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Caruso Affiliated wins support of 85-15 Plan

"L.A.'s Walt Disney of Shopping."

That's how The Hollywood Reporter recently referred to developer Rick Caruso, whose whimsically designed retail, dining and entertainment centers often seem that they're created as movie sets or part of a theme park.

At Caruso's The Grove, a 25-acre open-air complex adjoining the Los Angeles Farmer's Market, a double-decker trolley wends past a dancing-water fountain, tree-lined minipark and art deco storefronts that hearken back to Hollywood's golden age, generating the second-highest amount of retail sales per-square foot of any mall in the nation.

The Americana, Caruso's 15.5-acre complex in Glendale, is designed to resemble an old-time town square in New England, albeit a town square where retailers including Nordstrom's, Tiffany and J. Crew revolve around a central fountain that -- like the one at The Grove -- spurts out streams of water that are choreographed to music.

"Caruso Affiliated does not build 'shopping malls,'" says the Web page of his development firm. "We have torn up that old template and created something entirely new -- open-air lifestyle destinations that attract people through great design, architecture, landscaping and a focus on working at a neighborhood scale."

Now, as Caruso prepares to make his first major beachhead in San Diego County, he is focusing as much on the open space surrounding his proposed retail complex as on the complex itself.

Under a plan approved by the Carlsbad City Council on Aug. 25, Caruso acquired 203 acres of land north of Cannon Road and east of Interstate 5, including the city's landmark strawberry fields and the woodlands and meadows along the southern fringe of Agua Hedionda Lagoon.

But under Caruso's so-called 85-15 Plan, only 15 percent of the land, totaling 27 acres, will be earmarked for one of his themed shopping, dining and entertainment promenades.

The remaining 85 percent will be set aside as open space.

The strawberry fields will double from their current size to 60 acres, which -- together with a proposed orchard and herb garden -- would feed into a farm-to-table restaurant Caruso plans to build at the entrance to the retail area.

The rest of the land would be transformed into a public park, including hiking trails, bike paths, picnic areas, an amphitheater and an outdoor education area overlooking the lagoon.

Caruso said his plan "seamlessly fits with the fabric of the Carlsbad community … while preserving and protecting the lagoon, coastal habitat and agriculture.”

And he's gained the support of a wide swath of Carlsbad residents, as well as the Carlsbad Strawberry Co., the San Diego Farm Bureau and the Agua Hedionda Lagoon Foundation, a nonprofit environmental group that Caruso has been donating money to since launching his proposal.

In a $2.75 million petition drive that Caruso Affiliated funded this year, more than 20,000 Carlsbad residents said they wanted to see the plan placed on the June 2016 ballot -- twice as many signatures as required for a voters' initiative.

But there are critics who worry that the plan would bring too many cars into an area that can already get congested with traffic headed for Legoland to the east or Car Country Carlsbad and the Carlsbad Outlet Malls to the south.

They argue that Carlsbad already has enough development in the neighborhood and that some of the petition signers were misled into thinking they were signing to save the strawberry fields instead of to support a mall.

"We don't need another mall," Carlsbad resident Linda Breen said. "And how many people have tried to get from here to San Diego on a weekend or on an off hour and it takes an hour or an hour and a half because the I-5 is absolutely stopped? And there's no plan to mitigate that."

At press time, the City Council had until the end of August to decide whether to put the measure onto the ballot or to approve the project by itself.

To prepare for that meeting, the council asked staffers to perform a thorough analysis of Caruso's plans.

The city staff report, released on Aug. 7, found that Caruso's plan confirmed with all of the city's goals for the property except for traffic.

But the staffers added that even without the development, traffic emanating from the intersection of I-5 and Cannon Road would be worse than the city's goals -- and would be worse than it would be if Caruso built the development, which would include some traffic mitigation measures.

San Diego Gas & Electric started buying land around Agua Hedionda Lagoon in 1948, as it laid plans for the Encina Power Station. But it bought more land than it ultimately needed and started selling off parcels about 15 years ago.

Because SDG&E never developed the land, it has remained as open space. To protect that status, Carlsbad voters in 2006 approved Proposition D, requiring that 155 acres of SDG&E's land east of Cannon Road should remain as open space, while allowing 48 acres along I-5 to be used for commercial development.

In 2012, Caruso bought the commercially zoned space but also took out an option on the open space -- agreeing to buy it if his plans for a retail complex were approved.

Over the next three years, Caruso and his team held more than 100 meetings involving an estimated 6,000 Carlsbad residents, trying to get their input and buy-in on the project. Bryce Ross, Caruso's vice president for acquisitions and development, said the talks with voters had a real impact.

"They told us that they wanted an architectural style that reflects coastal California but that it shouldn't be uniform, with individual designs for the buildings," he said. "And they wanted the buildings to be low and approachable. So no building will be taller than 35 feet and the buildings fronting the lagoon will be lower than 25 feet."

Another thing that Carlsbad residents wanted, according to Caruso, was Nordstrom to be the anchor tenant, which was fortuitous, since Nordstrom has anchored several of his properties.

Nordstrom last month agreed to build a two-story, 123,000-square-foot store on the site, if it is approved.

Under the 85-15 Plan, the retail space is half the size allowed under Proposition D, while the open space is roughly 25 acres larger.

The plan would devote a portion of the revenue from the retail space to pay for sprucing up and maintaining the park, ranging from removing invasive, non-native plants to building the outdoor "classroom" designed to help students at local schools learn more about nature.

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