
an important component of any new residential housing project, and the Project will provide an in-lieu fee related to affordable housing as a condition of approval to the Vesting Tentative Tract Map as detailed in those findings.
(3) The Transient Occupancy Taxes (TOT) Analysis Consistent with Newport Beach City
Council Policy K-4 for Conversion of Hotel Rooms to Project dated March 18, 2022, and attached as Exhibit J analyzed the potential loss of TOT associated with the reduction of up to 159 hotel rooms. The analysis concludes that although the reduction in hotel rooms associated with Project implementation would affect TOT receipts to the City, this
reduction in TOT would be fully mitigated because the 373 remaining hotel rooms would
be significantly upgraded compared to the existing 532 hotel rooms, and each upgraded room is expected to rent for a higher room rate – and thus, generate higher TOT- than would the existing unrenovated rooms. The analysis concludes that the projected 20-Year combined TOT and property taxes to be generated by the Project would result in
Planning Commission Resolution No. PC2022-011
Page 31 of 72
total tax receipts to the City of approximately $136,413,736, which is $7,694,975 more
than the City would otherwise receive if the Project was not built. This represents a net
increase in revenue for the City compared to the hotel alone. As such, no mitigation is
necessary because the overall assessment of TOT and property taxes will result in a
net financial benefit to the City.
SECTION 4. DECISION.
NOW, THEREFORE, BE IT RESOLVED:
1. The Planning Commission finds that potential environmental impacts for this Project have
been previously mitigated through the implementation of the policies of the General Plan
as evaluated in Program Environmental Impact Report for the 2006 General Plan Update
(SCH No . 2006011119) ("PEIR"); therefore, in accordance with Section 15164 of the
California Environmental Quality Act ("CEQA") Guidelines, an addendum to the previously
adopted PEIR is the appropriate environmental documentation for the Project.
2. The Planning Commission of the City of Newport Beach hereby approves Project
(PA2021-296), which includes a finding that the Project is eligible for accessory residential
uses under Director's Determination No. DD2021 -001 and City Council Policy K-4 , and
approval of Environmental Impact Report Addendum No . 6, Major Site Development
Review No . SD2021-005, Modification Permit No. 2022-0001, Conditional Use Permit
No. UP2021-053, Coastal Development Permit No. CD2021-077, and Vesting Tentative
Tract Map No . NT2021-003, subject to the conditions set forth in Exhibit "A," which is
attached hereto and incorporated by reference .
3. This action shall become final and effective 14 days following the date this Resolution
was adopted unless within such time an appeal is filed with the City Clerk in accordance
with the provisions of Title 20 (Planning and Zoning) of the Newport Beach Municipal
Code.
PASSED, APPROVED, AND ADOPTED THIS 12th DAY OF MAY, 2022.
AYES:
NOES:
Ellmore, Klaustermeier, Kleiman, Koetting, Lowrey, Rosene and Weigand
None
ABSTAIN :
ABSE~_:-_~~-~~_.:::,~rt---~:::::>
BY: C.1 ~
Curtis Ellmore, Secretary
Planning Commission Resolution No. PC2022-011 Page 32 of 72
Attachments: Exhibit A – Conditions of Approval Exhibit B – 2006 General Plan Update EIR
Exhibit C – Addendum No. 1 (North Newport Center)
Exhibit D – Addendum No. 2 (North Newport Center Planned Community Amendment – ER2020-002) Exhibit E – Addendum No. 3 (Newport Airport Village) Exhibit F – Addendum No. 4 (Residences at Von Karman – ER2020-003)
Exhibit G – Addendum No. 5 (Residences at 1300 Bristol – ER2022-001)
Exhibit H – Addendum No. 6 (Ritz-Carlton Residences – ER2022-002) Exhibit I - Newport Beach Municipal Code Section 21.48.025 Feasibility and Impact Analyses for The Ritz-Carlton Residences dated March 18, 2022
Exhibit J - Transient Occupancy Taxes (TOT) Analysis Consistent with
Newport Beach City Council Policy K-4 for Conversion of Hotel Rooms to Hotel-Branded Residences dated March 18, 2022
Planning Commission Resolution No. PC2022-011 Page 33 of 72
EXHIBIT “A”
CONDITIONS OF APPROVAL
(Project-specific conditions are in italics)
Planning Division
1. The development shall be in substantial conformance with the approved site plan, floor
plans and building elevations stamped and dated with the date of this approval (except as
modified by applicable conditions of approval). 2. The project is subject to all applicable City ordinances, policies, and standards, unless specifically waived or modified by the conditions of approval.
3. The applicant shall comply with all federal, state, and local laws. Material violation of any of those laws in connection with the use may be cause for revocation of this Use Permit.
4. All proposed signs shall be in conformance with an approved Comprehensive Sign
Program for the project site and provisions of Chapter 20.42 (Signs) of the Newport Beach Municipal Code.
5. Major Site Development Review No. SD2021-005, Conditional Use Permit No. UP2021-
053, Modification Permit No. 2022-001, Coastal Development Permit No. CD2021-077,
and Vesting Tentative Tract Map No. NT2021-003 shall expire unless exercised within
24 months from the date of approval as specified in Section 20.91.050 of the Newport
Beach Municipal Code, unless an extension is otherwise granted. Demolition of the existing Harbor Landing building shall deem the approvals in this resolution exercised.
6. Vesting Tentative Tract Map No. NT2021-003 shall expire 7 years from the date of approval of Resolution No. PC2022-011. Pursuant to NBMC Section 19.16.010(A) an
approved tentative tract map expires 24 months after the date of its approval or conditional approval. Under NBMC Section 19.16.020(A), the subdivider shall have the
right to request an extension of the map for up to 5 years. The subdivider has submitted
an application for an extension of Vesting Tentative Tract Map No. NT2021-003 and has
requested that the extension be granted after the Planning Commission adopts
Resolution No. PC2022-011; thus, providing for an initial term of the vesting tentative tract map of 24 months, followed by extension of 5 years, for a total term of 7 years from
the date of approval of Resolution No. PC2022-011.
7. The applicant shall pay a public benefit fee of one hundred thousand dollars $100,000 per
unit to be paid prior to the issuance of a certificate of occupancy for the hotel-branded residences. The $100,000 per unit fee will be utilized in the following manner: $22,300
per unit for general public benefit to be used at City Council’s discretion; $2,000 per unit
for public safety; $10,700 per unit for future improvements to public coastal access; and
Planning Commission Resolution No. PC2022-011 Page 34 of 72
$65,000 of this shall be used at the City’s discretion for the future acquisition and construction of affordable housing units.
8. Major Site Development Review No. SD2021-005, Conditional Use Permit No. UP2021-053, Modification Permit No. 2022-001, and Coastal Development Permit No. CD2021-077 may be modified or revoked by the Planning Commission should they determine that the proposed uses or conditions under which it is being operated or maintained is
detrimental to the public health, welfare or materially injurious to property or
improvements in the vicinity or if the property is operated or maintained so as to constitute a public nuisance. 9. Any substantial change in operational characteristics, expansion in area, or other
modification to the approved plans, shall require an amendment to said plans or
processing of new approvals. 10. A copy of the Resolution, including conditions of approval Exhibit “A” shall be incorporated into the Building Division and field sets of plans prior to issuance of the
building permits.
11. Prior to the issuance of a building permit, the applicant shall submit to the Planning Division an additional copy of the approved architectural plans for inclusion in the Site Development Review/Modification Permit file. The plans shall be identical to those
approved by all City departments for building permit issuance. The approved copy shall
include architectural sheets only and shall be reduced in size to 11 inches by 17 inches. The plans shall accurately depict the elements approved by this Site Development Review/Modification Permit file and shall highlight the approved elements such that they are readily discernible from other elements of the plans.
12. Prior to the issuance of a building permit, the applicant shall submit a landscape and irrigation plan prepared by a licensed landscape architect. These plans shall incorporate drought tolerant plantings and water efficient irrigation practices, and the plans shall be approved by the Planning Division.
13. All landscape materials and irrigation systems shall be maintained in accordance with the approved landscape plan. All landscaped areas shall be maintained in a healthy and growing condition and shall receive regular pruning, fertilizing, mowing and trimming. All landscaped areas shall be kept free of weeds and debris. All irrigation systems shall be
kept operable, including adjustments, replacements, repairs, and cleaning as part of
regular maintenance. 14. Prior to the issuance of a building permit, the applicant shall prepare photometric study based on the final site and architectural lighting plans for approval by the Planning
Division. The study shall show that lighting values are “1” or less at all property lines and
the site and buildings are not excessively lighted. 15. The site shall not be excessively illuminated based on the luminance recommendations of the Illuminating Engineering Society of North America, or, if in the opinion of the
Planning Commission Resolution No. PC2022-011 Page 35 of 72
Director of Community Development, the illumination creates an unacceptable negative impact on surrounding land uses or environmental resources. The Director may order
the dimming of light sources or other remediation upon finding that the site is excessively
illuminated. 16. Prior to the issuance of a building permit, the applicant shall pay any unpaid administrative costs associated with the processing of this application to the Planning
Division.
17. All noise generated by the proposed use shall comply with the provisions of Chapter 10.26 and other applicable noise control requirements of the Newport Beach Municipal Code. The maximum noise shall be limited to no more than depicted below for the
specified time periods unless the ambient noise level is higher:
Between the hours of 7:00AM and 10:00PM Between the hours of 10:00PM and 7:00AM
Location Interior Exterior Interior Exterior
Residential Property 45dBA 55dBA 40dBA 50dBA
Residential Property located within 100 feet of a commercial property 45dBA 60dBA 45dBA 50dBA
Mixed Use Property 45dBA 60dBA 45dBA 50dBA
Commercial Property N/A 65dBA N/A 60dBA
18. Should the property be sold or otherwise come under different ownership, any future
owners or assignees shall be notified of the conditions of this approval by either the current business owner, property owner or the leasing agent.
19. Construction activities shall comply with Section 10.28.040 of the Newport Beach Municipal Code, which restricts hours of noise-generating construction activities that
produce noise to between the hours of 7:00 a.m. and 6:30 p.m., Monday through Friday,
and 8:00 a.m. and 6:00 p.m. on Saturday. Noise-generating construction activities are not allowed on Sundays or Holidays.
20. No outside paging system shall be utilized in conjunction with this establishment.
21. All trash shall be stored within the building or within dumpsters stored in the trash enclosure (three walls and a self-latching gate) or otherwise screened from view of neighboring properties, except when placed for pick-up by refuse collection agencies. The trash enclosure shall have a decorative solid roof for aesthetic and screening
purposes.
22. Trash receptacles for patrons shall be conveniently located both inside and outside of the establishment, however, not located on or within any public property or right-of-way.
23. The exterior of the business shall be maintained free of litter and graffiti at all times. The
owner or operator shall provide for daily removal of trash, litter debris and graffiti from the premises and on all abutting sidewalks within 20 feet of the premises.
Planning Commission Resolution No. PC2022-011 Page 36 of 72
24. The applicant shall ensure that the trash dumpsters and/or receptacles are maintained to control odors. This may include the provision of either fully self-contained dumpsters
or periodic steam cleaning of the dumpsters, if deemed necessary by the Planning
Division. Cleaning and maintenance of trash dumpsters shall be done in compliance with the provisions of Title 14, including all future amendments (including Water Quality related requirements).
25. Deliveries and refuse collection for the facility shall be prohibited between the hours of
10:00 p.m. and 7:00 a.m. on weekdays and Saturdays and between the hours of 10:00 p.m. and 9:00 a.m. on Sundays and Federal holidays, unless otherwise approved by the Director of Community Development, and may require an amendment to this Use Permit.
26. Storage outside of the building in the front or at the rear of the property shall be prohibited, with the exception of the required trash container enclosure. 27. A Special Events Permit is required for any event or promotional activity outside the
normal operational characteristics of the approved use, as conditioned, or that would
attract large crowds, involve the sale of alcoholic beverages, include any form of on-site media broadcast, or any other activities as specified in the Newport Beach Municipal Code to require such permits.
28. To the fullest extent permitted by law, applicant shall indemnify, defend and hold harmless
City, its City Council, its boards and commissions, officials, officers, employees, and agents from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses (including without limitation, attorney’s fees, disbursements and court costs) of every kind and nature
whatsoever which may arise from or in any manner relate (directly or indirectly) to City’s
approval of The Ritz-Carlton Residences including, but not limited to, Environmental Impact Report Addendum No. 6 (ER2022-002), Major Site Development Review No. SD2021-005, Modification Permit No. 2022-001, Conditional Use Permit No. UP2021-053, Coastal Development Permit No. CD2021-077, and Vesting Tentative Tract Map No.
NT2021-003 (PA2021-296). This indemnification shall include, but not be limited to,
damages awarded against the City, if any, costs of suit, attorneys' fees, and other expenses incurred in connection with such claim, action, causes of action, suit or proceeding whether incurred by applicant, City, and/or the parties initiating or bringing such proceeding. The applicant shall indemnify the City for all of City's costs, attorneys' fees,
and damages which City incurs in enforcing the indemnification provisions set forth in this
condition. The applicant shall pay to the City upon demand any amount owed to the City pursuant to the indemnification requirements prescribed in this condition. Fire Department
29. The high-rise building shall be constructed with fire and life safety systems and construction features as required for high-rise buildings per applicable California fire and building codes as adopted by the City of Newport Beach. This includes but is not limited to the following systems: an automatic fire sprinkler system, a stand pipe system, fire
Planning Commission Resolution No. PC2022-011 Page 37 of 72
pump system, a fire alarm system, an emergency responder radio system, a 2-way communication system and a smoke control system.
30. A fire command center (fire control room) shall be constructed as part of the high-rise building. 31. A generator (gas or diesel only) shall be installed to provide emergency power for the
high-rise building.
32. A fire master plan shall be submitted and approved prior to issuance of any grading or building permit. The fire master plan shall indicate fire department access for the high-rise building; however, the fire department access shall not include any turf block or
other vegetative materials.
33. The developer/property owner shall record a reciprocal fire department access easement for both parcels proposed with the tentative map. The “event lawn” is considered part of the fire department access providing protection to both the existing
hotel complex and the proposed high-rise building.
Building Division 34. The applicant is required to obtain all applicable permits from the City’s Building Division
and Fire Department. The construction plans must comply with the most recent, City-
adopted version of the California Building Code. The construction plans must meet all applicable State Disabilities Access requirements. Approval from the Orange County Health Department is required prior to the issuance of a building permit.
35. The applicant shall employ the following best available control measures (“BACMs”) to
reduce construction-related air quality impacts: Dust Control • Water all active construction areas at least twice daily.
• Cover all haul trucks or maintain at least two feet of freeboard.
• Pave or apply water four times daily to all unpaved parking or staging areas. • Sweep or wash any site access points within two hours of any visible dirt deposits on any public roadway. • Cover or water twice daily any on-site stockpiles of debris, dirt or other dusty
material.
• Suspend all operations on any unpaved surface if winds exceed 25 mph. Emissions • Require 90-day low-NOx tune-ups for off road equipment. • Limit allowable idling to 30 minutes for trucks and heavy equipment
Off-Site Impacts
• Encourage carpooling for construction workers. • Limit lane closures to off-peak travel periods. • Park construction vehicles off traveled roadways. • Wet down or cover dirt hauled off-site.
Planning Commission Resolution No. PC2022-011 Page 38 of 72
• Sweep access points daily. • Encourage receipt of materials during non-peak traffic hours.
• Sandbag construction sites for erosion control.
Fill Placement • The number and type of equipment for dirt pushing will be limited on any day to ensure that SCAQMD significance thresholds are not exceeded. • Maintain and utilize a continuous water application system during earth
placement and compaction to achieve a 10 percent soil moisture content in the
top six-inch surface layer, subject to review/discretion of the geotechnical engineer. 36. Prior to the issuance of a grading permit, a Storm Water Pollution Prevention Plan
(SWPPP) and Notice of Intent (NOI) to comply with the General Permit for Construction
Activities shall be prepared, submitted to the State Water Quality Control Board for approval and made part of the construction program. The project applicant will provide the City with a copy of the NOI and their application check as proof of filing with the State Water Quality Control Board. This plan will detail measures and practices that will be in
effect during construction to minimize the project’s impact on water quality.
37. Prior to the issuance of a grading permit, the applicant shall prepare and submit a Water Quality Management Plan (WQMP) for the proposed project, subject to the approval of the Building Division and Code and Water Quality Enforcement Division. The WQMP
shall provide appropriate Best Management Practices (BMPs) to ensure that no
violations of water quality standards or waste discharge requirements occur. 38. A list of “good housekeeping” practices will be incorporated into the long-term post-construction operation of the site to minimize the likelihood that pollutants will be used,
stored or spilled on the site that could impair water quality. These may include frequent
parking area vacuum truck sweeping, removal of wastes or spills, limited use of harmful fertilizers or pesticides, and the diversion of storm water away from potential sources of pollution (e.g., trash receptacles and parking structures). The Stage 2 WQMP shall list and describe all structural and non-structural BMPs. In addition, the WQMP must also
identify the entity responsible for the long-term inspection, maintenance, and funding for
all structural (and if applicable Treatment Control) BMPs. Public Works Department
39. The Ritz-Carlton Residences and the VEA Newport Beach Resort and Spa shall
implement City-approved parking management plan(s) that include a valet operations plan(s). The parking management plans, and valet operations plans, shall be reviewed and approved by both the Public Works and Community Development Departments prior to the issuance of certificated of occupancy. The parking management plans shall
be in substantial conformance with the Ritz-Carlton Residences and the VEA Newport
Beach Resort and Spa parking management plans, dated April 13, 2022. 40. Overhead utilities serving the site shall be undergrounded to the nearest appropriate pole in accordance with Section 19.24.140 of the Municipal Code.
Planning Commission Resolution No. PC2022-011 Page 39 of 72
41. County Sanitation District fees shall be paid prior to the issuance of any building permits.
42. Prior to the commencement of demolition and grading of the project, the applicant shall
submit a construction management and delivery plan for the project to be reviewed and
approved by the Public Works Department. The plan shall include a discussion of project phasing; parking arrangements for both the VEA Resort and Ritz-Carlton Residences
sites during demolition and construction; anticipated haul routes and construction
mitigation to ensure the orderly demolition and construction of the project. Parking
arrangements shall address construction worker parking as well as all operations
occurring at the VEA Resort during construction. Upon approval of the plan, the applicant and their contractors and employees shall be responsible for implementing
and complying with the plan and all conditions set forth in the approved plan. Demolition
permits shall be issued once project approvals are final provided said permits are
deemed compliant with all applicable construction regulations and applicable conditions
of approval.
43. Traffic control and truck route plans shall be reviewed and approved by the Public Works
Department before their implementation. Large construction vehicles shall not be permitted to travel narrow streets as determined by the Public Works Department. Disruption caused by construction work along roadways and by movement of construction vehicles shall be minimized by proper use of traffic control equipment and
flagman.
44. A Tract Map shall be recorded prior to the sale of any residential units. The Map shall be prepared on the California coordinate system (NAD83). Prior to recordation of the Map, the surveyor/engineer preparing the Map shall submit to the County Surveyor and
the City of Newport Beach a digital-graphic file of said map in a manner described in
Section 7-9-330 and 7-9-337 of the Orange County Subdivision Code and Orange County Subdivision Manual, Sub article 18. The Map to be submitted to the City of Newport Beach shall comply with the City’s CADD Standards. Scanned images will not be accepted.
45. Prior to recordation of the tract map, the surveyor/engineer preparing the map shall tie the boundary of the map into the Horizontal Control System established by the County Surveyor in a manner described in Section s 7-9-330 and 7-9-337 of the Orange County Subdivision Code and Orange County Subdivision Manual, Sub article 18. Monuments
(one-inch iron pipe with tag) shall be set On Each Lot Corner unless otherwise approved
by the Subdivision Engineer. Monuments shall be protected in place if installed prior to completion of construction project. 46. Prior to the recordation of the Tract Map, a Subdivision Agreement shall be obtained
and approved by the City Council consistent with subdivision Code Section 19.36.010.
47. Prior to Final Map approval, the applicant shall provide a Faithful Performance Bond and a Labor and Materials Bond, each for 100 percent of the estimated improvement cost for improvements in the public right of way, as prepared by a Registered Civil Engineer
Planning Commission Resolution No. PC2022-011 Page 40 of 72
and approved by the Public Works Director, for each of the following, but not limited to, public and private improvements, street improvements, monumentation, sidewalks,
striping, signage, street lights, sewer system, water system, storm drain system, water
quality management system, erosion control, landscaping and irrigation within public right of way, common open spaces areas accessible by the public, fire access and off-site improvements required as part of the project.
48. Warranty bond for a minimum of 10 percent of the engineers cost estimate (final
percentage to be determined by the Public Works Director) to be released 1-year after improvements have been accepted. 49. All improvements shall be constructed as required by Ordinance and the Public Works
Department.
50. An encroachment permit is required for all work activities within the public right-of-way. 51. Reconstruct the existing broken and/or otherwise damaged concrete curb, gutter,
sidewalk along the Newport Center Drive frontage per City Standard.
52. All improvements shall comply with the City’s sight distance requirement. See City Standard 110.
53. In case of damage done to public improvements surrounding the development site by
the private construction, additional reconstruction within the public right-of-way could be required at the discretion of the Public Works Inspector. 54. Install a manhole per City Standard at the proposed sewer lateral within the sidewalk
area along the Newport Center Drive frontage.
55. Parking layout and ramp slopes shall comply with City Standard 805. All dead-end drive aisle shall have a dedicated turn around space and 5-foot minimum drive aisle extension to accommodate vehicular maneuvering.
56. A temporary bus stop shall be provided throughout the duration of project construction.
The location of the permanent post-construction bus stop shall be evaluated during
construction and coordinated and approved by the Public Works Department prior to installation.
57. The ultimate dimensions of the landscape median at the center of the Ritz Carlton
Residences project’s porte cochere shall be reevaluated prior to issue of building
permits to ensure adequate vehicle circulation subject to the approval of the Public Works Department.
Planning Commission Resolution No. PC2022-011 Page 41 of 72
Exhibit “B”
The 2006 General Update EIR (PEIR) Available separately due to bulk at: https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-
plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 42 of 72
Exhibit “C”
Addendum No. 1 (North Newport Center) Available separately due to bulk at: https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-
plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 43 of 72
Exhibit “D”
Addendum No. 2 (North Newport Center Planned Community Amendment) Available separately due to bulk at: https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-
plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 44 of 72
Exhibit “E”
Addendum No. 3 (Newport Airport Village – ER2020-002) Available separately due to bulk at: https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-
plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 45 of 72
Exhibit “F”
Addendum No. 4 (Residences at 4400 Von Karman – ER2020-003) Available separately due to bulk at: https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-
plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 46 of 72
Exhibit “G”
Addendum No. 5 (Residences at 1300 Bristol – ER2022-001)
Available separately due to bulk at:
https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general- plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 47 of 72
Exhibit “H”
Addendum No. 6 (Ritz-Carlton Residences – ER2022-002) Available separately due to bulk at:
https://www.newportbeachca.gov/government/departments/community-
development/planning-division/general-plan-codes-and-regulations/general-plan/general-plan-environmental-impact-repor
Planning Commission Resolution No. PC2022-011 Page 48 of 72
Exhibit “I”
Newport Beach Municipal Code Section 21.48.025 Feasibility and Impact Analyses for The Ritz-Carlton Residences dated March 18, 2022
Planning Commission Resolution No. PC2022-011 Page 49 of 72
Maurice Robinson & Associates LL
28 Do er Place
Manhattan Beach., A 90266
arch 18, 2022
r. Kevin Martin
Vice Pre ident, De elopment
Newport Center Hotel. LLC
490 l Birch treet
Newport Beach, CA 92660
Re: Newport Beach Municipal Code Section 21.48.025 Fea ibility and Impact
Analyse for The Ritz-Carlton Residence
Dear r. Martin:
aurice Robinson & Associate LLC ("MR&A") has prepared a Feasibility and Impact Analysis
for Newport enter Hotel, LL ("Client") with respect to its proposed development and sale ofup
to 159 hotel branded residences at 900 Newport Center Drive ("Project").
In th.is report, we present our findings of the two reque ted analyses, as follow :
1) The fea ibility of the Project to include lower-cost visitor accommodations; and
2) The impact of the Project on the existing lower-cost visitor accommodations in tbe City of
Newport Beach ("City").
T11e fo llowing analyse conclude that it i not foasible to provide lower-co t vi itor
accommodations as part of the Project, and the Project would not impact the availability oflower-
cost visitor accommodations in the City.
lf you have any questions, please do not hesitate to call us at 310-640-9656 or email us at
Mauricc(@MauriccRobinson.com. My CV is attached at the end of this report.
Sincerely,
R. Maurice Robinson, ISHC
President
1
Planning Commission Resolution No. PC2022-011 Page 50 of 72
I. Fea ibilitv Analvsi
Newport Beach Municipal Code ("NBMC") ection 21.48.025( )(2) requires "au analysis of the
feasibility of providing lower-cost visitor accommodati ons ... for any application involving
the ... conversion ... or. .. visitor accommodations." Thi analysis is required regardless of whether
the accommodation to be converted are "lower-cost.' The Project propo es to convert up to 159
high-co t vi itor accommodations into hotel-branded residence . Thus, the NBM requires the
preparation of this feasibility analysis, at the Client's expense, to detetmine if the Project could
provide. lower-cost visitor accommodations on the Project site.
A explained below, it i not tea ible to include lower-cost visitor accommodation on the Project
site. This infeasibility i due to the site's high land value, the Project's high development costs,
the lack of annual operating revenue given the type of for-ale product created by the Project, and
other constraints related to tbe Ritz-Carlton brand.
Summary of Findings
Lo ation
The Project i · located on a 2. 775-acre development footprint at 900 ewpo11 Center Dri e within
Newport Center (see map below). ewport Center i a mixed-use area of the City that i home to
Fashion Island, commercial office developments, residential development , and the ewport
Beach Country Club. The location of the property makes it an inappropriate de.signation for lower-
cost accommodations. The property is within the urban nucleus of Newport Center, which is on
the inland side of Pacific Coast Highway, and does not allow for suitable access to public coastal
recreational resources or amenities. The prope11y's location is not suitable for lower-cost
ac-commodations to encourage coa tal access.
Newport Beach
Land Value
LMd in Newport Beach is extremely valuable, and ewport Center i known to ha e some of the
most expensive real estate in the entire City. Land in ewport Center can typically trade for
:l>20,000,000 per acre, as supported by the purchase of the Newpo1t Beach Marriott in 2020. This
high land value acquisition cost renders the property financially impractical and unsuitable for
2
Planning Commission Resolution No. PC2022-011 Page 51 of 72
lower-co t visitor accommodations. Additionally, given the relatively small ize of the project,
there i no physi cal area to construct lower-co t visitor accommodations at the Project site.
High Development Costs
TI1e e timated construction costs for the Project are nearly $1,200 per square foot. Additionally,
the project is burdened by nearly $400,000 per branded residence in design, financing and
pennitting costs. Assuming 65% debt financing; 4 more years of design and construc tion costs;
and nearly 3 years of sales; the l)VeraH leveraged internal rate of return ("IRR'') of the Project is
projected at 20.0%. loclusion oflowercost visitor accommodations would reduce lhe IRR to a level
that would di uade investors from investing in the Project, and would ultimately have the effect
of preventing the Project from being developed .
Lack of Annual Operating Income
The Proje.ct is developing up to l 59 hotel-branded residences. The Project does not include the
development of visitor accommodations. As a consequence, the Project will not generate any
annual operating income that could be used to develop, operate, or service lower-cost visitor
accommodations. Therefore the lack of annual operating income further renders the Project
infeasible for lower-cost visitor accommodations.
Ritz-Carlton Brand
The contract with Ritz-arlton to brand and service the Project does uot allow for the on-site
operation of lower-cost visit<>r accommodations. The Ritz-Carlton brand is dependent on our
Client's ability to provide operational exclusivity on the proposed 2.775-acre property. Ri tz-
Carlton doe not operate any lower-cost accommodation , and by includi ng them on-site, the
Client will be unable to adhere to the terms of their agreement with Ritz-Carlton. Without the
Ritz-Carlton brand, the sale prices of the hotel-branded residential units would be severely
reduced. Tbe pricing premium generated by a luxury hotel brand is typicall y 25% or more,
compared to comparably located and finished non-branded residential product. be RCLCO
market analysis dated 12/14/2020 concluded the premium was 35% fo r the Ritz-Carlton residences
studied.1
Without Ritz-Carlton aod its as oc iated premium pricing, the Project's ability to be financed would
suffer, resulting in a reduction of the amount of debt that could be sourced and an offsetting
requirement for additional, higher-cost equity. It would also be much more difficu lt to attract a
lender for the Project if ther ' were lower-cost visitor accommodations at the prope1t y. Thus, it is
infeasible to include lower-cost visitor accommodations, becau e thei r incl usion would effectively
terminate the Project.
1 See "Market Analysis and Strategic Development Recommendat ions, Proposed Hotel-Branded Condominiums,
Newport Beach, California", dated 12/12/2020, by RCLCO, pages 21 and 64.
3
Planning Commission Resolution No. PC2022-011 Page 52 of 72
1ethodology and Assumptions
This section, along with the tables in our motlel2, discusses the key assumptions used in our
analysis of both cenarios, and the results of the analyses.
The Project as proposed is depicted in the architectural renderings document prepared by MVE +
Partners dated 1/21/20223.
The proposed 22-story tower would contain 421,973 gross square fe-et of space, excluding 5 levels
of underground parking. The up to 159 residences would be located on floors 2 through 22, and
contain a total of 341,766 square feet of saleable residential space.
The hotel rooms would be considered '1.ower-cost" rooms. per the definiti.on of the alifornia
Coastal Commission and the definition provided in NBMC Section 2 l.48.025(C)( I )(a) and th eir
average daily rental rate ("ADR") would be limited to $135 (state.cl in 2021 dollars), plus inflation.
For the duration of the projections, int1ation has been assumed to average 3% per year for
development and operating costs, as well as for the pricing of the residences.
The price per square foot for the ale of the residen tial units with the Ritz-Carlton branding has
been estimated to be $2,500 per square foot, stated in 2021 dollars .. This was derived from both
actual sales and current listings of several hotel-branded residential projects in Southern Califomia,
and supported by an R LCO market analysis dated 12/J 4/20204.
The Project development budget and timetable were prepared by the Client and seem reasonable.
The absorption period for the sale of the residential units i projected to be 20 units pre-sold, then
4 units per month until sold.
The proposed capital stack, interes t rates, cap rate , and the various cost and fees are our e timatei'i,
and are based on our observations of the current real estate development and investment
environment.
The hotel occupancy levels and operating ratios are our est.imates, based upon our understanding
of lower-cost visitor accommodation operating metrics and our professional judgment as to how
such an operation would fit into the proposed Project, within the context of the Orange County
hotel market.
2 See Excel Workbook entitled ''MRA model Newport Beach Ritz".
3 See "The Ritz-Carlton Residences,, ewport Beach, Site Development Review", dated 1/21/2022.
• See "Market Analysis and Strategic Devel opment Recommendations, Proposed Hotel-Branded Condominiums,
Newport Beach, California", dated 12/12/2020, by RCLCO, pages 9 and 32.
4
Planning Commission Resolution No. PC2022-011 Page 53 of 72
II. Impact Ana lvsis
NBMC Section 2 l.48.025(C)(3)(a) provides that '"an auaJysis of a development's impact on the
availability of lower-cost visitor accommodations in the City shall be required for any application
involving ... the ... conversion ... of ... visitor accommodati ons .... " The Project proposes to convert
up to 159 high-cost visitor accommodations into hotel-branded residences. There have never been
lower-cost vi itor accommodations at the Project site. Thus, the NBMC requires the pl'eparation
of this impact analysis, at the Client's expense, to determine iftbe Project impacts the availability
oflower-cost visitor accommodations in the City.
As explained below, thi Project does not impact the City's existing lower-co t vi it.or
accommodations. The number of lower-cost visitor accommodations in the City will l'emain the
same, and both the supply and demaud for them will be unchanged by this Project.
Summary of Findings
Existing Supply of V~ itor Accommodarion
There are a variety of visitor accommodations within the City, as depi.cted on the table below. The
majority of hotels within the City are located in the Coa:,tal Zone. These hotels offer a range of
costs from economy class to luxury class, as further detailed below.
Coastal
# Hotel l'\ame Address Cost Zone
1 Balboa Bay Resort 1221 W Coast Hwy $579 X
2 Balboa Inn 105 Main St $299 X
3 Bay Shores Peninsula 1800 W Newport Blvd $399 X
4 Bayview Ma1Tiott 500 Bayview Circle $389 X
5 Dorvmans 2102 West Oceanfront $499 X
6 Extended Stay America Suites 4881 Birch St $128
7 Holiday Inn Express 2300 W Coast Hwy $256 X
8 Hyatt JWA 4545 MacArthur Blvd $167
9 Hyatt Newport Beach 1107 Jamboree Rd $332 X
10 Lido House 3300 Newport Blvd $769 X
II Little Inn by the Bay 2627 Newport Blvd $250 X
12 Marriott Newport Coast Vi.llas 23000 Newport Coast Dr. $549 X
13 Newport Beach Hotel 2306 W Oceanfront $3 13 X
14 VEA Newport Beach Marriott 900 Newport Center Dr $3 19 X
15 Newpo11 Channel Inn 6030 W Coast Hwy $259 X
16 Pelican Hill 22701 Pelican Hill Rd South $1,625 X
17 Renaissance Newpo1t Beach 4500 MacAtthur $161
18 Sonder Solarena 6208 W Coast Hwv $201 X
Sou,.ce: Booking. co 01, Mal'ch 17, 202 1
5
Planning Commission Resolution No. PC2022-011 Page 54 of 72
0
0 7.083
Feet
I 0
6
Planning Commission Resolution No. PC2022-011 Page 55 of 72
Existing Supply of Lower-Cost Visitor Accommodcition.s
NBMC ection 21.48.025(C)(l)(a) defines lower-cost visitor acconunodations as the "average
daily room rate for all economy hotels and motels in the City that have room rates that are below
the Statewide average daily room rate or lower. Economy hotels and mot Is are AAA-rated one or
two diamond hotels, or equivalent. ' Ba ed upon our research, the City onl y bas one lower-cost
visitor accommodation facility, the 164-room Extended Stay America motel, located at488 l Birch
Street. As depicted below, this motel is located adjacent to John Wayne Airport and is sandwiched
between the 405 and 73 freeways. he Project is not located anywhere near tbis lowe:r-cost visitor
accommodation facility, and the Project will have no impact on the lower-cost visitor
accommodations provided at this facility.
John Wayne
Airpon
C,
1useum t .. ~
i Legacy Nightclub
f and Lounge
Staples Print &Fl
Marketing Services
IRVINE BUSINESS
COMPLEX
4881 Birch St, Newpon
Beach, CA 92660
mac Wellness:
Michael Grossman, MD
Future Supply of Lower-Cost Visitor Accommodations
Based upon our research, there are no proposed lower-cost visitor accommodation developments
in the City. Thi is likely due to the high cost of land in the City, which discourages investors from
developing any lodging fac ilities in the lowest-priced segment, a it is financially infeasible. High
land costs force investors to develop higher-priced lodging. This Project will not impact the
proposed development of lower-cost visitor accommodations.
Demand for Lower Cost Visitor Accommo<latio11s
Since there would be no loss to the supply of existing lower cost visitor accommodations due to
tbe Project, the que tion is whether the Project would cause an increase in the demand for lower-
cost visitor accommodations in the ity. We are of the opinion that it would not. There has never
been any correlatit)n between the demand for lower-cost visitor accommodation an d providing
either high-cost visitor accommodations or hotel-branded residence .
Similarly, the conversion of the existing high-cost visitor ac,commodations at the Project s site,
which rented for an average of $197 per night in 202 1, will not generate demand for additi.onal
lower-cost visitor accommodation, which has been defined by the alifomia Coastal Commi.ssion
7
Planning Commission Resolution No. PC2022-011 Page 56 of 72
as hotels with pricing under $135 per night. STR categorizes hotels into si different levels by
their average daily room rates, as follows:
• Luxury Class
• Upper-Upscale Class
• Upscale Class
• Upper-Midscale Class
• Midscale Class
• Economy Class.
T11e existing high-cost hote l rooms at the Project's site are currently in the Upper-Upscale cla s,
which i · four level above the conomy class of lodging, which covers the lower-cost visitor
accommodations segment. J otel guests wbo would have stayed at the existing high-cost hotel
rooms have plenty of options for alternative lodging choices in the Upper-Upscale, Upscale,
Upper-Midscale aad Midsca.le classes, and wo uld not likely end up staying in an Economy hotel.
Virtually every other hotel in the City falls into these middle four classes, and the supply of these
altemati e hotel choices is unchanged by the Project. Th us, the conversion of up to l 59 Upper-
Upscale hotel rooms into hotel-branded re$idence would not create any new demand for tJ1e
xtended tay America, the single lower-cost visitor accommodation in the City.
In summary, since neither the supply of, nor demand for existing lower-cost v1s1tor
accommodations is impacted by the Project, we conclude the Project will not have any impact on
the City's existing lower-cost visitor accommodations, and no mitigation measures are required.
8
Planning Commission Resolution No. PC2022-011 Page 57 of 72
Statement of Qualifications
R. Maurice Robinson, ISHC
·r. Robinson has over 40 years of experienc-e as a consultant in the real estate and hospitality
develOJ)ment industry. He is an expe11 in the field of facilitating full-se1vice hotel development,
ground leases, concession contracts, market and financial feas ibility analysis, fiscal and economic
benefit s111dies, structuring public subsidies for new hotel development, and public/private
development pattnerships. He specialize in public sector counseling, and typically assists
Californ ia and ederal agencies in:
• facilitating hotel, commercial and residential development on public properties
• structuring hospitality development deals using public financing vehicles
• negotiating ground and building leases for new hospitality developments
• identifying and soliciting hospitality brands, operators and developers
• Performing economic feasibility and fiscal impact studies for hotel projects
• valu.ing private investment on public lands
• providing expei.1 witness testimony in disputes· and
• analyzing and structuring development and management agreements.
A partial list of his public-sector clients in California follows:
• Alameda
• Califomia Coastal Commission
• Cathedral City
• Crescent ity
• Del Mar
• Department of State Parks and Recreation
• Escondido
• Fresno
• Glendale
• Golden Gate Bridge District
• Healdsburg
• Inglewood
• Laguna Beach
• Long Beach
• Los Angeles, Community Redevelopment Agency
• Los Angeles, Department of Afrports
• Los Angeles, Department of City Planning
• Los Angeles, Grand Ave JP A
• Manhattan Beach
• Metropolitan Water District
• · lonterey County
9
Planning Commission Resolution No. PC2022-011 Page 58 of 72
• Mountain View
• Napa
• National Park Service
• Oceanside
• Orange County
• Palm Desert
• Poway
• Richmond
• Riverside
• Riverside County Transportation Commission
• San Diego City
• San Diego County
• San Diego etropolitan Transit System
• San Diego Unified Port District
• San Jose, Redevelopment Agency
• San Mate.a County
• San Mate.a County Harbor District
• Santa Clara Valley Transportation Authority
• Santa Monica
• Solano County
• South Coast Air Quality Management District
• Southern California Association of Government
• U.S. Department of Justice
• West Sacramento
Public client and the hotels that have been developed, or are now being developed:
• City of San Diego's 170-room 5-diamond Lodge at Torrey Pines
• City of Manhattan Beach's 400-room Westdrift Autograph Hotel and Golf Course
• City of San Jose's downtown 506-room Marriott Hotel
• City of Beverly Hills' s 20 I-room Montage Hotel & 25 Branded Residences
• City of Laguna Beach's 258-room Montage Resort and 27 Branded Residences
• National Park Service's 252-room Argonaut Hotel in San Francisco {conversion of the
historic Haslett Warehouse on Fisherman's Wharf)
• ational Park Service's 142-room Lodge at Cavallo Point in Golden Gate Park
(conversion of the hi toric fort Baker Army post near Sau alito).
• City of San Diego's Liberty Station 200-roorn Courtyard and 150-unit Homewood Suites
(conversion of the ex-Naval Training Center adjacent to the airport)
• Port of San Diego's 253-room Springhill Suites and 147-unit Residence Inn
• Port of San Diego's 400-room lnterContinental Hotel
10
Planning Commission Resolution No. PC2022-011 Page 59 of 72
• City of Mountain View's. 255-room Ameswell Hotel
• City of Oceanside's 161-room Mission Pacific hotel and 226-room Seabird hotel
• City of Mountain View's proposed 180-room Joie de Vivre hot.el (to be developed)
• City of Santa Monica' Fainnont Miramar Hotel and 60 Branded Residences. (co be
redeveloped)
Affiliations: Mr. Robinson is a member of the prestigi ous Internati.onal Society of Hospitality
Consultants (TSHC), where he served for nine years on the Board of Directors and as Chairman of
the Profe sional Conduct Committee. Other professional membership include the American
Society of Appraisers (ASA), and the Forensic Expert Wiu1ess Association (FEWA). He is also a
member of the Board of Arbitrators for the Financial Industry ational Regulatory Authority
(FINRA).
Background: Mr. Robinson is Presi dent of Maurice Robinson & Associates LLC, providing
advisory services to investors and developers in the Hospitality and Real Estate industries. Prior
to founding his current firm in 1999, he was a Principal with KPMG Peat Marwick LLP, leading
their western region Hospitality and Real Estate consulting practice for tv,elve years ( 1986-1998).
Prior to KPMG, he was a Senior Consultant and Manager in the real estate and hospitality
consulting practice of Pannell Km Forster (now PKF Consultiug) for five years ( 1982-I 986). His
previous work experience al.so includes three years as Senior Economist with the real. estate
c.onsulting firm of Williams-Kuebelbe.ck and Associates ( 1979-1 982), and a year as an independent
consultant (1978)..
Education: Mr. Robinson holds a General Real Estate Appraisal certificate from the tate of
Califomia; a Master of Public Administration degree from the Un_iversity of Southern California;
a Bachelor of Arts degree in economics from Macalester College in St. Paul, Minnesota; a
certificate of environmental management wilh a specialty in public/private partnerships from the
Environmental Management ln titute in Los Angeles; and a profe sional designation in financial
planning from UCLA
Speeches, Teaching itnd Writing: Mr. Robinson is a frequent lecturer, having spoken more than
two dozen times at various real estate and hospitality industry-related seminars and conferences
aero s the United Stales, and was an annua l guest lecturer at the UC Berkeley MBA program. He
is the author of numerous article , book chapter: , and was the editor of KPMG's Hospitality
Update newsletter. He has co-authored an article entitled "How to Value Commercial
hnprovements in a National Park" in the Winter 2000/Spring 2001 edition of Real Estate Issues; a
chapter entitled "Al.ternative Dispute Resolution in the Hospitality Indust1y" in the tex tbook l!!.!m!,
Investments: lssues and Perspectives. 4th edition (2006); a chapter entitled ''Couverting Existing
Historic Buildings into Hotels" in the textbook Hotel Sustainable Development: Principals and
Best Practices, I •1 edition (2011 ); and an article entitled "Issue Review Boards™ -The Next Wave
of Alternative Dispute Resolution for the Hospitality Industry'.
A wards: Mi-. Robinson recei ved the coveted James Felt Creative oun selor A ward from his peers
in the real estate counseling community for his ground-breaking work appraising tbe Grand
Canyon for the , ational Park Service. He is also the recipient of the Member of the Year award
11
Planning Commission Resolution No. PC2022-011 Page 60 of 72
by his peers in the ISHC for his efforts in establishing an Altemative Dispute Resolution training
prngram. In 2016, he facilitated the acquisition by the , 'PS of the final parcel ofland to complete
the 67-mile Backbone Trail in the Santa Monica Mountains.
Cont.act info: 28 Dover Place, Manhattan Beach, CA 90266. Tel: 310-640-9656. Fax: 3 l0-640-
9276. Cell: 3 I0-713-3220. E-mail: Mauricc@MauriccRobinson.com; Web site:
-.vww .MauriceRobinson.com.
12
Planning Commission Resolution No. PC2022-011 Page 61 of 72
Exhibit J
Transient Occupancy Taxes (TOT) Analysis Consistent with Newport Beach City Council Policy K-4 for Conversion of Hotel Rooms to Hotel-Branded Residences dated March 18, 2022
Planning Commission Resolution No. PC2022-011 Page 62 of 72
Maurice Robinson & Associates LLC
28 Dover Place
Manhattan Beach., CA 90266
March 18, 2022
Mr. Ke in Martin
Vice President, Development
Newport Center Hotel, LLC
4901 Birch Street
ewport Beach, A 92660
Subject: Transient Occupancy Taxes (TOT) Analysis Consistent with , ewport Beach City Council Policy
K-4 for Con ersion of Hotel Rooms to Hotel-Branded Residences
Dear Mr. Martin:
Maw·ice Robin on & Associates LLC (' MR&A") has prepared this TOT analysis for ewport Center
Hotel, LC (''Client") with respect to your proposed project in · ewpott Beach, A (the "Project"). The
Project ,vould involve the reduction of 159 exi ting hotel rooms at the VEA Newport Beach, A Marriott
Resort and Spa (the "Hotel"), and the construction of 159 Rjtz-arlt<)n Resi.dences.
Client proposes to replace 159 hotel rooms with the same number ofhote-1-branded residences, which wonld
reduce the nnmber of hotel rooms on the property from 532 to 373. City Council Policy K-4, Reduc ing the
Barrjer to the Creation of Housing, require a fiscal impact analysi to disclo e and mitigate any re<luction
in TOT due to the conversion of hotel room to residences. This analysis has been prepared c-onsistent with
PolicyK-4.
The reduction in hotel rooms would affect TOT receipt to the City of Newport Beach. The reduction in
TOT due to the replacement of 159 hotel rooms with hotel-branded residences would be fully mitigated,
however, because the 373 remaining hotel room would be significantly upgraded from their current
condition, and each upgraded room is expected to rent for a higher room rate -and thus, coupled with a
reduction in hotel supply, would collectively generate higher TOT-than would the existing unrenovated
room!!. The fo lk)\ving analysis concludes that the projected '"OT and property tax.es to be generated by the
Project would together, result in a ne-t increase in revenue for the City of Newport Beach.
It is important to note that this analysi does not consider the anticipated increase in ales ta es generat.oo
by the property's food a11d beverage operations as a result of the Project. It also does not account for the
additional retail foo d and beverage sales in the area sunounding the property as a result of the project,
which would be expected to have a positive economic benefit for the City .
If you have any questions, please do not he irate to call us at 310~640-9656 or email us at
Maurice@MauriceRobinson.com. My CV is attached at the end of this report.
Sincerely,
R. Maurice Robinson, ISHC
President
Planning Commission Resolution No. PC2022-011 Page 63 of 72
T ransient Occupancy Ta · (TOT) Analysis Consistent with City Council Policy K-41
Reducing th e Barriers to the Creation of Hm1sing
We have prepared an analy5is of the potential future TOT from tbe Hotel under tl11-ee scenarios:
Scenario 1: The Proposed Project, with 373 upgraded rooms (and 159 hotel-branded residences);
Scenatio 2: o Project with 532 unrenovated rooms (and no residential units)· and
Scenario 3: The Hybrid Hot.el Proje.ct, with 373 upgraded rooms and 159 unrenovated rooms for a
total of 532 room (and no hotel-branded resi dences).
Summary of Findings:
The table below summarizes the projected TOT only for e.ach Scenario for the ne t twenty years:
Twenty-Ye ar TOT l!roje ctions !ll
Year Scenario 1 Scenario 2 Scenal'i0 3
2022 $ 2,130,503 $ 3,093,560 s 3,055,082
2023 $ 3,328,113 $ 3,333,381 s 4,324,368
207..A $ 3,5<i4,769 $ 3,476 945 s 4,603,931
2025 $ 3,730,373 $ 3,595 476 4,804,961
2026 $ 3,842,284 $ 3,703,341 $ 4,949,1 IO
2027 $ 3,957,553 $ 3,814,44 1 $ 5,097,583
2028 $ 4,076;1.79 $ 3,928 874 $ 5 250510
2029 $ 4,198,568 $ 4,046,740 $ 5,408,026
2030 $ 4,324,525 $ 4,168,143 $ 5,570,267
203 1 $ 4,454,260 $ 4,293,187 $ 5 737 375
2032 $ 4,587,888 $ 4,421,982 $ 5,909,496
2033 $ 4,725,525 $ 4,554,642 $ 6,086,781
2034 $ 4,867,29 1 4,691 ,281 $ 6,269,384
2035 $ 5,013,309 s 4 832,020 $ 6,457,466
2036 $ 5,163,709 $ 4,976,980 $ 6,651,190
2037 $ 5,3 18,620 $ 5,126,290 $ 6,850,725
2038 $ 5,478,179 $ 5,280,078 $ 7,056,247
2039 $ 5,642,524 5,438,481 $ 7,267,934
2040 $ 5,811,800 $ 5,601,635 $ 7,485,972
204 1 $ 5,986,154 $ 5,769,684 $ 7,710,552
20-yr total $ 90,202,225 $ 88,147,16 2 $116,546,960
1. Applied SIR recovery projections for S Hotels for
2022 through 2025; then. 3% in_Oation through 2041.
As shown in the following table, combining the projected TOT and property taxes generated for
the City of Newpmi by the Project under each Scenario results in the following estimates of City
tax receipts over the next twenty years:
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Planning Commission Resolution No. PC2022-011 Page 64 of 72
20-year total of TOT+ Property Taxes for the City
Year Scenario l Scenario 2 Scenario 3
2022 $ 2,53.1,847 $ 3,523,529 $ J,556,034
2023 $ 4051334 $ 3,77 1949 $ 4,835,339
2024 $ 4,610,028 $ 3,924,284 $ 5,125,121
2025 $ 5 097,832 $ 4,05 1,762 $ 5,336,574
2026 $ 5,465,578 $ 4,168,752 $ 5,491,356
2027 $ 5,998,798 $ 4,289,161 $ 5,650,674
2028 $ 6,422,092 $ 4,413,088 s 5,814,663
2029 $ 6,6%,05 1 $ 4,540,639 s 5.983,461
2030 $ 6,871,957 $ 4,671,9 19 s 6,157,211
2031 $ 7,052,642 $ 4,807,039 s 6,336,058
2032 $ 7,238,237 $ 4,946.,111 s 6,520,153
2033 $ 7,428,88 1 $ 5,089,254 s 6,709,651
2034 $ 7,624,7 14 $ 5,236,585 $ 6,904,712
2035 $ 7,825,88 1 $ 5,388,230 $ 7,105,500
2036 $ 8,032,53 1 $ 5,544,3 14 $ 7,312,184
2037 $ 8,244,819 $ 5 704,970 $ 7,524,940
2038 $ 8,462.902 $ 5,870,333 $ 7,743,946
2039 $ 8,686942 $ 6,040,540 $ 7,969,387
2040 $ 8,917 106 $ 6,215,736 s 8,201,454
2041 $ 9,153,566 $ 6,396,067 $ 8,440,343
20-year total $ 136,413,736 $ 98,594,261 $ 128,718,761
In summary, the inclusion ofprope1iy taxes in the analysis would result in Scenario I's projected
City tax receipts exceeding those of Scenario 2 (the No Project) by almost S38 million (~38%),
and Scenario 3 (the Hybrid Hotel Project) by almost S8 million, or ~6%.
Methodology and Sources or Data
We stai1ed with the Hotel.'s most recent four years of historical perforn,ance, when it was operated
as tne Newp<)rt Beach Maniott Hotel and Spa. 2018 and 2019 were the peak years in the previous
economic cycle, while 2020 and 2021 were negatively impacted by Covid-19. Additionally, the
Hotel's 2021 perfonnance was further impacted by an ongoing renovation at the Hotel. The table
below summarizes the actual historical annual occupancy levels, ADRs 1, RevPars2, total room
revenues, and TOT realized/generated by the Hotel from 2018 through 2021:
1 ADR = Average D.iily Room r.ite.
2 RevPar =-Room Revenue Per Available Room; also, daily occupancy rate times ADR.
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Planning Commission Resolution No. PC2022-011 Page 65 of 72
Historirnl Pcrlornumce of the Nc,mo11 Bcacl1 Marriott Hotel (2018 • 202 l}
Year # of rooms 0cc ADR Rc ,•Par Room Rcn nue-s TOT@:! 10%
2018 532 80,7% $ 198. 76 $ 1(,0,40 $ 31,145,978 $ 3 114,598
2019 532 78,9% s 203.ll $ l(,0,25 $ 31,126,378 $ 3 112,638
2020 532 29 00/o s 186.23 $ 54,01 $ I0,53 1,213 $ 1,053,121
2021 532 :B,()0/o s 196.85 $ 64,96 $ 12,606,113 $ 1,260,611
Source: Marriott a nnua I P & Ls
For the projected TOT for Scenario I (the Proposed Project), we reviewed Marriott' proforma for
the proposed Project, and accepted their projections, on a per-room basis. 3 ln Scenario 1 the
upgraded rooms are forecast to achieve ADRs that are 47% more than would the unrenovated
rooms, which translates into an increase of approximately $100 per night by 2023. The table below
summarizes the proposed Proje,et's forecast occupancy levels, ADRs, Re-Pars, total room
revenues, and TOT by year for 2022 through 2025:
Scenario I: 373 Dl!l:l'aded ro1>ms (The Pro ject}
Ye ar # ofruoms 0cc ADR Rev Par Room Revenues TOT Ctil 10%
2022 373 55,5% s 281.96 s 1S6,49 s 21,305,032 $ 2,130,503
2023 373 76,6% s 319.13 s 244,45 s 33,28 1,133 $ 3,328,113
2024 373 79,6% s 328.94 261,84 s 35,647,695 $ 3,564,769
2025 373 80,8% s 339.l l s 274,00 s 37.303,730 $ 3,730.373
!Source: Man-jott bud!!.el & profomaas
For the forecast TOT for Scenario 2 (the No Project Alternative), we obtained the cunent forecast
by STR for the U.S. hotel market's recovery, using 2019 perfonnance levels as the base Again,
2019 was used as the base year due to the anomalous impacts on the lodging market and the Hotel
in the years 2020 and 2021. A an example, room revenue per available hotel room (RevPar) are
expected to reach 99% of2019 levels in 2022; 107% of2019 levels in 2023; 11 2% in 2024; and
I 16% in 2025. The table below summarizes the STR US Hotel Recovery Forecast as of January,
2022:
Summary ofSTR US Hotel Recovel"\I Forec.ast 1/2022
as a% of2019 levels
Year 0cc ADR RevPa.-0 cc ADR RevPar
2019 65.9"/4, $ 131.30 $ 86.53 100% !00% 100%
2020 41.8% $ 130.90 54.74 63% 100% 63%
2021 57.6% $ 125,00 $ 72.00 87% 95% 83%
2022 63.8% $ 134.00 $ 86.00 97% 103% 99%
2023 66.1% $ 140,00 $ 92.00 100% 107% 107%
2024 66.8% $ 145,00 $ 97.00 IOI% 110% 112%
2025 67.1% $ 149,03 $ 99.94 102% 114% ll6%
Source: STR J/2022 forecast for US Hotel Market recovery
3 The Marriott proforma assumed a 400-room upgraded hotel at the completion of the renovation, and the current
estimate is 373 rooms, Since this an.ilysis is based on 373 rooms, we used a pro-rata sh.ire of the Marriott
proforma.
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We applied these forecasted recovery factors to tbe actual 2019 perfo1mance levels achieved by
the existing Hotel to generate estimates of how the unrenovated hotel would perform in 2022
through 2025, if no renovations were undertaken. The table below summarizes the unrenovate-d
hotel's forecasted perfonnance, and its resulting TOT receipts, fo r these years:
Scenario l: 532 unrenfl\'ated rooms (No f>roject}
Year # of rooms 0cc ADR Re"l'ar Room llevenues TOT @) 10%
2022 532 76.4% s 208.59 s 159.3[ $ 30,935,605 $ 3,093,560
2023 532 79.L¾ s 216.92 s 171.66 $ 33,333,813 $ 3.333,38[
2024 532 79.9% s 224.0J s 179.06 s 34,769,445 $ 3,476,945
2025 532 80.3% s 230.53 s 185.16 $ 35,954,764 $ 3,595,476
Source: Growth rates from STR forecast applied to 2019 □chials
For the forecasted TOT under Scenario 3 (the Hybrid Hotel Project), we used the forecasted
performance levels under Scenario l above, which reflects 3 73 upgraded rooms added to Scena1io
2's forecasted perfonnance for the remaining 159 unrenovated rooms, to forecast room revenues
under the hypothetical 532-ro<Jm Scenario 3, as shown in the table below:
Scenario 3: 373 uegraded rooms & 159 unrenovated rooms (Hl!brid Hotel Project)
Year #of rooms 0cc AOO RevPar Room Revenues TOT@l0%
2022 532 61.7% $ 254.83 $ 157.33 $ 30,550,823 $3,055,082
2023 532 77.4% $ 287.88 $ 222.70 $ 43,243,682 $4,324,368
2024 532 79. 7"/4 $ 297.50 $ 237.10 $ 46,039,315 $4,603,931
2025 532 80.7°/o $ 306.79 $ 247.45 $ 48,049,609 $4,804,961
Source: MR&A calculations based on blended Scenarios
In swnmary, Scenario 1 the Proposed Project) is forecast to generate slightly more TOT than
Scenario 2 {the No Project Alternative) over the next twenty years, while Scenario 3 (the Hybrid
Hotel Project) would generate approximately 30% more TOT than either of the other two
Scenarios during this period, a shown in the table below.
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Planning Commission Resolution No. PC2022-011 Page 67 of 72
Twenty-Year TOT J!rojectlons (ll
Year Scenario 1 Sc.enario 2 Sc.enario 3
2022 $ 2,130,503 $ 3 093,560 3,055,082
2023 $ 3,328.1 13 $ 3,333,381 $ 4,324,368
2024 $ 3,564,769 $ 3,476,945 4,603,931
2025 $ 3,730,373 $ 3,595,476 4,804,961
2026 $ 3,842,284 $ 3,703,341 $ 4,949,110
2027 $ 3,957,553 $ 3,814,441 $ 5,097,583
2028 $ 4,076;1.79 $ 3,928 874 $ 5,250,510
2029 $ 4,198,568 $ 4,046,740 s 5,408,026
2030 $ 4,324,525 s 4,168,143 $ 5,570,267
203 1 $ 4,454,260 $ 4,293,187 $ 5,737,375
2032 $ 4,587,888 $ 4,421.982 $ 5,909,496
2033 $ 4,725,525 $ 4,554,642 $ 6,086,781
2034 $ 4,867,29 1 $ 4,691 ,281 $ 6,269,384
2035 $ 5,013,309 s 4,832,020 $ 6,457,466
2036 $ 5,163,709 s 4,976,980 $ 6,651,190
2037 $ 5,3 18,620 s 5,126,290 $ 6,850,725
2038 $ 5 478,179 $ 5,280,078 $ 7,056,247
2039 $ 5,642,524 $ 5,438,481 $ 7,267,934
2040 $ 5,8 11,800 $ 5,601,635 $ 7,485,972
2041 $ 5,986,154 $ 5,769,684 $ 7,710,552
20-yr total $ 90,202,225 $ 88,147,162 $ l 16,546,960
I. Appocd TR rec.ovcty pr~icc.tions for S Hotels for
2022 dlrough 2025; then 3% inflation throue.h 2041.
Comparison of Scenarios With the Additfon or Property Ta es
Although not required as part of the TOT comparison analysis it is clear that the City would
receive additional tax revenues from Scenario 1 that would not accrue under Scenarios 2 and 3,
specifically an increase of abl)ut $2 million per year in property taxes once the sell-out of the 159
hotel-branded re idence under Scenario l i projected to be completed.
We have prepared an analy is of the prope.rty taxes that would be expected to accrue to the City
for each of the Scena1.i os, assuiujng the sale of the residences during the 2026 through 2029 period.
Property taxes in Orange County are esti mated at I .05% of the sales price of each residence, and
the City receive approximately 17.15% of the property taxes paid each year to the County. The
sales of the propo ed 159 hotel-branded residences under Scenario I are projected to occur during
tbe years 2026 through 2029, and once sold, would generate an estimated approximately $10.5
nu ll ion of property taxes for the ounty with approximately $1.8 million (17.15%) of those
monies flowing directly to the City of Newpo11 Beach's general fund . There would be no such
additional property taxes generated under Scenarios 2 or 3.
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Planning Commission Resolution No. PC2022-011 Page 68 of 72
Thus, for the twenty-year projection period, tbe Project would be expected to generate well over
$30 million more in property taxes for the City than either of the other Scenarios, as shown in the
table below;
TwentJ-Year Nen~ort Beach Pro~ Tax P.-ojections
Year Scenario I Scenario 2 Scenario 3
2022 $ 401,344 $ 429,968 $ 500,95 1
2023 $ 723,221 $ 438,568 $ 510,970
2024 $ 1,045,258 $ 447,339 $ 521,190
2025 $ 1,367 459 $ 456,286 $ 531 ,614
2026 $ 1,623,294 $ 465,412 $ 542,246
2027 $ 2,041,246 $ 474,720 $ 553,09 1
2028 $ 2,345,812 s 484,214 $ 564,153
2029 $ 2,497 483 s 493,898 $ 575,436
2030 $ 2,547.432 s 503,776 $ 586944
203 [ $ 2,598,381 s 513,852 $ 598,683
2032 $ 2,650,349 s 524,129 $ 6l0,657
2033 $ 2,703,356 $ 534,612 $ 67?,870
2034 $ 2,757,423 s 545,304 $ 635 327
2035 $ 2,812,571 s 5562!0 $ 648,034
2036 $ 2,868,823 s 567,334 $ 660,995
2037 $ 2,926,199 s 578,681 $ 674,215
2038 $ 2,984,723 s 590,254 $ 687,699
2039 $ 3,044,418 602,059 $ 701,453
2040 $ 3,105,306 s 614,IOI $ 715,482
2041 $ 3,167,412 s 626,383 $ 729,792
2O-yr total $ 46,211,510 $ 10,447,099 $ 12,171,801
Combining the projected TOT and the property taxes for each Scenario would, corre.spondingly,
be expected to result in the following amounts of these tax receipts for tJ1e City of Newport Beach
for the next twenty years, as shown in the foHowiJ1g table:
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Planning Commission Resolution No. PC2022-011 Page 69 of 72
20-year total of TOT+ Property Taxes for U1e City
Year Scenario 1 Sce nario 2 Scenari.o 3
2022 $ 2,53 1847 3,523,529 $ 3,556,034
2023 $ 4,051,334 $ 3,771,949 $ 4,835,339
2024 $ 4,610,028 $ 3,924,284 $ 5.l 25 ,121
2025 $ 5Jl97,832 4,051 ,762 $ 5,336,574
2026 $ 5,465,578 $ 4,168,752 $ 5,491,356
2027 $ 5,998,798 s 4,289,161 $ 5,650674
2028 $ 6,422,092 $ 4,4 13,088 $ 5,8 14,663
2029 $ 6,696,051 $ 4,540,639 $ 5,983 ,461
2030 $ 6,871.;)57 $ 4,671,919 $ 6,157,211
203 1 $ 7 052,642 s 4,807,039 $ 6,336,058
2032 $ 7,238,237 $ 4,946,111 $ 6,520,153
2033 $ 7,428,881 $ 5,089,254 $ 6,709,651
2034 $ 7,624,7 14 $ 5,236,585 $ 6,904,712
2035 $ 7 825,881 $ 5,388,230 $ 7,105,500
2036 $ 8,032,531 $ 5,544,314 $ 7,312,184
2037 $ 8,244819 $ 5,704,970 $ 7,524,940
2038 $ 8 462,902 $ 5,870,333 $ 7,743,946
2039 $ 8,686,942 $ 6,040,540 $ 7,969,387
2040 $ 8,917,106 $ 6,215,736 $ 8201,454
2041 $ 9,153,566 $ 6,396,067 $ 8,440,343
20-yc ar total $ 136,413,736 $ 98,594,261 $ 128,718,761
The total tax receipts to the City would be greatest in Scenario 3 for tbe early years, but because
the property taxes associated with the residences would reset with each sale of a residential unit,
eventually the total truce,; generated by Scenario l would ove11ake thQSe of Scenario 3. In this
instance, the lines cross in 2027, after which the projected annual taxes genernted by the Project
under Scenario I exceed !hose of Scenario 3.
In sununary, the inclusion of property taxes iu tbe analysis would result in Scenario J's projected
ity tax receipts exceeding those of Scenario 2 by almost $38 million (-38%), and Scenario 3 by
almost $8 mill ion, Qr-6%.
Additional tables showing the assumptions and calculations for our analysis are presented in the
xcel workbook entitled "MRA model , B Ritz~Carlton 3.18.22".
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Planning Commission Resolution No. PC2022-011 Page 70 of 72
Statement of Qualifications
R. Ma urice Robinson ISHC
Mr. Ro binson has over 40 years of experience as a consult.ant in the real estate and hospitality
development industry. He is an expert in the field of facilitating full-service hotel development,
ground leases, conce sion contracts, market and financial feasibility analysis, fiscal and economic
benefit studies, structuring public subsi dies for new hotel development, and public/private
development pa1tnerships. He specializes in pub lic sector counseling and typically assists California
and Fedeml agencies in:
• facilitating hotel, commercial and residential development on public properties
• structuring hospitality development deals using public financing vehicles
• negotiating ground and bui ldi ng leases for new hospitality developments
• identifying and soliciting hospitality brands operators, and developers
• Performing e-eonomic feasibility and fiscal impact studies for hotel projects
• valuing private investment on pub lic lands
• pro iding e pert witness testimony in disputes; and
• analyzing and structuring development and management agreements.
A partial list of bis public-sector cl ients in Californi a fo l lows:
• Alameda
• California Coastal Commission
• Cathedral City
• Crescent City
• Del Mar
• Department of State Parks and Recreation
• Escondido
• Fresno
• Glendale
• Golden Gate Bridge District
• Healdsburg
• Inglewood
• Laguna Beach
• Long Beach
• Los Angeles, Community Redevelopment Agency
• Los Angeles, Department of Ai qJorts
• Los Angeles, Department of City Planning
• Los Angeles, Grand Ave JPA
• Manhattan Beach
• Metropolitan Water District
• Monterey C<rnnty
• Mountain View
8 IPagc
Planning Commission Resolution No. PC2022-011 Page 71 of 72
• Napa
• National Park Service
• Oceanside
• Orange County
• Palm Desert
• Poway
• Richmond
• Riverside
• Riverside County Transportation Commission
• San Diego City
• San Diego County
• San Diego Metropolitan Transit System
• San Diego Unified Port District
• San Jose, Redevelopment Agency
• San Mateo County
• San Mateo County Harbor District
• Santa Clara Valley Transportation Authority
• Santa Monica
• Solano County
• South Coast Air Quality Management District
• Southern California Association of Governments
• U.S. Department of Justice
• West Sacramento
Public cl ients and the hotels that have been developed, or are now being developed:
• City or San Diego's l 70-room 5-diamond Lodge. at Ton-ey Pines
• City of Manhattan Beach's 400-room Westdrifi Autograph Hotel and Golf Course
• City of San Jose's downtown 506-room Marriott Hotel
• City of Beverly Hills's 201-room Montage Hotel & 25 Branded Residenc.es
• City of Laguna Beach's 258-room Montage Resort and 27 Branded Residenc,es
• National Park Service's 252-room Argonaut Hotel in San Francisco (conversi on of the
historic Haslett Warehouse on Fisherman's Wharf)
• National Park Service's 142-room Lodge at Cavallo Point in Golden Gate Park (conversion
of the hi toric Fort Baker Army post near Sausalito).
• City of San Diego's Liberty Station 200-room Courtyard and I SO-unit Homewood Su ites
(conversion of the ex-aval Training Center adjacent to tbe airport)
• Port of San Diego's 253-room Springhill Suites and 147-unit Residence lnn
• Port of San Diego's 400-room Intercontinental Hotel
• ity of ountain View's 255-roomAmeswell Hotel
• City of Oceanside's 161 -room Mission Pacific hotel and 226-room Seabird hotel
• City of Mountain View s proposed 180-room Joie de Vivie hotel (to be developed)
9 I Pagc
Planning Commission Resolution No. PC2022-011 Page 72 of 72
• City of Santa Monica's Fairmont Miramar Hotel and 60 Branded Residences (to be
redeveloped)
Affiliations: Mr. Robinson is a member of the prestigious International Society of Hospitality
Con ult.ant (ISHC), where he erved for nine years on the Board of Direct.ors and as Chainnan of
the Professional Conduct Committee. Other professional memberships include the American Society
of Appraiser (ASA), and the Forensic Expert Witness Association (FEWA). He is also a member of
tbe Board of Arbitrators for tbe Financial Industry ational Regulatory Authority (FJNRA).
Background: r. Robinson is President of Maurice Robinson & A sociates LLC, providing advisory
services to investors and developers in the Hospitality and Real Estate industries. Prior to fo unding
his current firm in 1999, he was a Principal with KPMG Peat ' larwick LLP, leading their western
region r ospitality and Real Estate consulting practice for twelve years (1986-1998). Prior to KPMG,
he was a Senior Consultant and Manager in the real estate and hospitality consulting practice of
Pannell Kerr Forster (now PKF Consulting) for five years ( 1982-1986). His previous work experience
al o include three years a Senjor Economist with the real estate consuJting film of Wil.liams-
Kuebelbeck and Associates (1979-1982), and a year as an independent consultant (1978).
Education: Mr. Robinson holds a General Real . state Appraisal certificate from tbe State of
California; a Master of Public Administration degree from tbe University of Southern California; a
Bachelor of Arts degree in economics from Macalester College in St. Paul, Minnesota; a ceitificate
of environmental management wit.ha specialty in public/pri ate partnershjps from the Environmental
Management Instin1te in Los Angeles; and a professional designation in financial planning from
UCLA.
Speeches, Teaching and Writing: Mr. Robinson is a frequent lecturer, having spoken more than
two dozen times at various real estate and hospitality industry-related seminars and conferences
across the United States, and wa an annual guest lectllrer at the UC Berkeley · IBA program. He is
the author of numerous articles, book chapters, and was the editor of KPMG's Hospitality Update
newsletter. He has co-authored an article entitled "How to Value Commercial Improvements in a
National Park" in the Winter 2000/Spring 2001 edition of Real £state Issues; a chapter entitled
"Alternative Dispute Resolution in the Hospitality Industry" in the textbook Hotel Investments:
Issues and Perspectives, 4th edition (2006); a chapter entitled "Converting Existing Historic Buildings
into Hotels" in the textbook Hotel Sustainable De elopment: Principal. and Best Practice. , 1st edition
2011 ); a.nd an article entilled "Is ue Review Board TM -The Next Wave of Alternative Dispute
Resolution for the Hospitality Industry".
Awards : Mr. Robinson received the coveted Jame,s Felt Creative Counselor Award from his peers in
the real estate counseling community for his ground-breaking work appraising the Grand Canyon for
the National Park Service. He is al o the recipient of the Member of the Year award by rus peers in
the ISHC for his efforts in establishing an Alternative Dispute Resolution traini ng program. In 2016,
he facilitated the acquisition by the NPS of the final parcel of land to complete the 67-mile Backbone
Trail in the Santa Monica Mountains.
Contact info: 28 Dover Place, Manhattan Beach, CA 90266. Tel: 310-640-9656. Fax: 310-640-
9276. Cell: 310-713-3220. E-mail: Maurice@MauriceRobinson.com; Web site;
www.MauriccRobinson.com.
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