HomeMy WebLinkAbout16 - Approving the MacArthur Court Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)Q �EwPpRT
CITY OF
s NEWPORT BEACH
`q44:09 City Council Staff Report
November 18, 2025
Agenda Item No. 16
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Jaime Murillo, Acting Community Development Director - 949-644-
3209, jmurillo@newportbeachca.gov
PREPARED BY: Liz Westmoreland, Principal Planner - 949-644-3234,
Iwestmoreland@newportbeachca.gov
TITLE: Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the
MacArthur Court Development Agreement and Affordable Housing
Implementation Plan (PA2025-0090)
ABSTRACT:
The Irvine Company (Applicant) is requesting approval of a Development Agreement (DA)
and Affordable Housing Implementation Plan (AHIP) for the future development of the
MacArthur Court Campus, a mixed -use campus consisting of two five -story residential
buildings containing 700 residential units (MacArthur Court Apartments), and a 10,000-
square-foot retail building. No specific design for the project is included in this application.
The project would require a future Site Development Review and other entitlements by
the Planning Commission prior to building permit issuance.
For the City Council's consideration is the introduction of an ordinance approving a DA
for the project and adoption of a resolution to approve an AHIP for the purpose of
allocating and vesting development rights for 700 residential units.
RECOMMENDATIONS:
a) Conduct a public hearing;
b) Find this project is not subject to further environmental review pursuant to Section
21083.3 of the California Public Resources Code (PRC) and Section 15183 of the
CEQA Guidelines because the project is consistent with the previously certified
Program Environmental Impact Report (SCH No. 2023060699);
c) Introduce Ordinance No. 2025-36, An Ordinance of the City Council of the City of
Newport Beach, California, Approving a Development Agreement for the
MacArthur Court Project located at 4665, 4675, 4680, 4685 and 4695 MacArthur
Court, and 4770 Campus Drive (PA2025-0090), and pass to second reading on
December 9, 2025; and
d) Adopt Resolution No. 2025-80, A Resolution of the City Council of the City of
Newport Beach, California, Approving an Affordable Housing Implementation Plan
for the MacArthur Court Project Located at 4665, 4675, 4680, 4685 and 4695
MacArthur Court, and 4770 Campus Drive (PA2025-0090).
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 2
DISCUSSION:
Project Setting
The 18.7-acre project site of the existing MacArthur Court Campus consists of five parcels
located at 4665, 4675, 4680, 4685 and 4695 MacArthur Court, and 4770 Campus Drive
in the Airport Area as shown in Figure 1 below. The project site abuts Campus Drive and
the City of Irvine to the north, MacArthur Boulevard to the west, and Birch Street to the
south. The property is currently developed with various professional business offices and
a five -story parking structure as shown in Figure 1 below.
Figure 1: Five parcels that make up the MacArthur Court project site.
Background
Housing Opportunity (HO) Overlay Zoning District
On September 24, 2024, the City Council adopted Ordinance Nos. 2024-16 and 2024-17,
approving amendments to Title 20 (Planning and Zoning) of the Newport Beach Municipal
Code (NBMC) to establish the Housing Opportunity (HO) Overlay Zoning Districts in Section
20.28.050 (Housing Opportunity (HO) Overlay Zoning Districts) (Housing Overlay) of the
NBMC and to create multi -unit objective design standards in Section 20.48.185 (Multi -Unit
Objective Design Standards) of the NBMC. The new sections serve to implement Policy
Actions 1A through 1G and 3A in the 6t" Cycle Housing Element of the General Plan.
Properties identified as a Housing Opportunity Site have specified development
allowances conducive to residential development at the prescribed average density of 20
to 50 dwelling units per acre. The standards include but are not limited to minimum lot
area, setbacks, height, open space, landscaping, and parking. The multi -unit objective
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 3
design standards are applicable to any residential project with a minimum density of 20
dwelling units per acre to ensure the highest possible design quality and provide a
baseline standard for new multi -unit developments throughout the City.
Section 20.28.050 (Housing Opportunity (HO) Overlay Zoning Districts) of the NBMC
allows for new housing opportunities within five subareas to ensure the City can
accommodate its 6th Cycle RHNA allocation. These subareas correspond to the Focus
Areas identified in the Housing Element and are as follows:
• Airport Area Environs Area (HO-1)
• West Newport Mesa Area (HO-2)
• Dover-Westcliff Area (HO-3)
• Newport Center Area (HO-4)
• Coyote Canyon Area (HO-5)
Properties identified within these subareas are eligible for specified development
allowances conducive to residential development at the prescribed average density of 20
to 50 dwelling units per acre. The standards include but are not limited to minimum lot
area, setbacks, height, open space, landscaping and parking. Each of the five subareas
is also subject to a development limit that identifies the maximum number of dwelling units
allowed.
The property is categorized as General Commercial Office (CO-G) by the General Plan
and located within the Koll Center Planned Community (PC-15) Zoning District. The
property, including 4665 and 4685 MacArthur Court, and many other properties in the PC-
15 Zoning District, are located within the HO-1 Subarea'. The development limit for the
HO-1 Subarea is 2,577 units and the required average density range is 20 to 50 dwelling
units per acre. Figure 3 below depicts properties identified as housing sites within the HO-
1 Subarea and eligible for the development of housing pursuant to the Housing Overlay
of the NBMC.
On June 6, 2025, a Director's Determination (PA2025-0117) was issued determining that the entire block
bound by MacArthur Boulevard to the west, Campus Drive to the north, Von Karman Avenue to the east,
and Birch Street to the south is within the HO-1 Subarea.
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 4
Legend
Subject Property
Housing Opportunly Sites Overlay (Coastal Zane)
Housing Opportunity Sites Overlay
111151 Coastal Zone Boundary r
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Figure 2: HO-1 (Airport Area Environs Area) Subarea map
Project Description
The Applicant is requesting a development agreement and an AHIP to vest rights to
develop a mixed -use campus at MacArthur Court. The future development of the
MacArthur Court Campus includes the demolition of approximately 126,837 square feet
of existing office buildings on 4665 and 4685 MacArthur Court and 4770 Campus Drive.
The project includes the future construction of two five -story residential buildings
consisting of 700 rental dwelling units and a 10,000-square-foot non-residential building.
The project would retain the two existing high-rise office towers and an existing 2,412-
space parking garage. The two new residential buildings (the MacArthur Court
Apartments) will be constructed on a single parcel that comprises a portion of 4665 and
4685 MacArthur Court and a portion of 4680 MacArthur Court as shown in the conceptual
site plan below (Figure 3).
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 5
Figure 3: Conceptual Site Plan
No specific design for the project is included in this application, and no construction is
proposed as part of this application. Buildout of the project would require future entitlements,
including a Site Development Review by the Planning Commission prior to building permit
issuance.
Once complete, the proposed MacArthur Court Campus will include two new wrap
residential buildings, a new non-residential building, two existing office high rise towers,
and an existing stand-alone parking garage that supports the high-rise office buildings.
A DA and an AHIP are requested for the purpose of allocating and vesting development
rights for 700 of the 2,577-unit HO-1 Subarea development limit.
Development Agreement
Pursuant to Section 15.45.020(A)(2)(a)(Development Agreement Required) of the
NBMC, a DA is not required because the project does not include a legislative act
(General Plan Amendment, Zoning Code Amendment) nor does the City's 6t" Cycle
General Plan Housing Element require applicants to enter into DAs to develop housing
units located on Housing Opportunity Sites. Nonetheless, the Applicant is requesting a
voluntary DA to vest rights to develop the project including 700 residential dwelling units
for a term of 10 years. In exchange for vesting development rights, the project will be
required to pay public benefit fees as part of the DA. The Applicant would also voluntarily
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 6
commit to developing affordable housing units in the City in furtherance of the certified
Housing Element, including up to 49 new affordable units.
The DA provides assurance that the applicant may proceed with the proposed project in
accordance with existing policies, rules and regulations, and conditions of approval.
Additionally, the agreement provides the Applicant increased development certainty and
project feasibility, while encouraging a commitment to private participation in
comprehensive planning.
In exchange for vesting development rights, the applicant will be required to provide
various public benefits including:
• MacArthur Boulevard Revitalization Fee: Payment of a MacArthur Boulevard
Revitalization fee of $3.25 million to help fund future City planned improvements
to MacArthur Boulevard to be paid at the issuance of the first building permit for
all or any portion of the 700 residential units. The City's planned improvements for
MacArthur Boulevard include, but are not limited to, new bike lanes, improvements
to intersections to enhance bicycle and pedestrian safety, median and landscape
improvements, and City entry signage;
• Provision of Increased Open Space: In -lieu of dedicating 0.5-acres of land to the
City for a neighborhood park in accordance with Land Use Policy LU 6.15.13
(Standards) of the General Plan, the applicant has committed to dedicating a
public easement for a larger 1.0-acre publicly accessible, but privately owned and
maintained, area of open space within the Property. The easement would be
recorded prior to issuance of the final certificate of occupancy for the 700
residential units;
• Development Impact Fee (DIF): Payment of DIFs (Fire, Police, Recreation,
Sewer)2 to be paid at the issuance of the respective building permit for any of the
700 residential units;
• Affordable Housing Implementation Plan: Construction of up to 49 dwelling units
affordable to lower income households (see AH/P below); and
• Public Benefit Fee: A public benefit fee of $17,000 per residential unit (subject to
annual CPI Adjustments), paid prior to issuance of building permits for any of the
700 units that are issued a building permit on or after July 1, 2028. As an incentive
to encourage development of the project within the current 6t" Cycle Housing
Period, the public benefit fee will not be assessed to the development of any units
that are issued a building permit before July 1, 2028.
2 The project is located within the Irvine Ranch Water District and therefore not subject to the City's Water
System DIF.
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 7
Affordable Housing Implementation Plan (AHIP)
Although it is not required to implement the project, as a voluntary public benefit, the
Applicant has prepared a draft AHIP, dated May 2025 (Exhibit B of Attachment B) to
illustrate their commitment to the development of affordable housing in the community.
The project proposes constructing 700 new market rate residential units on the MacArthur
Court Campus. The Applicant also proposes building affordable housing units at an off -
site location equivalent to 7% of the new market rate residential units constructed, which
would equate to 49 new affordable units (i.e., 7% of 700 market rate units). The units
would be allocated for very low- or low-income households and would be built on a single
site, which may be located outside of the Airport Area. No density bonuses are requested
as part of the AHIP. The first building permit for construction of the affordable housing
units shall be issued by January 31, 2029.
In the event that the affordable units cannot be constructed within the specified timeline,
suitable land will be dedicated to the City for the purpose of developing affordable housing
in the future. If the affordable dwelling units are not built, and land is not dedicated, then
the Applicant shall be responsible for paying an affordable housing in -lieu fee of $36,690
per market rate unit constructed.
General Plan Consistency
Pursuant to General Plan Policy LU 4.5 (Residential Uses and Residential Densities),
residential use of any property included within an established housing opportunity overlay
zoning district is allowed regardless of the underlying land use category or density limit
established through General Plan Policy LU 4.1 (Land Use Diagram), Table LU1 (Land
Use Plan Categories) and Table LU2 (Anomaly Locations). A general plan amendment is
not required to develop residential uses within an established housing opportunity zoning
overlay district.
As discussed above, the project is consistent with Land Use Policy 6.15.13 (Standards)
of the General Plan Land Use Element which aims to provide neighborhood parks for the
entire neighborhood and to serve the daily recreational and commercial needs of the
community within easy walking distance of homes, by requiring dedication and
improvement of up to 0.5-acres as a neighborhood park. In -lieu of dedicating 0.5-acres
of land to the City, the Applicant will dedicate an easement for 1.0 acres of Publicly
Accessible Open Space (PAOS), significantly exceeding the approximately 0.5-acre
requirement (3% of net site area) of Section 20.48.185(0) (Multi -Unit Objective Design
Standards) of the NBMC. The PAOS is intended to be configured as a passive paseo and
active plaza that provides walking and biking connections through the project site, and a
central gathering area that serves as an amenity for residents of the project as well as
neighborhood residents, employees, and visitors.
Water Supply Assessment
Pursuant to California Senate Bill 610 (SB 610) adopted in 2011, Section 21151.1 of the
Public Resources Code, and Section 10910 et. seq. of the Water Code, a Water Supply
Assessment (WSA) is required for projects that result in construction of at least 500
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
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dwelling units. Since the project includes the future construction of up to 700 units on the
Property, and the City's Housing Implementation Program EIR contemplated that future
housing projects would prepare their own project specific WSAs, it was appropriate for
the Applicant to prepare a WSA for the project.
The Property is served by the Irvine Ranch Water District (IRWD). Therefore, the City is
not the Water Agency tasked with formally reviewing or accepting the WSA. The WSA
was approved by the Board of Directors of the IRWD on October 13, 2025. The
assessment determined that a sufficient water supply is available for the project and that
the total water supplies available to IRWD during normal, single -dry and multiple -dry
years within a 20-year projection will meet the projected water demand of the project in
addition to the demand of existing and other planned future uses, including, but not limited
to, agricultural and manufacturing uses.
Planning Commission Review and Recommendation
On October 23, 2025, the Planning Commission conducted a duly noticed public hearing
to consider the requested application. The Planning Commission discussed the merits of
the Project, the applicable public benefits, and public benefit fees. At the conclusion of
the public hearing, the Planning Commission voted five ayes and zero nays (with two
absent/recused), to adopt Resolution No. PC2025-023, recommending the City Council
approve the Project. The Planning Commission staff report, draft meeting minutes, and
resolution are included as Attachment Nos. C, D and E.
FISCAL IMPACT:
As the project is not increasing overall density and is consistent with the Zoning District
and General Plan, a fiscal impact analysis was not prepared. A fiscal impact analysis was
prepared by Keyser Marston Associates dated July 9, 2024, for the Housing Element
Implementation Program Amendments. The analysis concluded that residential projects
could have a net negative fiscal impact unless they continue to be developed at higher
price points. Additionally, fiscal impacts are often offset through payment of impact fees
and DAs. In this case, the applicant would provide various public benefit fees including
development impact fees to the City based on the specific terms contained in the DA.
ENVIRONMENTAL REVIEW:
Pursuant to the California Environmental Quality Act (CEQA) as set forth in California
Public Resources Code Section 21000 et seq. and its implementing guidelines set forth
in California Code of Regulations, Title 14, Division 6, Chapter 3 (CEQA Guidelines), the
City Council adopted Resolution No. 2024-50 on July 23, 2024, certifying Final Program
Environmental Impact Report SCH No. 2023060699 (PEIR), approving a Mitigation
Monitoring and Reporting Program (MMRP), and adopting Findings and a Statement of
Overriding Considerations related to the implementation of the Housing Element involving
amendments to the General Plan, Coastal Land Use Plan, and Title 20 (Planning and
Zoning) and Title 21 (Local Coastal Program Implementation Plan) of the NBMC which
are available at: Housina Implementation Proaram EIR.
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Ordinance No. 2025-36 and Resolution No. 2025-80 Approving the MacArthur Court
Development Agreement and Affordable Housing Implementation Plan (PA2025-0090)
November 18, 2025
Page 9
The Project is not subject to further environmental review pursuant to Section 21083.3 of
the California Public Resources Code (PRC) and Section 15183 of the CEQA Guidelines
because, inasmuch as the Properties involved are all within the HO-1 Subarea, the
Project does not change the underlying land use or zoning designations; and would not
result in new significant impacts or a substantial more adverse impact than addressed in
the PEIR. A detailed consistency analysis has been prepared by T&B Planning Inc., dated
October 2025, and peer reviewed by Kimley-Horn & Associates, Inc., is provided as
Exhibit "D" of Attachment A and hereby incorporated by reference.
NOTICING:
Notice of this hearing was published in the Daily Pilot, mailed to all owners of property
within 300 feet of the boundaries of the site (excluding intervening rights -of -way and
waterways), including the applicant and posted on the subject property at least 10 days
before the scheduled meeting, consistent with the provisions of the Municipal Code.
Additionally, the item appeared on the agenda for this meeting, which was posted at
City Hall and on the City website.
ATTACHMENTS:
Attachment A — Ordinance No. 2025-36
Attachment B — Resolution No. 2025-80
Attachment C — Planning Commission Staff Report (No Attachments)
Attachment D — Planning Commission Draft Meeting Minutes
Attachment E — Planning Commission Resolution No. PC2025-023 (No Exhibits)
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Attachment A
Ordinance No. 2025- 36
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ORDINANCE NO. 2025-36
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
NEWPORT BEACH, CALIFORNIA, APPROVING A
DEVELOPMENT AGREEMENT FOR THE MACARTHUR
COURT PROJECT LOCATED AT 4665, 4675, 4680, 4685
AND 4695 MACARTHUR COURT AND 4770 CAMPUS
DRIVE (PA2025-0090)
WHEREAS, Section 200 of the City Charter, of the City of Newport Beach ("City"),
vests the City Council with the authority to make and enforce all laws, rules and
regulations with respect to municipal affairs subject only to the restrictions and limitations
contained in the City Charter and the State Constitution, and the power to exercise, or act
pursuant to any and all rights, powers, and privileges or procedures granted or prescribed
by any law of the State of California;
WHEREAS, California Government Code Section 65580 et seq. ("State Housing
Element Law") requires each city and county adopt a housing element that identifies and
analyzes existing and projected housing needs within their jurisdiction and prepare goals,
policies, and programs, and quantified objectives to further the development, improvement,
and preservation of housing;
WHEREAS, an application was filed by The Irvine Company ("Applicant"),
concerning properties located at 4665, 4675, 4680, 4685 and 4695 MacArthur Court. and
4770 Campus Drive and legally described in Exhibit "A" ("Property"), which is attached
hereto and incorporated by reference, -
WHEREAS, the Applicant is requesting entitlements for the development of
MacArthur Court Campus, a mixed -use campus consisting of two, five -story residential
buildings containing 700 residential rental units ("MacArthur Court Apartments"), and a
10,000- square -foot nonresidential building ("Project");
WHEREAS, the Project would also retain the two existing high rise office towers
and an existing parking garage;
WHEREAS, the Applicant requests the following approvals to vest the
development rights for the Project:
• Development Agreement ("DA") - A development agreement between the
Applicant and the City, pursuant to Chapter 15.45 (Development Agreements) of
the Newport Beach Municipal Code ("NBMC"), which would provide the Applicant
with the vested right to develop the Project for a term of 10 years and to provide
negotiated public benefits to the City; and
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Ordinance No. 2025-
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• Affordable Housing Implementation Plan ("AHIP") - A preliminary plan specifying
how the Project would contribute affordable housing as a public benefit, by
providing affordable housing units equivalent to 7% of up to 700 market rate
residential units, or up to 49 affordable housing units;
WHEREAS, the Property is designated General Commercial Office (CO-G) by the
General Plan Land Use Element and is located within the Koll Center Planned Community
(PC-15) Zoning District - Office Site C;
WHEREAS, the Property is not located within the coastal zone;
WHEREAS, a public hearing was held by the Planning Commission on October
23, 2025, in the Council Chambers at 100 Civic Center Drive, Newport Beach. A notice of
the time, place, and purpose of the hearing was given in accordance with California
Government Code Section 54950 et seq. ("Ralph M. Brown Act") and Chapter 20.62
("Public Hearings") of the NBMC. Evidence, both written and oral, was presented to, and
considered by, the Planning Commission at this public hearing;
WHEREAS, at the hearing, the Planning Commission adopted Resolution No.
PC2025-023 by a unanimous vote (5 ayes, 2 absent) recommending the City Council
approve the Project; and
WHEREAS, a public hearing was held by the City Council on November 18, 2025,
in the Council Chambers at 100 Civic Center Drive, Newport Beach. A notice of the time,
place, and purpose of the hearing was given in accordance with the Ralph M. Brown Act,
Chapter 20.62 (Public Hearings) of the NBMC, and Section 15.45.050 (Public Hearing -
Notice) of the NBMC. Evidence, both written and oral, was presented to and considered
by the City Council at this hearing.
NOW THEREFORE, the City Council of the City of Newport Beach ordains as
follows:
Section 1: The City Council has considered the recommendation of the
Planning Commission and determined that modifications to the Project made by the City
Council, if any, are not major changes that require referral back to the Planning
Commission for consideration and recommendation.
Section 2: The City Council hereby approves the Development Agreement
which is attached hereto as Exhibit "B" and incorporated herein by reference.
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Ordinance No. 2025-
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Section 3: The City Council finds the Development Agreement is consistent with
provisions of California Government Code Sections 65864 et seq. and Chapter 15.45
(Development Agreements) of the NBMC that authorize binding agreements that: (i)
encourage investment in, and commitment to, comprehensive planning and public
facilities financing; (ii) strengthen the public planning process and encourage private
implementation of the local general plan; (iii) provide certainty in the approval of projects
to avoid waste of time and resources; and (iv) reduce the economic costs of development
by providing assurance to the property owners that they may proceed with projects
consistent with existing policies, rules, and regulations.
Additionally, the City Council finds the Development Agreement is entered into
pursuant to, and constitutes a present exercise of, the City's police power and is in the
best interest of the health, safety, and general welfare of the City, residents, and the
public.
Section 4: A v Development Agreement dated October 2025 was prepared for
the Project to vest the development rights for the Project over a period of 10 years. The
Development Agreement provides the content required in Section 15.45.040
(Development Agreement — Contents) of the NBMC as follows:
1. A development agreement is requested by the Applicant, as the Project would
include a total of 700 residential units. The development agreement includes
all the mandatory elements including a term of 10 years and public benefits that
are appropriate to support conveying the vested development rights consistent
with the City's General Plan, the NBMC, and Government Code Sections
65864 et seq.
2. Public benefits include the payment of a public benefit fee for each residential
unit. In addition to the public benefit fee, the Development Agreement includes
public benefits in the form of a recorded easement for one acre of open space,
a MacArthur Boulevard Revitalization Fee of $3.25 million (Three Million Two
Hundred Fifty Thousand) Dollars, payment of Development Impact Fees, and
an affordable housing obligation in the form of an AHIP to be adopted for the
development of affordable housing units.
Section 5: The recitals provided in this ordinance are true and correct and are
incorporated into the operative part of this resolution.
Section 6: If any section, subsection, sentence, clause or phrase of this
resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this resolution. The City
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Ordinance No. 2025-
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Council hereby declares that it would have passed this resolution, and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 7: Pursuant to the California Environmental Quality Act ("CEQA") as set
forth in California Public Resources Code Section 21000 et seq. and its implementing
guidelines set forth in California Code of Regulations, Title 14, Division 6, Chapter 3
("CEQA Guidelines"), the City Council adopted Resolution No. 2024-50 on July 23, 2024,
certifying Final Program Environmental Impact Report SCH No. 2023060699 ("PEIR"),
approving a Mitigation Monitoring and Reporting Program ("MMRP"), and adopting
Findings and a Statement of Overriding Considerations related to the implementation of
the Housing Element involving amendments to the General Plan, Coastal Land Use Plan,
and Title 20 (Planning and Zoning) and Title 21 (Local Coastal Program Implementation
Plan) of the NBMC which are available at: Housing Implementation Program EIR.
1. The Project is not subject to further environmental review pursuant to Section
21083.3 of the California Public Resources Code and Section 15183 of the
CEQA Guidelines because, inasmuch as the Properties involved are all within
the HO-1 Subarea, the Project does not change the underlying land use or
zoning designations; and would not result in new significant impacts or a
substantial more adverse impact than addressed in the PEIR. A detailed
consistency analysis has been prepared by T & B Planning Inc., dated
September 2025, and peer reviewed by Kimley-Horn & Associates, Inc., and is
attached hereto as Exhibit "C" and incorporated herein by reference.
2. Section 15183 of the CEQA Guidelines provides, in relevant part:
a. Projects which are consistent with the development density established by
existing zoning, community plan, or general plan policies for which an
environmental impact report ("EIR") was certified shall not require additional
environmental review, except as might be necessary to examine whether
there are project -specific significant effects which are peculiar to the project
or its site. This streamlines the review of such projects and reduces the
need to prepare repetitive environmental studies.
b. In approving a project meeting the requirements of this section, a public
agency shall limit its examination of environmental effects to those which
the agency determines, in an initial study or other analysis:
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Ordinance No. 2025-
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Are peculiar to the project or the parcel on which the project would
be located;
ii. Were not analyzed as significant effects in a prior EIR on the zoning
action, general plan, or community plan, with which the project is
consistent;
iii. Are potentially significant off -site impacts and cumulative impacts
which were not discussed in the prior EIR prepared for the general
plan, community plan or zoning action; or
iv. Are previously identified significant effects which, as a result of
substantial new information which was not known at the time the EIR
was certified, are determined to have a more severe adverse impact
than discussed in the prior EIR.
c. If an impact is not peculiar to the parcel or to the project, has been
addressed as a significant effect in the prior EIR, or can be substantially
mitigated by the imposition of uniformly applied development policies or
standards, as contemplated by subdivision (e) below, then an additional EIR
need not be prepared for the project solely on the basis of that impact.
d. This section shall limit the analysis of only those significant environmental
effects for which:
Each public agency with authority to mitigate any of the significant
effects on the environment identified in the EIR on the planning or
zoning action undertakes or requires others to undertake mitigation
measures specified in the EIR which the lead agency found to be
feasible, and
ii. The lead agency makes a finding at a public hearing as to whether
the feasible mitigation measures will be undertaken.
e. An effect of a project on the environment shall not be considered peculiar
to the project or the parcel for the purposes of this section if uniformly
applied development policies or standards have been previously adopted
by the city or county with a finding that the development policies or
standards will substantially mitigate that environmental effect when applied
to future projects, unless substantial new information shows that the policies
or standards will not substantially mitigate the environmental effect. The
finding shall be based on substantial evidence which need not include an
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Ordinance No. 2025-
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EIR. Such development policies or standards need not apply throughout the
entire city or county but can apply only within the zoning district in which the
project is located, or within the area subject to the community plan on which
the lead agency is relying. Moreover, such policies or standards need not
be part of the general plan or any community plan but can be found within
another pertinent planning document such as a zoning ordinance.
3. As part of its decision -making process, the City is required to review and
consider whether the Project would create new significant impacts or significant
impacts that would be substantially more severe than those disclosed in the
PEIR. Additional CEQA review is only triggered if the Project's new significant
impacts or impacts that are more severe than those disclosed in PEIR such
that major revisions to the PEIR would be required.
4. The PEIR contemplated those future projects meeting the thresholds of Senate
Bill No. 610 (SB 610) would require the preparation of a Water Supply
Assessment. The project area is within the Irvine Ranch Water District ("IRWD")
service area and the PEIR concluded that water demands from future housing
projects would result in a significant and unavoidable impact concerning water
supply. The City, therefore, adopted a Statement of Overriding Consideration
for this impact in connection with its certification of the PEIR.
5. The Project is consistent with the development density and use characteristics
established by the City's General Plan Housing Implementation Program as
analyzed by the PEIR, and the required determinations can be made, as
detailed in Exhibit "C" of this ordinance and incorporated by reference.
Section 8: The City Council finds that judicial challenges to the CEQA
determinations and approvals of land use projects are costly and time consuming. In
addition, project opponents often seek an award of attorneys' fees in such challenges. As
project applicants are the primary beneficiaries of such approvals, it is appropriate that
such applicants should bear the expense of defending against any such judicial
challenge, and bear the responsibility for any costs, attorneys' fees, and damages which
may be awarded to a successful challenger.
16-16
Ordinance No. 2025-
Page 7 of 7
Section 9: The Mayor shall sign and the City Clerk shall attest to the passage
of this ordinance. The City Clerk shall cause the ordinance, or a summary thereof, to be
published pursuant to City Charter Section 414. This ordinance shall be effective thirty
(30) calendar days after its adoption.
This ordinance was introduced at a regular meeting of the City Council of the City
of Newport Beach held on the 18th day of November, 2025, and adopted on the 9th day
of December, 2025, by the following vote, to -wit:
FWAY4001
NAYS:
ABSENT:
Joe Stapleton.. Mayor
ATTEST:
Lena Shumway, City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Aaron C. Harp, City Attorney
Attachments: Exhibit "A" — Legal Description
Exhibit "B" — Development Agreement
Exhibit "C" — CEQA Consistency Analysis prepared by T&B
Planning Inc. dated October 2025
16-17
Exhibit "A"
Legal Description
The Land referred to herein below is situated in the City of Newport Beach, County of
Orange, State of California, and is described as follows:
PARC'FI A -
PARCEL 1 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT BEACH,
COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL MAP
FILED IN BOOK 196, PAGE 40 THROUGH 43 OF PARCEL MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
PARCEL B:
PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF
CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED IN BOOK 68, PAGE 19 OF
PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
PAR('FI ('-
PARCELS 2, 3 AND 4 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT
BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL
MAP FILED IN BOOK 196, PAGES 40 THROUGH 43 OF PARCEL MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APNs:
445-121-14
(Affects Parcel A)
445-121-05
(Affects Parcel B)
445-121-15
(Affects Parcel 2 of Parcel C)
445-121-16
(Affects Parcel 3 of Parcel C)
445-121-17
(Affects Parcel 4 of Parcel C)
16-18
DEVELOPMENT AGREEMENT
16-19
November 12, 2025
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
City of Newport Beach
100 Civic Center Drive
Newport Beach, CA 92660
Attn: City Clerk
(Space Above This Line Is for Recorder's Use Only)
This Agreement is recorded at the request and for the
benefit of the City of Newport Beach and is exempt
from the payment of a recording fee pursuant to
Government Code §§ 6103 and 27383.
DEVELOPMENT AGREEMENT
between
CITY OF NEWPORT BEACH
and
THE IRVINE COMPANY LLC, a Delaware limited liability company
and
MACARTHUR COURT I LLC,
a Delaware limited liability company
CONCERNING
"MACARTHUR COURT"
16-20
TABLE OF CONTENTS
November 12, 2025
Page
1. Definitions............................................................................................................................2
2. General Provisions...............................................................................................................6
2.1 Plan Consistency, Zoning Implementation..............................................................6
2.2 Binding Effect of Agreement...................................................................................7
2.3 Property Owners' Representations and Warranties Regarding Ownership of
the Property and Related Matters Pertaining to this Agreement ..............................7
2.4 Term.........................................................................................................................7
3. Public Benefits.....................................................................................................................8
3.1
Public Benefit Fee....................................................................................................8
3.2
Other Public Benefits...............................................................................................8
3.3
Public Benefit Administration.................................................................................9
4. Development of Project.....................................................................................................10
4.1
Applicable Regulations; Property Owners' Vested Rights and City's
Reservation of Discretion With Respect to Subsequent Development
Approvals...............................................................................................................10
4.2
No Conflicting Enactments....................................................................................1
1
4.3
Reservations of Authority......................................................................................1
1
4.4
Tentative Subdivision Maps..................................................................................14
5. Amendment or Cancellation of Agreement.......................................................................14
6. Enforcement.......................................................................................................................14
7. Annual Review of Property Owners' Compliance With Agreement.................................14
7.1
General...................................................................................................................14
7.2
Property Owners' Obligation to Demonstrate Good Faith Compliance................14
7.3
Procedure...............................................................................................................14
7.4
Annual Review a Non -Exclusive Means for Determining and Requiring
Cure of Property Owners' Default.........................................................................15
8. Events of Default...............................................................................................................15
8.1 General Provisions.................................................................................................15
8.2 Default by Property Owner(s)................................................................................15
8.3 City's Option to Terminate Agreement.................................................................16
8.4 Default by City.......................................................................................................16
8.5 Waiver....................................................................................................................16
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November 12, 2025
8.6 Specific Performance Remedy...............................................................................16
8.7 Monetary Damages................................................................................................17
8.8 Additional City Remedy for Property Owners' Default........................................17
8.9 No Personal Liability of City Officials, Employees, or Agents ............................17
9. Force Majeure....................................................................................................................17
10. Indemnity Obligations of Property Owners.......................................................................18
10.1 Indemnity Arising From Acts or Omissions of Property Owner ...........................18
10.2 Third Party Litigation............................................................................................18
10.3 Environmental Liability .........................................................................................19
11. Assignment........................................................................................................................19
12. Mortgagee Rights...............................................................................................................20
12.1 Encumbrances on Property ....................................................................................20
12.2 Mortgagee Protection.............................................................................................20
12.3 Mortgagee Not Obligated......................................................................................21
12.4 Notice of Default to Mortgagee; Right of Mortgagee to Cure...............................21
13. Bankruptcy.........................................................................................................................21
14. Miscellaneous Terms.........................................................................................................21
14.1
Notices...................................................................................................................21
14.2
Project as Private Undertaking...............................................................................22
14.3
Cooperation............................................................................................................22
14.4
Estoppel Certificates..............................................................................................23
14.5
Rules of Construction............................................................................................23
14.6
Time Is of the Essence...........................................................................................23
14.7
Waiver....................................................................................................................23
14.8
Counterparts...........................................................................................................23
14.9
Entire Agreement...................................................................................................23
14.10
Severability ............................................................................................................24
14.11
Construction...........................................................................................................24
14.12
Successors and Assigns; Constructive Notice and Acceptance .............................24
14.13
No Third Party Beneficiaries.................................................................................25
14.14
Applicable Law and Venue....................................................................................25
14.15
Section Headings...................................................................................................25
14.16
Incorporation of Recitals and Exhibits..................................................................25
14.17
Recordation............................................................................................................25
ii
16-22
November 12, 2025
DEVELOPMENT AGREEMENT
(Pursuant to California Government Code sections 65864-65869.5)
This DEVELOPMENT AGREEMENT (the "Agreement") is dated as of the day of
, 2025, and is being entered into by and between the CITY OF NEWPORT
BEACH ("fily") and THE IRVINE COMPANY LLC, a Delaware limited liability company
("Prop Owner") and MACARTHUR COURT I LLC, a Delaware limited liability company
("Property Owner" and "Developer"). Property Owners are sometimes collectively referred to in
this Agreement together as "Property Owners". City and Property Owners are sometimes
collectively referred to in this Agreement as the "Parties" and individually as a "rq!1y."
RECITALS
A. The Irvine Company LLC is the owner of that certain real property located in the
City of Newport Beach, County of Orange, State of California commonly referred to as 4675, 4680
and 4695 MacArthur Boulevard (APN ## 445-121-15, -16 and -17) and MacArthur Court I LLC
is the owner of that certain real property located in the City of Newport Beach, County of Orange,
State of California commonly referred to as 4665 and 4685 MacArthur Boulevard and 4770
Campus Drive (APN ## 445-121-14 and 445-121-05), which together are bounded by Campus
Drive to the north, MacArthur Boulevard to the west, and Birch Street to the south (collectively
referred to herein as the "Pro "). The Property is more particularly described in the legal
description attached hereto as Exhibit A and is depicted on the site map attached hereto as
Exhibit B.
B. To encourage investment in, and commitment to, comprehensive planning and
public facilities financing, strengthen the public planning process and encourage private
implementation of the local general plan, provide certainty in the approval of projects in order to
avoid waste of time and resources, and reduce the economic costs of development by providing
assurance to property owners that they may proceed with projects consistent with existing land use
policies, rules, and regulations, the California Legislature adopted California Government Code
sections 65864-65869.5 (the "Development Agreement Statute") authorizing cities and counties
to enter into development agreements with persons or entities having a legal or equitable interest
in real property located within their jurisdiction.
C. On March 13, 2007, the City Council adopted Ordinance No. 2007-6, entitled
"Ordinance Amending Chapter 15.45 of City of Newport Beach Municipal Code Regarding
Development Agreements" (the "Development Agreement Ordinance"). This Agreement is
consistent with the Development Agreement Ordinance.
D. In consideration of City entering into this Agreement, Property Owners have agreed
to provide significant public benefits as detailed in this Agreement. City has determined that these
public benefits City constitute adequate consideration for City's entering into and performing its
obligations set forth in this Agreement.
E. The City Council adopted the General Plan 6th Cycle Housing Element ("Housing
Element") in September 2022 covering the planning period from 2021-2029. As required by state
16-23
November 12, 2025
law, the Housing Element was certified by the State Department of Housing and Community
Development ("HCD") in October 2022.
F. On July 23, 2024, the City Council adopted Resolution No. 2024-50 certifying the
Housing Element Implementation Program Amendments Final Program Environmental Impact
Report (State Clearinghouse No. 2023060699), approving a Mitigation Monitoring and Reporting
Program, and adopting Findings and a Statement of Overriding Considerations and related
approvals to implement the Housing Element including amendments to the General Plan, Coastal
Land Use Plan, and Title 20 (Planning and Zoning) and Title 21 (Local Coastal Program
Implementation Plan) of the Newport Beach Municipal Code and amending the General Plan Land
Use Element, Coastal Land Use Plan and Title 20 (Planning and Zoning) of the Newport Beach
Municipal Code.
G. On October 23, 2025, the City's Planning Commission held a public hearing on the
AHIP and this Agreement, made findings and determinations with respect to this Agreement, and
recommended to the City Council that the City Council approve this Agreement.
H. On November 18, 2025, the City Council also held a public hearing on this
Agreement and considered the Planning Commission's recommendations and the testimony and
information submitted by City staff, Property Owners or their representatives and members of the
public. On December 11, 2025, consistent with applicable provisions of the Development
Agreement Statute and Development Agreement Ordinance, the City Council adopted its
Ordinance No. 2025-36 (the "Adopting Ordinance"), finding this Agreement to be consistent with
the City of Newport Beach General Plan in approving this Agreement.
I. In recognition of the significant public benefits that this Agreement provides, the
City Council has found that this Agreement: (i) is consistent with the City of Newport Beach
General Plan; (ii) is in the best interests of the health, safety, and general welfare of City, its
residents, and the public; (iii) is entered into pursuant to, and constitutes a present exercise of, the
City's police power; (iv) is consistent with the provisions of the California Environmental Quality
Act ("CE A"); and (v) has been approved consistent with provisions of California Government
Code section 65867 and City of Newport Beach Municipal Code Chapter 15.45.
AGREEMENT
NOW, THEREFORE, City and Property Owners agree as follows:
Definitions.
In addition to any terms defined elsewhere in this Agreement, the following terms when
used in this Agreement shall have the meanings set forth below:
"Action" shall have the meaning ascribed in Section 8.10 of this Agreement.
"Adopting Ordinance" shall mean City Council Ordinance No. 2025-36 approving and
adopting this Agreement.
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16-24
November 12, 2025
"Agreement" shall mean this Development Agreement, as the same may be amended from
time to time.
"Agreement Date" shall mean the date first written above, which date is the date the City
Council adopted the Adopting Ordinance.
"AHIP" shall mean the Affordable Housing Implementation Plan attached hereto as
Exhibit C, as may be amended from time to time.
"CEOA" shall mean the California Environmental Quality Act (California Public
Resources Code sections 21000-21177) and the implementing regulations promulgated thereunder
by the Secretary for Resources (California Code of Regulations, Title 14, section 15000 et seq.),
as the same may be amended from time to time.
"Ci1y" shall mean the City of Newport Beach, a California charter city.
"City Council" shall mean the governing body of City.
"City's Affiliated Parties" shall have the meaning ascribed in Section 10.1 of this
Agreement.
"Claim" shall have the meaning ascribed in Section 10.1 of this Agreement.
"Consumer Price Index" or "CPI" shall mean the Consumer Price Index published from
time to time by the United States Department of Labor, Bureau of Labor Statistics for all urban
consumers (all items) for the Los Angeles -Long Beach -Anaheim, California Area, All Urban
Consumers, All Items, Base Period (1982-84=100), or, if such index is discontinued, such other
similar index as may be publicly available that is selected by City in its reasonable discretion.
"Cure Period" shall have the meaning ascribed in Section 8.1 of this Agreement.
"Default" shall have the meaning ascribed to that term in Section 8.1 of this Agreement.
"Develop" or "Development" shall mean to improve or the improvement of the Property,
including but not limited to:, grading; demolition, the construction of infrastructure and public
facilities related to the Project, whether located within or outside the Property; the construction of
all of the private improvements and facilities comprising the Project; the preservation or
restoration, as required of natural and man-made or altered open space areas; the installation of
landscaping; and subdivisions of land.
"Developer" shall mean the owner of that certain real property located in the City of
Newport Beach, County of Orange, State of California commonly referred to as 4665 and 4685
MacArthur Boulevard and 4770 Campus Drive (APN ## 445-121-14 and 445-121-05)
("MacArthur Court I"). Developer is the same as Property Owner of MacArthur Court I.
"Development Agreement Ordinance" shall mean Chapter 15.45 of the City of Newport
Beach Municipal Code.
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November 12, 2025
"Development Agreement Statute" shall mean California Government Code
sections 65864-65869.5, inclusive.
"Development Exactions" shall mean any requirement of City in connection with or
pursuant to any ordinance, resolution, rule, or official policy for the dedication of land, the
construction or installation of any public improvement or facility, or the payment of any fee or
charge in order to lessen, offset, mitigate, or compensate for the impacts of development of the
Project on the environment or other public interests.
"Development Impact Fee" shall mean the development impact fee adopted by the City on
November 12, 2024, pursuant to Resolution No. 2024-83.
"Development Plan" shall mean all of the land use entitlements, approvals and permits
approved by the City for the Project on or before the Agreement Date, as the same may be amended
from time to time consistent with this Agreement. Such land use entitlements, approvals and
permits include, without limitation, the following: (1) the Development rights as provided under
this Agreement; (2) the AHIP; and (3) all conditions of approval and all mitigation measures
approved for the Project on or before the Agreement Date.
"Development Regulations" shall mean the following regulations as they are in effect as
of the Agreement Date and to the extent they govern or regulate the development of the Property,
but excluding any amendment or modification to the Development Regulations adopted, approved,
or imposed after the Agreement Date that impairs or restricts Property Owners' rights set forth in
this Agreement, unless such amendment or modification is expressly authorized by this Agreement
or is agreed to by Property Owners in writing: the General Plan; the Development Plan; and, to the
extent not expressly superseded by the Development Plan or this Agreement, all other land use
and subdivision regulations governing the permitted uses, density and intensity of use, design,
improvement, and construction standards and specifications, procedures for obtaining required
City permits and approvals for development, and similar matters that may apply to development
of the Project on the Property during the Term of this Agreement that are set forth in Title 15 of
the Newport Beach Municipal Code (buildings and construction), Title 19 of the Newport Beach
Municipal Code (subdivisions), and Title 20 of the Newport Beach Municipal Code (planning and
zoning). Notwithstanding the foregoing, the term "Development Regulations," as used herein,
does not include any City ordinance, resolution, code, rule, regulation or official policy governing
any of the following: (i) the conduct of businesses, professions, and occupations; (ii) taxes and
assessments; (iii) the control and abatement of nuisances; (iv) the granting of encroachment
permits and the conveyance of rights and interests which provide for the use of or the entry upon
public property; or (v) the exercise of the power of eminent domain.
"Effective Date" shall mean the latest of all of the following dates occurring: (i) the date
that is thirty (30) days after the Agreement Date; (ii) if a referendum concerning the Adopting
Ordinance is timely qualified for the ballot and a referendum election is held concerning the
Adopting Ordinance, the date on which the referendum is certified resulting in upholding and
approving the Adopting Ordinance and becomes effective; (iii) if a lawsuit is timely filed
challenging the validity or legality of the Adopting Ordinance, this Agreement, and/or the AHIP,
the date on which said challenge is finally resolved in favor of the validity or legality of the
Adopting Ordinance, this Agreement, and/or the AHIP, whether such finality is achieved by a final
4
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November 12, 2025
non -appealable judgment, voluntary or involuntary dismissal (and the passage of any time required
to appeal an involuntary dismissal), or binding written settlement agreement. Promptly after the
Effective Date occurs, the Parties agree to cooperate in causing an appropriate instrument to be
executed and recorded against the Property memorializing the Effective Date.
"Environmental Laws" means all federal, state, regional, county, municipal, and local laws,
statutes, ordinances, rules, and regulations which are in effect as of the Agreement Date, and all
federal, state, regional, county, municipal, and local laws, statutes, rules, ordinances, rules, and
regulations which may hereafter be enacted and which apply to the Property or any part thereof,
pertaining to the use, generation, storage, disposal, release, treatment, or removal of any Hazardous
Substances, including without limitation the following: the Comprehensive Environmental
Response Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601, et SeMc ., as amended
("CERCLA"); the Solid Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. Sections 6901, et M., as amended ("RCRA"); the Emergency
Planning and Community Right to Know Act of 1986, 42 U.S.C. Sections 11001 et sea., as
amended; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et M., as
amended; the Clean Air Act, 42 U.S.C. Sections 7401 et seq., as amended; the Clean Water Act,
33 U.S.C. Section 1251, et SeMc ., as amended; the Toxic Substances Control Act, 15 U.S.C.
Sections 2601 et sea., as amended; the Federal Insecticide, Fungicide and Rodenticide Act, 7
U.S.C. Sections 136 et sea., as amended; the Federal Safe Drinking Water Act, 42 U.S.C. Sections
300f et sea., as amended; the Federal Radon and Indoor Air Quality Research Act, 42 U.S.C.
Sections 7401 et sea., as amended; the Occupational Safety and Health Act, 29 U.S.C. Sections
651 et sea., as amended; and California Health and Safety Code Section 25100, et SeMc .
"General Plan" shall mean City's 2006 General Plan adopted by the City Council on
July 25, 2006, by Resolution No. 2006-76, as amended by Resolution No. 2022-60, Resolution
No. 2022-80, Resolution No. 2024-51, and any other amendments through the Agreement Date
and such amendments expressly authorized by this Agreement or specifically agreed to by Property
Owners consistent with Section 4.3 below.
"Hazardous Substances" means any toxic substance or waste, pollutant, hazardous
substance or waste, contaminant, special waste, industrial substance or waste, petroleum or
petroleum -derived substance or waste, or any toxic or hazardous constituent or additive to or
breakdown component from any such substance or waste, including without limitation any
substance, waste, or material regulated under or defined as "hazardous" or "toxic" under any
Environmental Law.
"MacArthur Boulevard Street Revitalization" shall mean improvements to the public right
of way that City may undertake on and along MacArthur Boulevard between Campus Drive and
Bowsprit Drive.
"Mortgage" shall mean a mortgage, deed of trust, sale and leaseback arrangement, or any
other form of conveyance in which the Property, or a part or interest in the Property, is pledged as
security and contracted for in good faith and for fair value.
"Mortgagee" shall mean the holder of a beneficial interest under a Mortgage or any
successor or assignee of the Mortgagee.
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November 12, 2025
"Notice of Default" shall have the meaning ascribed in Section 8.1 of this Agreement.
"1'�" shall mean either City or one or both Property Owners as determined by the
context.
"Parties" shall mean City and one or both Property Owners as determined by the context.
"Permitted Transferee" shall mean a party to whom an interest in or fee title to the Property,
in whole or in part, is transferred as provided in Article 11 of this Agreement.
"Project" shall mean the development of up to 700 residential rental units and 10,000
square feet of retail and/or restaurant space, including all on -site and off -site improvements related
thereto, that Property Owners are authorized to construct with respect to each parcel of the
Property, as provided in this Agreement and the Development Regulations, as the same may be
modified or amended from time to time consistent with this Agreement and applicable law.
"Property" is described in Exhibit A and depicted on Exhibit B.
"Property Owner" shall mean The Irvine Company LLC or MacArthur Court I LLC or the
applicable successor or assignee to all or any portion of the rights, title, and interest in and to
ownership of all or a portion of the Property, as determined by the context. As of the Agreement
Date, MacArthur Court I LLC is a Property Owner and the Developer.
"Property Owners" shall mean The Irvine Company LLC and MacArthur Court I LLC and
any successor or assignee to all or any portion of the rights, title, and interest in and to ownership
of all or a portion of the Property.
"Public Benefit Fee" shall have the meaning ascribed in Section 3.1 of this Agreement.
"Subsequent Development Approvals" shall mean all discretionary development and
building approvals that Property Owners are required to obtain to Develop the Project on and with
respect to the Property after the Agreement Date consistent with the Development Regulations and
this Agreement.
"Term" shall have the meaning ascribed in Section 2.4 of this Agreement.
"Termination Date" shall have the meaning ascribed in Section 2.4 of this Agreement.
"Transfer" shall have the meaning ascribed in Section 11 of this Agreement.
2. General Provisions.
2.1 Plan Consistency, Zoning Implementation.
This Agreement, the Development Plan and the Development Regulations applicable to
the Property are consistent with the City's zoning and the General Plan.
C
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November 12, 2025
2.2 Binding Effect of Agreement.
The Property is hereby made subject to this Agreement. Development of the Property is
hereby authorized and shall be carried out in accordance with the terms of this Agreement.
2.3 Property Owners' Representations and Warranties Regarding Ownership of the
Property and Related Matters Pertaining to this Agreement.
Each Property Owner for itself, and each person executing this Agreement on behalf of a
Property Owner, hereby represents and warrants to City as follows: (i) that Property Owner is
owner of the fee simple title to the Property or portion thereof as set forth in Recital A of this
Agreement; (ii) that Property Owner is duly formed and existing and is authorized to do business
in the State of California; (iii) that all actions required to be taken by all persons and entities
comprising Property Owner to enter into this Agreement have been taken and that Property Owner
has the legal authority to enter into this Agreement; (iv) that Property Owner's entering into and
performing its obligations set forth in this Agreement will not result in a violation of any
obligation, contractual or otherwise, that Property Owner or any person or entity comprising
Property Owner has to any third party; (v) that neither Property Owner nor any co-owner
comprising Property Owner is the subject of any voluntary or involuntary bankruptcy or
insolvency petition; and (vi) that Property Owner has no actual or constructive knowledge of any
pending or threatened claims of any person or entity affecting the validity of any of the
representations and warranties set forth in clauses (i)-(vi), inclusive, or affecting Property Owner's
authority or ability to enter into or perform any of its obligations set forth in this Agreement.
2.4 Term.
The term of this Agreement (the "Term") shall commence on the Effective Date and shall
continue for a period of ten (10) years after the Effective Date unless otherwise terminated or
modified pursuant to the terms of this Agreement or the mutual written agreement of the Parties
hereto.
Notwithstanding any other provision set forth in this Agreement to the contrary, if any
Party reasonably determines that the Effective Date will not occur because (i) the Adopting
Ordinance has been disapproved by the City's voters at a referendum election or (ii) a court of
competent jurisdiction issues a final non -appealable order or judgement is entered that directs the
City to set aside the Adopting Ordinance, this Agreement and/or any of the Development
Regulations for the Project approved on or before the Agreement Date that expressly mandate any
approvals issued pursuant to such Development Regulations be set aside; then such Party, in its
sole and absolute discretion shall have the right to terminate this Agreement upon delivery of
written notice of termination to the other Party.
The Termination Date shall be the earliest of the following dates: (i) the tenth (1 Oth)
anniversary of the Effective Date; or (ii) such earlier date that this Agreement is terminated in
accordance with this Section 2.4, Articles 5 and 7, and/or Section 8.3 of this Agreement and/or
Sections 65865.1 and/or 65868 of the Development Agreement Statute. Further, upon completion
of the Project in accordance with the terms of this Agreement, including Developer's complete
satisfaction, performance, and payment, as applicable, of all applicable Development Exactions,
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November 12, 2025
the issuance of all required final occupancy permits, and acceptance by City or applicable public
agency(ies) or private entity(ies) of all required offers of dedication, if any, Property Owners, in
their sole and absolute discretion, shall have the right to terminate this Agreement upon delivery
of written notice of termination to City, in which event neither Party shall have any further rights
or obligations hereunder.
Notwithstanding any other provision set forth in this Agreement to the contrary, the
provisions set forth in Article 10 and Section 13.10 (as well as any other Property Owners'
obligations set forth in this Agreement that are expressly written to survive the Termination Date)
shall survive the Termination Date of this Agreement.
3. Public Benefits.
3.1 Public Benefit Fee.
As consideration for this Agreement, Developer shall pay to City a fee that shall be in
addition to any other fee or charge to which the Property and the Project would otherwise be
subject (herein, the "Public Benefit Fee") in the sum of Seventeen Thousand Dollars and 00/100
($17,000.00) per unit payable at the issuance of the respective building permit for any of the 700
residential units that are issued a building permit on or after July 1, 2028. Development of all or
a portion of the 700 residential units on the Property shall not be subject to a Public Benefit Fee
for any units that are issued a building permit for such residential units before July 1, 2028.
3.2 Other Public Benefits. In addition to the Public Benefit Fee, the direct and indirect
benefits the City shall receive pursuant to this Development Agreement are as follows:
3.2.1 Open Space. Prior to the issuance of the final certificate of occupancy for
the 700 residential units of the Project, the applicable Property Owner(s) shall record an easement
for a 1.0-acre publicly accessible open space, but privately owned and maintained, within the
Property. Prior to the issuance of the final building permit for the 700 residential units of the
Project, the City and applicable Property Owner(s) shall reasonably agree to a mutually acceptable
form of such easement. The provision of the publicly accessible open space pursuant to this
Section 3.2.1 is in -lieu of any park fee or dedication that would otherwise be applicable to the
Project, including as may be required pursuant to General Plan Policy 6.15.13 of the Newport
Beach Municipal Code or any other Development Regulation.
3.2.2 MacArthur Boulevard Revitalization Fee. Developer shall provide funding
in the amount of Three Million Two Hundred Fifty Thousand Dollars and 00/100 ($3,250,000.00)
to the City for the MacArthur Boulevard Street Revitalization (herein "MacArthur Boulevard
Street Revitalization Fee") work to be completed by the City, to be paid at the issuance of the first
building permit for all or any portion of the 700 residential units on the Property. If Property
Owners do not complete development of all 700 residential units prior to the expiration of this
Agreement, then City agrees that Developer or its designated affiliate(s) shall receive a credit for
a portion of the MacArthur Boulevard Revitalization Fee (determined on a pro rata basis based on
residential units remaining to be developed) that Developer or its designated affiliate(s) may apply
against any Development Impact Fee required for development in the City, which credit shall
survive the termination of this Agreement.
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3.2.3 Development Impact Fee. The Developer shall pay the applicable
Development Impact Fee at the issuance of the respective building permit for any of the 700
residential units.
3.2.4 Affordable Housing Obli ag tion. The Parties agree that Developer's
compliance with the AHIP satisfies any obligation of Property Owners to the City with respect to
the provision of affordable housing for the Project or the Property pursuant to and during the Term
of this Agreement. The adopted AHIP may be amended by the mutual consent of the Parties
without requiring an amendment to this Agreement.
Any unpaid portion of the per unit Public Benefit Fee set forth in Section 3.1 and the
MacArthur Boulevard Street Revitalization Fee set forth in Section 3.2.2 shall be adjusted for
inflation based upon percentage increases in the CPI as provided herein. The first CPI adjustment
of the per unit Public Benefit Fee and MacArthur Boulevard Street Revitalization Fee shall occur
on July 1, 2029, (the first "Fee Adjustment Date") and subsequent CPI adjustments shall occur on
each anniversary of the first Fee Adjustment Date thereafter until expiration of the Term of this
Agreement. The amount of the CPI adjustment on the applicable Fee Adjustment Date shall in
each instance be calculated based on the then most recently available CPI figures such that, for
example, if the Effective Date of this Agreement falls on July 1 and the most recently available
CPI figure on the first Fee Adjustment Date (for illustration assumed to be January 1 of the
following year) is the CPI for November of the preceding year, the percentage increase in the CPI
for that partial year (a 6-month period) shall be calculated by comparing the CPI for November of
the preceding year with the CPI for May of the preceding year (a 6-month period). In no event,
however, shall application of the CPI reduce the amount of the Public Benefit Fee or MacArthur
Boulevard Street Revitalization Fee (or unpaid portions thereof) below the amount in effect prior
to any applicable Fee Adjustment Date.
3.3 Public Benefit Administration.
Developer and Property Owner(s) acknowledge by each's approval and execution of this
Agreement that it/they is/are voluntarily agreeing to pay or provide the applicable Public Benefits
as set forth in this Article 3 if and when Development of any of the 700 residential units is
undertaken, that the obligation to pay or provide the Public Benefit Fee for each residential unit
developed is an essential term of this Agreement and is not severable from City's obligations and
Property Owners' vesting rights to be acquired hereunder, and that Developer and Property
Owners expressly waive any constitutional, statutory, or common law right it/they might have in
the absence of this Agreement to protest or challenge the payment of such fee on any ground
whatsoever, including without limitation pursuant to the Fifth and Fourteenth Amendments to the
United States Constitution, California Constitution Article I Section 19, the Mitigation Fee Act
(California Government Code Section 66000 et seq.), or otherwise.
In addition to any other remedy set forth in this Agreement for Developer's Default, if Developer
fails to pay timely any portion of the Public Benefit Fee or MacArthur Boulevard Street
Revitalization Fee identified in Article 3 when due, City shall have the right to withhold issuance
of any further building permits, occupancy permits, or other development or building permits for
the Project. While certain public benefits set forth in Section 3.1 and 3.2 are required of the
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Developer, each Property Owner understands that building permits will not be issued until the
public benefits fees required to be paid at the issuance of such building permits are paid.
4. Development of Project.
4.1 Applicable Regulations; Property Owners' Vested Rights and City's Reservation
of Discretion With Respect to Subsequent Development Approvals.
Other than as expressly set forth in this Agreement, during the Term of this Agreement, (i)
Property Owners shall have the vested right to Develop the Project, including without limitation,
permitted uses, density and intensity of use, the maximum height, size and location of proposed
structures, on and with respect to the Property in accordance with the terms of the Development
Plan, Development Regulations and this Agreement and (ii) City shall not prohibit, prevent, restrict
or condition Development of the Property on grounds inconsistent with the Development Plan,
Development Regulations or this Agreement. Notwithstanding the foregoing, nothing herein is
intended to limit or restrict City's discretion with respect to (i) review and approval requirements
contained in the Development Regulations, (ii) the approval, conditional approval, or denial of any
Subsequent Development Approvals that are required for Development of the Project as of the
Agreement Date provided that all such actions are consistent with the Development Regulations,
or (iii) any environmental approvals that may be required under CEQA or any other federal or state
law or regulation in conjunction with any Subsequent Development Approvals that may be
required for the Project, and in this regard, as to future actions referred to in clauses (i)-(iii) of this
sentence, City reserves its full discretion subject to the limitations under state law. In addition, it
is understood and agreed that nothing in this Agreement is intended to vest Property Owners' rights
with respect to any laws, regulations, rules, or official policies of any other governmental agency
or public utility company with jurisdiction over the Property or the Project; or any applicable
federal or state laws, regulations, rules, or official policies that may be inconsistent with this
Agreement and that override or supersede the provisions set forth in this Agreement, and regardless
of whether such overriding or superseding laws, regulations, rules, or official policies are adopted
or applied to the Property or the Project prior or subsequent to the Agreement Date.
Property Owners have expended and will continue to expend substantial amounts of time
and money planning and preparing for Development of the Project. Property Owners represent
and City acknowledges that Property Owners would not make these expenditures without this
Agreement, and that Property Owners are and will be making these expenditures in reasonable
reliance upon their vested rights to Develop the Project as set forth in this Agreement.
Property Owners may apply to City for permits or approvals to modify or amend the
Development specified in the Development Regulations. In addition, Property Owners may apply
to City for approval of tentative tract maps or tentative parcel maps, or minor amendments to
existing tentative maps or associated conditions of approval, consistent with City of Newport
Beach Municipal Code Section 19.12.090. This Agreement does not constitute a promise or
commitment by City to approve any such permit or approval, or to approve the same with or
without any particular requirements or conditions including any applicable Development Impact
Fees, and City's discretion with respect to such matters shall be the same as it would be in the
absence of this Agreement. If approved by City, then any such permits or approvals shall be vested
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in the same manner as provided in this Agreement for the Development Regulations, and shall be
a part of and included in the Development Plan without requiring an amendment of this Agreement.
4.2 No Conflicting Enactments.
Except to the extent City reserves its discretion as expressly set forth in this Agreement,
during the Term of this Agreement, City shall not apply to the Project or the Property any
ordinance, policy, rule, regulation, or other measure relating to Development of the Project that is
enacted or becomes effective after the Agreement Date to the extent it conflicts with this
Agreement unless specifically mandated by a court of competent jurisdiction as expressly
applicable to the Project in a final and non -appealable order or judgment. This Section 4.2 shall
not restrict the City's ability to enact an ordinance, policy, rule, regulation, or other measure
applicable to the Project pursuant to California Government Code Section 65866 consistent with
the procedures specified in Section 4.3 of this Agreement. In Pardee Construction Co. v. City of
Camarillo (1984) 37 Cal.3d 465, the California Supreme Court held that a construction company
was not exempt from a city's growth control ordinance even though the city and construction
company had entered into a consent judgment (tantamount to a contract under California law)
establishing the company's vested rights to develop its property consistent with the zoning. The
California Supreme Court reached this result because the consent judgment failed to address the
timing of development. The Parties intend to avoid the result of the Pardee case by acknowledging
and providing in this Agreement that Property Owners shall have the vested right to Develop the
Project on and with respect to the Property at the rate, timing, and sequencing that Property Owners
deem appropriate within the exercise of Property Owners' sole subjective business judgment,
provided that such Development occurs in accordance with this Agreement and the Development
Regulations, notwithstanding adoption by City's electorate of an initiative to the contrary after the
Effective Date. No City moratorium or other similar limitation relating to the rate, timing, or
sequencing of the Development of all or any part of the Project and whether enacted by initiative
or another method, affecting subdivision maps, building permits, occupancy certificates, or other
entitlement to use, shall apply to the Project to the extent such moratorium or other similar
limitation restricts Property Owners' vested rights in this Agreement or otherwise conflicts with
the express provisions of this Agreement. Nothing herein shall obligate Property Owners to
Develop the Project.
4.3 Reservations of Authority.
Notwithstanding any other provision set forth in this Agreement to the contrary, the laws,
rules, regulations, and official policies set forth in this Section 4.3 shall apply to and govern the
Development of the Project on and with respect to the Property.
4.3.1 Procedural Regulations. Procedural regulations relating to hearing bodies,
petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals, and
any other matter of procedure shall apply to the Property, provided that such procedural regulations
are adopted and applied City-wide or to all other properties similarly situated in City.
4.3.2 Processing and Permit Fees. City shall have the right to charge, and the
respective Property Owners shall be required to pay, all applicable processing and permit fees to
cover the reasonable cost to City of processing and reviewing applications and plans for any
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required Subsequent Development Approvals, building permits, excavation and grading permits,
encroachment permits, and the like, for performing necessary studies and reports in connection
therewith, inspecting the work constructed or installed by or on behalf of such Property Owner,
and monitoring compliance with any requirements applicable to Development of the Project, all at
the rates in effect at the time fees are due.
4.3.3 Consistent Future City Regulations. City ordinances, resolutions,
regulations, and official policies governing Development which do not conflict with the
Development Regulations, or with respect to such regulations that do conflict, where Property
Owners have consented in writing to the regulations, shall apply to the Property.
4.3.4 Development Exactions Applicable to Property. During the Term of this
Agreement, Developer shall be required to satisfy and pay the Public Benefit Fee (Section 3.1),
provision of open space (Section 3.2.1), MacArthur Boulevard Revitalization Fee (Section 3.2.2),
Development Impact Fee (Section 3.2.3), and affordable housing obligations (Section 3.2.4) as set
forth in this Agreement, and any applicable traffic fees required pursuant to the Fair Share Traffic
Contribution Ordinance (Chapter 15.38 of the City's Municipal Code) and the Traffic Phasing
Ordinance (Chapter 15.40 of the City's Municipal Code) at the time performance or payment of
any such fees are due as set forth in the Fair Share Traffic Contribution Ordinance and Traffic
Phasing Ordinance. Other than the foregoing, Property Owners shall not be required to pay any
Development Exaction for the Project and City shall not alter, increase, or modify any public
benefits set forth in Article 3 or Development Exactions required under this Agreement in a
manner that is inconsistent with the Development Plan, Development Regulations or this
Agreement without Property Owners' prior written consent or as may be otherwise required
pursuant to overriding federal or state laws or regulations (Section 4.3.5 hereinbelow). In addition,
nothing in this Agreement is intended or shall be deemed to vest Property Owners against the
obligation to pay any of the following (which are not included within the definition of
"Development Exactions") in the amount that would apply in the absence of this Agreement: (i)
City's normal fees for processing, environmental assessment and review, tentative tract and parcel
map review, plan checking, site review and approval, administrative review, building permit,
grading permit, inspection, and similar fees imposed to recover City's costs associated with
processing, reviewing, and inspecting project applications, plans, and specifications; (ii) fees and
charges levied by any other public agency, utility, district, or joint powers authority, regardless of
whether City collects those fees and charges; or (iii) community facility district special taxes or
special district assessments or similar assessments, business license fees, bonds or other security
required for public improvements, transient occupancy taxes, sales taxes, property taxes, sewer
lateral connection fees, water service connection fees, new water meter fees, and the Property
Development Tax payable under Section 3.12 of City's Municipal Code.
4.3.5 Overriding Federal and State Laws and Regulations. Federal and state laws
and regulations that override Property Owners' vested rights set forth in this Agreement shall apply
to the Property, together with any City ordinances, resolutions, regulations, and official policies
that are necessary to enable City to comply with the provisions of any such overriding federal or
state laws and regulations, provided that (i) Property Owners do not waive their right to challenge
or contest the validity of any such purportedly overriding federal, state, or City law or regulation;
and (ii) upon the discovery of any such overriding federal, state, or City law or regulation that
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prevents or precludes compliance with any provision of this Agreement, City or Property Owner
shall provide to the other Parties a written notice identifying the federal, state, or City law or
regulation, together with a copy of the law or regulation and a brief written statement of the
conflict(s) between that law or regulation and the provisions of this Agreement. Promptly
thereafter City and Property Owners shall meet and confer in good faith in a reasonable attempt to
determine whether a modification or suspension of this Agreement, in whole or in part, is necessary
to comply with such overriding federal, state, or City law or regulation. In such negotiations, City
and Property Owners agree to preserve the terms of this Agreement and the rights of Property
Owners as derived from this Agreement to the maximum feasible extent while resolving the
conflict. City agrees to cooperate with Property Owners at no cost to City in resolving the conflict
in a manner which minimizes any financial impact of the conflict upon Property Owners. City
also agrees to process in a prompt manner a Property Owner's proposed changes to the Project and
any of the Development Regulations as may be necessary to comply with such overriding federal,
state, or City law or regulation; provided, however, that the approval of such changes by City shall
be subject to the discretion of City, consistent with this Agreement.
4.3.6 Public Health and Safety. Any City ordinance, resolution, rule, regulation,
program, or official policy that is necessary to protect persons on the Property or in the immediate
vicinity from conditions dangerous to their health or safety, as reasonably determined by City,
shall apply to the Property, even though the application of the ordinance, resolution, rule
regulation, program, or official policy would result in the impairment of Property Owners' vested
rights under this Agreement.
4.3.7 Uniform Building Standards. Existing and future building and
building -related standards set forth in the uniform codes adopted and amended by City from time
to time, including building, plumbing, mechanical, electrical, housing, swimming pool, and fire
codes, and any modifications and amendments thereof shall all apply to the Project and the
Property to the same extent that the same would apply in the absence of this Agreement.
4.3.8 Public Works Improvements. To the extent a Property Owner constructs or
installs any public improvements, works, or facilities, the City standards in effect for such public
improvements, works, or facilities at the time of City's issuance of a permit, license, or other
authorization for construction or installation of same shall apply.
4.3.9 No Guarantee or Reservation of Utility Capacity. Notwithstanding any
other provision set forth in this Agreement to the contrary, nothing in this Agreement is intended
or shall be interpreted to require City to guarantee or reserve to or for the benefit of Property
Owners or the Property any utility capacity, service, or facilities that may be needed to serve the
Project, whether domestic or reclaimed water service, sanitary sewer transmission or wastewater
treatment capacity, downstream drainage capacity, or otherwise, and City shall have the right to
limit or restrict Development of the Project if and to the extent that City reasonably determines
that inadequate utility capacity exists to adequately serve the Project at the time Development is
scheduled to commence. Notwithstanding the foregoing, City covenants to provide utility services
to the Project on a non-discriminatory basis (i.e., on the same terms and conditions that City
undertakes to provide such services to other similarly situated new developments in the City of
Newport Beach as and when service connections are provided and service commences).
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4.4 Tentative Subdivision Maps.
City agrees that Property Owners may apply for new and existing tentative subdivision
map(s) for the Property consistent with California Government Code sections 66498.1-66498.9
and City of Newport Beach Municipal Code Chapter 19.20 as a Subsequent Development
Approval. Pursuant to the applicable provision of the California Subdivision Map Act (California
Government Code section 66452.6(a)), the life of any tentative subdivision map approved for the
Property, whether designated a "vesting tentative map," or otherwise, shall be extended for the
Term of this Agreement.
5. Amendment or Cancellation of Agreement.
This Agreement may be amended or canceled in whole or in part only by mutual written
and executed consent of the Parties in compliance with California Government Code section 65868
and City of Newport Beach Municipal Code section 15.45.070.
6. Enforcement.
Unless this Agreement is amended, canceled, modified, or suspended as authorized herein
or pursuant to California Government Code section 65869.5, this Agreement shall be enforceable
by either Party despite any change in any applicable general or specific plan, zoning, subdivision,
or building regulation or other applicable ordinance or regulation adopted by City (including by
City's electorate) that purports to apply to any or all of the Property.
7. Annual Review of Property Owner's Compliance With Agreement.
7.1 General.
City shall review this Agreement once during every twelve (12) month period following
the Effective Date for compliance with the terms of this Agreement as provided in Government
Code section 65865.1. Property Owners or Developer shall pay City a reasonable fee in an amount
City may reasonably establish from time to time to cover the actual and necessary costs for the
annual review. City's failure to timely provide or conduct an annual review shall not constitute a
Default hereunder by City.
7.2 Property Owners' Obligation to Demonstrate Good Faith Compliance.
During each annual review by City, Property Owners are required to demonstrate good
faith compliance with the terms of the Agreement. Each Property Owner agrees to furnish such
evidence of good faith compliance as City, in the reasonable exercise of its discretion, may require,
thirty (30) days prior to each anniversary of the Effective Date during the Term; provided,
however, that the evidence may be provided in one submittal for all Property Owners.
7.3 Procedure.
The City shall conduct a review of whether or not each Property Owner has, for the period
under review, complied with the terms of this Agreement, as provided for in the Newport Beach
Municipal Code. If the City finds that Property Owners have so complied, the annual review shall
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be concluded. If the City finds, on the basis of substantial evidence, that a Property Owner has not
so complied, written notice shall be sent to such Property Owner by first class mail of the City's
finding of non-compliance, and Property Owners shall be given at thirty (30) days to cure any
noncompliance. If a cure not relating to the payment of money cannot be completed within thirty
(30) days for reasons which are beyond the control of the Property Owner, such Property Owner
must commence the cure within such thirty (30) days and diligently pursue such cure to
completion. If such Property Owner fails to cure such noncompliance within the time(s) set forth
above, such failure shall be considered to be a Default and City shall be entitled to exercise the
remedies set forth in Article 8 below.
7.4 Annual Review a Non -Exclusive Means for Determining and Requiring Cure of
Property Owners' Default.
The annual review procedures set forth in this Section 7 shall not be the exclusive means
for City to identify a Default by a Property Owner or limit City's rights or remedies for any such
Default.
8. Events of Default.
8.1 General Provisions.
In the event of any material default, breach, or violation of the terms of this Agreement
("Default"), the Party alleging a Default shall have the right to deliver a written notice (each, a
"Notice of Default") to the defaulting Party. The Notice of Default shall specify the nature of the
alleged Default and a reasonable manner and sufficient period of time (thirty (30) days if the
Default relates to the failure to timely make a monetary payment due hereunder and not less than
sixty (60) days in the event of non -monetary Defaults) in which the Default must be cured (the
"Cure Period"). During the Cure Period, the Party charged shall not be considered in Default for
the purposes of termination of this Agreement or institution of legal proceedings. If the alleged
Default is cured within the Cure Period, then the Default thereafter shall be deemed not to exist.
If a non -monetary Default cannot be cured during the Cure Period with the exercise of
commercially reasonable diligence, the defaulting Party must promptly commence to cure as
quickly as possible, and in no event later than sixty (60) days after it receives the Notice of Default,
and thereafter diligently pursue said cure to completion.
8.2 Default by Property Owner(s).
If a Property Owner is alleged to be in default and it disputes the claimed Default, it may
make a written request for an appeal hearing before the City Council within thirty (30) days of
receiving the Notice of Default, and a public hearing shall be scheduled at the next available City
Council meeting to consider such Property Owner's appeal of the Notice of Default. Failure to
appeal a Notice of Default to the City Council within the thirty (30) business days shall result in
waiver of any right to a hearing on the claimed Default. If Property Owner's appeal of the Notice
of Default is timely and in good faith but after a public hearing of Property Owner's appeal the
City Council concludes that such Property Owner is in Default as alleged in the Notice of Default,
the accrual date for commencement of the sixty (60) day Cure Period provided in Section 8.1 shall
be extended until the City Council's denial of Property Owner's appeal is communicated to
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Property Owner in writing. Notwithstanding any other provision of this Agreement to the contrary,
Developer shall be liable under this Agreement for a Default by any Property Owner.
8.3 City's Option to Terminate Agreement.
If the City alleges Property Owner(s) Default, City may not terminate this Agreement
without first delivering a written Notice of Default and providing Property Owners with the
opportunity to cure the Default within the Cure Period, as provided in Section 8.1, and complying
with Section 8.2 if the Property Owner timely appeals any Notice of Default. A termination of
this Agreement by City shall be valid if good cause exists and is supported by evidence presented
to the City Council at or in connection with a duly noticed public hearing to establish the existence
of a Default. The validity of any termination may be judicially challenged by Property Owner(s).
Any such judicial challenge must be brought within ninety (90) calendar days of service on
Property Owners, by first class mail, postage prepaid, of written notice of termination by City or a
written notice of City's determination of an appeal of the Notice of Default as provided in
Section 8.2.
8.4 Default b.�Citv_.
If a Property Owner alleges a City Default and alleges that the City has not cured the
Default within the Cure Period, such Property Owner may pursue any equitable remedy available
to it under this Agreement, including, without limitation, an action for a writ of mandamus,
injunctive relief, or specific performance of City's obligations set forth in this Agreement. Upon
a City Default, any resulting delays in a Property Owner's performance hereunder shall neither be
a Property Owner Default nor constitute grounds for termination or cancellation of this Agreement
by City and shall, at Property Owner's option (and provided Property Owner delivers written
notice to City within thirty (30) days of the commencement of the alleged City Default), extend
the Term for a period equal to the length of the delay.
8.5 Waiver.
Failure or delay by a Party in delivering a Notice of Default shall not waive that Party's
right to deliver a future Notice of Default of the same or any other Default.
8.6 Specific Performance Remedy.
Due to the size, nature, and scope of the Project, it will not be practical or possible to restore
the Property to its pre-existing condition once implementation of this Agreement has begun. After
such implementation, Property Owners and City may be foreclosed from other choices they may
have had to plan for the development of the Property, to utilize the Property or provide for other
benefits and alternatives. Property Owners and City have invested significant time and resources
and performed extensive planning and processing of the Project in agreeing to the terms of this
Agreement and will be investing even more significant time and resources in implementing the
Project in reliance upon the terms of this Agreement. It is not possible to determine the sum of
money which would adequately compensate Property Owners or City for such efforts. For the
above reasons, Property Owners and City agree that damages would not be an adequate remedy if
either City or a Property Owner fails to carry out its obligations under this Agreement. Therefore,
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specific performance of this Agreement is necessary to compensate Property Owners if City fails
to carry out its obligations under this Agreement or to compensate City if a Property Owner fails
to carry out its obligations under this Agreement.
8.7 Monetary Damages.
The Parties agree that monetary damages shall not be an available remedy for any Party
for a Default hereunder by another Party; provided, however, that (i) nothing in this Section 8.7 is
intended or shall be interpreted to limit or restrict City's right to recover the Public Benefit Fee or
MacArthur Boulevard Street Revitalization Fee as set forth herein and/or (ii) nothing in this
Section 8.7 is intended or shall be interpreted to limit or restrict Property Owner's indemnity
obligations set forth in Article 10. In no event shall damages otherwise be awarded against a Party
upon an event of default or upon termination of this Agreement Property Owners expressly agree
that the City, any City agencies and their respective elected and appointed council, boards,
commissions, officers, agents, employees, volunteers and representatives (collectively, for
purposes of this Section 8.7, "City") shall not be liable for any monetary damage for a Default by
the City or any claims against City arising out of this Agreement. The sole and exclusive judicial
remedy for Property Owners in the event of a Default by the City shall be an action in mandamus,
specific performance, or other injunctive or declaratory relief. Notwithstanding the foregoing,
nothing in this Section 8.7 is intended or shall be interpreted to limit or restrict Property Owner(s)
right(s) to recover repayment of the Public Benefit Fee, MacArthur Boulevard Street Revitalization
Fees or any Development Exaction as set forth in Section 4.3.4 paid by Developer in the event of
a determination by a court of competent jurisdiction of (i) the City's Default or (ii) that directs the
City to set aside the Adopting Ordinance or this Agreement and/or any of the Development
Regulations for the Project approved on or before the Agreement Date and expressly mandates
that any approvals issued pursuant to such Development Regulations be set aside.
8.8 Additional Ci1y Remedy for Property Owners' Default.
In the event of any Default by a Property Owner, in addition to any other remedies which
may be available to City, whether legal or equitable, City shall be entitled to receive and retain any
Development Exactions applicable to the Project or the Property, including any fees, grants,
dedications, or improvements to public property which it may have received from such Property
Owner prior to Property Owner's Default without recourse from Property Owner or its successors
or assigns.
8.9 No Personal Liability of City Officials, Employees, or Agents. No City official,
employee, or agent shall have any personal liability hereunder for a Default by City of any of its
obligations set forth in this Agreement.
9. Force Majeure.
No Party shall be deemed to be in Default where failure or delay in performance of any of
its obligations under this Agreement is caused, through no fault of the Party whose performance
is prevented or delayed, by floods, earthquakes, other acts of God, fires, wars, riots or similar
hostilities, strikes or other labor difficulties, state or federal regulations, or court actions. Except
as specified above, nonperformance shall not be excused because of the act or omission of a third
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person (other than another Party). In no event shall the occurrence of an event of force majeure
operate to extend the Term of this Agreement. In addition, in no event shall the time for
performance of a monetary obligation, including without limitation Developer's obligation to pay
Public Benefit Fees, be extended pursuant to this Section.
10. Indemnity Obligations.
10.1 Indemnity Arising From Acts or Omissions of Property Owner(s).
Developer shall indemnify, defend and hold harmless City or City's officials, employees,
agents, attorneys, and contractors (collectively, the "City's Affiliated Parties"), from and against
all suits, claims, liabilities, losses, damages, penalties, obligations, and expenses (including but not
limited to reasonable attorneys' fees and costs) (collectively, a "Claim") that may arise, directly or
indirectly, from the acts, omissions, or operations of any Property Owners including Developer or
its agents, contractors, subcontractors, agents, or employees in the course of Development of the
Project or any other activities of any Property Owner including Developer pursuant to this
Agreement. City shall have the right to select and retain counsel to defend any Claim filed against
City and/or any of City's Affiliated Parties, and the indemnifying Property Owner shall pay the
reasonable cost for defense of any Claim. The indemnity provisions in this Section 10.1 shall
survive the Termination Date.
10.2 Third Party Litigation.
In addition to its indemnity obligations set forth in Section 10.1, the Developer shall
indemnify, defend, and hold harmless City and City's Affiliated Parties from and against any
Claim against City or City's Affiliated Parties seeking to attack, set aside, void, or annul the
approval of this Agreement, the Adopting Ordinance, any of the Development Regulations for the
Project (including without limitation any actions taken pursuant to CEQA with respect thereto), or
the approval of any permit granted pursuant to this Agreement. (For the avoidance of doubt, this
indemnity obligation does not extend to any Claims to attack, set aside, void or annul the City's
General Plan, any element thereof, or zoning where Developer is not a party to the litigation as a
named defendant or real party in interest in a direct challenge to the Project. In no event shall this
be construed as obligating the City to defend against or take other action that is related in any way,
directly or indirectly, to a challenge, lawsuit, or other legal action to attack, set aside, void or annul
the City's General Plan, any element thereof, or zoning.) Said indemnity obligation shall include
payment of reasonable attorney's fees, expert witness fees, and court costs. City shall promptly
notify the Developer of any such Claim and City shall cooperate with the Developer in the defense
of such Claim. If City fails to promptly notify Developer of such Claim, Developer shall not be
responsible to indemnify, defend, and hold City harmless from such Claim until Developer is so
notified and if City fails to cooperate in the defense of a Claim Developer shall not be responsible
to defend, indemnify, and hold harmless City during the period that City so fails to cooperate or
for any losses attributable thereto. City shall be entitled to retain separate counsel to represent City
against the Claim and the City's defense costs for its separate counsel shall be included in
Developer's indemnity obligation, provided that such counsel shall reasonably cooperate with
Developer in an effort to minimize the total litigation expenses incurred by Developer. In the event
either City or Developer recover any attorney's fees, expert witness fees, costs, interest, or other
amounts from the party or parties asserting the Claim, Developer shall be entitled to retain the
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same (provided they have fully performed their indemnity obligations hereunder). The indemnity
provisions in this Section 10.2 shall commence on the Agreement Date, regardless of whether the
Effective Date occurs, and shall survive the Termination Date.
10.3 Environmental Indemnity.
In addition to its indemnity obligations set forth in Section 10.1, each Property Owner on
its own behalf shall indemnify, defend, and hold harmless City and City's Affiliated Parties from
and against any and all Claims for personal injury or death, property damage, economic loss,
statutory penalties or fines, and damages of any kind or nature whatsoever, including without
limitation attorney's fees, expert witness fees, and costs, based upon or arising from the storage,
handling, transport, or disposal of any Hazardous Substance on, to, or from the Property, and any
other area disturbed, graded, or developed by Property Owners, by or on behalf of such Property
Owner in connection with such Property Owner's Development of the Project. The indemnity
provisions in this Section 10.3 shall survive the Termination Date.
11. Assignment.
Each Property Owner including Developer shall have the right to sell, transfer, or assign
(hereinafter, collectively, a "Transfer") such Property Owner's interest in or fee title to the
Property, in whole or in part, to a Permitted Transferee (which successor, as of the effective date
of the Transfer, shall become a "Property Owner" under this Agreement) at any time from the
Agreement Date until the Termination Date without the prior consent or approval of City;
provided, however, that no such Transfer shall violate the provisions of the Subdivision Map Act
(Government Code Section 66410 et seq.) or City's local subdivision ordinance and shall comply
with the requirements of this Section 11. Any Transfer of fee title to the Property shall include the
assignment and assumption of the transferring Property Owner's (and if Developer, then
Developer's) rights, duties, and obligations set forth in or arising under this Agreement as to the
Property or the portion thereof so Transferred and shall be made in strict compliance with the
following conditions: (i) no Transfer of any of Property Owner's or Developer's rights or interest
under this Agreement shall be made unless made together with the Transfer of all or a part of
Property Owner's or Developer's interest in the Property; (ii) prior to the effective date of any
proposed Transfer, the transferring Property Owner (as transferor) or Developer shall notify City,
in writing, of such proposed Transfer; and (iii) upon the Transfer, the transferring Property Owner
or Developer (as transferor) shall deliver to City a written assignment and assumption, in a
recordable form reasonably approved by the City Attorney, executed by the transferring and
successor Property Owner or Developer, pursuant to which the transferring Property Owner or
Developer assigns to the successor Property Owner or Developer and the successor Property
Owner or Developer assumes from the transferring Property Owner or Developer all of the rights
and obligations of such Property Owner or Developer with respect to the Property, or interest in
the Property, or portion thereof, to be so Transferred, including in the case of a partial Transfer the
obligation to perform such obligations that must be performed that are a condition precedent to the
successor Property Owner's or Developer's right to develop the portion of the Property so
Transferred. Any Permitted Transferee shall have all of the same rights, benefits, duties,
obligations, and liabilities of the transferor Property Owners or Developer under this Agreement
with respect to the Portion of, or interest in, the Property Transferred to such Permitted Transferee;
provided, however, that in the event of a Transfer of less than all of the Property, or interest in the
lr
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Property, no such Permitted Transferee shall have the right to enter into an amendment of this
Agreement that jeopardizes or impairs the rights or increases the obligations of the other Property
Owners or Developer with respect to the balance of the Property.
Notwithstanding any Transfer, the transferring Property Owner or Developer shall
continue to be jointly and severally liable to City, together with the successor Property Owner, to
perform all of the transferred obligations set forth in or arising under this Agreement; provided,
however, that the transferring Property Owner or Developer shall be released from any and all
obligations with respect to the Property so Transferred, or portion thereof in the event of a partial
Transfer if. (i) the transferring Property Owner or Developer no longer has a legal or equitable
interest in the portion of the Property so Transferred other than as a beneficiary under a deed of
trust; (ii) the transferring Property Owner or Developer is not then in Default under this
Agreement; and (iii) the transferring Property Owner or Developer has provided City with the
notice and the fully executed written and recordable assignment and assumption agreement
required as set forth in the first paragraph of this Article 11; and (iv) the successor Property Owner
or Developer either (A) is an affiliate of the transferring Property Owner or Developer, or (B) the
City Manager provides a written release of the transferring Property Owner or Developer after a
review of all documentation reasonably required to the satisfaction of the City Manager, that
demonstrates to the City Manager's reasonable satisfaction that the successor Property Owner or
Developer has the financial resources or commitments available to perform the transferred
obligations at the time and in the manner required under this Agreement. The City Manager's
review of the documentation is a ministerial review, without any public notices or hearings
required.
12. Mortgagee Rights.
12.1 Encumbrances on Property.
The Parties agree that this Agreement shall not prevent or limit Property Owners in any
manner from encumbering the Property, any part of the Property, or any improvements on the
Property with any Mortgage securing financing with respect to the construction, development, use,
or operation of the Project.
12.2 Mortgagee Protection.
This Agreement shall be superior and senior to the lien of any Mortgage. Nevertheless, no
breach of this Agreement shall defeat, render invalid, diminish, or impair the lien of any Mortgage
made in good faith and for value. Any acquisition or acceptance of title or any right or interest in
the Property or part of the Property by a Mortgagee (whether due to foreclosure, trustee's sale,
deed in lieu of foreclosure, lease termination, or otherwise) shall be subject to all of the terms and
conditions of this Agreement. Any Mortgagee who takes title to the Property or any part of the
Property shall be entitled to the benefits arising under this Agreement.
12.3 Mortgagee Not Obligated.
Notwithstanding the provisions of this Section 12.3, a Mortgagee will not have any
obligation or duty under the terms of this Agreement to perform the obligations of Property Owners
20
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or other affirmative covenants of Property Owners, or to guarantee this performance except that:
(i) the Mortgagee shall have no right to develop the Project under the Development Regulations
without fully complying with the terms of this Agreement; and (ii) to the extent that any covenant
to be performed by Property Owner is a condition to the performance of a covenant by City, that
performance shall continue to be a condition precedent to City's performance.
12.4 Notice of Default to Mortgagee; Right of Mortgagee to Cure.
Each Mortgagee shall, upon written request to City, be entitled to receive written notice
from City of (i) the results of the periodic review of compliance specified in section 7 of this
Agreement, and (ii) any default by the Property Owner subject to the Mortgage of its obligations
set forth in this Agreement.
Each Mortgagee shall have a further right, but not an obligation, to cure the Default subject
to the Mortgage within thirty (30) days after receiving a Notice of Default with respect to a
monetary Default and within sixty (60) days after receiving a Notice of Default with respect to a
non -monetary Default. If the Mortgagee can only remedy or cure a non -monetary Default by
obtaining possession of the Property or applicable portion thereof, then the Mortgagee shall have
the right to seek to obtain possession with diligence and continuity through a receiver or otherwise,
and to remedy or cure the non -monetary Default within sixty (60) days after obtaining possession
and, except in case of emergency or to protect the public health or safety, City may not exercise
any of its judicial remedies set forth in this Agreement to terminate or substantially alter the rights
of the Mortgagee until expiration of the sixty (60)-day period. In the case of a non -monetary
Default that cannot with diligence be remedied or cured within sixty (60) days, the Mortgagee
shall have additional time as is reasonably necessary to remedy or cure the Default, provided the
Mortgagee promptly commences to cure the non -monetary Default within sixty (60) days and
diligently prosecutes the cure to completion.
13. Bankruptcy. The obligations of this Agreement shall not be dischargeable in bankruptcy.
14. Miscellaneous Terms.
14.1 Notices.
Any notice or demand that shall be required or permitted by law or any provision of this
Agreement shall be in writing. If the notice or demand will be served upon a Party, it either shall
be personally delivered to the Party; deposited in the United States mail, certified, return receipt
requested, and postage prepaid; or delivered by a reliable courier service that provides a receipt
showing date and time of delivery with courier charges prepaid. The notice or demand shall be
addressed as follows:
TO CITY: City of Newport Beach
100 Civic Center Drive
Newport Beach, California 92660
Attn: City Manager
21
16-43
November 12, 2025
With a copy to: City Attorney
City of Newport Beach
100 Civic Center Drive
Newport Beach, California 92660
TO IRVINE COMPANY LLC: 550 Newport Center Drive
Newport Beach, California 92660
Attn: General Counsel
TO MACARTHUR COURT 1 550 Newport Center Drive
LLC: Newport Beach, California 92660
Attn: General Counsel
With a copy to:
Latham & Watkins LLP
10250 Constellation Boulevard, Suite 1100
Century City, California 90067
Attn: Maria Hoye
Any Party may change the address stated in this Section 14.1 by delivering notice to the
other Parties in the manner provided in this Section 14.1, and thereafter notices to such Party shall
be addressed and submitted to the new address. Notices delivered in accordance with this
Agreement shall be deemed to be delivered upon the earlier of: (i) the date received or (iii) three
business days after deposit in the mail as provided above.
14.2 Project as Private Undertaking.
Any future Development of the Project is a private undertaking. No Party is acting as the
agent of the other in any respect, and each Party is an independent contracting entity with respect
to the terms, covenants, and conditions set forth in this Agreement. This Agreement forms no
partnership, joint venture, or other association of any kind. The only relationship between the
Parties is that of a government entity regulating the Development of private property by the owner
or user of the property.
14.3 Cooperation.
Each Party shall cooperate with and provide reasonable assistance to the other Parties to
the extent consistent with and necessary to implement this Agreement. Upon the request of a Party
at any time, the other Parties shall promptly execute, with acknowledgement or affidavit if
reasonably required, and file or record the required instruments and writings and take any actions
as may be reasonably necessary to implement this Agreement or to evidence or consummate the
transactions contemplated by this Agreement.
14.4 Estoppel Certificates.
At any time, either City or any Property Owner may deliver written notice to the other
Party requesting that that Party certify in writing that, to the best of its knowledge: (i) this
22
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November 12, 2025
Agreement is in full force and effect and is binding on the Party; (ii) this Agreement has not been
amended or modified either orally or in writing or, if this Agreement has been amended, the Party
providing the certification shall identify the amendments or modifications; and (iii) the requesting
Party is not in Default in the performance of its obligations under this Agreement and no event or
situation has occurred that with the passage of time or the giving of Notice or both would constitute
a Default or, if such is not the case, then the other Party shall describe the nature and amount of
the actual or prospective Default.
The Party requested to furnish an estoppel certificate shall execute and return the certificate
within thirty (30) days following receipt. Requests for the City to furnish an estoppel certificate
shall include reimbursement for all administrative costs incurred by the City including reasonable
attorney's fees incurred by the City in furnishing an estoppel certificate.
14.5 Rules of Construction.
The singular includes the plural; the masculine and neuter include the feminine; "shall" is
mandatory; and "may" is permissive.
14.6 Time Is of the Essence.
Time is of the essence regarding each provision of this Agreement as to which time is an
element.
14.7 Waiver.
The failure by a Party to insist upon the strict performance of any of the provisions of this
Agreement by the other Party, and failure by a Party to exercise its rights upon a Default by the
other Party, shall not constitute a waiver of that Party's right to demand strict compliance by the
other Party in the future.
14.8 Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be
identical and may be introduced in evidence or used for any other purpose without any other
counterpart, but all of which shall together constitute one and the same agreement.
14.9 Entire Agreement.
This Agreement constitutes the entire agreement between the Parties and supersedes all
prior agreements and understandings, both written and oral, between the Parties with respect to the
subject matter addressed in this Agreement.
14.10 Severabilitv.
The Parties intend that each and every obligation of the Parties is interdependent and
interrelated with the other, and if any provision of this Agreement or the application of the
provision to any Party or circumstances shall be held invalid or unenforceable to any extent, it is
the intention of the Parties that the remainder of this Agreement or the application of the provision
23
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November 12, 2025
to persons or circumstances shall be rendered invalid or unenforceable. The Parties intend that
neither Party shall receive any of the benefits of the Agreement without the full performance by
such Party of all of its obligations provided for under this Agreement. Without limiting the
generality of the foregoing, the Parties intend that a Property Owner shall not receive any of the
benefits of this Agreement if such Property Owner's obligations are rendered void or
unenforceable as the result of any third party litigation, and City shall be free to exercise its
legislative discretion to amend or repeal the Development Regulations applicable to such Property
Owner and its Property and such Property Owner shall cooperate as required, despite this
Agreement, should third party litigation result in the nonperformance of Property Owner's
obligations under this Agreement. The provisions of this Section 14.10 shall apply regardless of
whether the Effective Date occurs and after the Termination Date.
14.11 Construction.
This Agreement has been drafted after negotiation and revision. City and Property Owners
are sophisticated parties who were represented by independent counsel throughout the negotiations
or City and Property Owners had the opportunity to be so represented and voluntarily chose to not
be so represented. City and Property Owners each agree and acknowledge that the terms of this
Agreement are fair and reasonable, taking into account their respective purposes, terms, and
conditions. This Agreement shall therefore be construed as a whole consistent with its fair
meaning, and no principle or presumption of contract construction or interpretation, if any, shall
be used to construe the whole or any part of this Agreement in favor of or against either Party.
14.12 Successors and Assigns; Constructive Notice and Acceptance.
The burdens of this Agreement shall be binding upon, and the benefits of this Agreement
shall inure to, all successors in interest to the Parties to this Agreement. All provisions of this
Agreement shall be enforceable as equitable servitudes and constitute covenants running with the
land. Each covenant to do or refrain from doing some act hereunder with regard to Development
of the Property or portion thereof: (i) is for the benefit of and is a burden upon the Property; (ii)
runs with the Property; and (iii) is binding upon each Party and each successor in interest during
its ownership of the Property or any portion thereof. Every person or entity who now or later owns
or acquires any right, title, or interest in any part of the Project or the Property is and shall be
conclusively deemed to have consented and agreed to every provision of this Agreement. This
Section 14.12 applies regardless of whether the instrument by which such person or entity acquires
the interest refers to or acknowledges this Agreement and regardless of whether such person or
entity has expressly entered into an assignment and assumption agreement as provided for in
Article 12.
14.13 No Third -Party Beneficiaries.
The only Parties to this Agreement are City and Property Owners. This Agreement does
not involve any third party beneficiaries, and it is not intended and shall not be construed to benefit
or be enforceable by any other person or entity.
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November 12, 2025
14.14 AMlicable Law and Venue.
This Agreement shall be construed and enforced consistent with the internal laws of the
State of California, without regard to conflicts of law principles. Any action at law or in equity
arising under this Agreement or brought by any Party for the purpose of enforcing, construing, or
determining the validity of any provision of this Agreement shall be filed and tried in the Superior
Court of the County of Orange, State of California, or the United States District Court for the
Central District of California. The Parties waive all provisions of law providing for the removal
or change of venue to any other court.
14.15 Section Headings.
All section headings and subheadings are inserted for convenience only and shall not affect
construction or interpretation of this Agreement.
14.16 Incorporation of Recitals and Exhibits.
All of the Recitals are incorporated into this Agreement by this reference. Exhibits A and
B are attached to this Agreement and incorporated by this reference as follows:
EXHIBIT
DESIGNATION
DESCRIPTION
A
Legal Description of Property
B
Depiction of the Property
C
Affordable Housing Implementation Plan
14.17 Recordation.
The City Clerk of City shall record this Agreement and any amendment, modification, or
cancellation of this Agreement in the Office of the County Recorder of the County of Orange
within the period required by California Government Code section 65868.5 and City of Newport
Beach Municipal Code section 15.45.090. The date of recordation of this Agreement shall not
modify or amend the Effective Date or the Termination Date.
[Signature page follows]
25
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November 12, 2025
SIGNATURE PAGE TO
DEVELOPMENT AGREEMENT
"PROPERTY OWNER"
The Irvine Company LLC,
a Delaware limited liability company
M.
By:
"PROPERTY OWNER" AND "DEVELOPER"
MacArthur Court I LLC,
a Delaware limited liability company
By:
By:
"CITY"
CITY OF NEWPORT BEACH
By:
Joe Stapleton, Mayor
ATTEST:
Lena Shumway, City Clerk
APPROVED AS TO FORM:
-LI C, +49—
Aaron C. arp, City Mtorney
November 12, 2025
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
County of Orange )
On , before me, , a Notary Public,
personally appeared , who proved to me on the basis of
satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
County of Orange )
On , before me, , a Notary Public,
personally appeared , who proved to me on the basis of
satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity
upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
US -ROCS\ 159466499.20
16-49
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
The Land referred to herein below is situated in the City of Newport Beach, County of Orange,
State of California, and is described as follows:
PARCEL A:
PARCEL 1 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT BEACH, COUNTY
OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED IN BOOK
196, PAGE 40 THROUGH 43 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
PARCEL B:
PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF
CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED IN BOOK 68, PAGE 19 OF PARCEL
MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
PARCEL C:
PARCELS 2,3 AND 4 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT BEACH,
COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED
IN BOOK 196, PAGES 40 THROUGH 43 OF PARCEL MAPS, IN THE OFFICE OF THE
COUNTY RECORDER OF SAID COUNTY.
APNs:
445-121-14 (Affects Parcel A)
445-121-05 (Affects Parcel B)
445-121-15 (Affects Parcel 2 of Parcel C)
445-121-16 (Affects Parcel 3 of Parcel C)
445-121-17 (Affects Parcel 4 of Parcel C)
US-DOCS\ 159466499.20
16-50
EXHIBIT B
DEPICTION OF PROPERTY
CAMPUS OMW
r
445-121-14
p MacAM%w Court
p Pavaa Unn
- Bum" Fadro
445-121-17
445-121-16
0c„ SnKEr
U S-DOCS\ 159466499.20
16-51
EXHIBIT C
Affordable Housing Implementation Plan
[attached hereto]
16-52
MACARTHUR COURT
AFFORDABLE HOUSING
IMPLEMENTATION PLAN
Prepared For:
The City of Newport Beach
September 2025
16-53
Contents
I.
Introduction...................................................................................................................................
I
Background...................................................................................................................................
1
II.
Affordable Housing Plan ..............................................................................................................
3
ProposedPlan ...............................................................................................................................3
Number of Affordable Units/Income Levels........................................................................................................
3
Implementation.........................................................................................................................................................
4
Conclusion.................................................................................................................................................................
4
III.
Consistency with Housing Element.......................................................................................................................
5
IV.
Amendments to the AHIP.......................................................................................................................................
V.
Authority ....................................................................................................................................................................
5
Figures
Exhibit1— MacArthur Court .................................................................................................................2
MacArthur Court
Affordable Housing Implementation Plan
16-54
I. Introduction
The MacArthur Court project approval by the City of Newport Beach will implement the goals and
policies of the City's General Plan. With the project, MacArthur Court, as shown on Exhibit 1, will
consist of a mixed -use office and residential community with retail located at the strategic intersection
of MacArthur Boulevard and Campus Drive in the City's Airport Area, a regional center comprised of
professional office, residential, retail, recreation and hotel uses in proximity to John Wayne Airport.
The subject property is located within the HO-1 subarea (Airport Area Environs Area) as identified in
Newport Beach Municipal Code Sections 20.80.025 (Housing Opportunity Overlay Zoning Districts
maps) and 20.28.050 (Housing Oopportunity (HO) Overlay Zoning Districts) including 4665, 4675,
4680, 4685, and 4695 MacArthur Court and 4770 Campus Drive.
With the project, a total of 700 residential units may be developed on MacArthur Court. The City has
not adopted an inclusionary housing policy. However, the City is encouraging new residential
development projects to provide affordable housing. This Affordable Housing Implementation Plan
(AHIP) outlines how affordable housing will be provided relative to the 700 new residential units
allowed at MacArthur Court.
Background
On September 13, 2022, the Newport Beach City Council adopted the 6th Cycle Housing Element for
the 2021-2029 planning cycle in response to the Regional Housing Needs Assessment (RHNA)
allocation. The Housing Element identifies moderate income households as those with annual incomes
between 8 1 % and 120% of the County median household income. Low-income households are those
with annual incomes between 5 1 % and 80% of the County median household income. Very -low
income households are those with annual incomes between 31% and 50% of the County median
household income. Extremely low-income households are those with annual incomes of 30% or less
of the County median household income. While the Housing Element does not require an AMP, this
document has been prepared to outline how the development will meet the City's affordable housing
goal.
The Southern California Association of Governments (SCAG) prepares the state -mandated RHNA.
The RHNA quantifies the need for housing within each jurisdiction during specified planning periods.
The City's General Plan Housing Element must include its "fair share" regional housing needs
allocation for all income groups which must be updated periodically. The most recently published
SCAG RHNA identifies the City allocation as follows:
• Total allocation between 10/15/2021 and 10/15/2029 —4,845 units
• Very -low income allocation — 30% (1,456 units)
• Low-income allocation — 19% (930 units)
• Moderate -income allocation — 22% (1,050 units)
MacArthur Court
Affordable Housing Implementation Plan
16-55
CAMPUS DRNE
145-121-05
_I
1d5-121-15
W-121-17
145.121-! 6
415-121-14
t-
OG{STREET
QMacAj+ui Cou t
Q Parcel Unes
Baking F-WO.
Exhibit 1 — MacArthur Court
MacArthur Court
Affordable Housing Implementation Plan
2
16-56
II. Affordable Housing Plan
Proposed Plan
This Affordable Housing Implementation Plan includes the following plan.
A. Construction of New Affordable Housing Units
Irvine Company owns property within Newport Beach that would allow for the development of new
affordable housing. Irvine Company proposes to identify an appropriate site for the development of
affordable housing and to develop a new affordable housing project. Due to land costs, the location
may be located outside of the Airport Area.
The units must be sold or rented to households qualifying as very -low or low-income households. The
annualized rents chargeable for occupancy of the Affordable Units shall not exceed thirty percent
(30%) of the Very -Low or Low-income limits. The restriction on these units — for example, tenant
selection procedures, monitoring — will be included in an affordable housing agreement, which shall
be submitted for review and approval by the City Attorney and recorded against the property(ies).
B. Dedication of Property to the City
If Irvine Company is unable to construct new affordable housing units as described in Section II.A
above and in a manner consistent with the Implementation terms below, Irvine Company shall dedicate
land to the City, which could include land not currently zoned for residential use, for the purpose of
future affordable housing development. The site shall be of adequate size to allow for construction of
at least 49 affordable housing units at an assumed density of 20-50 dwelling units to the acre. The site
shall be free of any restrictions such as easements, covenants, conditions, or other restrictions that
would preclude or make financially infeasible the development of the intended affordable housing
development as determined by the City. The City shall coordinate with Irvine Company regarding
design. Notwithstanding any covenants, conditions or other restrictions, the City shall be the final
review authority regarding design of the building(s) and property.
C. Fee Payment
In the event that construction of new affordable housing units as described in Section II.A above, or
dedication of property as described in Section II.B above, is not possible, Irvine Company shall pay
the City an affordable housing in -lieu fee of $36,690 per market -rate unit constructed. If the City
determines that the conditions in Sections II.A and II.B above cannot be met, the fee for any market -
rate unit that has received a building permit shall be paid to the City within 90 days of said
determination. For any remaining market -rate units to be constructed, the in -lieu fee shall be paid at
the time of building permit issuance.
Number and Type of Affordable Units
The Irvine Company proposes to build new affordable housing units which equate to 7% of new
market -rate housing units built at MacArthur Court. Irvine Company shall be permitted to construct
conventional affordable housing or senior affordable housing. Irvine Company shall be required to
build the number of affordable housing units equivalent to 7% of new market -rate residential units
permitted. Irvine Company is contemplating the construction of approximately 700 new market -rate
residential units at MacArthur Court, which would require construction of 49 new affordable units. If
MacArthur Court 3
Affordable Housing Implementation Plan
16-57
additional affordable units are provided (or land is dedicated that will accommodate more affordable
housing units) in excess of the 7% requirement, Irvine Company shall be allowed to offset any future
residential development against the excess affordable units provided.
Implementation
The new affordable housing units shall be constructed on a single site (which may include additional
new affordable housing units that are intended to meet the affordable housing requirements related to
other projects in the City) and may be implemented in a single phase or in multiple phases. Irvine
Company shall secure the first approved building permit (i.e. issued) from the City by January 31,
2029, for the affordable housing units required under this AHIP (Section II.A), unless the deadline is
extended by the Director of Community Development upon mutual consent of the parties.
Conclusion
Implementation of this AHIP will result in the availability of affordable housing units as identified
above within the City of Newport Beach in accordance with the City's Housing Element.
MacArthur Court
Affordable Housing Implementation Plan
16-58
III. Consistency with Housing Element
The City of Newport Beach adopted a Housing Element Implementation Plan in 2024. A Housing
Element was included in the General Plan in accordance with state law. The Housing Element was
updated in 2022 and amended in 2024. The Housing Element identifies goals and programs for the
provision of affordable housing in the City. The AHIP is intended to meet the specific goals of the
Housing Element as follows:
Housing Goal #3 A variety of housing types, designs, and opportunities for all social and
economic segments.
Housing Policy 3.1 Encourage preservation of existing and provision of new housing
affordable to extremely low-, very low-, low-, and moderate -income
households.
The AHIP supports the City's requirement for the provision of affordable housing for all new
residential development. The Irvine Company has prepared a Development Agreement in accordance
with this Policy/Program.
Housing Goal #5 Preservation of the City's housing stock for extremely low-, very low-, low-, and
moderate -income households.
Housing Policy 5.1 Continue or undertake the following programs to mitigate potential loss of "at risk"
units due to conversion to market -rate units. These efforts utilize existing City and
local resources. They include efforts to secure additional resources from public and
private sectors should they become available.
The affordable housing provided per the AHIP will increase the City's affordable housing stock. The
units will be deed -restricted to remain affordable for a period of 55 years. In addition, the developer
will provide periodic reports in the form required by the City. The provision of the affordable housing units
will assist the City in meeting Housing Element Goal # 1: Provision of adequate sites to accommodate projected
housing unit growth needs identified by the 2021-2029 RHNA.
In conclusion, the AHIP is consistent with the relevant goals and programs in the City's 2022 General Plan
Housing Element.
IV. Amendments to the AHIP
This AHIP may be amended with the approval of the City Council.
V. Authority
The AHIP has been adopted by the City of Newport Beach per Resolution No. 2025-_ on the 18th
day of November, 2025.
MacArthur Court
Affordable Housing Implementation Plan
16-59
Exhibit "C"
CEQA CONSISTENCY ANALYSIS PREPARED BY T&B PLANNING INC.
DATED OCTOBER 2025
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187695&dbid=0&repo=CNB
Appendix A — Mitigation, Monitoring, and Reporting Program ("MMRP")
Applicability Matrix:
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187694&dbid=0&repo=CNB
Appendix B — Water Supply Assessment (WSA):
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187693&dbid=0&repo=CNB
16-60
Attachment B
Resolution No. 2025- 80
16-61
RESOLUTION NO. 2025- 80
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
NEWPORT BEACH, CALIFORNIA, APPROVING AN
AFFORDABLE HOUSING IMPLEMENTATION PLAN FOR
THE MACARTHUR COURT PROJECT LOCATED AT 4665,
4675, 4680, 4685 AND 4695 MACARTHUR COURT AND
4770 CAMPUS DRIVE (PA2025-0090)
WHEREAS, Section 200 of the City Charter, of the City of Newport Beach ("City"),
vests the City Council with the authority to make and enforce all laws, rules and
regulations with respect to municipal affairs subject only to the restrictions and limitations
contained in the City Charter and the State Constitution, and the power to exercise, or act
pursuant to any and all rights, powers, and privileges or procedures granted or prescribed
by any law of the State of California;
WHEREAS, California Government Code Section 65580 et seq. ("State Housing
Element Law") requires each city and county adopt a housing element that identifies and
analyzes existing and projected housing needs within their jurisdiction and prepare goals,
policies, and programs, and quantified objectives to further the development, improvement,
and preservation of housing;
WHEREAS, an application was filed by The Irvine Company ("Applicant"),
concerning properties located at 4665, 4675, 4680, 4685 and 4695 MacArthur Court, and
4770 Campus Drive and legally described in Exhibit "A" ("Property"), which is attached
hereto and incorporated by reference;
WHEREAS, the Applicant is requesting entitlements for the development of
MacArthur Court Campus, a mixed -use campus consisting of two five -story residential
buildings containing 700 residential rental units ("MacArthur Court Apartments"), and a
10,000- square -foot nonresidential building ("Project"),
WHEREAS, the Project would also retain the two existing high rise office towers
and an existing parking garage;
WHEREAS, the Applicant requests the following approvals to vest the development
rights for the Project:
• Development Agreement ("DA") - A development agreement between the
Applicant and the City, pursuant to Chapter 15.45 (Development Agreements) of
the Newport Beach Municipal Code ("NBMC"), which would provide the Applicant
with the vested right to develop the Project for a term of 10 years and to provide
negotiated public benefits to the City; and
16-62
Resolution No. 2025-
Page 2 of 7
• Affordable Housing Implementation Plan ("AHIP") - A preliminary plan specifying
how the Project would contribute affordable housing as a public benefit, by
providing affordable housing units equivalent to 7% of up to 700 market rate
residential units, or up to 49 affordable housing units:
WHEREAS, the Property is designated General Commercial Office (CO-G) by the
General Plan Land Use Element and is located within the Koll Center Planned Community
(PC-15) Zoning District - Office Site C;
WHEREAS, the Property is not located within the coastal zone;
WHEREAS, a public hearing was held by the Planning Commission on October
23, 2025, in the Council Chambers at 100 Civic Center Drive, Newport Beach. A notice of
the time, place, and purpose of the hearing was given in accordance with California
Government Code Section 54950 et seq. ("Ralph M. Brown Act") and Chapter 20.62
("Public Hearings") of the NBMC. Evidence, both written and oral, was presented to, and
considered by, the Planning Commission at this public hearing;.
WHEREAS, at the hearing, the Planning Commission adopted Resolution No.
PC2025-023 by a unanimous vote (5 ayes, 2 absent) recommending the City Council
approve the Project; and
WHEREAS, a public hearing was held by the City Council on November 18, 2025,
in the Council Chambers at 100 Civic Center Drive, Newport Beach. A notice of the time,
place, and purpose of the hearing was given in accordance with the Ralph M. Brown Act,
Chapter 20.62 (Public Hearings) of the NBMC, and Section 15.45.050 (Public Hearing -
Notice) of the NBMC. Evidence, both written and oral, was presented to and considered
by, the City Council at this hearing.
NOW, THEREFORE, the City Council of the City of Newport Beach resolves as
follows:
Section 1: The City Council has considered the recommendation of the
Planning Commission and determined that modifications to the Project made by the City
Council, if any, are not major changes that require referral back to the Planning
Commission for consideration and recommendation.
Section 2: The City Council hereby approves the Affordable Housing
Implementation Plan, which is attached hereto as Exhibit "B" and incorporated herein by
reference.
16-63
Resolution No. 2025-
Page 3 of 7
Section 3: The AHIP has been prepared by CAA Planning, Inc. dated
September 2025, for the Project consistent with the intent to implement affordable
housing goals within the City pursuant to the Sixth Cycle Housing Element in response to
the Regional Housing Needs Assessment ("RHNA") allocation for the following reasons:
1. The Applicant has committed to assisting the City in the provision of additional
affordable housing opportunities. The location, type, affordability level, design,
and other details will be determined in the future as part of a site -specific project
review. The AHIP is attached as Exhibit "B" to this resolution and incorporated
herein by reference.
2. The AHIP proposes the construction of 700 residential units that will be rented
at market rate on the Property. The Applicant will construct new affordable
housing units equal to 7% of the new market rate units constructed on the
Property, or 49 affordable units. The Applicant will identify an appropriate site
to develop a new affordable housing project for these 49 affordable units. The
Project will facilitate the City's efforts in attaining its Sixth Cycle RHNA mandate
through the provision of market -rate and affordable units.
3. The AHIP has been prepared consistent with the provisions of Section
20.52.015 (Affordable Housing Implementation Plan) of the NBMC.
Section 4: The recitals provided in this resolution are true and correct and are
incorporated into the operative part of this resolution.
Section 5: If any section, subsection, sentence, clause or phrase of this
resolution is, for any reason, held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this resolution. The City
Council hereby declares that it would have passed this resolution, and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 6: Pursuant to the California Environmental Quality Act (CEQA°) as set
forth in California Public Resources Code Section 21000 et seq. and its implementing
guidelines set forth in California Code of Regulations, Title 14, Division 6, Chapter 3
("CEQA Guidelines"), the City Council adopted Resolution No. 2024-50 on July 23, 2024,
certifying Final Program Environmental Impact Report SCH No. 2023060699 ("PEIR"),
approving a Mitigation Monitoring and Reporting Program ("MMRP"), and adopting
Findings and a Statement of Overriding Considerations related to the implementation of
the Housing Element involving amendments to the General Plan, Coastal Land Use Plan,
16-64
Resolution No. 2025-
Page 4 of 7
and Title 20 (Planning and Zoning) and Title 21 (Local Coastal Program Implementation
Plan) of the NBMC which are available at: Housing Implementation Program EIR.
1. The Project is not subject to further environmental review pursuant to Section
21083.3 of the California Public Resources Code (PRC) and Section 15183 of the
CEQA Guidelines because, inasmuch as the Properties involved are all within the
HO-1 Subarea, the Project does not change the underlying land use or zoning
designations; and would not result in new significant impacts or a substantial more
adverse impact than addressed in the PEIR. A detailed consistency analysis has
been prepared by T & B Planning Inc., dated September 2025, and peer reviewed
by Kimley-Horn & Associates, Inc., and is attached hereto as Exhibit "C" and
incorporated herein by reference.
2. Section 15183 of the CEQA Guidelines provides, in relevant part:
a. Projects which are consistent with the development density established by
existing zoning, community plan, or general plan policies for which an
environmental impact report ("EIR") was certified shall not require additional
environmental review, except as might be necessary to examine whether
there are project -specific significant effects which are peculiar to the project
or its site. This streamlines the review of such projects and reduces the
need to prepare repetitive environmental studies.
b. In approving a project meeting the requirements of this section, a public
agency shall limit its examination of environmental effects to those which
the agency determines, in an initial study or other analysis:
Are peculiar to the project or the parcel on which the project would
be located;
ii. Were not analyzed as significant effects in a prior EIR on the zoning
action, general plan, or community plan, with which the project is
consistent;
iii. Are potentially significant off -site impacts and cumulative impacts
which were not discussed in the prior EIR prepared for the general
plan, community plan or zoning action; or
iv. Are previously identified significant effects which, as a result of
substantial new information which was not known at the time the EIR
16-65
Resolution No. 2025-
Page 5 of 7
was certified, are determined to have a more severe adverse impact
than discussed in the prior EIR.
c. If an impact is not peculiar to the parcel or to the project, has been
addressed as a significant effect in the prior EIR, or can be substantially
mitigated by the imposition of uniformly applied development policies or
standards, as contemplated by subdivision (e) below, then an additional EIR
need not be prepared for the project solely on the basis of that impact.
d. This section shall limit the analysis of only those significant environmental
effects for which:
Each public agency with authority to mitigate any of the significant
effects on the environment identified in the EIR on the planning or
zoning action undertakes or requires others to undertake mitigation
measures specified in the EIR which the lead agency found to be
feasible, and
ii. The lead agency makes a finding at a public hearing as to whether
the feasible mitigation measures will be undertaken.
e. An effect of a project on the environment shall not be considered peculiar
to the project or the parcel for the purposes of this section if uniformly
applied development policies or standards have been previously adopted
by the city or county with a finding that the development policies or
standards will substantially mitigate that environmental effect when applied
to future projects, unless substantial new information shows that the policies
or standards will not substantially mitigate the environmental effect. The
finding shall be based on substantial evidence which need not include an
EIR. Such development policies or standards need not apply throughout the
entire city or county but can apply only within the zoning district in which the
project is located, or within the area subject to the community plan on which
the lead agency is relying. Moreover, such policies or standards need not
be part of the general plan or any community plan but can be found within
another pertinent planning document such as a zoning ordinance.
3. As part of its decision -making process, the City is required to review and
consider whether the Project would create new significant impacts or significant
impacts that would be substantially more severe than those disclosed in the
PEIR. Additional CEQA review is only triggered if the Project's new significant
16-66
Resolution No. 2025-
Page 6 of 7
impacts or impacts that are more severe than those disclosed in PEIR such
that major revisions to the PEIR would be required.
4. The PEIR contemplated those future projects meeting the thresholds of Senate
Bill No. 610 (SB 610) would require the preparation of a Water Supply
Assessment. The project area is within the Irvine Ranch Water District (IRWD)
service area and the PEIR concluded that water demands from future housing
projects would result in a significant and unavoidable impact concerning water
supply. The City, therefore, adopted a Statement of Overriding Consideration
for this impact in connection with its certification of the PEIR.
5. The Project is consistent with the development density and use characteristics
established by the City's General Plan Housing Implementation Program as
analyzed by the PEIR, and the required determinations can be made, as
detailed in Exhibit "C" of this resolution and incorporated by reference.
Section 7: The City Council finds that judicial challenges to the City's CEQA
determinations and approvals of land use projects are costly and time consuming. In
addition, project opponents often seek an award of attorneys' fees in such challenges. As
project applicants are the primary beneficiaries of such approvals, it is appropriate that
such applicants should bear the expense of defending against any such judicial
challenge, and bear the responsibility for any costs, attorneys' fees, and damages which
may be awarded to a successful challenger.
16-67
Resolution No. 2025-
Page 7 of 7
Section 8: This resolution shall take effect upon the effective date of the
associated ordinance for the project filed as PA2025-0090, and the City Clerk shall certify
the vote adopting the resolution.
ADOPTED this 18th day of November, 2025.
Joe Stapleton
Mayor
ATTEST:
Lena Shumway
City Clerk
APPROVED AS TO FORM:
CITY TTORNEY'S OFFI E
on--`_ �—
Aaron C. Harp
City Attorney
Attachments: Exhibit "A" — Legal Description
Exhibit "B" — Affordable Housing Implementation Plan
prepared by CAA Planning Inc. dated May 2025
Exhibit "C" — CEQA Consistency Analysis prepared by T&B
Planning Inc. dated October 2025
Exhibit "D" — Conditions of Approval
Exhibit "A"
Legal Description
The Land referred to herein below is situated in the City of Newport Beach, County of
Orange, State of California, and is described as follows:
PAF2r.Fl A -
PARCEL 1 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT BEACH,
COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL MAP
FILED IN BOOK 196, PAGE 40 THROUGH 43 OF PARCEL MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
WARRENS 0".
PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF
CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED IN BOOK 68, PAGE 19 OF
PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
PARCEL C:
PARCELS 2. 3 AND 4 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT
BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL
MAP FILED IN BOOK 196, PAGES 40 THROUGH 43 OF PARCEL MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APNs:
445-121-14
(Affects Parcel A)
445-121-05
(Affects Parcel B)
445-121-15
(Affects Parcel 2 of Parcel C)
445-121-16
(Affects Parcel 3 of Parcel C)
445-121-17
(Affects Parcel 4 of Parcel C)
16-69
Exhibit "B"
AFFORDABLE HOUSING IMPLEMENTATION PLAN PREPARED BY CAA PLANNING
INC. DATED SEPTEMBER 2025
16-70
MACARTHUR COURT
AFFORDABLE HOUSING
IMPLEMENTATION PLAN
Prepared For:
The City of Newport Beach
September 2025
16-71
Contents
I. Introduction................................................................................................................................... I
Background................................................................................................................................... I
II. Affordable Housing Plan..............................................................................................................3
ProposedPlan...............................................................................................................................3
Number of Affordable Units/Income Levels........................................................................................................ 3
Implementation......................................................................................................................................................... 4
Conclusion................................................................................................................................................................. 4
III. Consistency with Housing Element.............................................................................
IV. Amendments to the AHIP....................................................................................................................................... 5
V. Authority....................................................................................................................................................................5
Figures
Exhibit1 — MacArthur Court.................................................................................................................2
MacArthur Court
Affordable Housing Implementation Plan
16-72
I. Introduction
The MacArthur Court project approval by the City of Newport Beach will implement the goals and
policies of the City's General Plan. With the project, MacArthur Court, as shown on Exhibit 1, will
consist of a mixed -use office and residential community with retail located at the strategic intersection
of MacArthur Boulevard and Campus Drive in the City's Airport Area, a regional center comprised of
professional office, residential, retail, recreation and hotel uses in proximity to John Wayne Airport.
The subject property is located within the HO-1 subarea (Airport Area Environs Area) as identified in
Newport Beach Municipal Code Sections 20.80.025 (Housing Opportunity Overlay Zoning Districts
maps) and 20.28.050 (Housing Oopportunity (HO) Overlay Zoning Districts) including 4665, 4675,
4680, 4685, and 4695 MacArthur Court and 4770 Campus Drive.
With the project, a total of 700 residential units may be developed on MacArthur Court. The City has
not adopted an inclusionary housing policy. However, the City is encouraging new residential
development projects to provide affordable housing. This Affordable Housing Implementation Plan
(AHIP) outlines how affordable housing will be provided relative to the 700 new residential units
allowed at MacArthur Court.
Background
On September 13, 2022, the Newport Beach City Council adopted the 6th Cycle Housing Element for
the 2021-2029 planning cycle in response to the Regional Housing Needs Assessment (RHNA)
allocation. The Housing Element identifies moderate income households as those with annual incomes
between 81 % and 120% of the County median household income. Low-income households are those
with annual incomes between 51 % and 80% of the County median household income. Very -low
income households are those with annual incomes between 31 % and 50% of the County median
household income. Extremely low-income households are those with annual incomes of 30% or less
of the County median household income. While the Housing Element does not require an AHIP, this
document has been prepared to outline how the development will meet the City's affordable housing
goal.
The Southern California Association of Governments (SCAG) prepares the state -mandated RHNA.
The RHNA quantifies the need for housing within each jurisdiction during specified planning periods.
The City's General Plan Housing Element must include its "fair share" regional housing needs
allocation for all income groups which must be updated periodically. The most recently published
SCAG RHNA identifies the City allocation as follows:
• Total allocation between 10/15/2021 and 10/15/2029 —4,845 units
• Very -low income allocation — 30% (1,456 units)
• Low-income allocation — 19% (930 units)
• Moderate -income allocation — 22% (1,050 units)
MacArthur Court
Affordable Housing Implementation Plan
16-73
CJIIIPlJS DItA�
aas-121-05�
aas-1 zt -1 s
i"5421-17
"5-121-16
uS-121-1d
vp�
9
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W STREET
Q Mr—H r Court
C Parcel Unes
-- Building FbOpir*s
Exhibit 1 — MacArthur Court
MacArthur Court
Affordable Housing Implementation Plan
2
16-74
II. Affordable Housing Plan
Proposed Plan
This Affordable Housing Implementation Plan includes the following plan.
A. Construction of New Affordable Housing Units
Irvine Company owns property within Newport Beach that would allow for the development of new
affordable housing. Irvine Company proposes to identify an appropriate site for the development of
affordable housing and to develop a new affordable housing project. Due to land costs, the location
may be located outside of the Airport Area.
The units must be sold or rented to households qualifying as very -low or low-income households. The
annualized rents chargeable for occupancy of the Affordable Units shall not exceed thirty percent
(30%) of the Very -Low or Low-income limits. The restriction on these units — for example, tenant
selection procedures, monitoring — will be included in an affordable housing agreement, which shall
be submitted for review and approval by the City Attorney and recorded against the property(ies).
B. Dedication of Property to the City
If Irvine Company is unable to construct new affordable housing units as described in Section II.A
above and in a manner consistent with the Implementation terms below, Irvine Company shall dedicate
land to the City, which could include land not currently zoned for residential use, for the purpose of
future affordable housing development. The site shall be of adequate size to allow for construction of
at least 49 affordable housing units at an assumed density of 20-50 dwelling units to the acre. The site
shall be free of any restrictions such as easements, covenants, conditions, or other restrictions that
would preclude or make financially infeasible the development of the intended affordable housing
development as determined by the City. The City shall coordinate with Irvine Company regarding
design. Notwithstanding any covenants, conditions or other restrictions, the City shall be the final
review authority regarding design of the building(s) and property.
C. Fee Payment
In the event that construction of new affordable housing units as described in Section II.A above, or
dedication of property as described in Section II.B above, is not possible, Irvine Company shall pay
the City an affordable housing in -lieu fee of $36,690 per market -rate unit constructed. If the City
determines that the conditions in Sections II.A and II.B above cannot be met, the fee for any market -
rate unit that has received a building permit shall be paid to the City within 90 days of said
determination. For any remaining market -rate units to be constructed, the in -lieu fee shall be paid at
the time of building permit issuance.
Number and Type of Affordable Units
The Irvine Company proposes to build new affordable housing units which equate to 7% of new
market -rate housing units built at MacArthur Court. Irvine Company shall be permitted to construct
conventional affordable housing or senior affordable housing. Irvine Company shall be required to
build the number of affordable housing units equivalent to 7% of new market -rate residential units
permitted. Irvine Company is contemplating the construction of approximately 700 new market -rate
residential units at MacArthur Court, which would require construction of 49 new affordable units. If
MacArthur Court
Affordable Housing Implementation Plan
16-75
additional affordable units are provided (or land is dedicated that will accommodate more affordable
housing units) in excess of the 7% requirement, Irvine Company shall be allowed to offset any future
residential development against the excess affordable units provided.
Implementation
The new affordable housing units shall be constructed on a single site (which may include additional
new affordable housing units that are intended to meet the affordable housing requirements related to
other projects in the City) and may be implemented in a single phase or in multiple phases. Irvine
Company shall secure the first approved building permit (i.e. issued) from the City by January 31,
2029, for the affordable housing units required under this AHIP (Section II.A), unless the deadline is
extended by the Director of Community Development upon mutual consent of the parties.
Conclusion
Implementation of this AHIP will result in the availability of affordable housing units as identified
above within the City of Newport Beach in accordance with the City's Housing Element.
MacArthur Court
Affordable Housing Implementation Plan
16-76
III. Consistency with Housing Element
The City of Newport Beach adopted a Housing Element Implementation Plan in 2024. A Housing
Element was included in the General Plan in accordance with state law. The Housing Element was
updated in 2022 and amended in 2024. The Housing Element identifies goals and programs for the
provision of affordable housing in the City. The AHIP is intended to meet the specific goals of the
Housing Element as follows:
Housing Goal #3 A variety of housing types, designs, and opportunities for all social and
economic segments.
Housing Policy 3.1 Encourage preservation of existing and provision of new housing
affordable to extremely low-, very low-, low-, and moderate -income
households.
The AHIP supports the City's requirement for the provision of affordable housing for all new
residential development. The Irvine Company has prepared a Development Agreement in accordance
with this Policy/Program.
Housing Goal #5 Preservation of the City's housing stockfor extremely low-, very low-, low-, and
moderate -income households.
Housing Policy 5.1 Continue or undertake the followingprograms to mitigate potential loss of "at risk"
units due to conversion to market -rate units. These efforts utilize existing City and
local resources. They include efforts to secure additional resources from public and
private sectors should they become available.
The affordable housing provided per the AHIP will increase the City's affordable housing stock. The
units will be deed -restricted to remain affordable for a period of 55 years. In addition, the developer
will provide periodic reports in the form required by the City. The provision of the affordable housing units
will assist the City in meeting Housing Element Goal # 1: Provision of adequate sites to accommodate projected
housing unit growth needs identified by the 2021-2029 RHNA.
In conclusion, the AHIP is consistent with the relevant goals and programs in the City's 2022 General Plan
Housing Element.
IV. Amendments to the AHIP
This AHIP may be amended with the approval of the City Council.
V. Authority
The AHIP has been adopted by the City of Newport Beach per Resolution No. 2025-_ on the 18th
day of November, 2025.
MacArthur Court
Affordable Housing Implementation Plan
16-77
Exhibit "C"
CEQA Consistency Analysis prepared by T&B Planning Inc. dated October 2025
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187695&dbid=0&repo=CNB
Appendix A — Mitigation, Monitoring, and Reporting Program ("MMRP")
Applicability Matrix:
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187694&dbid=0&repo=CNB
Appendix B — Water Supply Assessment (WSA)
https:Hecros.newportbeachca.gov/WEB/DocView.aspx?id=3187693&dbid=0&repo=CNB
16-78
Exhibit "D"
Conditions of Approval
CONDITIONS OF APPROVAL
(Project -specific conditions are in italics)
Plannina Division
1. The development shall be in substantial conformance with the approved MacArthur
Court Development Agreement dated September 25. 2025, and Affordable Housing
Implementation Plan dated May 2025 (except as modified by applicable conditions
of approval).
2. Prior to the issuance of building permits, the Applicant shall obtain all applicable
discretionary permits (e.g. Site Development Review, Subdivision Map, etc.). The
Applicant shall comply with all conditions of approval for said discretionary permits.
3. The Project is subject to compliance with all applicable submittals approved by the
City of Newport Beach ("City") and all applicable City ordinances, policies, and
standards, unless specifically waived or modified by the conditions of approval.
4. The Applicant shall comply with all federal, state, and local laws. Material violation
of any of those laws in connection with the use may be cause for revocation of this
Development Agreement and Affordable Housing Implementation Plan.
5. Any change in operational characteristics, expansion in area, or other modification
to the approved plans, shall require an amendment to this Development Agreement
or Affordable Housing Implementation Plan or the processing of a new Development
Agreement or Affordable Housing Implementation Plan.
6. Prior to the issuance of a building permit, an affordable housing agreement shall
be executed in a recordable form as required by the City Attorneys Office.
7. The Applicant shall comply with all provisions of the Development Agreement for
the Project including payment and timing of the public benefit fees.
8. A copy of the Resolution, including conditions of approval Exhibit "A" shall be
incorporated into the Building Division and field sets of plans before issuance of
the building permits.
9. Should the property be sold or otherwise come under different ownership, any
future owners or assignees shall be notified of the conditions of this approval by
either the current business owner, property owner or the leasing agent.
16-79
10. To the fullest extent permitted by law, Applicant shall indemnify, defend and hold
harmless City, its City Council, its boards and commissions, officials, officers,
employees, and agents from and against any and all claims, demands, obligations,
damages, actions, causes of action, suits, losses, judgments, fines, penalties,
liabilities, costs and expenses (including without limitation, attorney's fees,
disbursements and court costs) of every kind and nature whatsoever which may arise
from or in any manner relate (directly or indirectly) to City's approval of MacArthur
Court Project including, but not limited to, the Affordable Housing
Implementation Plan (PA2025-0090). This indemnification shall include, but not be
limited to, damages awarded against the City, if any, costs of suit, attorneys' fees,
and other expenses incurred in connection with such claim, action, causes of action,
suit or proceeding whether incurred by Applicant, City, and/or the parties initiating or
bringing such proceeding. The Applicant shall indemnify the City for all of City's costs,
attorneys' fees, and damages which City incurs in enforcing the indemnification
provisions set forth in this condition. The Applicant shall pay to the City upon demand
any amount owed to the City pursuant to the indemnification requirements prescribed
in this condition.
16-80
Attachment C
Planning Commission Staff Report (No
Attachments)
16-81
CITY OF NEWPORT BEACH
PLANNING COMMISSION STAFF REPORT
' K z October 23, 2025
cq'_' op. Agenda Item No. 3
SUBJECT: MacArthur Court (PA2025-0090)
■ Development Agreement
■ Affordable Housing Implementation Plan
SITE LOCATION: 4665, 4675, 4680, 4685 and 4695 MacArthur Court, and 4770 Campus
Drive
APPLICANT: The Irvine Company
OWNER: MacArthur Court I LLC and The Irvine Company LLC
PLANNER: Jenny Tran, Associate Planner
949-644-3212, jtran newportbeachca.gov
PROJECT SUMMARY
The applicant is requesting entitlements for the future development of MacArthur Court
Campus, a mixed -use campus consisting of two five -story residential buildings containing
700 residential units (MacArthur Court Apartments), and a 10,000-square-foot retail
building. The project would also retain the two existing high-rise office towers and an
existing parking garage. The applicant requests the following approvals to vest the
development rights for the project:
• Development Agreement (DA) - A development agreement between the applicant
and the City, pursuant to Chapter 15.45 (Development Agreements) of the Newport
Beach Municipal Code (NBMC), which would provide the applicant with the vested
right to develop the project for a term of 10 years and to provide negotiated public
benefits to the City; and
Affordable Housing Implementation Plan (AHIP) - A preliminary plan specifying
how the project would contribute affordable housing as a public benefit, by providing
affordable housing units equivalent to 7% of up to 700 market rate residential units,
or up to 49 affordable housing units. The applicant will identify an appropriate site
for development of the 49 affordable units at a future date.
RECOMMENDATION
1) Conduct a public hearing;
2) Find this project is not subject to further environmental review pursuant to Section
21083.3 of the California Public Resources Code (PRC) and Section 15183 of the
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 2
CEQA Guidelines because the project is consistent with the previously certified
Program Environmental Impact Report (SCH No. 2023060699); and
3) Adopt Resolution No. PC2025-023 recommending City Council approval of the
Development Agreement and Affordable Housing Implementation Plan filed as
PA2025-0090 (Attachment No. PC 1).
(The remainder of this page intentionally left blank)
t-83
GENERALPLAN
a
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 3
t�
ZONING
3
•p r -
LOCATION
GENERAL PLAN
ZONING
CURRENT USE
General Commercial
Koll Center Planned
Various professional business
ON -SITE
Office CO-G
Community PC-15
offices
NORTH
City of Irvine
City of Irvine
Various professional business
offices and residential apartments
SOUTH
Mixed -Use Horizontal
MU-H2
PC-15
Various professional business
offices
EAST
General Commercial (CG)
PC-15
Fast food, professional office, and
hotel
Office -Airport (OA) and
Airport Office and
Newport Airport Village
WEST
Supporting Uses (AO) and
Planned Community
Various commercial uses
MU-H2
(PC-60)
A-84
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 4
INTRODUCTION
Project Setting
The 18.7-acre project site of the MacArthur Court Campus consists of five parcels located
at 4665, 4675, 4680, 4685 and 4695 MacArthur Court, and 4770 Campus Drive in the
Airport Area as shown in Figure 1 below. The project site abuts Campus Drive and the
City of Irvine to the north, MacArthur Boulevard to the west, and Birch Street to the south.
The property is currently developed with various professional business offices and a five -
story parking structure as shown in Figure 1 below.
4695 MacArthur'
Court 4680 MacArthur
{ Court
4675 MacArthur
lr' Court.ti
Figure 1: Five parcels that make up the MacArthur Court project site.
Background
Housing Opportunity (HO) Overlay Zoning District
On September 24, 2024, the City Council adopted Ordinance Nos. 2024-16 and 2024-17,
approving amendments to Title 20 (Planning and Zoning) of the NBMC to establish the
Housing Opportunity (HO) Overlay Zoning Districts in Section 20.28.050 (Housing
Opportunity (HO) Overlay Zoning Districts) (Housing Overlay) of the NBMC and to create
multi -unit objective design standards in Section 20.48.185 (Multi -Unit Objective Design
Standards) of the NBMC. The new sections serve to implement Policy Actions 1A through
4
1'6-85
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 5
1 G and 3A in the 6th Cycle Housing Element of the General Plan. Properties identified as a
Housing Opportunity Site have specified development allowances conducive to
residential development at the prescribed average density of 20 to 50 dwelling units per
acre. The standards include but are not limited to minimum lot area, setbacks, height,
open space, landscaping, and parking. The multi -unit objective design standards are
applicable to any residential project with a minimum density of 20 dwelling units per acre
to ensure the highest possible design quality and provide a baseline standard for new
multi -unit developments throughout the City.
Section 20.28.050 (Housing Opportunity (HO) Overlay Zoning Districts) of the NBMC
allows for new housing opportunities within five subareas to ensure the City can
accommodate its 6th Cycle RHNA allocation. These subareas correspond to the Focus
Areas identified in the Housing Element and are as follows:
• Airport Area Environs Area (HO-1)
• West Newport Mesa Area (HO-2)
• Dover-Westcliff Area (HO-3)
• Newport Center Area (HO-4)
• Coyote Canyon Area (HO-5)
Properties identified within these subareas are eligible for specified development
allowances conducive to residential development at the prescribed average density of 20
to 50 dwelling units per acre. The standards include but are not limited to minimum lot
area, setbacks, height, open space, landscaping, and parking. Each of the five subareas
is also subject to a development limit that identifies the maximum number of dwelling units
allowed.
The property is categorized as General Commercial Office (CO-G) by the General Plan
and located within the Koll Center Planned Community (PC-15) Zoning District. The
property, including 4665 and 4685 MacArthur Court, and many other properties in the PC-
15 Zoning District, are located within the HO-1 Subarea. The development limit for the
HO-1 Subarea is 2,577 units and the required average density range is 20 to 50 dwelling
units per acre. Figure 3 below depicts properties identified as housing sites within the HO-
1 Subarea and eligible for the development of housing pursuant to the Housing Overlay
of the NBMC.
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 6
%LB9F1 Subject Property
Housing Opportunity Sites Overlay (Coastal Zone)
Housing Oppwunily Sites Overlay
t�
w111l111l Coastal Zone Boundary'
GQ' n=xkrtum
Figure 2: HO-1 (Airport Area Environs Area) Subarea map
Project Description
The applicant, Irvine Company, is requesting a development agreement and affordable
housing implementation plan to vest rights to develop a mixed -use campus at MacArthur
Court. The future development of the MacArthur Court Campus includes the demolition
of approximately 126,837 square feet of existing office buildings on 4665 and 4685
MacArthur Court and 4770 Campus Drive. The project includes the future construction of
two five -story residential buildings consisting of 700 residential dwelling units and a
10,000-square-foot non-residential building. The project would retain the two existing
high-rise office towers and an existing 2,412 space parking garage. The two new
residential buildings (the MacArthur Court Apartments) will be constructed on a single
parcel that comprises a portion of 4665 and 4685 MacArthur Court and a portion of 4680
MacArthur Court as shown in the conceptual site plan below (Figure 3).
1-
.` RYA
MacArthur Court
Apartments
Figure 3: Conceptual Site Plan
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 7
Existing Parking
Garage
XESTENG
U11FA
A
0
I
¢¢o¢¢aa¢¢¢n
SLEVEL
EXISTING
GARAGE
op
Non -Residential
f Development
No specific design for the project is included in this application and no construction is
proposed as part of this application. Buildout of the project would require future entitlements,
including a Site Development Review by the Planning Commission prior to building permit
issuance.
Once complete, the proposed MacArthur Court Campus will include two new wrap
residential buildings, a new retail building, two existing office high rise towers, and an
existing stand-alone parking garage that supports the high-rise office buildings.
The following approvals are requested at this time for the purposes of allocating and
vesting development rights to 700 of the 2,577-unit HO-1 Subarea development limit-
• Development Agreement (DA) - A development agreement between the applicant
and the City, Chapter 15.45 (Development Agreements) of the Newport Beach
Municipal Code (NBMC), which would provide the applicant with the vested right to
develop the project for a term of 10 years and to provide negotiated public benefits
to the City-, and
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 8
Affordable Housing Implementation Plan (AHIP) - A preliminary plan specifying
how the project would contribute affordable housing as a public benefit, by providing
affordable housing units equivalent to 7% of up to 700 residential units rented at
market rate, or up to 49 affordable housing units. The applicant will identify an
appropriate site to develop a new affordable housing project for these 49 affordable
units at a future date.
DISCUSSION
Development Agreement
Pursuant to Section 15.45.020(A)(2)(a)(Development Agreement Required) of the
NBMC, a development agreement is not required because the project does not include a
legislative act (General Plan Amendment, Zoning Code Amendment) nor does the City's
6t" Cycle General Plan Housing Element require applicants to enter into DAs to develop
housing units located on Housing Opportunity Sites. Nonetheless, the Applicant is
requesting a voluntary development agreement to vest rights to develop the project
including 700 residential dwelling units for a term of 10 years. Additionally, the project will
be required to pay public benefit fees as part of the Development Agreement. The project
would also voluntarily provide much needed housing opportunities in the City in
furtherance of the certified Housing Element including up to 49 new affordable units.
As stated, the applicant requests a 10-year term for the agreement. The agreement
provides assurance that the applicant may proceed with the proposed project in
accordance with existing policies, rules and regulations, and conditions of approval.
Additionally, the agreement helps the applicant avoid a waste of resources and escalated
costs of the proposed project while encouraging a commitment to private participation in
comprehensive planning.
In exchange for vesting development rights, the applicant will be required to provide
various public benefits including:
MacArthur Boulevard Revitalization Fee: Payment of a MacArthur Boulevard
Revitalization fee of $3.25 million to help fund future City planned improvements
to MacArthur Boulevard to be paid at the issuance of the first building permit for
all or any portion of the 700 residential units. The City's planned improvements for
MacArthur Boulevard include, but are not limited to, new bike lanes, improvements
to intersections in order to enhance bicycle and pedestrian safety, median and
landscape improvements, and City entry signage;
Provision of Increased Open Space: In -lieu of dedicating 0.5-acre of land for a
neighborhood park in accordance with Land Use Policy LU 6.15.13 (Standards)
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 9
of the General Plan, the applicant has committed to granting of a public easement
for a larger 1.0-acre publicly accessible, but privately owned and maintained, area
of open space within the Property. The easement would be recorded prior to
issuance of the final certificate of occupancy for the 700 residential units;
• Development Impact Fee: Payment of Development Impact Fees (Fire, Police,
Recreation, Sewer) to be paid at the issuance of the respective building permit for
any of the 700 residential units;
• Affordable Housing Implementation Plan: Construction of up to 49 affordable
dwelling units (see AHIP below); and
• Public Benefit Fee: A public benefit fee of $17,000 per residential unit, paid prior
to issuance of building permit for any of the 700 units that are issued a building
permit on or after July 1, 2028. As an incentive to encourage development of the
project within the current 6t" Cycle Housing Period, the public benefit fee will not
be assessed to the development of any units that are issued a building permit
before July 1, 2028.
Affordable Housing Implementation Plan
Although not required to implement the project, as a voluntary public benefit, the applicant
has prepared a draft Affordable Housing Implementation Plan (AHIP), dated May 2025
(Exhibit C of Attachment No. PC 1) to illustrate their commitment to the development of
affordable housing in the community.
The project proposes constructing 700 new market rate residential units on the MacArthur
Court Campus. The applicant proposes building affordable housing units at an off -site
location equivalent to 7% of the new market rate residential units constructed, which
would require up to 49 new affordable units (i.e., 7% of 700 market rate units). No density
bonuses are requested as part of the AHIP. The units would be allocated for very low- or
low-income households and would be built on a single site, which may be located outside
of the Airport Area. The first building permit for construction of the affordable housing
units shall be issued by January 31, 2029.
In the event that the affordable units cannot be constructed within the specified timeline,
suitable land will be dedicated to the City for the purpose of future affordable housing
development. If the affordable units are not built, and land is not dedicated, then the
Applicant shall be responsible for paying an affordable housing in -lieu fee of $36,690 per
market rate unit constructed.
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MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 10
General Plan Consistency
Pursuant to General Plan Policy LU 4.5 (Residential Uses and Residential Densities),
residential use of any property included within an established housing opportunity overlay
zoning district is allowed regardless of the underlying land use category or density limit
established through General Plan Policy LU 4.1 (Land Use Diagram), Table LU1 (Land
Use Plan Categories) and Table LU2 (Anomaly Locations). A general plan amendment is
not required to develop residential uses within an established housing opportunity zoning
overlay district. Therefore, although the project site has a General Plan land use
designation of General Commercial Office (CO-G), a general plan amendment is not
required to implement the project because the project proposes to vest the rights for the
development of residential uses located within the HO-1 (Airport Area Environs Area)
Subarea of the City's Housing Opportunity (HO) Overlay zoning district.
As discussed above, the project is consistent with Land Use Policy 6.15.13 (Standards)
of the General Plan Land Use Element which aims to provide neighborhood parks for the
entire neighborhood and to serve the daily recreational and commercial needs of the
community within easy walking distance of homes, require dedication and improvement
of up to 0.5-acres as a neighborhood park. This requirement may be waived by the City
where it can be demonstrated that the development parcels are too small to feasibly
accommodate the park or inappropriately located to serve the needs of local residents,
and when an in -lieu fee is paid to the City for the acquisition and improvement of other
properties as parklands to serve the Airport Area. In -lieu of the 0.5-acre park dedication,
the project will provide provisions for 1.0 acres of Publicly Accessible Open Space
(PAOS), significantly exceeding the approximately 0.5-acre requirement (3% of net site
area) of Section 20.48.185(0) (Multi -Unit Objective Design Standards) of the NBMC. The
PAOS is intended to be configured as a passive paseo and active plaza that provides
walking and biking connections through the project site, and a central gathering area that
serves as an amenity for residents of the project as well as neighborhood residents,
employees, and visitors.
Water Supply Assessment
Pursuant to California Senate Bill 610 (SB 610) adopted in 2011, Section 21151.1 of the
Public Resources Code, and Section 10910 et. seq. of the Water Code, a Water Supply
Assessment is required for projects that result in construction of at least 500 dwelling
units. Since the project includes the future construction of up to 700 units on the Property,
and the City's Housing Implementation Program EIR contemplated that future housing
projects would prepare their own project specific WSA's, it was appropriate for the
Applicant to prepare a WSA for the project.
The Property is served by the Irvine Ranch Water District (IRWD). Therefore, the City is
not the Water Agency tasked with formally reviewing or accepting the WSA. The WSA
was approved by the Board of Directors of the IRWD on October 13, 2025. The
assessment determined that a sufficient water supply is available for the project and that
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 11
the total water supplies available to IRWD during normal, single -dry and multiple -dry
years within a 20-year projection will meet the projected water demand of the project in
addition to the demand of existing and other planned future uses, including, but not limited
to, agricultural and manufacturing uses.
Environmental Review
Pursuant to the California Environmental Quality Act (CEQA) as set forth in California
Public Resources Code Section 21000 et seq. and its implementing guidelines set forth
in California Code of Regulations, Title 14, Division 6, Chapter 3 (CEQA Guidelines), the
City Council adopted Resolution No. 2024-50 on July 23, 2024, certifying Final Program
Environmental Impact Report SCH No. 2023060699 (PEIR), approving a Mitigation
Monitoring and Reporting Program (MMRP), and adopting Findings and a Statement of
Overriding Considerations related to the implementation of the Housing Element involving
amendments to the General Plan, Coastal Land Use Plan, and Title 20 (Planning and
Zoning) and Title 21 (Local Coastal Program Implementation Plan) of the NBMC which
are available at: Housina Implementation Proaram EIR.
The Project is not subject to further environmental review pursuant to Section 21083.3 of
the California Public Resources Code (PRC) and Section 15183 of the CEQA Guidelines
because, inasmuch as the Properties involved are all within the HO-1 Subarea, the
Project does not change the underlying land use or zoning designations; and would not
result in new significant impacts or a substantial more adverse impact than addressed in
the PEIR.
Section 15183 of the CEQA Guidelines provides, in relevant part:
a. Projects which are consistent with the development density established by
existing zoning, community plan, or general plan policies for which an
environmental impact report (EIR) was certified shall not require additional
environmental review, except as might be necessary to examine whether there
are project -specific significant effects which are peculiar to the project or its
site. This streamlines the review of such projects and reduces the need to
prepare repetitive environmental studies.
b. In approving a project meeting the requirements of this section, a public agency
shall limit its examination of environmental effects to those which the agency
determines, in an initial study or other analysis:
Are peculiar to the project or the parcel on which the project would be
located;
MacArthur Court Apartments (PA2025-0090)
Planning Commission, October 23, 2025
Page 12
ii. Were not analyzed as significant effects in a prior EIR on the zoning
action, general plan, or community plan, with which the project is
consistent;
iii. Are potentially significant off -site impacts and cumulative impacts which
were not discussed in the prior EIR prepared for the general plan,
community plan or zoning action; or
iv. Are previously identified significant effects which, as a result of
substantial new information which was not known at the time the EIR
was certified, are determined to have a more severe adverse impact
than discussed in the prior EIR.
C. If an impact is not peculiar to the parcel or to the project, has been addressed
as a significant effect in the prior EIR, or can be substantially mitigated by the
imposition of uniformly applied development policies or standards, as
contemplated by subdivision (e) below, then an additional EIR need not be
prepared for the project solely on the basis of that impact.
d. This section shall limit the analysis of only those significant environmental
effects for which:
Each public agency with authority to mitigate any of the significant
effects on the environment identified in the EIR on the planning orzoning
action undertakes or requires others to undertake mitigation measures
specified in the EIR which the lead agency found to be feasible, and
ii. The lead agency makes a finding at a public hearing as to whether the
feasible mitigation measures will be undertaken.
e. An effect of a project on the environment shall not be considered peculiar to
the project or the parcel for the purposes of this section if uniformly applied
development policies or standards have been previously adopted by the city or
county with a finding that the development policies or standards will
substantially mitigate that environmental effect when applied to future projects,
unless substantial new information shows that the policies or standards will not
substantially mitigate the environmental effect. The finding shall be based on
substantial evidence which need not include an EIR. Such development
policies or standards need not apply throughout the entire city or county but
can apply only within the zoning district in which the project is located, or within
the area subject to the community plan on which the lead agency is relying.
Moreover, such policies or standards need not be part of the general plan or
any community plan but can be found within another pertinent planning
document such as a zoning ordinance.
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As part of its decision -making process, the City is required to review and consider whether
the Project would create new significant impacts or significant impacts that would be
substantially more severe than those disclosed in the PEIR. Additional CEQA review is
only triggered if the Project's new significant impacts or impacts that are more severe
than those disclosed in PEIR such that major revisions to the PEIR would be required. A
detailed consistency analysis has been prepared by T & B Planning Inc., dated
September 2025, and peer reviewed by Kimley-Horn & Associates, Inc., is provided as
Exhibit "B" to Attachment No. PC 1 of this staff report and hereby incorporated by
reference.
The PEIR contemplated those future projects meeting the thresholds of Senate Bill No.
610 (SB 610) would require the preparation of a WSA. The project area is within the Irvine
Ranch Water District (IRWD) service area and the PEIR concluded that water demands
from future housing projects would result in a significant and unavoidable impact
concerning water supply. The City, therefore, adopted a Statement of Overriding
Consideration for this impact in connection with its certification of the PEIR.
The Project is consistent with the development density and use characteristics
established by the City's General Plan Housing Implementation Program as analyzed by
the PEIR, and the required determinations can be made, as detailed in Exhibit "B" of
Attachment No. PC 1 and incorporated by reference.
Summary and Next Ste
The proposed project is consistent with the HO-1 Overlay Zoning District and will help the
City further the goals and policies of its Housing Element of the General Plan through the
incorporation of 700 residential units from the City's Housing Overlay (HO-1) as well as
up to 49 affordable units through the proposed AHIP.
Pursuant to Section 15.45.050 (Development Agreements — Public Hearing -Notice) of the
NBMC, the Planning Commission's role is to make a recommendation to the City Council
for action. If a supportive recommendation is made, City staff will bring the matter to the
City Council on November 18, 2025.
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Planning Commission, October 23, 2025
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Public Notice
Notice of this hearing was published in the Daily Pilot, mailed to all owners of property
within 300 feet of the boundaries of the site (excluding intervening rights -of -way and
waterways) including the applicant, and posted on the subject property at least 10 days
before the scheduled meeting, consistent with the provisions of the Municipal Code.
Additionally, the item appeared on the agenda for this meeting, which was posted at City
Hall and on the City website.
Prepared
Submitted by:
Jenny Tran J ime Murillo, AICP
Associate Planner Acting Comrnunity Development Director
ATTACHMENTS
PC 1 Draft Resolution
1-1 �i-95
Attachment D
Planning Commission Draft Meeting Minutes
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IV.
V
a
VII
NEWPORT BEACH PLANNING COMMISSION MINUTES
CITY COUNCIL CHAMBERS — 100 CIVIC CENTER DRIVE
THURSDAY, OCTOBER 23, 2025
REGULAR MEETING — 6:00 P.M.
CALL TO ORDER - 6:02 p.m.
PLEDGE OF ALLEGIANCE — Commissioner Ellmore
ROLL CALL
PRESENT: Chair Tristan Harris, Secretary Jonathan Langford, Commissioner Curtis Ellmore,
Commissioner Michael Gazzano, Commissioner Mark Rosene
ABSENT: Vice Chair David Salene, Commissioner Greg Reed
Staff Present: Acting Community Development Director Jaime Murillo, Deputy City Attorney Jose
Montoya, Associate Planner Jenny Hannsun, Assistant Planner Jerry Arregui, and
Administrative Assistant Clarivel Rodriguez
PUBLIC COMMENTS — None
REQUEST FOR CONTINUANCES — None
CONSENT ITEMS
ITEM NO. 1 MINUTES OF OCTOBER 9, 2025
Recommended Action: Approve and file
Chair Harris opened public comment.
Jim Mosher reported that he did not see any corrections that need to be made to the October 9,
2025, meeting minutes and congratulated the staff. He noted that Secretary Langford's first
name "Jonathan" is misspelled as "Jonathon" on the meeting's Agenda.
Chair Harris closed public comment.
Motion made by Commissioner Ellmore and seconded by Secretary Langford to approve the
meeting minutes of October 9, 2025.
AYES: Ellmore, Gazzano, Harris, Langford, and Rosene
NOES: None
ABSTAIN: None
ABSENT: Reed, and Salene
PUBLIC HEARING ITEMS
ITEM NO. 2 EAST COAST HIGHWAY RESTAURANT SPACE (PA2024-0198)
Site Location: 3840 East Coast Highway
Summary:
A request for a conditional use permit to establish a new 2,155-square-foot cafe style
restaurant by remodeling and expanding a vacant restaurant space within Suite B into the
adjacent vacant office space within Suite A. While a specific tenant has not yet been
identified, the request includes the allowance for alcohol service through a Type 41 (On -Sale
Beer and Wine — Eating Place) California Department of Alcohol Beverage Control (ABC)
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Planning Commission Meeting
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License and operating hours from 6 a.m. to 10 p.m., daily. No live entertainment, dancing, or
late -hour operations (i.e., after 11 p.m.) are proposed. Also included in the request is a 16-
space parking waiver to accommodate the expanded restaurant. Approval of the project will
supersede Use Permit Nos. UP1848 and UP2006A.
Recommended Actions:
1. Conduct a public hearing;
2. Find this project exempt from the California Environmental Quality Act (CEQA)
pursuant to Section 15301 under Class 1 (Existing Facilities) of the CEQA
Guidelines, because it has no potential to have a significant effect on the
environment; and
3. Adopt Resolution No. PC2025-022 approving the Conditional Use Permit filed as
PA2024-0198.
Assistant Planner Jerry Arregui used a presentation to present the project location, zoning, and
surrounding land uses, future project description, existing conditions, requested approvals
required by the City. He reported on receiving only one public comment generally supporting the
applications but also expressing concerns about the parking waiver.
In response to Secretary Langford's inquiries, Assistant Planner Arregui clarified that nothing will
be changed in the rear of the building and there are no changes to the rear setback. He clarified
that a Parking Management Plan was incorporated into the Parking Study, and the corresponding
Condition of Approval allows the plan to be enforced.
In response to Commissioner Rosene's inquiry, Assistant Planner Arregui clarified that the
Parking Study found the operations would peak early in the day due to the cafe -style use. He
reported that the intention of the property owner is to lease to a breakfast -serving restaurant. He
added that the hours in the proposal extending to 10:00 p.m. are intended to allow for flexibility in
searching for a tenant.
In response to Chair Harris' inquiries, Assistant Planner Arregui reported that Mama D's Italian
Kitchen, located a block from the site and also has residential units on its property, does not
provide any parking. He added that a parking waiver was approved for the restaurant in 2017 and
while there were no offsite parking agreement, there were informal parking agreements with
neighboring property owners. He stated that the property owner in this proposal will also be
encouraged to work with neighboring property owners for the potential creation of parking
agreements. He confirmed that the parking agreements for Mama D's are informal and not
required.
Chair Harris opened the public hearing.
Theory R Properties Vice President Buddy Molway, speaking for the building owners, confirmed
that they are pursuing potential restaurant operators focused on breakfast and lunch. He added
that they cannot sign a lease with a restaurant until they can guarantee the space, which is part
of why the hours of operation are so broad. He added that they are looking for a family -friendly
tenant who will add to CdM's vibrance, and they have identified several good potential operators
who focus on a breakfast cafe -style restaurant.
In response to Chair Harris' inquiry, Mr. Molway confirmed that the applicant agrees with all
recommended Conditions of Approval.
In response to Commissioner Rosene's inquiries, Mr. Molway agreed that it is somewhat unusual
in that they do not yet know the tenant for this CUP application. He agreed with Condition of
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Approval Nos. 6 and 13, which limit the property to a cafe -style restaurant.
Mr. Mosher agreed with Commissioner Rosene's concerns about approving a CUP without an
identified operator, adding that it is unusual. He stated that the project would be inconsistent with
the Zoning Code in terms of parking. He reported that Conditional of Approval No. 11 has a
typographical error where "that" should be "than" and "and" should probably be "or" to better meet
the intent of the condition. He added that Condition of Approval No. 13 is also grammatically
incorrect due to either including the word "and" or the possible needed omission of words following
the "and". He added that this Condition is critical as Commissioner Rosene is relying on it to
ensure that the eventual tenant is a cafe -style restaurant. He expressed concerns about having
staff parking on the roof because it contains the only handicapped -accessible space and
encouraged this space to be reserved for guests.
Theory R Properties Founder and Chairman Gary Daichendt added that the elevator to the roof
is intended to help in the loading and unloading of handicapped guests who are not driving
themselves for better access. He noted that there are also regularly empty parking spaces in front
of the building for handicapped drop-offs and pick-ups. He clarified that there is also the potential
for a handicapped employee. He added that interested tenants are cafe -centric because it is what
fits the venue and neighborhood.
Assistant Planner Arregui thanked Mr. Mosher for noting the grammatical mistakes. He clarified
that Condition No. 11 should use the word "than" and keep the "and". He added that "and" should
be struck from Condition No. 13.
Acting Community Director Jaime Murillo added that Condition of Approval No. 45 can be modified
to require employees to park within the five standard parking spaces so that the accessible space
can be available for customers or employes who are disabled .
In response to Chair Harris' inquiry, Acting Community Director Murillo clarified that restaurants
come and go, and staff looks at whether a new restaurant is in substantial conformance with the
original approval. He stated that staff would take a similar stance here if something other than a
cafe with more of an evening -heavy use moves into the space. He added that peak parking
demand in the area occurs around lunchtime, with it lessening in the evening when offices are
closed. He added that this assertion led to staff providing more flexibility with the closing hours.
Chair Harris closed the public hearing.
Commissioner Gazzano recommended editing the language of Condition of Approval No. 45 to
include a phrase such as "consistent with the Americans with Disabilities Act"
Acting Community Director Murillo confirmed that staff can modify the language of Condition of
Approval No. 45 to meet this intent.
Secretary Langford stated that CdM needs something like this. He noted that the CdM
Commercial Corridor Study is coming to the City Council in a couple of weeks and added that the
findings will likely call for ways to attract businesses such as this proposed cafe.
Motion made by Secretary Langford and seconded by Commissioner Ellmore to approve the
item with amendments to Condition of Approval Nos. 11, 13, and 45.
AYES: Ellmore, Gazzano, Harris, Langford, and Rosene
NOES: None
ABSTAIN: None
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ABSENT: Reed, and Salene
ITEM NO. 3 MACARTHUR COURT (PA2025-0090)
Site Location: 4665, 46575, 4680, 4685, and 4695 MacArthur Court, and 4470
Campus Drive
Summary:
A request for a development agreement and affordable housing implementation plan for the
future development of MacArthur Court Campus, a mixed -use campus consisting of two
new five -story residential buildings containing 700 residential units (MacArthur Court
Apartments), and a new 10,000-square-foot retail building. The project would include the
demolition of approximately 126,837 square feet of existing office buildings and retention of
two existing high rise office towers and an existing parking garage. The applicant requests
the following approvals to vest the development rights for the project:
• Development Agreement (DA) - A development agreement between the applicant and
the City, pursuant to Chapter 15.45 (Development Agreements) of the Newport Beach
Municipal Code (NBMC), which would provide the applicant with the vested right to
develop the project for a term of 10 years and to provide negotiated public benefits to the
City; and
• Affordable Housing Implementation Plan (AHIP) - A preliminary plan specifying how
the project would contribute affordable housing as a public benefit, by providing affordable
housing units equivalent to 7% of up to 700 market rate residential units, or up to 49
affordable housing units. The applicant will identify an appropriate site for development
of the 49 affordable units at a future date.
The Project would require approval of a future Site Development Review prior to building
permit issuance, as no specific design for the Project is included.
Recommended Actions:
1. Conduct a public hearing;
2. Find this project is not subject to further environmental review pursuant to Section
21083.3 of the California Public Resources Code (PCR) and Section 15183 of the
CEQA Guidelines because the project is consistent with the previously certified
Program Environmental Impact Report (SCH No. 2023060699); and
3. Adopt Resolution No. PC2025-023 recommending City Council approval of the
Development Agreement and Affordable Housing Implementation Plan filed as
PA2025-0090.
Acting Community Director Murillo clarified that this is not the approval of the actual mixed -use
housing project but only the Development Agreement (DA) and Affordable Housing
Implementation Plan (AHIP).
Associate Planner Jenny Hannsun used a presentation to present the future project location and
description, surrounding land uses, zoning, existing conditions, and the requested approvals
required by the City..
She reported that the DA would have a 10-year term with a $17,000 Public Benefit Fee for
residential units built on or after July 1, 2028. She added that there would be a $3.25 million
payment for improvements along MacArthur Boulevard, a public one -acre easement for open
space, Development Impact Fees, and the AHIP. She clarified that the DA is still under review
and there will be minor changes before it is presented to the City Council.
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Associate Planner Hannsun reported that the Voluntary AHIP requires the provisions for
affordable housing in an amount equal to 7% of the requested market -rate residential units . She
added that up to 700 market -rate units can be constructed on the project site, with the affordable
housing units to be constructed off -site. She stated that the first building permit for affordable
housing will be issued by January 31, 2029, and, if the units are not constructed, either suitable
land will be dedicated to the City or a fee of $36,690 per market rate unit will be paid by the
developer.
In response to Secretary Langford's inquiries, Acting Community Development Director Murillo
clarified that the 700 residential unit cap is allocated from to the overall development limit for the
airport area. He added that there is no location identified for the 49 affordable housing units and
clarified that they would be separate from the 700 on -site units. He confirmed that the 49
affordable housing units would be subject to a separate entitlement process from the main
development in the future.
In response to Secretary Langford's inquiry, Associate Planner Hannsun confirmed that this site
would be held to the same development standards as other Housing Opportunity sites.
In response to Chair Harris' inquiry, Associate Planner Hannsun clarified that the affordable
housing units would be equal to 7% of whatever overall number of market -rate housing units are
eventually built.
In response to Chair Harris' inquiry, Commissioners Rosene, Ellmore, and Gazzano, and
Secretary Langford, disclosed ex Parte communications with the applicant's consultant. Chair
Harris clarified that the applicant's consultant contacted him, but they did not meet.
Chair Harris opened the public hearing.
CAA Planning Chief Executive Officer Shawna Schaffner, speaking on behalf of the Irvine
Company, stated that Associate Planner Hannsun's thorough staff report leaves her with nothing
to add. She stated that the applicant received a letter yesterday from the Western States Regional
Council of Carpenters, and it has been responded to with the feeling that no further issues to
discuss have been raised. She agreed with the staff's opinion of Condition of Approval No. 5 being
struck as it is irrelevant in this case.
Mr. Mosher stated that it is unusual to approve a DA without a specific project while locking in the
current zoning for a future development that has not yet been planned. He noted a contradiction
between the CEQA documentation stating that the entire site is within the HO-1 Subarea when
the site diagram says otherwise. He noted that a recent ministerial director's determination
change added the rest of the site to the HO-1 Subarea despite the Land Use Element saying that
additions can only be made through rezoning. He added that an October 101" decision by the
California Court of Appeals found the concept of housing overlay zones to be invalid. He added
that the applicant will be securing a development entitlement that may prove to be invalid and
expressed his discomfort with the item.
Western States Regional Council of Carpenters Representative Leonard De La Rosa encouraged
the construction to require local hires, pay a prevailing wage, and utilize State -certified
apprentices. He lauded the benefits of hiring a local workforce, including the lessening of negative
climate impacts due to shorter commutes to the job site.
Ms. Schaffner noted that the housing overlay's boundaries cross parcel lines and added that staff
has addressed the way the zones do not cover the entirety of the parcels. She stated that the
applicant does not view the housing overlay's boundaries as a problem with this application.
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Acting Community Development Director Murillo confirmed that a director's determination clarified
a discrepancy in the boundaries of the housing overlay within these parcels. He added that the
determination contains extensive details about why it is appropriate to include the entirety of the
parcels.
Chair Harris closed the public hearing.
Chair Harris stated that the AHIP is fair and realistic.
Motion made by Chair Harris and seconded by Secretary Langford to approve the item.
AYES:
Ellmore, Gazzano,
NOES:
None
ABSTAIN:
None
ABSENT:
Reed, and Salene
Harris, Langford, and Rosene
Vill. STAFF AND COMMISSIONER ITEMS
ITEM NO. 4 MOTION FOR RECONSIDERATION - None
ITEM NO. 5 REPORT BY THE COMMUNITY DEVELOPMENT DIRECTOR OR REQUEST
FOR MATTERS WHICH A PLANNING COMMISSION MEMBER WOULD LIKE
PLACED ON A FUTURE AGENDA
Acting Community Development Director Murillo reported that the November 6th meeting will be
canceled due to a lack of scheduled public hearings. He added that the next meeting will be on
November 20th, featuring a medical office condominium map. He stated that the November 20th
meeting will also include a discussion item about the ongoing General Plan update.
ITEM NO. 6 REQUESTS FOR EXCUSED ABSENCES — None
IX. ADJOURNMENT — With no further business, Chair Harris adjourned the meeting at 6:54 p.m.
The agenda for October 23, 2025, Planning Commission meeting was posted on Thursday,
October 16, 2025, at XXXXX p.m. in the Chambers binder, on the digital display board located
inside the vestibule of the Council Chambers at 100 Civic Center Drive, and on the City's
website on Thursday, October 16, 2025, at XXXXX p.m.
Tristan Harris, Chair
Jonathan Langford, Secretary
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Attachment E
Planning Commission Resolution No.
PC2025-023 (No Exhibits)
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RESOLUTION NO. PC2025-023
A RESOLUTION OF THE PLANNING COMMISSION OF THE
CITY OF NEWPORT BEACH, CALIFORNIA,
RECOMMENDING CITY COUNCIL ADOPTION OF A
DEVELOPMENT AGREEMENT AND AFFORDABLE
HOUSING IMPLEMENTATION PLAN FOR THE
MACARTHUR COURT PROJECT LOCATED AT 4665, 4675,
4680, 4680, 4685 AND 4695 MACARTHUR COURT AND
4770 CAMPUS DRIVE (PA2025-0090)
THE PLANNING COMMISSION OF THE CITY OF NEWPORT BEACH HEREBY FINDS
AS FOLLOWS:
SECTION 1. STATEMENT OF FACTS.
An application was filed by The Irvine Company ("Applicant"), with respect to
properties located at 4665, 4675, 4680, 4685 and 4695 MacArthur Court, and 4770
Campus Drive and legally described in Exhibit "A," which is attached hereto and
incorporated by reference ("Property").
2. The Applicant is requesting entitlements for the development of MacArthur Court
Campus, a mixed -use campus consisting of two five -story residential buildings
containing 700 residential units ("MacArthur Court Apartments"), and a 10,000-
square-foot retail building. The project would also retain the two existing high rise
office towers and an existing parking garage ("Project"). The Applicant requests the
following approvals to vest the development rights for the Project:
• Development Agreement ("DA") - A development agreement between the
Applicant and the City, pursuant to Chapter 15.45 (Development Agreements)
of the Newport Beach Municipal Code ("NBMC"), which would provide the
Applicant with the vested right to develop the Project for a term of 10 years
and to provide negotiated public benefits to the City; and
Affordable Housing Implementation Plan ("AHIP") - A preliminary plan
specifying how the Project would contribute affordable housing as a public
benefit, by providing affordable housing units equivalent to 7% of up to 700
market rate residential units, or up to 49 affordable housing units. The
Applicant will identify an appropriate site for development of the 49
affordable units at a future date.
3. The Property is designated General Commercial Office (CO-G) by the General Plan
Land Use Element and is located within the Koll Center Planned Community (PC-15)
Zoning District - Office Site C.
4. The Property is not located within the coastal zone.
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5. A public hearing was held on October 23, 2025, in the Council Chambers at 100 Civic
Center Drive, Newport Beach. A notice of the time, place, and purpose of the
hearing was given in accordance with California Government Code Section 54950
et seq. ("Ralph M. Brown Act") and Chapters 20.62 ("Public Hearings") of the
Newport Beach Municipal Code ("NBMC"). Evidence, both written and oral, was
presented to, and considered by, the Planning Commission at this public hearing.
SECTION 2. CALIFORNIA ENVIRONMENTAL QUALITY ACT DETERMINATION.
Pursuant to the California Environmental Quality Act ("CEQA") as set forth in California
Public Resources Code Section 21000 et seq. and its implementing guidelines set forth
in California Code of Regulations, Title 14, Division 6, Chapter 3 (CEQA Guidelines), the
City Council adopted Resolution No. 2024-50 on July 23, 2024, certifying Final Program
Environmental Impact Report SCH No. 2023060699 ("PEIR"), approving a Mitigation
Monitoring and Reporting Program (MMRP), and adopting Findings and a Statement of
Overriding Considerations related to the implementation of the Housing Element involving
amendments to the General Plan, Coastal Land Use Plan, and Title 20 (Planning and
Zoning) and Title 21 (Local Coastal Program Implementation Plan) of the NBMC which
are available at: Housing Implementation Program EIR.
The Project is not subject to further environmental review pursuant to Section 21083.3 of
the California Public Resources Code (PRC) and Section 15183 of the CEQA Guidelines
because, inasmuch as the Properties involved are all within the HO-1 Subarea, the
Project does not change the underlying land use or zoning designations; and would not
result in new significant impacts or a substantial more adverse impact than addressed in
the PEIR.
Section 15183 of the CEQA Guidelines provides, in relevant part:
a. Projects which are consistent with the development density established by
existing zoning, community plan, or general plan policies for which an
environmental impact report ("EIR") was certified shall not require additional
environmental review, except as might be necessary to examine whether there
are project -specific significant effects which are peculiar to the project or its
site. This streamlines the review of such projects and reduces the need to
prepare repetitive environmental studies.
b. In approving a project meeting the requirements of this section, a public agency
shall limit its examination of environmental effects to those which the agency
determines, in an initial study or other analysis:
Are peculiar to the project or the parcel on which the project would be
located;
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Were not analyzed as significant effects in a prior EIR on the zoning
action, general plan, or community plan, with which the project is
consistent;
iii. Are potentially significant off -site impacts and cumulative impacts which
were not discussed in the prior EIR prepared for the general plan,
community plan or zoning action; or
iv. Are previously identified significant effects which, as a result of
substantial new information which was not known at the time the EIR
was certified, are determined to have a more severe adverse impact
than discussed in the prior EIR.
C. If an impact is not peculiar to the parcel or to the project, has been addressed
as a significant effect in the prior EIR, or can be substantially mitigated by the
imposition of uniformly applied development policies or standards, as
contemplated by subdivision (e) below, then an additional EIR need not be
prepared for the project solely on the basis of that impact.
d. This section shall limit the analysis of only those significant environmental
effects for which:
Each public agency with authority to mitigate any of the significant
effects on the environment identified in the EIR on the planning or zoning
action undertakes or requires others to undertake mitigation measures
specified in the EIR which the lead agency found to be feasible, and
The lead agency makes a finding at a public hearing as to whether the
feasible mitigation measures will be undertaken.
e. An effect of a project on the environment shall not be considered peculiar to
the project or the parcel for the purposes of this section if uniformly applied
development policies or standards have been previously adopted by the city or
county with a finding that the development policies or standards will
substantially mitigate that environmental effect when applied to future projects,
unless substantial new information shows that the policies or standards will not
substantially mitigate the environmental effect. The finding shall be based on
substantial evidence which need not include an EIR. Such development
policies or standards need not apply throughout the entire city or county but
can apply only within the zoning district in which the project is located, or within
the area subject to the community plan on which the lead agency is relying.
Moreover, such policies or standards need not be part of the general plan or
any community plan but can be found within another pertinent planning
document such as a zoning ordinance.
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As part of its decision -making process, the City is required to review and consider whether
the Project would create new significant impacts or significant impacts that would be
substantially more severe than those disclosed in the PEIR. Additional CEQA review is
only triggered if the Project's new significant impacts or impacts that are more severe
than those disclosed in PEIR such that major revisions to the PEIR would be required. A
detailed consistency analysis has been prepared by T & B Planning Inc., dated
September 2025, and peer reviewed by Kimley-Horn & Associates, Inc., is provided as
Exhibit "B" to this draft resolution and hereby incorporated by reference. The PEIR
contemplated those future projects meeting the thresholds of Senate Bill No. 610 (SB
610) would require the preparation of a WSA. The project area is within the Irvine Ranch
Water District (IRWD) service area and the PEIR concluded that water demands from
future housing projects would result in a significant and unavoidable impact concerning
water supply. The City, therefore, adopted a Statement of Overriding Consideration for
this impact in connection with its certification of the PEIR.
The Project is consistent with the development density and use characteristics
established by the City's General Plan Housing Implementation Program as analyzed by
the PEIR, and the required determinations can be made, as detailed in Exhibit "B" of
Attachment No. PC 1 and incorporated by reference.
SECTION 3. REQUIRED FINDINGS.
Development Agreement
Although not required pursuant to Section 15.45.020(A)(1) (Development Agreement
Required) of the NBMC, a voluntary DA is requested to vest the development rights for
the Project over a period of 10 years. The DA provides the content required in Section
15.45.040 (Development Agreement — Contents) of the NBMC as follows:
1. A development agreement is requested by the Applicant, as the Project would
include a total of 700 residential units. The development agreement includes all
the mandatory elements including a term of 10 years and public benefits that are
appropriate to support conveying the vested development rights consistent with
the City's General Plan, the NBMC, and Government Code Sections 65864 et seq.
2. Public benefits include the payment of a public benefit fee for each residential unit.
In addition to the public benefit fee, the DA includes public benefits in the form of
a recorded easement for one acre of open space, a MacArthur Boulevard
Revitalization Fee of 3.25 million (Three Million Two Hundred Fifty Thousand)
Dollars, payment of Development Impact Fees, and an affordable housing
obligation in the form of an AHIP to be adopted for the development of affordable
housing units.
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Affordable Housing Implementation Plan
The AHIP is consistent with the intent to implement affordable housing goals within the
City pursuant to the Sixth Cycle Housing Element in response to the Regional Housing
Needs Assessment ("RHNA") allocation for the following reasons:
The Applicant has committed to assisting the City in the provision of additional
affordable housing opportunities. The location, type, affordability level, design, and
other details will be determined in the future as part of a site -specific project review.
The AHIP is attached as Exhibit "C" to this resolution and incorporated herein by
reference.
2. The AHIP proposes the construction of 700 residential units that will be rented at
market rate on the Property. The Applicant will construct new affordable housing
units equal to 7% of the new market rate units constructed on the Property, or 49
affordable units. The Applicant will identify an appropriate site to develop a new
affordable housing project for these 49 affordable units. The Project will facilitate
the City's efforts in attaining its Sixth Cycle RHNA mandate through the provision
of market -rate and affordable units.
3. The AHIP has been prepared consistent with the provisions of Section 20.52.015
(Affordable Housing Implementation Plan) of the NBMC.
SECTION 4. DECISION.
NOW, THEREFORE, BE IT RESOLVED:
In accordance with Section 21083.3 of the California Public Resources Code and
Section 15183 of the CEQA Guidelines, the Project is consistent with the
development density, intensity, and use characteristics established by the City's
General Plan Housing Implementation Program as analyzed by the PEIR, and the
required determinations can be made, as detailed in Exhibit "D"; therefore, the
Planning Commission finds that no additional environmental review is required to
approve the Project.
2. The Planning Commission of the City of Newport Beach hereby recommends
approval of the Project to the City Council, including: (1) the Development Agreement
in compliance with Chapter 15.45 (Development Agreements) of the NBMC and
California Code Section 65864 attached hereto as Exhibit "B"; and (2) the Affordable
Housing Implementation Plan attached hereto as Exhibit "C."
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PASSED, APPROVED, AND ADOPTED THIS 23RD DAY OF OCTOBER, 2025.
AYES: Ellmore, Gazzano, Harris, Langford, and Rosene
NOES: None
ABSTAIN: None
ABSENT: Rosene and Salene
BY: TviSfxv' RA.v'v'iS
BY:
Tristan Harris, Chair
Jon Langford, Secretary
Attachment(s): Exhibit A — Legal Description
Exhibit B — Development Agreement
Exhibit C — Affordable Housing Implementation Plan
prepared by CAA Planning Inc. dated May 2025
Exhibit D — CEQA Consistency Analysis prepared by T&B
Planning Inc. dated October 2025
Exhibit E — Conditions of Approval
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EXHIBIT "A"
LEGAL DESCRIPTION
The Land referred to herein below is situated in the City of Newport Beach, County of
Orange, State of California, and is described as follows:
PARCEL A -
PARCEL 1 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT BEACH,
COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL MAP
FILED IN BOOK 196, PAGE 40 THROUGH 43 OF PARCEL MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
PARCEL B:
PARCEL 1, IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF
CALIFORNIA, AS SHOWN ON A PARCEL MAP FILED IN BOOK 68, PAGE 19 OF
PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
PARCEL C:
PARCELS 2, 3 AND 4 OF PARCEL MAP NO. 84-716, IN THE CITY OF NEWPORT
BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A PARCEL
MAP FILED IN BOOK 196, PAGES 40 THROUGH 43 OF PARCEL MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APNs:
445-121-14 (Affects Parcel A)
445-121-05 (Affects Parcel B)
445-121-15 (Affects Parcel 2 of Parcel C)
445-121-16 (Affects Parcel 3 of Parcel C)
445-121-17 (Affects Parcel 4 of Parcel C)
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EXHIBIT "E"
CONDITIONS OF APPROVAL
(Project -specific conditions are in italics)
Planning Division
The development shall be in substantial conformance with the approved MacArthur
Court Development Agreement dated September 25, 2025, and Affordable Housing
Implementation Plan dated May 2025 (except as modified by applicable conditions
of approval).
2. Prior to the issuance of building permits, the Applicant shall obtain all applicable
discretionary permits (e.g. Site Development Review, Parcel Map, etc.). The
Applicant shall comply with all conditions of approval for said discretionary permits.
3. The Project is subject to compliance with all applicable submittals approved by the
City of Newport Beach ("City") and all applicable City ordinances, policies, and
standards, unless specifically waived or modified by the conditions of approval.
4. The Applicant shall comply with all federal, state, and local laws. Material violation
of any of those laws in connection with the use may be cause for revocation of this
Development Agreement and Affordable Housing Implementation Plan.
5. Any change in operational characteristics, expansion in area, or other modification
to the approved plans, shall require an amendment to this Development Agreement
or Affordable Housing Implementation Plan or the processing of a new Development
Agreement or Affordable Housing Implementation Plan.
6. Prior to the issuance of a building permit, an affordable housing agreement shall
be executed in a recordable form as required by the City Attorney's Office.
7. The Applicant shall comply with all provisions of the Development Agreement
including payment and timing of the public benefit fees.
8. A copy of the Resolution, including conditions of approval Exhibit "A" shall be
incorporated into the Building Division and field sets of plans before issuance of
the building permits.
9. Should the property be sold or otherwise come under different ownership, any
future owners or assignees shall be notified of the conditions of this approval by
either the current business owner, property owner or the leasing agent.
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10. To the fullest extent permitted by law, applicant shall indemnify, defend and hold
harmless City, its City Council, its boards and commissions, officials, officers,
employees, and agents from and against any and all claims, demands, obligations,
damages, actions, causes of action, suits, losses, judgments, fines, penalties,
liabilities, costs and expenses (including without limitation, attorney's fees,
disbursements and court costs) of every kind and nature whatsoever which may arise
from or in any manner relate (directly or indirectly) to City's approval of MacArthur
Court Project including, but not limited to, Development Agreement and
Affordable Housing Implementation Plan (PA2025-0090). This indemnification
shall include, but not be limited to, damages awarded against the City, if any, costs
of suit, attorneys' fees, and other expenses incurred in connection with such claim,
action, causes of action, suit or proceeding whether incurred by applicant, City,
and/or the parties initiating or bringing such proceeding. The applicant shall indemnify
the City for all of City's costs, attorneys' fees, and damages which City incurs in
enforcing the indemnification provisions set forth in this condition. The applicant shall
pay to the City upon demand any amount owed to the City pursuant to the
indemnification requirements prescribed in this condition.
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