Garden Grove Planning a Downtown Makeover

Garden Grove council members Tuesday evening approved a lease agreement for a proposed downtown commercial project by the developer behind trendy Orange County eating and shopping centers such as the Anaheim Packing House and Costa Mesa’s The Lab.

The development is part of an effort by city leaders to turn Garden Grove’s downtown – a patchwork of city-owned facilities, single family homes, big box stores and local businesses – into a walkable hub that preserves the city’s history by renovating, rather than bulldozing, existing structures.

Under the agreement, the developer, Costa Mesa-based LAB Holdings LLC, would purchase twelve single-family home properties for $3.38 million and convert them for commercial use. Five other properties will be leased and subleased to the company for just $1 a year for fifteen years, with the company being the first in line to purchase the properties should they go up for sale in the future.

Once the sale is finalized, the developer estimates the project would take three years to complete, according to a city staff report.

The properties, now owned by Garden Grove’s Housing Authority, were originally purchased by the city’s former redevelopment agency with the hope of consolidating them for a large development project. With the dissolution of redevelopment by Gov. Jerry Brown in 2012, the city transferred the properties to the Housing Authority, which has been using the homes for affordable housing.

Eleven homes have been used as month-to-month temporary rental housing for low-income families, who were notified of the development before renting. One of the homes has been unoccupied because of poor conditions, and the city does not have the money to maintain or renovate the homes, said city attorney Omar Sandoval.

Although the deal received a unanimous vote of the City Council, councilman Phat Bui expressed some reservations about the deal and the lack of public notice about the proposal.

“This [comes] as such a surprise. I thought we would have public hearings involving residents to get their input before rushing forward,” said Bui, who also expressed concerns that the development opportunity was not advertised to other developers.

In an email to the city council, resident Josh McIntosh also chided officials about the lack of public input.

“My concerns are that the public, nearly 180,000 residents, most likely do not know that this is about to happen. I have a lot of questions and concerns for this project, which has remained in back room discussions, with almost no public outreach done,” said McIntosh. “At the only public meeting, nearly two years ago, we had a lot of opposition to the project. Why has the city not brought this back for public discussion?”

The last time the city discussed the potential development at length was in April 2015, during a series of Planning Commission meetings about a zoning amendment to expand the types of commercial uses allowed in the neighborhoods around Garden Grove’s civic center.

At that time, several residents within the Civic Center zone had concerns about increased traffic, parking issues and unruly bar patrons seen in other downtowns, such as downtown Orange, which is near Chapman University, and downtown Santa Ana.

Others rave about the potential for revitalizing the city’s downtown and creating a space for residents who might otherwise go to Orange, Santa Ana or Fullerton to shop and eat.

LAB Holdings is owned by Shaheen Sadeghi and is known for converting vacant properties into retail spaces. In 1993, the company converted an abandoned factory in Costa Mesa into The Lab, a shopping center aimed at trendy youth and billed as an “anti-mall.” A complementary development, The Camp, was later added.

Sadeghi’s company also purchased a long-vacant Sunkist fruit packing house and in 2010 began converting it into the Anaheim Packing House, a gourmet food hall.

“We got really excited about the opportunity to preserve these homes and reuse them into something that’s more localization and personalization as opposed to the traditional retail commercial project,” Sadeghi said at the council meeting.

Contact Thy Vo at or follow her on Twitter @thyanhvo.

  • UnitedWeStand

    “Five other properties will be leased and subleased to the company for just $1 a year for fifteen years”!!!!!!!!!
    Orange county government needs more transparency. I agree with councilman Phat Bui and Mr. McIntosh and the City of Garden Grove isn’t the only city in Orange county which is “walking all over their own residents” and doesn’t listen to them..

  • BeeBee.BeeLeaves

    Cloud 9! Eleven years of wishful thinking! Woohoo-yeah!

  • Cynthia Ward

    While I look forward to any project Shaheen is involved in, Garden Grove must first explain the little issue of how HOUSING funds (usually restricted to HOUSING) are used for a commercial venture that removes housing units from the inventory. Have those restrictions been set aside with the demise of RDA?

    Shaheen is a genius and there is nobody better to carry a plan like this forward….AFTER the City has addressed for its residents the VERY REAL concerns about parking and traffic they have already rightfully expressed alarm about. The Packing House is a HUGE success, far beyond anything we imagined when our HPC pitched the idea of a gourmet food court for the Packing House back in the mid-2000s and were told by RDA that “Anaheim’s demographics don’t pencil out for such a thing,” (Up yours, Brad Hobson. I am SO GLAD we did not let the pencil pushers turn the building into condos.) But now you cannot get near the place even in slow periods, parking is a big issue and spills into surrounding neighborhoods. The price of success. Shaheen solved some of the issue with the coolest trolley, which now slowly rolls along a very charming loop of small independent shops, gathering spaces, and architecturally interesting townhomes. Riding that trolley and seeing my neighborhood with new eyes made me fall in love with it all over again. Shaheen also brought his golden touch to the previously failed Center Street Promenade (another “i told you so” to RDA who ignored pleas from the HPC focus group to not put in such generic storefronts) Today our slice of new-old downtown is even better than anything my husband and I used to dream of walking to for date night when we first moved from West Anaheim to the Colony, and wept over the empty lots that had once held our real downtown. Does it beat the SQR store? Nope, the bitterness remains, but as a second best he has taken a sow’s ear and turned it into a charming, high end silk purse, and Anaheim is seeing a huge influx of monied patrons and new residents. It’s been a while since Anaheim gave out a Key to the City, we need to offer one to Shaheen. But there are also some lessons learned by Anaheim’s experience that can be taken to Garden Grove to make a good idea even better.

    In addition to parking, the big skeleton in the closet that has not been addressed is TRASH. I cannot describe the mess that gets left by patrons returning to their cars. Gourmet popsicles still leave popsicle sticks, it doesn’t matter how much you paid for them, the little wooden sticks are the same sticky mess. Wrappers, drink cups, cup lids, straws, napkins, bags, it all ends up in the curbs and parkways and blown up onto lawns. GG MUST insist on a clean up crew. DAILY. Think maintenance district ALA Resort. Otherwise the patrons drawn by Shaheen’s projects seem to be a different crowd than the Fullerton pub crawling crowd, we have never encountered inebriated patrons or the grabby bros that characterize the Fullerton scene.

    Most importantly, Shaheen has a genuine love for history, and worked HARD with the architects to preserve the original character defining features of the sites he now handles in Anaheim, and I trust he will do the same in Garden Grove. If I had the cash to invest I’d be buying in that area because anything he touches turns to gold. The problem i see is the City of Garden Grove has a long standing tradition of walking all over their own residents, and THAT needs to be addressed before Shaheen is let loose to do his thing, because conflict between residents who have been dismissed ends up coming back on the developer, and is not fair to either side.

    Good luck, Garden Grove.

    • occynic

      Agree, not sure how GG can move property from their RDA into their Housing Authority to keep the State from forcing a sale, and then selling it to a private developer for commercial use?

      • Cynthia Ward

        Looks like selling some and leasing some, but it still has to remain in a housing use, does it not? I am no clear how that works with the dissolution of the RDA system. Anyone?