Image by Ian Britton.
With one notable exception**, new, high tech, high growth companies aren’t looking to locate themselves in The Canyon. Most of the building stock in The Canyon is old and starting to get dilapidated. It’s missing most of the infrastructure that can be found in newer buildings, especially the IT networks that any modern company needs to be competitive. These older buildings aren’t as energy efficient as newer buildings, and often times they can’t handle the power load that newer companies require for their operations. Finally, these older buildings are simply ugly, most companies that are focused on the future (i.e. tech companies) want to be located in buildings that are new and fresh, not stale relics from a bygone era.
Unfortunately, developers are not interested in redeveloping The Canyon, it simply does not make financial sense to do so. It is easier and cheaper to build new office and industrial buildings on virgin land, where there isn’t the added cost of demolition of the existing buildings. Companies can locate their offices in Irvine and other south county cities and still pull from the same pool of job candidates as they would be able to in Anaheim.
The City of Anaheim needs to find a way to encourage developers to demo existing buildings within The Canyon and rebuild newer, more modern buildings. The only way to do this is to make The Canyon as valuable place to build as the Irvine Business Complex. The City of Anaheim needs to find a way to offset the demolition costs so developers build new buildings in The Canyon.
One way the city could help offset the demolition costs is by waiving building plan check and permitting fees for any property owner who pulls a demolition permit for their entire property and whose new building can be developed by right, meaning that they don’t require any General Plan Amendments, Zone Changes or Variances to build their proposed building. Putting this policy in place would ensure that more new development would happen within The Canyon and that the new development would fit in with the planning department’s vision for The Canyon.
Many people would say that this is nothing more than a handout to the developers, or that the city can ill afford to be giving away potential revenue when the budget is so tight. However, without these incentives, little new development will take place in The Canyon. This policy would be an investment in Anaheim’s future, ensuring higher property values (and more tax revenue) in The Canyon, and providing new jobs for Anaheim area residents, which will have the secondary affect of raising home prices and additional tax revenue.
The City of Anaheim has been doing a lot of good work to encourage businesses to locate within The Canyon. However, the city needs to fully realize the competition it has for those businesses and understand why they are not moving to Anaheim. The only way to get companies in new and growing industries to locate in The Canyon is if new development comes to the area and that will only happen if the developers can make as much money building in Anaheim as they can in Irvine and south county. Waiving building plan check and permitting fees is one good investment that would level the playing field between Anaheim and its competing cities.
* There will be a community workshop to discuss the specific plan and get ideas and feedback from the community. It will be held on February 15th from 4 to 6 p.m at the new Kaiser Permanente medical campus located at 3450 E. La Palma Aveune.
** The City of Anaheim was able to convince Fisker Automotive, a manufacturer of high end electric sports cars, to locate their headquarters in The Canyon. Unfortunately, it seems as if Fisker’s main reason for locating in Anaheim is that the real estate is relatively cheap, at least compared to much of Irvine and south county. Fisker is currently in a cash crunch, even having to .
Anaheim is on a precipitous path to ruin. Over the past decade, and accelerating over the past two year, Anaheim has relinquished much of its power to regulate what goes on in the city. The city has given developers and businesses free reign within its borders with the misguided belief that it will spur economic development and create jobs.
In reviewing the votes of the Anaheim Planning Commission over the past several years, you’ll start to wonder why we have any zoning regulations at all. Every time a developer goes before the commission for a General Plan Amendment, Zone Change or Variance the planning commission will grant the change or waiver the developer is seeking. The General Plan and zoning regulations are important tools any city has to guide their future development. By allowing developers to change that guidance at their will, the City of Anaheim is indicating that it’s not interested in where it goes in the future.
By contrast, the most economically successful city in Orange County, Irvine, has an unbelievable set of rules that are enforced with vigor. This has been especially true since Irvine recruited a number of people from Santa Monica into their planning department a few years ago. Irvine’s success has attracted many large and successful companies that pay top wages, especially in technology. Not everyone wants to live in a hyper-planned community like Irvine, but it is where people want to work and companies want to locate.
The path that Anaheim has set itself on ensures that many businesses will want to locate within the city. Unfortunately, they’re the wrong type of businesses. Anaheim is currently attracting businesses that have very low margins and are looking for any advantage they can find to improve their bottom line. They are willing to give up on nice buildings and smooth roads because they simply don’t have the money to afford to locate in a nicer area. Unfortunately, these are the same businesses that tend to have lower wages.
The City of Anaheim shouldn’t discourage any type of business to establish itself within the city. However, it should try to specifically attract companies that will offer high wage jobs even if that means some of the lower wage paying companies don’t end up locating within the city. Anaheim could attract companies like Blizzard Entertainment or Linksys into its business corridor, as Irvine has done, if it enforced planning guidelines and invested in beautifying and enhancing the roads and right-of-ways.
Anaheim is currently in a race to the bottom, but we seem to be racing against ourselves. We need to stop relying upon a doctrine that says less regulation creates economic growth and realize that one of our neighbors is eating our lunch by having more regulation than any other city in the county. The only way to attract good paying jobs into Anaheim is by creating a place companies want to call home. The only way to do that is by creating and enforcing rules ensure Anaheim is a desirable place to do business, that it looks nice, has low crime and a quality transportation network.
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