Developers of The LAB, a hipster shopping complex in Costa Mesa, are eyeing a number of downtown properties in Garden Grove owned by the city’s housing authority for a new development project.

The housing authority is currently engaging in preliminary discussions with LAB developers Shaheen and Linda Sadeghi, according to a conflict of interest waiver that appeared on Tuesday’s city council agenda.

The city council, acting as the housing authority, rejected the waiver for the law firm Stradling Yocca Carlson and Rauth, which has acted as special counsel to the housing authority and has also represented the developer on past projects, opting instead to use its in-house firm, Woodruff Spradlin and Smart, in the negotiations.

So far, the developers have suggested purchasing the property from the housing authority to develop them commercially, according to Community Development Director Susan Emery.

Emery said the city’s intent would be to maintain the original historic character of the downtown properties akin to the Packing House in Anaheim, where a citrus packing plant was repurposed into an indoor food court.

“Some of the buildings are dilapidated, some are vacant land and some are homes occupied by housing authority tenants, and we’d have to help them find new housing,” Emery said.

Emery emphasized that the ideas are “only high level concepts” so far and no specific proposals have been given.

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