An Irvine, Calif.-based real estate investment firm has secured some funding for its long-in-the-works plan to redevelop a beachside industrial parcel in Southern California.
Shopoff Realty Investments secured a $60.9 million senior mortgage loan from Lionheart Strategic Management toward Magnolia Coast, Shopoff’s 28.9-acre master-planned project in Huntington Beach, Calif. The new loan package refinances existing debt and provides funds for future development, according to Shopoff. Lionheart’s Andy Klein and Benjamin Eshiwani led the deal for the lender.
Shopoff acquired the oceanfront parcel, formerly dubbed Magnolia Tank Farm as the storage site for large oil tanks, in 2016 for $26.5 million, according to media reports from the time of the deal. Shopoff plans to build a mixed-use district on the site, including about 200 attached and detached single-family homes, an affordable housing community containing 50 units, and a 215-room hotel with 19,000 square feet of retail space. Shopoff plans to begin construction on the project, which is wedged between Magnolia Street and Pacific Coast Highway, in late 2025.
“This financing is a key step forward in bringing Magnolia Coast to life. … This project represents an important opportunity to support the local workforce while potentially contributing to the growth and vitality of Huntington Beach,” Bill Shopoff, president and CEO of Shopoff Realty Investments, said in a statement.
After years of winding its way through the application process, including environmental review and rezoning, Shopoff’s project won final approval from the Huntington Beach City Council in September 2024. But the development has also been the source of controversy, as some environmental groups and local residents claim the site isn’t suitable for such a project due to its proximity to the neighboring Ascon landfill and its location astride an earthquake fault line. The landfill ended operations in the 1980s.
In an open letter sent in July to the California Coastal Commission, environmental groups such as the California Coastal Protection Network, the Surfrider Foundation, the Orange County Coastkeeper and the Sierra Club recommended denial for the project, claiming that the Ascon site was “un-remediated.” Shopoff rejects those claims, and the California Coastal Commission issued its approval of the development that same month.
“The property in question is located adjacent to a landfill site that is currently being remediated with a closure plan approved by the California Department of Toxic Substances Control,” Bill Shopoff told Commercial Observer in September. “There has been no migration [of toxic materials] from that site to Magnolia Tank Farms, which Shopoff continues to test and monitor.”
Nick Trombola can be reached at [email protected].
