• News
  • Real Estate

Otay Ranch's victory lap

It's been a rough ride during the years for Otay Ranch LP, builders of the planned community known as Otay Ranch in Chula Vista, but as they near the sale of their 5,000th home, it looks as if the road is smoothing out for the developers.

The Baldwin family, who are off-road racing enthusiasts as well as developers, owns Otay Ranch LP. In 1988, Baldwin Company of Irvine purchased 19,000 acres of the Otay Ranch from United Enterprises for $150 million. Baldwins plans for the site include several planned communities, and a resort on the 133-acre parcel around the Spreckels hunting lodge. But, the plans for a collection of villages to be built in the community, which straddles the South Bay city of Chula Vista and a portion of neighboring Otay Mesa, soon became entangled in a legal mire, both financially and environmentally.

Kim Kilkenny is executive vice president of Otay Ranch LP. Photo: J. Kat Woronowicz

"We had some tough times, but we've always had an unusual history," said Kim Kilkenny, executive vice president of Otay Ranch LP. "We always remained optimistic and it's all finally coming together."

The Baldwin companies have always been a private family operation, said Kilkenny.

In 1956, teenage brothers Al and James Baldwin converted their family's Temple City chicken ranch into a subdivision. As the company grew and the brothers moved their operations to Orange County, they became one of the largest builders in Southern California and San Diego. Until the late 1990s, Baldwin was one of the largest homebuilders in the country, and the family acquired the 23,000-acre Otay Ranch property project in 1989.

The real-estate bust of the late 1980s took a toll on most of the developers in the area, but helped by a $150 million junk-bond deal it offered in 1993, the Baldwins held on to the former land in the Chula Vista area that was once filled with orchards and crops.

By 1995, the Baldwins finally entered bankruptcy, where the brothers lost control of at least part of their company, selling off a 4,900-acre parcel of the Otay Ranch to Carlsbad-based HomeFed Corp and others, but they did retain about seven acres of Otay Ranch.

The company emerged in 1996 with $20 million in new funding as the demand for affordable homes in San Diego soared.

"We sold some (property) to McMillin (Company)," Kilkenny said. "But everyone seemed to take a hit in those days because of the real-estate recession."

After the company placated local environmental groups with a promise to set aside thousands of acres of open space for habitat, Otay Ranch LP sold its first home in April 1999, overcoming obstacles that had never been dealt with before in the San Diego entitlement processing and along the way they created award-winning land-planning and environmental designs.

"We had a unique opportunity to plan something special," Kilkenny said. "We has a vision and we took risks and we did something no one in San Diego County had ever done before."

Today Otay Ranch is designed as a collection of villages. Homes and employment centers are near each other, designed to be easily accessible by public transportation. The goal is to reduce congestion by allowing as many people as possible to work near their homes, or take mass transit to the rest of Chula Vista. The overriding philosophy of Otay Ranch, according to Kilkenny, is to preserve biological resources. The master-planned community has a 17-square-mile nature-preserve system, surrounded by trails open to the public. For every acre of developed land in Heritage Village, 1.18 acres have been dedicated to the 11,375-acre Otay Ranch Nature Preserve, home to 84 endangered species. Not everyone agrees that this is enough, however.

"They built on nature preserves and I don't think they stuck to the original agreement of protecting the environment," said Susan Gold, a member of the San Diego Chapter of the Sierra Club. "We had to fight tooth-and-nail for those 11,000 acres, but I guess we should be happy with what we got."

Otay Ranch's neighborly hometown atmosphere is a result of more than a decade of comprehensive planning and homeowners who have embraced a "Mayberry" point of view. The pedestrian-oriented community blends residential neighborhoods with the services people want close at hand such as schools, parks, shopping, trails, transportation options and open space.

"I never would have moved to this area of San Diego because it used to be a, let's say, undesirable place to live," Otay Ranch homeowner Ted Tyler said. "But we love it. The open spaces and the stores close by us make it a great community."

Today, the Otay Ranch LP is headquartered in Newport Beach with an office in downtown San Diego, and remains a small organization with only about 25 employees.

Kilkenny said that hard work, determination and smart growth put his company ahead of the other developments in the area, with about 40 percent of the land already built out.

"It's quit remarkable how everything finally came together," he said. "We continue to be optimistic about this company and every decision we make. For nearly 20 years, we had a vision and it all came together because of our willingness to take risks."

Reed is a San Diego-based freelance writer.

User Response
0 UserComments