HomeMy WebLinkAboutC-519(E) - West Coast Highway, 1221 (Balboa Bay Resort) - Lease 1986Lc -ase
Between
City of Newport Beach
and
Balboa Bay Club, Inc.
Table of Contents
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Page
Recitals............................................
1
Agreements...........................................
2
1.
Description of Leased Premises .............
2
2.
Term .......................................
2
3.
Purpose of Lease ...........................
2
4.
Rental Commencement ........................
2
5.
Rental .....................................
2
a. Minimum Rent ..........................
2
b. Percentage Rent .......................
3
6.
Payment of Percentage Rent .................
3
7.
Place of Payment and Filing ................
3
8.
Charges for Goods and Services .............
4
9.
Definition of Gross Receipts ...............
4
10.
Books of Account ...........................
5
11.
Utilities, Taxes and Assessments...........
5
12,
Compliance with Laws .......................
6
13.
Improvements, Fixtures and Equipment.......
6
14.
Existing Encumbrance .......................
7
15.
Encumbrances ...............................
7
16.
Assignment of Lease ........................
8
17.
Subletting .................................
8
18.
Default ....................................
8
19.
Remedies of Lessor .........................
10
20.
Peaceful Enjoyment .........................
11
21.
Invalidity of Provisions ...................
11
22.
Relationship of Parties ....................
12
23.
Notices ....................................
12
24.
Successors and Assigns .....................
12
25.
Insurance ..................................
12
a. Lessor's Nonliability.................
12
b. Fire Insurance ........................
13
C. Liability Insurance ...................
14
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26. Restoration ................................
27. Maintenance of Landscaping and
Improvements...............................
28. MOU..................... I..................
29. Lease Extension ............................
30. Apartment Uses .............................
31. Pump -Out Station ...........................
32. Traffic Signal .............................
33. Miscellaneous ..............................
a. No Waiver .............................
b. Captions ..............................
Signatures...........................................
Exhibit "A" - Legal Description
Exhibit "B" - Percentage Rent Calculation
15
16
16
16
17
17
17
17
17
18
LEASE
Balboa Bay Club
This Lease, made and entered into to be effective this
13th day of May, 1986, by and between the City of Newport
Beach, a chartered municipal corporation, hereinafter
referred to as "Lessor," and the Balboa Bay Club, Inc., a
California corporation, hereinafter referred to as "Lessee."
Recitals
A. Lessor is the grantee and owner of certain harbor
frontage property located within the corporate limits of
the City of Newport Beach, in the County of Orange, State
of California, hereinafter referred to as the "leased
premises."
B. Lessor, by agreement dated March 24, 1948 (here-
inafter "Existing Lease"), leased the leased premises to
Newport Bay Company, which leasehold interest was subse-
quently assigned to Lessee.
C. Lessee presently operates and maintains a club,
hotel, apartments, a restaurant and lounge, meeting rooms,
boat slips, spa and other recreational and support facili-
ties on the leased premises. The term of the Existing
Lease expires August 31, 1998. Lessee has requested the
City to enter into a new lease having a term of twenty-
five (25) years.
D. Lessor has employed an independent appraiser
(Robert L. Foreman, MAI of Real Estate Analysts of Newport,
Inc.) for the purpose of making recommendations concerning
the increase in rent and other charges based on fair market
rental rates to be included in the new lease. Lessor,
after negotiations with Lessee, has determined that the
provisions contained within this lease provide for a fair,
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economic return to Lessor from the leased premises.
E. This lease provides that Lessor shall become the
owner of all structures and improvements on the premises at
the end of this lease and the lease further constitutes the
re-leasing of property under lease prior to the date of
adoption of the Charter of the City of Newport Beach and
is therefore exempt from the election provisions in Sec-
tions 420 and 1402 of said Charter.
NOW, THEREFORE, IN CONSIDERATION of the foregoing
recitals, and of the mutual covenants set forth below,
Lessor and Lessee hereby agree as follows:
Agreements
1. Description of Leased Premises. Lessor leases to
Lessee certain real property together with all improvements
existing thereon, situated within the corporate limits of
the City of Newport Beach, County of Orange, State of Cali-
fornia, as more particularly described in the attached
legal description marked Exhibit "A" and made a part herein
by this reference.
2. Term. This lease shall extend for a total term
of twenty-five (25) years commencing on the effective date
and expiring at the end of the day preceding the twenty-
fifth (25th) anniversary of the date of execution of this
lease.
3. Purpose of Lease. The leased premises may be
used by the Lessee for any purpose permitted under the City
of Newport Beach general plan and zoning ordinances, and
not prohibited by law.
4. Rental CommenggDent. Rent as provided in this
lease shall commence to accrue as of July 1, 1986.
5. Rental.
a. IYIinimum Rent. Lessee agrees to pay to
Lessor, as minimum rental for the use and occupancy of the
leased premises the sum equal to the total aggregate amount
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of the rent paid by Lessee to Lessor during the first full
twelve (12) months from the rental commencement date based
on the Contract Rent plus the 1986 percent of the Margin
Phase -In as hereinafter provided. The Minimum Rent shall
be paid in equal quarterly installments commencing on the
first of October and thereafter on January 1, April 1, and
July 1 of each year.
b. Percentage Rent. If the Percentage Rent, as
hereinafter provided, exceeds the Minimum Rent, Lessee
agrees to pay Lessor the Percentage Rent in lieu of the
Minimum Rent. The Percentage Rent shall be based on a
fixed percent of the Margin Rent for each year of the
remaining term of the Existing Lease plus the Contract
Rent. The Percentage Rent calculation is shown on the
attached Exhibit "B" which is incorporated herein by this
reference.
6. Payment of Percentage Rent. Lessee shall submit
to Lessor an estimate, prepared by a certified public
accountant, of the percentage rent payable for each fiscal
year of Lessor (October 1 through September 30) or portion
therof, during the term of this lease. The estimate shall
be due within sixty (60) days after the end of Lessee's
fiscal year. Any adjustment in the estimate of percentage
rental shall be due on March 1st of each year for the
preceding lease year and shall be accompanied by a full,
true and correct statement prepared by a certified public
accountant indicating in detail all gross operating reve-
nues received by it in connection with the operation of the
lease premises during that fiscal year or portion thereof
for which such payment is made. In the event the adjust-
ment requires payment by Lessor, the payment shall be made
within thirty (30) days from the date the final accounting
is submitted to Lessor.
7. Place of Pavment and Filing. All rent as pro-
vided in this lease shall be payable at, and all statements
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and reports herein required shall be filed with, the Office
of the Finance Director of the City of Newport Beach at
3300 Newport Boulevard, Newport Beach, California 92663.
Rent shall be paid by check and made payable to the City of
Newport Beach.
8. Charges for Goods and Services. Subsequent to
the execution of this lease, Lessee agrees to charge prices
for all goods and services offered and provided on the
leased premises which are competitive with prices charged
at other private clubs located in Southern California
offering similar goods and services.
9. Definition of Gross Receipts. The term "gross
receipts" shall mean the aggregate amount of all sales of
merchandise or services made, ordered or arranged at, in or
about the leased premises by Lessee whether for cash,
charge or credit (and in case of credit or charge sales,
regardless of whether the money for such sales is collected
or not) without deduction or allowance for costs, charges
or expenses for purchase, sale, transportation or delivery
of merchandise, or for labor and material in connection
with the rendition of services. The term gross receipts
shall also include deferred income in the year earned and
telephone receipts. The term gross receipts shall also
include fees and charges made by Lessee for use of any
facilities located at, in or about the leased premises,
including, but not necessarily limited to, hotel, motel or
apartment rentals derived from persons not carrying on and
conducting a business at, in or about the leased premises
or dockage fees and charges.
The term "gross receipts" shall not include
(a) the selling price of goods which are delivered in
exchange for goods returned by customers; (b) the price of
goods returned without exchange upon which a refund for the
purchase price is made; (c) cash or other discounts allowed
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to purchaser of merchandise or services; (d) the amount of
any tax imposed or computed upon the basis of sales made or
services rendered at, in or about the leased premises;
(e) discounts to Gold Card holders, honorary memberships,
promotional billings not actually charged or paid; (f) or
any revenues derived from those revenue-producing activi-
ties of the Balboa Bay Club or affiliated companies or
entities pertaining to business operations in existence or
conducted in the future at locations other than the leased
premises.
Gross receipts shall be reported on the accrual
method of accounting and not cash method.
10. Books of Account. The Lessee shall maintain and
keep a full, accurate and correct amount of all of its
business carried on and conducted at, in or about the
leased premises and all of its books and records in respect
to said business shall be open to the inspection by Lessor
and of any authorized agent, accountant or employee of
Lessor. The books of accounts and records shall include at
least those that would normally be required to be kept and
examined by an independent accountant in accordance with
generally accepted auditing practices. The books and
records shall be preserved for at least three years after
expiration of Lessee's fiscal year to which the books and
records apply. Lessor, and its employees or agents, shall
have the right to enter in and upon the leased premises at
any time during reasonable business hours to inspect the
premises and, upon demand, all books and records required
to be kept by Lessee pursuant to this section.
11. Utilities, Taxes and Assessments. Lessee shall
pay and discharge prior to delinquency all charges for
water, gas, electricity, telephone, rubbish and garbage
disposal and other public utility services furnished to the
leased premises or the occupants thereof and shall hold
Lessor harmless of and from any and all loss, damage or
liability by reason of the failure of Lessee to pay and
discharge in full any of said charges. Lessee shall like-
wise pay and discharge prior to delinquency all taxes and
assessments which shall be levied or assessed by the City
of Newport Beach, County of orange, State of California or
any taxing authority having jurisdiction over the leased
premises against any and all buildings, structures or
improvements placed at, in or about the leased premises by
Lessee and against the leasehold estate created hereby and
shall hold Lessor harmless of and from any and all loss,
damage or liability by reason of the failure of Lessee to
pay and discharge in full any of said taxes and assess-
ments. Lessee hereby expressly acknowledges that Lessor
has given Lessee notice that Lessee's possessory interest
in the leased premises may be taxed.
12. Compliance with Laws. Lessee, in its use and
occupancy of the leased premises, shall fully and com-
pletely comply with all rules, regulations, ordinances and
laws of any governmental authority or authorities having
jurisdiction over the leased premises or of any business or
other activity conducted at, in or about the same.
13. Improvements. Fixtures and-Bguipme-nt. Lessee
shall have the right and privilege of erecting and con-
structing such buildings, structures and improvements at,
in or about the leased premises as it may deem to be
desirable or necessary, provided Lessee complies with all
applicable building and zoning ordinances of any govern-
mental authority having jurisdiction over the leased
premises. Lessee shall also have the right to place at, in
or about the leased premises, such trade fixtures and per-
sonal property as may appear to be desirable or necessary
for the operation of any business or other activity. All
buildings, structures, improvements, fixtures and personal
property or equipment placed at, in or about the leased
premises by the Lessee shall, upon the expiration of the
term of this lease or the earlier termination thereof,
belong to and become the property of the Lessor and Lessee
shall receive no compensation therefor; provided, however,
Lessee shall have the right for a period of sixty (60)
days after termination or expiration to remove all trade
fixtures and personal property or equipment placed or
installed at, in or about the leased premises. All per-
sonal property, equipment and trade fixtures not removed by
Lessee within this sixty (60) day period shall, upon the
expiration thereof, become the property of Lessor and
Lessee shall no longer have any right, title or interest
therein.
14. Existing Encumbrance. Nothing in this lease
shall be deemed to modify or negate the rights of any
assignments or encumbrances which were previously autho-
rized by Lessor or placed on the leased premises pursuant
to written consent of Lessor prior to the effective date of
this lease.
15. Encumbrances. In the event that Lessee requests
Lessor to approve an assignment of Lessee's rights under
this lease, including but not limited to Lessee's leasehold
interest in either the Terrace Apartments parcel or the
Club parcel separately, as collateral security for any bona
fide loan, Lessee shall submit the proposed financing plan
and other related documents to the City Manager of Lessor
for his review and consideration. The City Manager may, in
his discretion, execute a consent to the proposed assign-
ment if the proposed encumbrance will not in any way subor-
dinate Lessor's fee interest in the leased premises and if
the proposed encumbrance is made subject to each and all of
the terms and conditions set forth in this lease, and to
all rights and interests of the Lessor hereunder. Lessee
reserves the right to request the City Council of Lessor to
approve any proposed encumbrance in lieu of the adminstra-
tive consent as herein provided, which approval shall not
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unreasonably be withheld.
16. Assignment of Lease. Lessee shall not assign
this lease or any interest therein without the prior
written consent of the Lessor, which consent shall not
unreasonably be withheld, and this lease and the leasehold
estate created thereby shall not be assignable by operation
or law or otherwise. No assignment or subletting even with
the consent of Lessor, shall operate to relieve Lessee of
its obligation to pay rent and perform the other obliga-
tions of this lease unless approved by Lessor.
17. Subletting. Lessee shall not sublet the leased
premises or any part or portion thereof for the purpose of
operating and conducting any business enterprise at, in or
about the same for a term in excess of the period of
one (1) year without the prior written consent of the City
Manager of Lessor, which shall not unreasonably be with-
held. Lessee reserves the right to request the City
Council of Lessor to approve any sublease in excess of
one (1) year in lieu of the administrative approval as
herein provided. It is agreed that any consent given by
Lessor or the City Manager of Lessor to Lessee authorizing
it to sublet the leased premises or any part or portion
thereof shall not be construed as a consent to any further
subletting or as a waiver of the right of Lessor to object
to any further subletting to which its prior written con-
sent has not been given.
18. Default. The occurrence of any one or more of
the following events shall constitute a default by Lessee:
a. Abandonment of the premises by lessee.
Abandonment shall be defined to include, but is not limited
to, the failure of tenant to conduct business on the
premises for thirty (30) consecutive days or more, unless
the failure to conduct business is caused by damage or
destruction to the premises, or other cause beyond the
control of Lessee;
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b. Failure of Lessee to pay rent, or make other
payment required by this lease, as and when due, where the
failure continues for three (3) days after written notice
of default from Lessor; provided, however, that any such
notice shall be in lieu of, and not in addition to, any
notice required under Section 1151 et. seg, of the Code of
Civil Procedure of the State of California, as amended;
C. Failure of Lessee to observe or perform any
express or implied covenant or provision of this lease,
other than as specified in paragraphs a. or b. above, where
the failure continues for thirty (30) days after written
notice of default from Lessor; provided, however that any
such notice shall be in lieu of, and not in addition to,
any notice required under Section 1151 et. seq. of the Code
of Civil Procedure of the State of California, as amended;
provided, further, that if the nature of the default is
such that more than thirty (30) days are reasonably
required for its cure, then Lessee shall not be in default
if it commences cure within the thirty (30) day period and
thereafter diligently pursues same to completion;
d. The making of: any general assignment for
the benefit of creditors;
e, the filing by or against Lessee of a peti-
tion to have Lessee adjudged a debtor; or to have debts
discharged or a petition for reorganization or arrangement
under any law relating to bankruptcy (unless, in the case
of a petition filed against Lessee, the petition is dis-
missed within thirty (30) days);
f. the appointment of a trustee or receiver to
take possession of substantially all of the assets of
Lessee located at the premises or Lessee's interest in this
lease, where possession is not restored within thirty (30)
days;
g. the attachment, execution or other judicial
seizure of substantially all of Lessee's assets located on
the premises, or of Lessee's interest in this lease, where
the seizure is not discharged within thirty (30) days;
h. Lessee's convening of a meeting of its
creditors or any class thereof for the purpose of effecting
a moratorium on, or rearrangement of, its debts; or
i. Failure to charge prices for goods and
services offered on the leased premises based on charges of
other private clubs located in Southern California offering
similar goods and services as provided in this lease shall
not constitute a default of this lease.
19. Remedies of Lessor. In the event Lessee defaults
in the performance of any covenant, condition or agreement
contained in this lease, and the default is not curred as
provided in the preceding section, then Lessor, at its
option, may terminate this lease and:
a. Bring an action to recover from Lessee:
(1) The worth, at time of award, of the
unpaid rent which had been earned at the time of the ter-
mination of the lease;
(2) The worth, at time of award, of the
amount by which the unpaid rent (which would have been
earned after termination of the lease and until the time of
award) exceeds the amount of rental loss Lessee proves
could have been reasonably avoided by Lessor;
(3) The worth, at time of award, of the
amount by which the unpaid rent for the balance of the term
after time of award exceeds the amount of rental loss that
Lessee proves could be reasonably avoided by Lessor; and
(4) Any other amount necessary to compen-
sate Lessor for all detriment proximately caused by
Lessee's failure to perform its obligations under this
lease; and
b. Bring an action, in addition to, or in lieu
of the action described above, to reenter and regain pos-
session of the premises in the manner provided by the laws
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of unlawful detainer in the State of California then in
effect.
The remedies of Lessor as specified in this
section are not exclusive, but shall be cumulative with, in
addition to, all remedies now or hereafter allowed by law.
20. Peaceful EnjoyMent. Lessor covenants and agrees
that the Lessee in performing the covenants, terms and
conditions of this lease on the part of lessee to be kept,
observed and performed may and shall have the right at all
times during the term of this lease to quietly and peace-
fully hold, possess, use, occupy and enjoy the leased
premises and all improvements which may from time to time
be placed thereon under and by virtue of this lease.
21. Invalidity of Provisions. In the event this
lease in its entirety shall be declared invalid or void by
a court of competent jurisdiction, the same shall cease and
terminate and Lessee waives any claim of damages or right
of action against the Lessor by reason of such invalidity,
and Lessee shall only be entitled for a period of sixty (60)
days after the judgment of invalidity is final, to remove
from the leased premised any and all trade fixtures and
equipment and personal property placed by Lessee. In the
event a particular term or provision of this lease shall be
declared invalid or void by a court of competent jurisdic-
tion, Lessee waives any claim for damages or right of
action against the Lessor by reason of such invalidity, but
shall have the option of terminating this lease by a notice
in writing given at any time on or before sixty (60) days
following the final judgment or decree declaring such terms
or provisions to be invalid or void, and in the event this
lease be so terminated, Lessee shall only be entitled to,
for a period of sixty (60) days after final judgment, to
remove, from the leased premises, trade fixtures, equipment
and personal property placed by it on the leased premises.
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Should Lessee not elect to exercise the option in the fore-
going sentence all of the terms and provisions of this
lease, other than those declared to be invalid or void,
shall remain in force and effect. Lessor, in the event of
the termination of this lease under the terms and provi-
sions of this paragraph, shall refund to Lessee all
unearned rentals paid by Lessee and shall not be entitled
to receive any accrued or unpaid rentals which have not at
the effective date of said termination become due and
payable under the terms hereof.
22. Relationship of Parties. The parties agree that
this lease does not create a partnership relation between
them or that of joint venturers and that it is intended by
the parties that this lease shall only create as between
them the relationship of landlord and tenant.
23. Notices. All notices, demands or communications
of any kind which may be required, or desired to be served
by the Lessor or the Lessee upon the other under terms of
this lease shall be deemed served, if hand delivered, or
mailed, by registered mail with postage prepaid, as follows:
TO LESSOR: City Manager
City of Newport Beach
3300 Newport Boulevard
Newport Beach, Ca 92663
TO LESSEE: General Manager
Balboa Bay Club, Inc.
1221 West Coast Highway
Newport Beach, CA 92663
24. Successors and Assigns. Each of the covenants,
provisions, conditions and obligations of this lease shall
extend to, bind, and inure to the benefit of the parties,
but nothing in this section shall be construed as a consent
to any assignment by Lessee.
25. Insurance.
a. Lessor's Nonliability. Lessor shall not be
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liable for any loss, damage or injury of any kind or char-
acter to any person or property arising from any use of the
leased premises, or any part thereof, or caused by any
defect in any building, structure or other improvements
thereon or in any equipment or other facility therein, or
caused by or arising from any act or omission of Lessee,
or of any of its agents, members, tenants, employees,
licensees or invitees, or by or from any accident on said
leased premises or any fire or other casualty thereon, or
occasioned by the failure of Lessee to maintain the
premises in a safe condition, or arising from any other
cause whatsoever; and Lessee, as a material part of the
consideration of this lease, hereby waives on its behalf
all claims and demands against Lessor for any such loss,
damage or injury of Lessee, and hereby agrees to indemnify
and hold Lessor entirely free and harmless from all lia-
bility for any such loss, damage or injury to other per-
sons, and from all costs and expenses arising therefrom.
b. Fire Insurance. During the period of this
lease, Lessee shall keep all buildings, structures and
other improvements insured against loss or damage by fire,
with extended coverage endorsement or its equivalent in
such responsible insurance companies as Lessee shall select
and Lessor shall approve, and in amounts not less than
ninety percent (40%) of the insurable value of the build-
ings and other improvements insured, with loss payable
thereunder to Lessor and Lessee and to any authorized
encumbrancer of Lessee in accordance with their respective
interests therein as provided in this lease and in any
written consent to such encumbrance by the Lessor; pro-
vided, however, any such policy may provide that a loss of
less than $100,000.00 may be paid directly to Lessee and
any authorized encumbrancer without the prior consent of
Lessor. Lessee shall pay all premiums and other charges in
connection with such insurance and from time to time shall
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deposit with Lessor the certificate of the insurance
carrier as to each policy of such insurance and satisfac-
tory evidence of the payment of premiums and other charges
thereunder. Such insurance policies shall contain an
express waiver of any right of subrogation against Lessor,
and shall provide that the Lessor shall be given thirty (30)
days' prior written notice of any cancellation or change in
the provisions of the policy.
C. Liability insurance. Lessee shall, at its
cost and expense, at all times during the term of this
lease, maintain in force a broad form comprehensive cover-
age policy of public liability insurance by the terms of
which Lessor and Lessee are named as insureds and are
indemnified against liability for the damage or injury to
the property or person (including death) of any member,
sublessee, tenant or invitee of Lessee or any other person
entering upon or using the leased premises; or any struc-
ture thereon, or any part thereof, in any way related to
Lessee's use or occupancy of the leased premises. Such
insurance policy or policies shall be maintained on the
minimum basis of $5,000,000.00 combined single limit
coverage for bodily injury, death and damage to property.
Such insurance policy or policies shall be stated to be
primary and non-contributing with any insurance which may
be carried by Lessor, and shall provide Lessor with
thirty (30) days' written notice of any cancellation or
changes in the provisions of the policy. Lessee shall
deliver to Lessor a certificate of each insurance carrier
as to each such insurance policy.
26. Restoration. if during the term hereof any
building or improvement erected by Lessee on the leased
premises, or any part thereof, shall be damaged or
destroyed by fire or other casualty, Lessee shall, at its
sole cost and expense, repair or restore the same according
to the original plans thereof; or, at Lessee's option,
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Lessee may elect to replace such building or improvement,
with a structure substantially identical to that damaged or
destroyed provided that if Lessee so elects, Lessee shall
first obtain the approval of Lessor. Any such work of
repair, restoration or replacement shall be commenced
within one hundred twenty (120) days after the damage or
loss occurs and shall be completed with due diligence, but
not longer than eighteen (18) months after such work is
commenced unless delay is caused by events beyond the
control of Lessee. All insurance proceeds collected for
such damage or destruction shall be applied to the cost of
such repairs or restoration, and if such insurance proceeds
shall be insufficient for said purpose, Lessee shall make
up the deficiency out of its own funds. Should Lessee fail
or refuse to make the repairs or restoration as hereinabove
provided, or if the authorized encumbrancer of Lessee, if
any, after thirty (30) days' written notice by Lessor,
shall fail or refuse to undertake and complete such work on
behalf of Lessee then, in either of said events, such
failure or refusal shall contitute a default under the
covenants and conditions hereof and all insurance proceeds
so collected shall be forthwith paid over to and retained
by Lessor on its own account and Lessor may, but shall not
be required to, use and apply the same to the repair and
restoration of said leased premises, and Lessor may, at its
option, terminate this lease as elsewhere provided herein.
Notwithstanding the provisions of this section, if such
damage or destruction occurs during the last five (5) years
of the lease term, Lessee shall have no duty to repair or
restore, and if Lessee elects not to repair or restore,
this lease shall terminate, and Lessor shall receive all
insurance proceeds.
27. Maintenance of Landscaping and Improvement .
Lessee covenants and agrees that during the term of this
lease it shall, at its own cost and expense, maintain the
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grounds, landscaping, and all buildings, and any other
improvements of any kind or nature in existence or to be
constructed or installed on the leased premises by the
Lessee, at a good standard of maintenance and repair.
28. Mme. Consistent with the term of the Memorandum
of Understanding between Lessor and Lessee dated June 10,
1985, upon execution of this lease Lessor and Lessee shall
cooperate and work together on a comprehensive plan for
redevelopment of the leased premises. As part of that
comprehensive plan of redevelopment, Lessee shall:
a. Prepare a master plan consistent with the
City of Newport Beach General Plan and Land Use Element;
b. Participate in appropriate public hearings
and meetings for the purpose of gaining community input and
consensus relative to approval of the master plan concept
and specific land uses; and
C. Review the master plan with the California
Coastal Commission and obtain approval in concept of the
master plan from that Commission.
29. Lease Extension. It is acknowledged that imple-
mentation of a comprehensive plan of redevelopment of the
leased premises may extend over a significant period of
time. It is further acknowledged that such implementation
may necessitate substantial and immediate long-term finan-
cial commitments by Lessee. It is therefore understood
that when Lessee complies with conditions (a) through (c)
of Paragraph 26 of this lease, a further lease term exten-
sion for the leased premises may be sought by Lessee
consistent with the financing requirements associated with
implementation of the master redevelopment plan and the
Charter of the City of Newport Beach. Lessor agrees to
consider such further lease extension under terms and con-
ditions to be mutually agreed upon at that time.
30. Apartment Uses. The stated position of represen-
tatives of the California State Lands Commission is the
-16-
leased premises constitute public tidelands granted to the
City of Newport Beach. Apartment uses are considered to be
incompatible with the public trust purposes contained in
the provisions of the tidelands grant to the City. There-
fore, Lessee agrees that any portions of the leased
premises which are subleased for permanent residential uses
will be used for visitor serving lodging purposes no later
than December 31, 1998, unless prior to that date a deter-
mination is made through the legislative, judicial or other
appropriate process that said permanent residential apart-
ments are legally proper uses on the leased premises.
31. Pump -Out Station. Within one {1} year of the
effective date of this lease, Lessee shall install and
thereafter maintain a vessel holding tank pump -out facility
located in the marina area of the leased premises conve-
nient for use by the public.
32. Traffic Signal. Lessee agrees to pay its fair
share of the cost of installing a traffic signal on Pacific
Coast Highway at the entrance of the leased premises at
such time as the necessary traffic studies are completed,
all required permits are obtained, and thereafter when
directed by Lessor.
33. Miscellaneous.
a. No Warmer. No delay or omission of the
Lessor to exercise any right or power arising from any
omission, neglect or default of the Lessee shall impair any
such right or power or shall be construed as a waiver of
any such omission, neglect or default on the part of the
Lessee or any acquiescence therein.
No waiver of any breach of any of the terms,
covenants, agreements, restrictions or conditions of this
lease shall be construed as a waiver of any succeeding
breach of the same or of any of the terms, covenants,
agreements, restrictions or conditions of this lease.
b. Captiilss. The captions of paragraphs and
-17-
subparagraphs of this lease are for convenience only and do
not in any way limit or amplify the terms and provisions
hereof.
IN WITNESS WHEREOF, the parties hereto have executed
this lease as of the day and year first above written.
CITY OF- --NEWPORT BEACH,
AMuniciD^Sll Cor ration
By, AA
&e,APPROVED AS TO FORM: Philipayor
By: Z
Cobert . Burnham, City
Attorney
ATTEST:
By:
Wanda Raggio, City rk
BALBOA BAY CLUB, INC.,
A Californi-a- corporation
By:
Title:
C _4 (6
W.D. RAY, Chairman of the
B70d
B
Title: O rf'Sl/�✓��I
THOMAS G. DEEMER, President
LEGAL DESCRIPTION
BALBOA BAY CLUB LEASED PROPERTY
That portion of Lot 171, Block 54 of Irvine's Subdivision in the.City of Newport
Beach, County of Orange, State of California, as shown on a map filed in Book 1,
Page 88 of Miscellaneous Record Maps in the Office of the County Recorder of
said Orange County described as follows:
BEGINNING at a point on the U.S. Bulkhead line extending from U.S. Bulkhead Sta-
tion No. 12.9 to U.S. Bulkhead Station No. 130 as said Bulkhead line and Bulkhead
Stations are laid out and shown on a map of Newport Bay, California, showing
Harbor lines approved by the War Department, January 18, 1917, said point being
distant South 61°01'07" East, measured along said Bulkhead line, 700.00 feet
from the point of intersection of said Bulkhead line with the southwesterly pro-
longation of the centerline of Irvine Avenue as shown on a Map of First Addition
to Newport Heights recorded in Book 4, Page 94 of Miscellaneous Maps in said
Office of the County Recorder, said point of intersection being the most
southerly corner of Lot H of Tract No. 919 as shown on a map recorded in Book
29, Pages 31 through 34 of Miscellaneous Maps in said Office of the County
Recorder; thence North 28°58'53" East 154.19 feet to a point in the south-
westerly line of the 100 foot wide right-of-way of California State Highway
ORA -60-B, said point being on a non -tangent curve in said right-of-way line
concave northeasterly and having a radius of 2050.00 feet, said point being on a
line radial to Engineer's Station 6+56.15 in the centerline of said highway,
said radial line bears North 19037157" East; thence along said southwesterly
line through the following courses: along said curve southeasterly 142.79 feet
through a central angle of 3059127"; thence tangent from said curve
South 74021'30" East 792.16 feet to the beginning of a tangent curve concave
northerly and having a radius of 2550.00 feet; thence along said curve easterly
715.57 feet through a central angle of 16°04'41" to an intersection with the
northeasterly prolongation of the northwesterly line of Tract No. 1140 as shown
on a map thereof recorded in Book 36, Page 28 of Miscellaneous Maps in said
Office of the County Recorder; thence along said prolongation, northwesterly
line and the southwesterly prolongation thereof South 28°58'53" West 975.03 feet
to a line parallel with and distant southwesterly 350.00 feet from said Bulkhead
line; thence along said parallel line North 61001'07" West 1574.91 feet to a
point which bears South 28°58'53" West from the POINT OF BEGINNING; thence
North 28°58'53" East 350.00 feet to the POINT OF BEGINNING.
EXCEPT that portion described as follows:
BEGINNING at a point on .said southwesterly line of the 100 foot wide
right-of-way of California State Highway CRA -60-8, said point being on a line
perpendicular to the centerline of said highway and which bears
South 15038'30" West from Engineers Station 7+95.46 on said centerline; thence
South 15°38'30" West 44.00 feet; thence North 74021'30" West 34.00 feet; thence
North 15038'30" East 44.28 feet to a point of intersection with a curve in said
southwesterly line, said curve being concave northeasterly and having a radius
of 2050.00 feet, a radial line of said curve from said point bears
North 16°35'31" East; thence along said southwesterly line and said curve
southeasterly 34.00 feet through a central angle of 0°57'01" to the POINT OF
BEGINNING.
CONTAINING: 25.274 Acres, more or less.
SUBJECT TO all Covenants, Rights, Rights -of -Way and Easements of Record.
EXHIBIT "A"
PERCENTAGE RENT CALCULATION
Contragt Rent: 5% of gross operating revenues of the
first $750,000; 4% of the gross operating
revenues between $750,000 and $1 million;
3% of the gross operating revenues in
excess of $1 million plus a percentage as
mutually agreed upon for all sub -rentals.
Activities Rent: Rent based on appraisal of a percentage
7.69
of Lessee's club
activities.
1988
23.07
Percentage of Gross
30.76
Activity
Revenue
1.
Club Fees & Dues
5.00%
2.
Apartments
16.50%
3.
Marina
31.00%
4.
Dry Boat Storage
10.00%
5.
Boat Charters Gross
6.00%
6.
Boat Charter Commissions
20.00%
7.
Guest Rooms
7.00%
8.
Meeting Rooms
7.00%
9.
Food
3.00%
10.
Beverage
5.00%
11.
Retail
5.00%
12.
Boat Sales (when transacted)
1.00%
13.
Boat Brokerage Commissions
(when transacted)
10.00%
14.
Other
5.00%
Margin Rent: Activities Rent minus Contract Rent
Percent of Marqin Phase -In
Year Percent
1986
7.69
1987
15.38
1988
23.07
1989
30.76
1990
38.45
1991
46.14
1992
53.83
1993
61.52
1994
69.21
1995
76.90
1996
84.59
1997
92.28
1998
100.00
Percentage Rent Formula
Margin Rent x Annual Percentage of Phase -In + Contract
Rent = Percentage Rent
EXHIBIT "B"
ENVIRONMENTAL CHECKLIST FORM
(To Be Completed By Lead Agency)
I.
Name of Proponent
Cl -i OF
N11poKT �EACN
2.
Address and Phone
Number of Proponent %53M ACEI pop --VD,
P. 10, BM 1?108,0
Ateitnfe.T BrAc.µ.LA.
U2P59-Ii1S
ATN: �Xpja x L
WyNN'I CIN
MAWA-bai 71y-104�(-30OD
3.
Date of Checklist Submitted 1Z-30-45
4.
Agency Requiring Checklist C ITk
OF AFWP02T BOAC -d
S.
Name of Proposal,
if applicable -bAt
by f -?,� t(. & LE,4-taE
Environmental Impacts
(Explanations of all "yes" and "maybe" answers are required on attached sheets.)
Yes Maybe No
I. Earth. Will the proposal result in:
a. Unstable earth conditions or in changes
in geologic substructures? %
b. Disruptions, displacements, compaction
or overcovering of the soil? X
c. Change in topography or ground surface
relief features?
d. The destruction, covering or modification
of any unique geologic or physical features? X
e. Any increase in wind or water erosion of
soils, either on or off the site? k
f. Changes in deposition or erosion of beach
sands, or ch-nges in siltation, deposition or
erosion whi.: may modify the channel of a
river or stro^ im or the bed of the ocean or
any bay, inli t or lake? X
,N.
5
Yes Maybe No
g. Exposure of people or property to geolo-
gic hazards such as earthquakes, landslides,
mudslides, ground failure, or similar hazards? }C
2. Air. Will the proposal result in:
a. Substantial air emissions or deterioration
of ambient air quality? X
b. The creation of objectionable odors? X
c. Alteration of air movement, moisture, or
temperature, or any change in climate,
either locally or regionally? X
3. Water. Will the proposal result in:
a. Changes in currents, or the course of di-
rection of water movements, in either
marine or fresh waters? X
b. Changes in absorption rotes, drainage pat-
terns, or the rate and amount of surface
runoff? I X
c. Alterations to the course or flow of flood
waters? X
d. Change in the amount of surface water in
any water body?
X
e.
Discharge into surface waters, or in any
alteration of surface water quality, in-
cluding but not limited to temperature,
dissolved oxygen or turbidity?
x
f.
Alteration of the direction or rate of flow
of ground waters?
X
g.
Change in the quantity of ground waters,
either through direct additions or with-
drawals, or through interception of an
aquifer by cuts or excavations?
k
h.
Substantial reduction in the amount of
water otherwi!e available for public water
supplies?
i.
Exposure of ip-ople or property to water re-
lated hazards such as flooding or tidal waves?
X
D
4. Plant Life. Will the proposal result in:
a. Change in the diversity of species, or
number of any species of plants (including
trees, shrubs, gross, crops, and aquatic
plants)?
b. Reduction of the numbers of any unique,
rare or endangered species of plants?
C. Introduction of new species of plants into
an area, or in a barrier to the normal
replenishment of existing species?
d. Reduction in acreage of any agricultural
crop?
5. Animal Life. Will the proposal result in:
a. Change in the diversity of species, or
numbers of any species of animals (birds,
land animals including reptiles, fish and
shellfish, benthic organisms or insects)?
b. Reduction of the numbers of any unique,
rare or endangered species of animals?
c. Introduction of new species of animals into
an area, or result in a barrier to the
migration or movement of animals?
d. Deterioration to existing fish or wildlife
habitat?
6. Noise. Will the proposal result in:
a. Increases in existing noise levels?
b. Exposure of people to severe noise levels?
7. Light and Glare. Will the proposal produce
new light or glare?
8. Land Use. Will the proposal result in a sub-
stantial alteration of the present or planned
land use of an area?
9. Natural Resources. Will the proposal result in:
a. Increase in the rate of use of any natural
resources?
Yes Maybe No
X
M
X
X-
x
X
X
X
X
X
X
I
b. Substantial depletion of any nonrenewable
natural resource?
10. Risk of Upset. Will the proposal involve:
a. A risk of an explosion or the release
of hazardous substances (including, but not
limited to, oil, pesticides, chemicals or
radiation) in the event of an accident or
upset conditions?
b. Possible interference with an emergency
response plan or an emergency evacuation
plan?
II. Population. Will the proposal alter the location,
distribution, density, or growth rate of the
human population of an area?
12. Housing. Will the proposal affect existing hous-
ing, or create a demand for additional housing?
13. Transportation/Circulation. Will the proposal
result in:
a. Generation of substantial additional'
vehicular movement?
b. Effects on existing parking facilities, or
demand for .new parking?
c. Substantial impact upon existing transpor-
tation systems?
d. Alterations to present patterns of circula-
tion or movement of people and/or goods?
e. Alterations to waterborne, rail a air '
traffic?
f. Increase in traffic hazards to motor
vehicles, bicyclists or pedestrians?
14. Public Services. Will the proposal have an
effect upon, or result in a need for new or
altered governmental services in any of the
following areas:
a. Fire protection?
b. Police protection?
C. Schools?
Yes Maybe No
X
A
Yes Maybe No
d. Parks or other recreational facilities?
e. Maintenance of public facilities, including
roads?
f. Other governmental services?
X
15.
Energy. Will the proposal result in:
a. Use of substantial amounts of fuel or energy?
){
b. Substantial increase in demand upon exist-
ing sources of energy, or require the
%\
development of new sources of energy?
16.
Utilities. Will the proposal result in a need
for new systems, or substantial alterations to
the following utilities:
a. Power or natural gas?
�C
b. Communications systems?
�(
C. Water?
X
d. Sewer or septic tanks?
x
e. Storm water drainage?
Y,
f. Solid waste and disposal?
17.
Human Health. Will the proposal result in:
a. Creation of any health hazard or potential
health hazard (excluding mental health)?
b. Exposure of people to potential health
hazards?
X
18.
Aesthetics. Will the proposal result in the
obstruction of any scenic vista or view open to
f
the public, or will the proposal result in the
creation of an aesthetically offensive site open
to public view?
X
19.
Recreation. Will the proposal result in an
impact upon the quality or quantity of existing
recreational opportunities?
20.
Cultural Resources.
a. Will the proposal result in the alteration
of or the destruction of a prehistoric or
historic archaeological site?
�_
■I
IV.
Yes Maybe No
b. Will the proposal result in adverse physical
or aesthetic effects to a prehistoric or
historic building, structure, or object? X
C. Does the proposal have the potential to
cause a physical change which would affect
unique ethnic cultural values? X
d. Will the proposal restrict existing religious
or sacred uses within the potential impact
area? X
21. Mandatory Findings of Significance.
a. Does the project have the potential to
degrade the quality of the environment,
substantially reduce the habitat of a fish
or wildlife species, cause a fish or wild-
life population to drop below self sus-
taining levels, threaten to eliminate a
plant or animal community, reduce the
number or restrict the range of a rare or
endangered plant or animal or eliminate
important examples of the major periods
of California history or prehistory?
b. Does the project have the potential to
achieve short-term, to the disadvantage of
long-term, environmental goals? (A short-
term impact on the environment is one
which occurs in a relatively brief, definitive
period of time while long-term impacts
will endure well into the future.) X
C. Does the project have impacts which are
individually limited, but cumulatively con-
siderable? (A project may irpoct on t•.✓o
or more separate resources where the impact
on each resource is relatively small, but
where the effect of the total of those
impacts on the environment is significant.)
d. Does the project have environmental effects
which will cause substantial adverse effects
on human beings, either directly or indirectly? )(
Discussion of Environmental Evaluation
Determination
(To be completed by the Lead Agency)
On the basis of this initial evaluation:
I find that the proposed project COULD NOT have a significant effect
on the environment, and a NEGATIVE DECLARATION will be prepared. �X
I find that although the proposed project could have a significant effect �—
on the environment, there will not be a significant effect in this case —
because the mitigation measures described on an attached sheet have
been added to the project. A NEGATIVE DECLARATION WILL BE PREPARED.
I find the proposed project MAY have a significant effect on the environ-
ment, and an ENVIRONMENTAL IMPACT REPORT is required.
_ Date Signature
For Q
BALBOA
BAY,
A s
PRELIMINARY
PLANNING
STUDY
PREPARED FOR
CITY OF NEWPORT BEACH
Nm
October. 1985
gnp uq yIX P1N�
cmc. v+n eosmv+
BALBOA BAY CLUB PROPERTY
PRELIMINARY PLANNING STUDY
Prepared for
City of Newport Beach
Prepared by
Turrini & Brink
Planning Consultants
1920 E. 17th Street, Suite 200
Santa Ana, CA 92701
October, 1985
I
I
I
L
1
H
1
I
II
I
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I
1
F
11
TABLE OF CONTENTS
PAGE
I. INTRODUCTION 1
II. BALBOA
BAY CLUB OPERATION & FUNCTION
2
A. Facilities and Programs
2
1.
Civic and Business
2
Opportunities
2.
Residential Opportunities
5
3.
Member Activities
6
B. Environmental Conditions
6
1.
Land Use
6
City General Plan
6
City Zoning
7
Local Coastal Program
8
Surrounding Land Use
13
2.
Circulation and Access
15
Pacific Coast Highway
15
City of Newport Beach
General Plan Circulation
Element
15
3.
Utilities & Services
16
Water Service
17
Sewer Service
17
Storm Drains
18
Other Services
18
4.
Fiscal Summary
19
Bay Club On-site Security
& Maintenance
19
Existing City Revenues
19
Appraisal
19
ZIZ. LAND USE ALTERNATIVES
22
PUBLIC
PARK
22
A. Facilities Description
22
B. Environmental Impact
24
1.
Land Use
24
City General Plan
24
City Zoning
24
Local Coastal Program
25
2.
Site Modification
26
3.
Circulation & Access
27
4.
Utilities & Services
27
5.
Fiscal Factors
28
HOTEL
29
A. Facilities Description
29
i
B. Environmental Impact
31
1. Land Use
31
City General Plan
31
City Zoning
31
Local Coastal Program
32
2. Site Modification
34
3. Circulation & Access
34
4. Utilities & Services
34
5. Fiscal Factors
35
IV. DOCUMENTS AND PERSONS CONSULTED
38
A. Documents
38
B. Persons
38
1. City of Newport Beach
38
2. County Sanitation Districts of
County of Orange
39
3. Balboa Bay Club
39
ii
LIST OF EXHIBITS
NO. TITLE PAGE
1 Existing Balboa Bay Club Plan 4
2 Preliminary Design Concept - Public Park 23
3 Preliminary Design Concept - Hotel 30
LIST OF TABLES
NO. TITLE
I Public User Days August 1983 -August 1985 3
II City of Newport Beach Fiscal Benefits -
Balboa Bay Club 20
III City of Newport Beach Projected Fiscal
Benefits - First Year - Hotel Alternative 36
Local Coastal Program Land Use Plan Map #6
iii
[�
[J
I. INTRODUCTION
The purpose of this Preliminary Planning Study is to provide
background information for use by the City of Newport Beach
City Council in evaluating long-term utilization for the
City ground currently leased to the Balboa Bay Club, at 1221
West Coast Highway, in western Newport Beach.
The 14.85 -acre property is leased by the City to the Bay
Club for a 50 -year term, due to expire in 1998. However,
the Bay Club has indicated to the City its desire to extend
the lease past 1997 for a total of 25 years, to enable its
continued function.
In light of the proposed lease extension, the intent of this
study is to examine the value of the existing Balboa Bay
Club land use to the City, in relation to that of two other
potential uses for the site - a public park and a hotel.
This analysis of land use for the Balboa Bay Club site is
designed to facilitate discussion and decision-making re-
garding the proposed property lease extension by the City.
*Note: The Club site contains 14.85 ac. of upland ground
and an adjacent 12 ac. of tidelands, separated by the U.S.
Bulkhead/mean high tide line located through the middle of
the marina. The outer edge of the marina lies along the
U.S. Pierhead line.
I
II. BALBOA BAY CLUB OPERATION AND FUNCTION
A. FACILITIES AND PROGRAMS
The Balboa Bay Club is a major center of community, business
and recreational activities in the City of Newport Beach.
Privately -owned by International Bay Clubs, Inc. the Club's
broad program of social, business and outdoor sport -related
functions has served the community interest for thirty-five
years. Its membership includes 13,000 local and regional
residents, and over 133,000 members of the general public
have been hosted in the last two years alone. (See Table
I, Public User Days.) The Club also operates residential
apartments providing long-term permanent housing for Newport
Beach residents.
There are hundreds of opportunities for civic, political,
corporate and social county -wide events every year. origi-
nally conceived as a vacation/resort spot used primarily by
out-of-town members and numerous weekend celebrities, the
Club's program has evolved as the City has matured to a
permanent residential and commercial community. Through the
years, its dual role as a member and publicly -oriented fa-
cility has been bolstered by community leaders, anxious to
further Newport Beach's goals for business growth and
coastal recreation.
1. Civic and Business Opportunities
The Balboa Bay Club provides visitor -serving hotel, conven-
tion and restaurant facilities in a casual atmosphere. (See
Exhibit 1, Existing Balboa Bay Club Plan.)The relaxing for-
mat of the Club attracts a variety of organizations for
2
TABLE I
PUBLIC USER DAYS
AUGUST 1983 - AUGUST 1985
MONTH
BUSINESS/COMMUNITY
GROUP USERS*
Aug.'83
- Jul. '84
8/83
4297
9/83
4560
10/83
6115
11/83
6355
12/83
10248
1/84
4079
2/84
5425
3/84
5207
4/84
5419
5/84
5247
6/84
5459
7/84
3901
Subtotal
66,312
user days
8/83-7/84
Aug.'84
- Jul.'85
8/84
3484
9/84
5532
10/84
5263
11/84
5368
12/84
11521
1/85
5034
2/85
4986
3/85
6314
4/85
4105
5/85
6503
6/85
4470
7/85
4363
Subtotal
66,943
user days
8/84-7/85
TOTAL
133,255
user days
8/83-8/85
* total
number of persons/month
EXISTING BALBOA BAY CLUB PLAN
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meetings, weekend and weeklong events. University, school,
public service, sporting and community political and charity
organizations using the Club include UCLA (MBA program);
Orange County Volleyball Club; the Boy Scouts of America;
organizes of the City's Character Boat Parade, Chili Cook -
offs and California Regatta; Newport Harbor Kiwanis, Busi-
ness Club, Rotary and the Chemical Peoples Task Force.
Major business users include corporations and organizations
like Hewlett-Packard, IBM, Microdata,and TRW, as well as
Fluor Corporation, Kidder Peabody, Signal Landmark, Pepsi
Cola, Koll Company, Smith Tool, Security Bank, Ford Motor
Company and Times Mirror. The Newport Beach Chamber of
Commerce and Mariners Mile Business Association (including
businesses between Dover Street and Newport Boulevard) also
utilize the Club as a primary meeting facility.
Overnight, convention, seminar and banquet rooms are spread
throughout several buildings on-site. According to Bay Club
staff, it appeals to the same tourist -commercial -business
user market as the Marriott and Newporter Hotels in Newport
Beach. Meeting areas in the four main buildings can accom-
2. Residential opportunities
The Balboa Bay Club also provides a permanent residential
community including 144 apartments in the 5 -story building
on the west side of the property. Units range in size
from 780-3000 square feet. Tenants are largely olderadults,
in a relatively high income bracket.
5
modate anywhere
from 4-400 persons in
functional rooms,
lounges, meeting
halls and a restaurant.
A total of 127
guest units are
provided near the Club
beach, pools, and
athletic center.
2. Residential opportunities
The Balboa Bay Club also provides a permanent residential
community including 144 apartments in the 5 -story building
on the west side of the property. Units range in size
from 780-3000 square feet. Tenants are largely olderadults,
in a relatively high income bracket.
5
3. Member Activities
In addition to civic, business and residential uses on-site,
the Club manages a wide social and recreational program for
its 13,000 members. The 134 -boat marina (and related hoist-
ing and storage facilities); beach; athletic center, pools
and tennis/racquetball courts are available to members year-
round, although member activities appear to be concentrated
in the summer months (June -August). Club management is
housed in administration offices at the eastern site bound-
ary.
B. ENVIRONMENTAL COMDITIONS
1. Land Use
City General Plan
The Bay Club property has been identified in the General
Plan Land Use Element as a site for "further, more detailed
study" in the form of a Specific Area Plan for physical
improvement. According to the General Plan, Specific Area
Plans may include guidelines to preserve the visual and
marine elements of the coastal environment, including a
specific combination of land uses, local street pattern
revisions, access and parking areas, public improvements in
the street rights-of-way (such as landscaping, lighting,
street furniture, signs) and architectural design standards
and criteria.
As noted in the previous section, the existing blend of
facilities at the Bay Club site includes extensive opportu-
nities for the public and members to enjoy the visual and
marine attributes of the location. The Club format complies
0
with the Land Use Element goals, providing a "harmonious
grouping" of land uses with "individual character". The
Club's mixed use plan also reflects the Land Use Element's
expressed interest in "mixture(s) of two or more types of
land use."
Any plan developed for this site could include an improved
or expanded plan of the continued Balboa Bay Club use, an
enhanced land use concept that eases access to facilities
and strengthens opportunities for members and the public
taking advantage of the Club's facilities and programs.
Parking, street layout, landscaping, lighting and architec-
tural design standards would be considered in any new site
design for a Balboa Bay Club plan.
City Zoning
As noted in the Land Use Element, the Balboa Bay Club site
is designated as an R-4 zone. Per the City Zoning Code uses
permitted in the R-4 District include "multiple dwelling,
apartment houses and dwelling groups", and "community cen-
ters, social halls, lodges and clubs" similar to those uses
available at the Bay Club. The City zoning code contains
guidelines for R-4 accessory uses; building height and floor
area limits; general, family unit, hotel or motel uses;
front, side and rear yards and dimensions; pools, equipment
and parking. According to the Land Use Element, any future
Specific Area Plan guidelines prepared for the Balboa Bay
Club property will replace existing zoning, so that zoning
requirements will coincide with the General Plan.
7
Local Coastal Program
The 1976 California Coastal Act contains policies, land use
designation maps, and descriptions for coastal -related de-
velopment and activities within the California Coastal Zone.
This data is contained in a Local Coastal Program (LCP) text
and Land Use Plan approved by the California Coastal Commis-
sion in 1978. (See Local Coastal Program Land Use Plan Map
#6 in report Appendix pertaining to the project site.)
As noted in the LCP, Newport Beach has "been dependent upon
and sensitive to a wide range of coastal resources for over
100 years," as a commercial shipping center, vacation/resort
community and now, as a permanent residential and commercial
City.
The purpose of the LCP is to assure provision of public
access to recreational, visitor -serving and coastal -depend-
ent facilities, programs and uses. According to the LCP,
the City as a whole is "highly consistent" with Coastal Act
requirements. However, the Policy Analysis Summary in the
City's LCP outlines how the proposed LCP Land Use Plan can
enhance and extend public access to and enjoyment of coastal
resources throughout the City. The Bay Club is designated
for "Recreational and Marine Commercial" use in the LCP, and
as a prominent waterfront facility used extensively by the
public, the Balboa Bay Club program reflects many elements
of the Coastal Act itself.
Policy requirements and the Bay Club's compliance with them
are briefly outlined below.
,a,
I
'
Policies and Compliance:
Shoreline Access: Provide public access and recreational
'
opportunities for all; present development interference
with right of access; provide public access to shoreline
in new development.
tCompliance:
The Balboa Bay Club offers broad opportuni-
ties for public visual and recreational access to its
'
facilities. As noted in the previous section, there were
over 133,000 public/visitor user days at the Bay Club in
the years '83-'85, representing a wide variety of commu-
nity and corporate groups. The visitor and tourist -serv-
ing hotel facilities also provide on-site housing for
public vacationers, or business users. The Club's civic
and business focus reflects a major commitment to the
needs of the Orange County community at large. It re-
'
gional appeal and scope of facilities draws users to
Newport Beach, preserving shoreline access.
'
Recreational and Visitor -Serving Facilities: Provide
public and low-cost recreation and visitor -serving fa-
cilities as a community priority.
'
Compliance: As indicated, the Bay Club offers a range of
public and visitor -serving facilities (function rooms,
'
hotel and recreation facilities) utilized year-round by
visiting community and business organizations and tour-
ists enjoying the City. According to Club staff, Bay
Club facility rental fees are comparable to those of
'
other quality hotels in the City (Marriott, Newporter
Inn, etc.). The Club represents a major attraction for
Newport Beach business and tourism interests.
' Water and Marine Resources: Preserve and enhance coastal
waters, streams and wetlands.
' Compliance: The Bay Club's extensive publicly -oriented
programs are intended to enhance public, visual and rec-
reational enjoyment of the adjacent coastal water re-
source.
Diking, Dredging, Filling and Shoreline Structures: Es-
t tablish conditions to plan, regulate and control all
necessary diking, dredging, and filling activities and
development of shoreline structures occurring within the
jurisdictions of the City, County, Corps of Engineers,
t Environmental Protection Agency, Water Resources Board
and Coastal Commission.
' Compliance: N/A
Commercial Fishing & Recreational Boating: Increase
recreational boating facilities, marinas, docks, slips,
' maintenance facilities, supply uses.
I
II
II
II
II
II
1
1
1
1
Compliance: The Balboa Bay Club provides a marina and
boat -related services for its members, and opportunities
for public enjoyment of its facilities at community boat
festivals, parades, the Boy Scout boat auction, etc.
These activities are oriented for the public, and allow
the Club to host major events involving the City as a
whole.
Environmentally Sensitive Habitat Areas: Protect upper
Newport Bay and Corona del Mar Marine Life Refuge.
Compliance: N/A
Hazard Areas: Minimize risks to areas of geologic, flood
and fire hazard; prevent damage to bluffs and cliffs.
Compliance: The Bay Club would be subject to any im-
provements in City building and fire codes and zoning
regulations, that would improve public safety along the
coast.
Locating and Planning New Development: Concentrate new
development in areas of existing use; preserve public
access and provide adequate support facilities.
Compliance: Any potential improvements at the Balboa Bay
Club would be made in the context of the City's General
Plan, site plan and environmental reviews. Key factors
in this review would be type, intensity and compatibility
of land use, and the availability of continued public
and/or private services. It is anticipated that any
future improvements at the Club would occur within the
existing boundaries of the Club site, and that any such
improvements would continue to enhance public visitors'
and tourists' physical, visual and recreational access to
Newport Bay and the coast.
Coastal Visual Resources and Special Communities: Pro-
ject scenic and visual qualities of the coastal re-
sources, and the "special character" of these areas.
Compliance: The Bay Club offers coastal vistas to all
site visitors utilizing the site for business and/or
vacation/recreational purposes. The relaxing ambience of
the historic club is supported by its seaside locale and
bay focus. The site's special character - combining
location, vistas and public hospitality - appeals to
business and recreational customers alike wishing to
visit Newport Beach for business reasons, while accessing
its pleasing natural resources.
Public Works: Construct and
ties to provide service to
with Coastal Act requirements.
10
expand public works facili-
only those uses conforming
LJ
Compliance: It is anticipated that construction or ex-
pansion of any public works facilities serving the Club
would be undertaken to support the Club's existing pro-
gram of public and member activities.
Related Policies
Public Access: Maintain and operate public beaches,
accessways and vista points; maximize public access con-
sistent with natural resource protection, public safety
and private property rights; provide lateral and vertical
coastal access in connection with new development (in
relation to shoreline, surrounding land uses, etc.), by
way of easements, provided fragile coastal resources are
protected and the potential for overusage is considered;
evaluate use intensity, fragile resources, proximity to
adjacent residential use; security of upland and adjacent
to water uses and need to collect litter, signage and
prescriptive rights.
Compliance: Public access opportunities are offered on
an ongoing basis as a major part of the Club's function.
Access provisions required for new development would be
observed at the time of potential future improvements in
Club facilities.
Public Pro ert Leaseholds: According to the LCP Land
Use Plan pp. 9-10 , within the City of Newport Beach,
there are many publicly held lands. Some of these par-
cels are held in fee by the City and some are held by
the City as a tidelands trust. over the years most of
these areas have been leased and uses established on the
properties. While it is not reasonable to expect
long-established uses to be eliminated, the following
leasehold policies are established to guide the leasing
and re-leasing of public properties:
1. In the leasing or re-leasing of publicly owned land,
full consideration shall be given to the public's
right of access to the ocean, beach, and bay and to
the provision of coastal -dependent uses adjacent to
the water.
2. At the time the leases are negotiated or renewed,
careful consideration shall be given to the consis-
tency of the proposed use with the public interest.
If a positive determination is made, the property
shall be leased at fair market value, unless it is
clearly in the public interest to do otherwise.
3. All new leases and lease renewals of publicly owned
land shall be considered by the City Council at a
public hearing.
11
n
L
' 4. When tidelands leases are renegotiated, they shall be
at full market value and the monies shall be segre-
gated in a separate fund and shall be used for main-
tenance and related visitor -generated services and
acquisition of coastal properties, to provide uses
consistent with the Coastal Act, such as small boat
launching facilities, acquisition of environmentally
sensitive habitat areas, and other uses which may be
consistent with the tidelands trust provisions.
S. Public access shall be required when the City issues
new leases of public land, or renews existing leases.
' This requirement shall be understood to apply to
beaches leased to the Lido Isle Association, as well
as to all other public leaseholds in the City's
Coastal Zone. Public access shall be required only
' where it would not jeopardize public health and
safety."
' forum that facilitates public access to Newport Bay. Its
public and member -oriented programs serve Newport Beach
and Orange County residents at large.
L
r
U
Circulation: LCP Circulation Plan generally reflects the
City Master Plan, featuring 6 major coastal access
routes, including Pacific Coast Highway; ride-shar-
ing/carpooling, extended bikeway system and public tran-
sit are encouraged.
Compliance; As Balboa Bay Club is located on West Coast
Highway, access to facilities is influenced by variations
in traffic and parking patterns on that route.
EnvironmentallASensitive Habitats and Unique Coastal
Resources: N
New Development/Privately-Financed Visitor -Serving Fa-
cilities (including restaurants, boat tour services,
hotel motel rooms, boat launching, amusement and recrea-
tion facilities, shops). Preserve, promote and provide
access to beaches, coastal shoreline, environmental pre-
serves, public recreational and entertainment facilities,
restrooms, etc.; marine sanitation facilities; bike racks
and guest boat slips; overnight and camping accommodatio-
ns (including lower cost commercial visitor -serving fa-
cilities); and public launching and marina facilities.
12
Compliance: As explained in the Introduction, the pur-
pose of this document is to present information to City
decision -makers
that will assist
them in evaluating the
existing Balboa
Bay Club land use and the related pro-
posal for a lease extension. As
noted in this compara-
tive discussion,
the Bay Club is
viewed as serving the
public interest
year-round, as a
business and community
' forum that facilitates public access to Newport Bay. Its
public and member -oriented programs serve Newport Beach
and Orange County residents at large.
L
r
U
Circulation: LCP Circulation Plan generally reflects the
City Master Plan, featuring 6 major coastal access
routes, including Pacific Coast Highway; ride-shar-
ing/carpooling, extended bikeway system and public tran-
sit are encouraged.
Compliance; As Balboa Bay Club is located on West Coast
Highway, access to facilities is influenced by variations
in traffic and parking patterns on that route.
EnvironmentallASensitive Habitats and Unique Coastal
Resources: N
New Development/Privately-Financed Visitor -Serving Fa-
cilities (including restaurants, boat tour services,
hotel motel rooms, boat launching, amusement and recrea-
tion facilities, shops). Preserve, promote and provide
access to beaches, coastal shoreline, environmental pre-
serves, public recreational and entertainment facilities,
restrooms, etc.; marine sanitation facilities; bike racks
and guest boat slips; overnight and camping accommodatio-
ns (including lower cost commercial visitor -serving fa-
cilities); and public launching and marina facilities.
12
I
11
F
I
J
New Development/Coastal-Dependent Uses: (including rec-
reational and commercial facilities; restaurants; uses
providing coastal views). Develop coastal -dependent
commercial and industrial developments as priority pro-
jects; encourage commercial fishing; encourage develop-
ment of ocean and waterfront areas outside Newport Bay to
distribute use; provide support (restroom, launching,
parking, education) facilities; protect public visual
access.
Compliance: The Bay Club provides commercial restaurant,
hotel and recreational facilities for the public, as well
as convention/ seminar rooms to promote educational pro-
grams by local business and civic organizations. These
uses are enhanced by their seaside location, and their
availability contributes to the City's appeal as a re-
gional recreation, industrial, commercial and financial
center, in a scenic setting.
. Land Use Designations
Residential (low and medium density); commercial (recrea-
tional and marine, administrative, professional and fi-
nancial); public, semi-public, institutional (government,
educational, recreation and open space); and industrial
land uses appear in the LCP Land Use Plan. Certain land
use areas are also called out, including the "Mariners
Mile" area encompassing the project site.
Compliance: The Balboa Bay Club provides a combination
of residential, commercial, public and semi-public fa-
cilities. within the Mariners Mile district, the Bay
Club site is designated for "Recreational and Marine
Commercial" uses on the LCP Land Use Plan. (Please see
report Appendix for a copy of LCF Land Use Plan Map #6
outlining the Balboa Bay Club site.)
Surrounding Land Use
The Balboa Bay Club site is located in the Newport Heights,
Cliffhaven and Mariners' Mile section of Newport Beach,
encompassing all land south of the northern City boundary
and 16th Street, from Newport Boulevard east to Dover Drive
and south to the Bay.
The Newport Heights and Cliffhaven residential neighborhoods
are raised above the Coast Highway corridor along Cliff
Drive, extending north -south on the inland side, from Old
13
Newport Boulevard to Dover Shores. Major concentrated land
uses in the immediate vicinity of the Bay Club are the
marine -oriented and mixed commercial uses in the neighboring
Mariners Mile Specific Area Plan area.
The Specific Area Plan document prepared for neighboring
Mariners Mile includes land uses designed to retain and
enhance the marine -oriented theme or character of the area,
protecting physical and visual access to Newport Bay. Uses
are contained in the Recreation and Marine Commercial (RMC)
and Retail and Service Commercial (RSC) districts. They
include activity -oriented commercial recreation and hotels;
personal, professional and office services; "incentive"
uses, i.e., boat supplies and maintenance services for ma-
rine and nautical needs; and related landscaping and parking
areas.
Other major land uses in the immediate vicinity of the Bay
Club include the Bayshore residential community (Tract 1140)
just south of the Club facilities, and the Boy Scouts of
America Sea Scout Base just north of the Club. According to
Club staff and activity records, there is a positive, on-
going cooperative relationship with these organizations. The
Club hosts the Boy Scout boat auction each year for charity,
and provides a side entrance at the south end of the Club
for Bayshore community resident members desiring access.
Across the street is another commercial use offering retail
services, office, community and accessory uses that contrib-
ute to the marine orientation of the area.
Land uses across Newport Bay from the Club include a combi-
nation of residential and marine -oriented commercial areas
on Balboa and Lido Peninsulas. Continuing commercial ma-
rine, recreation -oriented commercial and residential uses
14
are planned in this area as part of a future Planned Devel-
opment District. Adjacent to the Peninsula is the Lido
Island residential community.
2. Circulation and Access
Pacific Coast Highway
Access to the Balboa Bay Club complex for the public and
members is available strictly from the segment of West Coast
Highway (Route 1) located in Newport Beach between Dover
Drive and Newport Boulevard. This segment of Coast Highway
is a heavily -used, 4 -lane, modified Primary route accessing
marine retail and commercial uses that line the highway, as
well as surrounding residential neighborhoods. It is also
a key through route for vehicles travelling north and south
through Newport Beach to adjacent communities.
There is only one unsignalized access from Coast Highway
leading in and out of the Bay Club complex. Additional
"water access" is available to Club members who moor boats
at the Club marina along Newport Bay.
City of Newport Beach General Plan Circulation Element
The Circulation Element (1974 ed. currently being revised)
identifies circulation needs, patterns and problem areas
within and around all City land uses; proposes alternative
transportation plans based on existing needs, future demand,
public acceptance, and minimal environmental disturbance;
and recommends specific implementation projects, standards
and criteria for all City routes.
The Element proposes widening the Dover Drive - Newport
Boulevard segment of West Coast Highway (adjacent to the
Balboa Bay Club) to Major status, including 6 lanes (3 in
15
'
each direction);
a center median/turning lane; and a
right-
of-way width of
112'. The additional 12' of lane area
would
be obtained on the north side of Coast Highway. The
deci-
sion whether to
restrict parking to one side only would be
1 made at a future design stage.
A study and environmental impact report were prepared by the
City (City approval, 12/83; Caltrans approval, 9/84) to
evaluate the need and potential for improvements along Coast
Highway between MacArthur and Newport Boulevards, to imple-
ment the City's Master Plan. However, improvements were
authorized for the stretch from MacArthur to Bayside Drive
only. Because Coast Highway is a state route, the Califor-
nia Department of Transportation (Caltrans) has reviewed
City plans for potential Coast Highway improvements, and
concurred with those proposed in the Master Plan for the
Dover/Newport Boulevard segment. According to City staff,
the City is now engaged in an implementation study to deter-
mine how the next phase of Coast Highway improvements might
occur, based on Master Plan recommendations and additional
concepts being considered. It is anticipated that an envi-
ronmental impact report will be required to evaluate poten-
tial impacts of any additional improvements, including those
along the Dover/Newport segment.
irJ
J
1 3. Utilities and Services
' A brief review of site infrastructure and services indicates
the Balboa Bay Club is serviced by facilities owned or man-
aged by the following agencies within the City of Newport
Beach.
flu
Water Service
The City of Newport Beach owns and maintains a 24" water
main located 21' north of the Balboa Bay Club property line
within Coast Highway, and two, 6" water lines that parallel
the 24" main about 5' north of the property line. The two,
6" mains link to the 24" main, terminate at hydrants located
100' and 900' west of the Club entrance.
Water lines serving the project site are owned and main-
tained by the Club. They connect in two places to the 6"
lines in Coast Highway.
There are two meters, one outside the entrance along the
highway and one in the southeastern corner of the Bayshore
residential community site just south of the Club property.
Sewer Service
There is a network of sewer mains in the Club vicinity,
owned and maintained by the City of Newport Beach, the
County Sanitation Districts of the County of Orange and the
Club itself.
Specifically, the City owns and maintains an 8" sewer lo-
cated in the northwestern corner of the property, and con-
necting to another 8" City line located in the highway. The
Club itself owns and maintains sewer lines on-site that tie
into the City's system.
The County Sanitation Districts of the County of Orange
operates a system of 2 -foot wide trunk sewers in Coast High-
way and the Rocky Point pump station located in the north-
western corner of the project site. This pump station
serves District #5, encompassing the portion of Newport
Beach roughly bounded by the Back Bay (south) and 17th
17
Street in Costa Mesa (north). Sewage effluent is pumped
from this area to a Sanitation Districts treatment plant in
Huntington Beach.
Storm Drains
Major storm drains in the Club vicinity include an 18" storm
drain pipe stemming from the Kings Road area, paralleling
Cliff Drive at the edge of the bluff overlooking Coast High-
way. This City -owned pipe connects to a storm drain owned
by Caltrans in Coast Highway, reaching to the bay. The City
also owns 2, 18" pipes located in the sidewalk along Coast
Highway.
Other Services
The Club receives electricity service from Southern Califor-
nia Edison, which owns lines in the easement adjacent to and
immediately south of Coast Highway on the project site. Gas
service is provided by Southern California Gas Company.
The site is served by Pacific Telephone Company, and cable
t.v. is provided by Group W Cablevision.
Solid waste services are provided by Western Reclamation.
Fire and Police services are provided to the site by the
City, and the Club is located within the boundaries of the
Newport -Mesa Unified School District.
The continuing expense for utility facilities and services
is born by the Balboa Bay Club.
M
4. Fiscal Summary
Bay Club On-site Security and Maintenance
The Bay Club covers all costs for round-the-clock, on-site
security (except City police and fire, etc.) and maintenance
services for all business, recreation and apartment facili-
ties. Financing of any facilities and improvements on the
property is also the Club's responsibility.
Existing City Revenues
The Balboa Bay Club is currently a significant revenue
source for the City, bringing in an average of $563,000 in
revenues per year for the past 5 years. Major revenues
accrued by the City include the annual land rental fee;
uniform transient occupancy or "bed" tax; sales tax, prop-
erty tax and sewer fees. Table II, City of Newport Beach
Fiscal Benefits - Balboa Bay Club reviews City income from
the Club over the past 5 years.
In addition, the Bay Club employs 320 persons year-round in
club management, staff and service capacities (380 persons
in summer). Employees are largely Newport Beach and Orange
County residents who are local "consumers" benefiting the
local Newport Beach economy, in terms of goods and services.
Appraisal
At this time, the firm Real Estate Analysis of Newport, Inc.
is preparing an estimate of the fair market annual return to
the City of Newport Beach, for a 25 -year ground lease of the
existing Club site. The valuation will indicate the
separate, fair rental values for lease of the uplands and
19
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tidelands only, and will not consider the value of the ex-
isting Club buildings.*
The appraisal for the tidelands will be approved by the
State Lands Commission, and will reflect any restrictions
imposed by the California Coastal Commission.
*As noted earlier, the bulkhead line is assumed to represent
the mean high tide line for appraisal purposes, as no mean
high tide line has been adjudicated.
041
III. LAND USE ALTERNATIVES
PUBLIC PARK
A. FACILITIES DESCRIPTION
One of the two alternative preliminary design concepts for
the 14.85 -acre project site presents a public, multi -use
park use. It is anticipated that this park would resemble
Main Beach Park in Laguna Beach i.e. a multi -use park fea-
turing recreational, leisure and educational pastime facili-
ties and public accesses with a beach/bay focus. Distinctive
elements could include a beach, boardwalk, benches and/or
picnic and barbeque tables, grassy areas, basketball
court(s), volleyball area, a boat rental site, observation
point and public restrooms, showers, and food service fa-
cilities. Parking lots would also be provided. (See Exhibit
2, Preliminary Design Concept - Public Park.)
1 22
These facilities could be located adjacent to an enlarged
beach area adjacent to Newport Bay. A boat rental area will
also be located on-site. Parking areas would also be neces-
sary. All existing club facilities and structures, such as
hotel units, swimming pools, tennis courts, restaurant,
beach, be de-
marina, and the apartment building would
stroyed.
Development of a public park on the Bay Club site would
'
create a City of Newport Beach -owned and maintained activity
area available to the general public within use guidelines
'
dictated by the City. All facilities and site opportunities
would be designed and maintained by the City for the purpose
'
of preserving public visual and recreational access to the
short segment of Newport Bay frontage now occupied by the
Club, with a park concept. The City of Newport Beach cur-
'
1 22
rently offers extensive public beach area providing an
oceanfront coastal experience adjacent to residential areas.
An additional public park and beach on the Bay Club site
would supplement this existing acreage with limited
bay -oriented footage amidst a high intensity use commercial
area.
I
B. ENVIRONMENTAL IMPACT
1. Land Use
City General Plan
Any public park would provide a coastal -oriented recrea-
tional and open space use with appropriate street network,
parking and public amenities within the Area Plan. Land-
scaping, street lighting and architectural design features
(on park buildings) would also be considered in park layout
and design. A park land use would meet the General Plan
Land Use Element goal for providing "open space corridor and
buffers" within the City borders. The site would have to be
identified by the City, as a result of its inventory of City
needs and goals.
City Zoning
As noted in Section II., any Specific Area Plan for the
property would contain land use guidelines for recreational
establishments, parking lots, public buildings, etc., that
will also constitute site zoning. Therefore, a zone change
might be required to change the existing R-4 zone to the
land use represented in the "public park" alternative.
24
Local Coastal Program
Section II. of this document contains an introduction to the
Local Coastal Program and a detailed review and analysis of
each Coastal Zone policy, within the discussion of Bay Club
conformance to LCP public access guidelines. Therefore,
this section will provide a brief overview of how the park
alternative (located on a site designated for Recreational
and Marine Commercial use on the LCP) complies with public
access requirements called out in the LCP. For further
detail on each policy, please refer back to Section II.
Shoreline Access: The multi -use park alternative would
provide public access to open space, a boardwalk, picnic
and sport areas. Public amenities (restrooms, etc.) and
a parking lot are also included.
Recreation and Visitor- Serving Facilities: The park
would provide low-cost visitor and tourist -oriented fa-
cilities, all financed and maintained by the City of
Newport Beach.
Water and Marine Resources: The park would enhance pub-
lic visual and recreational access to coastal waters.
Di_�in+, Dredging, Filling and Shoreline Structures: Any
activities of this nature such as beach expansion would
be coordinated by the City as manager of the facility.
Commercial Fishing and Recreational Boating: A public
boat rental site would be provided with the park land
use.
Environmentally Sensitive Habitat Areas: N/A
Hazard Areas: The City -owned and maintained park would
be subject to any improvements in City building and fire
codes and zoning regulations, that would improve public
safety along the coast.
Locating and Planning New Development: The public park
alternative would be developed on the project site, the
area of the existing club use.
Coastal Visual Resources & Special Communities: Provi-
sion of a park would protect scenic and visual qualities
of the Newport Bay resource.
25
Public Works: It is anticipated that construction and
expansion of any public works facilities serving the
Park, would be undertaken to support park facilities that
conform to Coastal Zone requirements.
Related Policies
Public Access: The park use would maintain public visual
and recreational access to the coast. Public safety,
easement/access maintenance (signage and litter collec-
tion) would be overseen by the City of Newport Beach.
Circulation: As with the Bay Club, the park would be
located along Coast Highway, a heavily -traveled
coast -oriented route. As with all Coastal Zone uses,
ridesharing, carpooling, a bikeway system and public
transit would be encouraged to control traffic to and
from the park alternative.
Environmental) A Sensitive Habitats and Unique Coastal
Resources: N
New Development/Publicly-financed Visitor -Serving Facili-
ties: The park would represent tourist and visitor -ori-
ented land uses providing access to the coastal shoreline
and public recreational and related support facilities.
A small boat rental facility would also be available.
New Development/Coastal-Dependent Uses: As noted, devel-
opment of and any future improvements within the public
park would further public access to the coastline.
Land Use Designations: As noted in the discussion of the
Balboa Bay Club, the park project site would be located
in the "Recreational and Marine Commercial" use category
on the LCP Land Use Plan. The "recreational" label
allows the uses proposed in the park land use alterna-
tive.
2. Site Modification
It is anticipated that installing a public park will require
redesign and redevelopment of the site by the City, to pro-
vide public open space and recreation facilities. This will
necessitate destroying all of the existing Balboa Bay Club
buildings and facilities at City expense.
92
The City would undertake a large-scale grading, recontour-
ing, landscaping and improvement program, including poten-
tial importation of fill, to create a totally new look for
the property. It may be expected that this redevelopment
effort will entail an expansive parking lot area along with
recreational and open space uses.
3. Circulation and Access
It is anticipated that development of a public park use
would intensify traffic use along Coast Highway, the only
access to the property. Extensive parking area would also
be required on-site to supplement or replace on -street park-
ing along the highway. Special lane configurations, inter-
section design and/or signalization may be required to
regulate vehicles moving in and out of the park, to minimize
the impact upon existing highway traffic.
Development of a multi -use park would attract a large number
of vehicles to Coast Highway. on days when park use is most
intense (holidays, weekends, etc.), it is anticipated taht
traffic problems at the highway access point and moving
north and south of the entrance/exit would be exacerbated.
4. Utilities and Services
The public park use would demand a re-evaluation of the
existing infrastructure network and services program to
accommodate proposed public needs. All utilities and serv-
ices would be planned for and fully financed by the City of
Newport Beach. This may include additional hook-ups for
water and sewer (restrooms, showers, etc.), potential ad-
justments to the electricity system to feed outdoor park
lighting, realignment of storm drain and flood control fa-
cilities to serve large open space area, parking lot and
expanded beach developed at City expense. Solid waste
27
r
requirements would also be altered. Fire and police protec-
tion services would have to be available from the City on a
short response -time basis. It is expected that the public
park would also have full time security and maintenance
needs accommodated by the City.
5. Fiscal Factors
Currently, the Balboa Bay Club finances all 24-hour on-site
security (except City police and fire, etc.), and mainte-
nance services for the complex of business, recreation and
residentially -oriented facilities on the property, and all
facilities are maintained to a high level of quality for use
and access by the general public and Club members. The
public park plan would require that full time maintenance,
lifeguard and security and safety services be provided by
the City of Newport Beach, to assure continued quality of
the site experience. Park maintenance fees alone are esti-
mated at $5,000/acre, or about $74,250 for the site. Fi-
nancing of any new buildings, activity programs or related
public park improvements would also be the on-going respon-
sibility of the City.
Development of a public park would eliminate any further
revenues contributed annually by the Bay Club to the City,
including an average total of $563,000 received in yearly
rental fee, bed, sales and property taxes and sewer fees,
from the Bay Club. (Please see Section 11.,8,4).
As noted earlier, the Balboa Bay Club currently employs
320-380 persons living in Newport Beach and greater Orange
County. It is anticipated that a public park use would
employ maintenance and security personnel as well as poten-
tial recreational staff. However, the employee total is
expected to be signficantly less than that employed by the
existing Club.
WP
HOTEL
A. FACILITIES DESCRIPTION
The second alternative land use for the project site is a
tourist -oriented hotel on about half the site, containing
approximately 100-300 guestrooms. The hotel complex would
also provide interior restaurants and meeting, seminar and
convention rooms. Walkways and landscaped area would be
planned around the hotel, supplemented by tennis courts, a
pool, small beach, boat rental site, and boardwalk along the
water. (See Exhibit 3, Preliminary Design Concept - Hotel.)
Related retail/commercial uses within the hotel complex
would serve hotel patrons and other members of the public.
An enclosed parking structure and standard parking lot would
also support the hotel use.
West of the hotel on the project site would be a public
park, with adjacent open space and beach, parking lot and
public restrooms.
Development of a hotel on the Balboa Bay Club property would
replace the current Club -use with another private user/les-
see. The hotel use would provide many opportunities similar
to those now available at the Bay Club for public access for
social, business, recreation and employment purposes, on a
larger, less personal scale. Hotel facilities and related
commercial uses would serve patrons and the public as a
who ie .
An additional hotel would increase the existing number of
local tourist -oriented overnight accommodations in the City.
Many commercial, restaurant and other shopping opportunities
also exist now in the Mariners Mile area and neighboring
29
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PRELIMINARY DESIGN CONCEPT - PUBLIC PARK
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23
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PRELIMINARY DESIGN CONCEPT - HOTEL
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30
I
Balboa and Lido Peninsulas. Any commercial or retail uses
provided on this site as part of the hotel complex, would
therefore supplement these existing uses.
B. ENVIRONMENTAL IMPACT
1. Land Use
City General Plan
Any hotel use substituted for the Club facilities would be
developed as part of the ultimate area plan. It would
therefore provide a combination "commercial center adjacent
'
to village areas", within a "public and semi-public facil-
ity" such as that discussed in the General Plan.
As defined in the Mariners Mile Specific Area Pian, Retail
and Service Commercial (RSC) and Retail and Marine Commer-
cial (RMC) designations may be appropriate. The RSC use
allows retail, personal and professional services; hotels
and motels; and commercial recreation, with a limit on cor-
porate buildings in order to limit traffic volumes. RMC use
permits marinas, as well as boat retail, restaurant, hotel,
motel and related office uses. A street network, parking
areas, landscaping, street lighting and architectural design
features would also be considered in any alternative plan
proposed for a hotel complex.
City Zoning
As noted earlier, any plan prepared for the Balboa Bay Club
property would contain land use guidelines for hotel and
accessory facilities that would also be the equivalent of
31
site zoning. As a result, a zone change might be required
to alter the existing R-4 zone to the use indicated in the
new "hotel" alternative.
Local Coastal Program
As noted earlier, the site is designated for Recreational
and Marine Commercial use on the LCP.
This section reviews how the hotel alternative complies with
public access requirements outlined in the LCP Land Use
Plan. For further detail on each policy, please see the
Section II. discussion of the Balboa Bay Club use at the
front of this report.
Shoreline Access: The hotel alternative would provide
public recreational opportunities at all on-site facili-
ties.
Recreation and Visitor -Serving Facilities: It is antici-
pated that the hotel complex and related activity centers
would provide low-cost public services.
Water and Marine Resources: The hotel would preserve and
enhance public visual and recreational access to the
coastal resource, Newport Bay.
Diking, Dredging, Filling and Shoreline Structures: It
is expected that any activities of this nature in the
site vicinity, such as beach expansion, would be coordi-
nated by the City with the private hotel operator.
Commercial Fishing and Recreational Boating: A public
boat rental site would be provided wJt'-'F-i the hotel land
use.
. Environmentally Sensitive Habitat Areas: N/A
Hazard Areas: The hotel use would be subject to any
improvements in City building and fire codes and zoning
regulations that would improve public safety along the
Coast.
Locating and Planning New Development: The hotel alter-
native would occur on the site already occupied by the
existing Club.
32
LJ
I
II
I
I
I
Related Policies
Public Access: The hotel use would maintain public vis-
ual and recreational access to the Coast. Public safety,
easement and access maintenance (signage, litter collec-
tion) would be overseen by the private hotel operator.
Public Proper Leaseholds: Public right of coastal
access would be protected with the hotel use, and it is
anticipated that any hotel proposal would be evaluated by
City decision -makers in that context. (Please refer to
discussion in Section II.)
Circulation: The project site is located along Coast
Highway. As noted, ridesharing, carpooling, a bikeway
system and public transit would be encouraged to control
traffic to and from the hotel.
Environmental Sensitive Habitats and Unique Coastal Re-
sources: N/A
New Development/Privately-financed Victor-servinq Facili-
ties: The hotel and related land uses would preserve and
provide access to beach and shoreline areas, public rec-
reational and entertainment facilities in the attendant
activity areas and restaurants, and support facilities
(restrooms, etc.); a boat rental site; and a large number
of guest accommodations in the hotel structure itself.
New Development/Coastal-Dependent Uses: As indicated,
development of any future improvements within the hotel
project site would further public visual and physical
access to commercial uses that are enhanced by their
coastline location. The business and social opportuniti-
es available would accentuate the City's appeal as a
coastal -oriented recreational and commercial center.
Land Use Designations: The project site is located in
the "Recreational and Marine Commercial" use category on
the LCP Land Use Plan. Public recreational facilities
would be provided on-site.
1 33
Coastal Visual Resources and Special Communities: Devel-
opment of a hotel use would protect access to scenic
and
visual qualities of
Newport Bay.
Public Works: It
is anticipated that construction
and
expansion of any
public works facilities serving
the
hotel use would be
undertaken to support the hotel
site
uses conforming to
Coastal Zoning guidelines.
I
II
I
I
I
Related Policies
Public Access: The hotel use would maintain public vis-
ual and recreational access to the Coast. Public safety,
easement and access maintenance (signage, litter collec-
tion) would be overseen by the private hotel operator.
Public Proper Leaseholds: Public right of coastal
access would be protected with the hotel use, and it is
anticipated that any hotel proposal would be evaluated by
City decision -makers in that context. (Please refer to
discussion in Section II.)
Circulation: The project site is located along Coast
Highway. As noted, ridesharing, carpooling, a bikeway
system and public transit would be encouraged to control
traffic to and from the hotel.
Environmental Sensitive Habitats and Unique Coastal Re-
sources: N/A
New Development/Privately-financed Victor-servinq Facili-
ties: The hotel and related land uses would preserve and
provide access to beach and shoreline areas, public rec-
reational and entertainment facilities in the attendant
activity areas and restaurants, and support facilities
(restrooms, etc.); a boat rental site; and a large number
of guest accommodations in the hotel structure itself.
New Development/Coastal-Dependent Uses: As indicated,
development of any future improvements within the hotel
project site would further public visual and physical
access to commercial uses that are enhanced by their
coastline location. The business and social opportuniti-
es available would accentuate the City's appeal as a
coastal -oriented recreational and commercial center.
Land Use Designations: The project site is located in
the "Recreational and Marine Commercial" use category on
the LCP Land Use Plan. Public recreational facilities
would be provided on-site.
1 33
2. Site Modification
As with the public park alternative, constructing a hotel in
the Balboa Bay Club area would necessitate a entirely new
design and redevelopment of the property by the City of
Newport Beach, to provide the hotel complex, public park
area and parking area. It is anticipated that all existing
structures would be torn down at City expense, to make way
for a wide scale grading, construction and planting program.
3. Circulation and Access
Development of a hotel land use and related commercial may
be expected to increase traffic use on West Coast Highway,
the sole site access. An expansive parking lot would be an
important element of the hotel plan, supplementing or re-
placing on -street parking along the highway. As with the
public park use, special lane configurations, intersection
and/or signalization may be required to regulate vehicles
moving in and out of the hotel area to minimize highway
traffic.
As with the park, use of the hotel and commercial site would
draw many additional vehicles to Pacific Coast Highway,
intensifying traffic conditions at the access intersection
and moving north and south of the site.
4. Utilities and Services
As with the park alternative, the hotel use would entail
reconsideration of the existing infrastructure network and
services program to meet hotel needs. All utilities and
services would be developed and paid for by the hotel, in
conjunction with the City. This may include realigned wa-
ter, sewer, electricity and gas lines to accommodate dif-
34
I
ferent use concentrations and lighting plans; adjustments to
the storm drain network in view of the expanded open space
and parking areas and potentially enlarged beach.
Solid waste requirements would change, and fire and police
protection services would be permanently on-call. The fa-
cilities would demand 24-hour security and maintenance serv-
ices from the City to guarantee public safety.
5. Fiscal Factors
The Balboa Bay Club now assumes all fees and costs related
to round-the-clock on-site security (except City police and
fire, etc.), and maintenance services for all business,
recreation and apartment facilities. The hotel operator
would be obliged to cover similar fulltime maintenance and
on-site security needs for the hotel site. Financing of any
facilities and improvements related to the property would
also be handled by the private operator. It is expected
that all financial obligations for the public park half of
the property would be borne by the City, including develop-
ment, maintenance, lifeguard and/or security costs. As
noted earlier, park maintenance fees in the City are esti-
mated as $5,000/acre.
Development of a hotel complex would continue the flow of
revenues to the City from the new lessee, including rental
fee, bed, sales and property taxes and sewer fees. Notably,
the increased number of occupants or "beds" in the hotel
would determine any annual bed tax revenues to the City.
Estimated projections of City revenue are included in Table
III, City of Newport Beach Projected Fiscal Benefits - First
Year - Hotel Alternative.
35
TABLE III
CITY OF NEWPORT BEACH
PROJECTED FISCAL BENEFITS FIRST YEAR - HOTEL ALTERNATIVE
Uniform Initial
Transient 1 -Time Only
Fiscal Rental Occupancy Tax Sales Property Sewer Processing Total
Year (FY) Fee (Bed Tax) Tax Tax Fees Fees (First Year)
(First FY) $344,023 $521,395 $49,500 $24,965 $ 1,680 $10,310 $ 951,873
Assumptions:
Hotel Profile: 200 rooms, $124/night, 72% occupancy, restaurant and meeting room functions
with complex. (,Note: A concept of this size is expected to conform to City's 26' height
limitation.)
Rental fee/compensation: It is anticipated that a hotel use leasing land from the City would
have a similar lease to the Bay Club. The Club lease is based on the City payment equaling 5%
of gross operating revenues of first $750,000; 48 of gross between $750,000-1,000,000; 3% of
gross upwards of $1,000,000, plus mutually agreed-upon percentage for all subrentals. Gross
operating revenue is estimated at $6,517,440 from room revenue alone within the 200 -roam hotel,
rn plus $4,950,000 from restaurant, bar and catering income (total $11,467,440).
Uniform Transient Occupancy Tax (Bed Tax): 8% of annual room revenue ($6,517,440) total only is
due City.
Sales Tax: 1% of total sales, or 1 cent in every 6 cents paid to State is returned to City
(based on restaurant, bar and catering facilities rental income, totaling $4,950,000.)
Property Tax: 10% of tax paid to County is returned to City. Average tax paid by three other
hotels in City is $24,965/year.
Sewer Fees: Fee is paid annually for hook-up to City System, based on number of hook-ups and
70 cents/month/dwelling unit (with 200 units).
one-time fees include business license fees @ $5/roam ($1000); building permit engineering and
inspection fees ($4,730); plan check fees ($3,080); energy fees (for undergrounding utilities)
($1,050); planning and zoning fees ($450) for a total of $10,310.
Information obtained from City of Newport Beach Finance Department; telephone survey; "Trends in
Hotel Industry" Hotel Use Summary - Orange County.
It is expected that the proposed hotel and related commer-
cial uses would generate a significant number of jobs for
Newport Beach and Orange County residents in Management
Security, domestic services, restaurant, retail and related
fields. As noted earlier, 320-380 positions in similar
fields are currently in place to operate the Balboa Bay
Club.
37
IV. DOCUMENTS AND PERSONS CONSULTED
A. DOCUMENTS
City of Newport Beach General Plan Land Use Element (5/73
am. 10/83); Circulation Element (3/74; being revised 8/85);
Recreation and Open Space Element Plan (2/85) and Technical
Supplement (10/84)
City of Newport Beach Mariners Mile Specific Plan Draft
E.I.R., prepared by Owen Menard and Associates (9/76)
City of Newport Beach Zoning Code (3/76)
Local Coastal Program Development Policies and Land Use
Plan, City of Newport Beach, California Coastal Commission
(5/82)
Trends in the Hotel Industry Hotel use Summary - Orange
County (12/84)
B. PERSONS
1. City of Newport Beach
City Manager, Robert Wynn
Planning Department
Jim Hewicker, Director
Sandy Genis
Craig Bluell
Joanne MacQuarrie
92
Engineering Department
Ben Nolan
Bob Dixon
Paul Malcomas
Merle Milne
Finance Department
John Burkhart
Parks Department
Ron Whitley
I
2. County Sanitation Districts of County of Orange
'
Tom Dawes
3. Balboa Bax Club
General Manager, Thomas Deemer
Jan Holden
Bob Basmajian
i
1
39
I
1
1
1
1
1
1
1
1
r -
I
1
I
1
1
1
1 Appendix
1
..8. r . r r r r m r r r ' ••
LOW DENSITY RESIDENTIAL
LOM DENSITY RES./OPEN SPACE
TWO-FAMILY RESIDENTIAL
E0000 ---__MEDIUM-OENSITY RESIDENTIAL
0o MULTI•FAMILT RESIDENTIAL
b00
LCP LAND USE PLAN
RECREATIONAL B MARINE COMMERCIAL 011011011110 WALKWAY/BIKEWAY/ACCESSMAY
RETAIL B SERVICE COMMERCIAL '1"' ACCESS POINT
ADMIN.. PROF. AND FINAN. COMMERCIAL
i RESTROOM FACILITY
RECREATIONAL B ERVIR. OPEN SPACE COASTAL ZONE BOUNDARY
GOVERN., £DUCAT. AND INSTIT. FACILITIES
C
4
LLLL
00
l
LLL LL L L 00 O
LLL` lLLLL*
L
LL
\
L l L ryy
L L ` LLL Y `
L l b bbb
Yr]•
`Y�
/,�
LOW DENSITY RESIDENTIAL
LOM DENSITY RES./OPEN SPACE
TWO-FAMILY RESIDENTIAL
E0000 ---__MEDIUM-OENSITY RESIDENTIAL
0o MULTI•FAMILT RESIDENTIAL
b00
LCP LAND USE PLAN
RECREATIONAL B MARINE COMMERCIAL 011011011110 WALKWAY/BIKEWAY/ACCESSMAY
RETAIL B SERVICE COMMERCIAL '1"' ACCESS POINT
ADMIN.. PROF. AND FINAN. COMMERCIAL
i RESTROOM FACILITY
RECREATIONAL B ERVIR. OPEN SPACE COASTAL ZONE BOUNDARY
GOVERN., £DUCAT. AND INSTIT. FACILITIES
C