The Village at Laguna Hills has a construction order now, and the park is not near the front of it. The amended development agreement the City Council adopted on August 25 sets out two phases. Phase One must deliver two anchor stores, a block called Shops A, the first hotel and an affordable senior housing project. Village Park, the 3-acre green space at the center of this summer's coverage, is a required improvement in Phase Two.
The order matters if you live in Laguna Hills, because the site has been empty a long time. The Orange County Register reported in July that it has been eight years since the mall closed, and the mall buildings were razed in 2023. The developer, Merlone Geier Partners, bought the property in 2013. Anyone waiting to see what fills the 68 acres beside the 5 can now find the sequence in the agreement itself, and the city's own numbers help explain why it runs this way.
What the Agreement Puts in Each Phase
The revised plan covers 1,457 homes, two four-story hotels with 239 rooms between them, about 163,000 square feet of retail and an expanded 3-acre park. The office space, gym and movie theater from the 2022 approval are gone. The Register reported that city staff named economic feasibility as the main reason for cutting the gym and theater. The agreement then splits the work into required and elective pieces:
Required improvements | Elective improvements | |
|---|---|---|
Phase One | Anchor 1, Anchor 2, Shops A, Hotel 1, the Affordable Senior Housing Project, plus the streets, utilities and landscaping that serve them | All residential units north of Health Center Drive |
Phase Two | Village Park, the retail pads, Shops B and Shops C, Hotel 2, plus their streets, utilities and landscaping | The Central and South Residential multifamily buildings and other residential units south of Health Center Drive |
The table leaves out one option. In Phase One, the owner may build up to 60 attached or detached for-sale homes, along with Shops B and Shops C as stand-alone retail buildings, in place of the planned Lot 9 & 10 North Residential building. Anything built on that lot has to be at least three stories tall.
Most of the market-rate housing is elective. That includes the 901 market-rate apartments and the for-sale product types: 110 townhomes, 60 split units, 78 Paseo detached homes, 72 duplex units and 36 motor-court units. The 200 affordable senior apartments are the only housing on the required list.
The agreement also ties the homes south of Health Center Drive to the commercial work. Phase Two elective construction cannot begin until the Phase Two required work has started, both hotels have started and the affordable senior housing has started. So for most of the site, the stores, the hotels and the park have to be underway before apartments can go up.
Why a Hotel Is on the First List
The city's fiscal analysis explains why a hotel gets such an early spot. Economic & Planning Systems prepared the analysis for the City of Laguna Hills, and it is dated July 10, 2026. At full buildout, in 2026 dollars, it projects these annual General Fund figures for the Village.
Line item | Annual amount at buildout |
|---|---|
Transient occupancy tax, the city's hotel room tax | $1,501,800 |
Sales and use tax | $883,500 |
Property tax | $536,300 |
Total General Fund revenue | $3,828,100 |
Total General Fund expenditures | $2,432,300 |
Projected annual surplus | $1,395,800 |
The room tax from two hotels brings in more than the sales tax from all of the retail. It is the largest line on the revenue side, and it covers most of the $1,360,400 the analysis projects for public safety, which is the largest expense line. Putting a hotel in the first required group lines up with that math. The Phase One package pairs the city's biggest projected revenue source with the retail it was promised.
The Register reported a somewhat different headline number. Its July story cited an anticipated annual General Fund surplus of $2 million, along with almost $29 million in developer fee payments and more than $20 million for parks and recreation. The consultant's table puts the annual surplus at about $1.4 million at buildout. In the same Register story, Councilmember Jared Mathis called the project "a home run for Laguna Hills" and said its revenue would exceed what the mall produced in its heyday, even adjusted for inflation.
The fiscal analysis names some proposed users. It lists Nordstrom Rack and Whole Foods as anchor uses and a Residence Inn with 119 rooms and an AC Marriott with 120 rooms as the hotels, along with shops, restaurants, service pads, a pavilion and a kiosk. Those names describe what the applicant proposed in its project summary. They are not announced leases or opening dates.
The Clocks Built Into the Agreement
The full text of the amended and restated development agreement is posted with item 15 on the August 25 council agenda. It is specific about timing, but every deadline counts from a defined "Development Agreement Date" and not from a calendar date:
- The owner must start the Phase One required construction within four years of the Development Agreement Date.
- Once the retail buildings, the hotels or Village Park have started, each must be finished by the earlier of two years after construction begins or the fifth anniversary of the Development Agreement Date.
- The affordable senior housing has a separate three-year completion window, which starts when its construction begins.
- Phase Two required improvements, the park among them, may begin at any point during the agreement's term.
- The term runs 15 years. It extends automatically by five more years only if every required Phase Two improvement is finished before the first 15 years end.
The agreement also defines how the park "starts." For Village Park, the owner has commenced construction once it has demolished the existing Nordstrom Rack building on the site and begun park improvements, such as paving, landscaping or hardscape. That gives neighbors a clear sign to watch for. Once the Nordstrom Rack building is down and park work has begun, the park has to be finished by the earlier of two years from that start or the fifth anniversary of the Development Agreement Date.
Where the Paperwork Stands This Fall
The approvals are in place. At the August 25 meeting, the council adopted the Urban Village Specific Plan amendment 4 to 1 and the amended and restated development agreement with MGP Fund X Laguna Hills, LLC 3 to 1. The agenda, staff reports and minutes are on the city's meeting portal. Among other changes, the agreement's ordinance allows detached single-family homes by right on the site and exempts the project from the city-wide Objective Design Standards.
The city's Development Application Status Report, attached to the October 27 council agenda, lists the Village under case USE-0239-2025 at 24155 Laguna Hills Mall. Its status is with the Building Division:
- Demolition of the former Firestone building is complete.
- Plans to demolish the former Sears auto repair building are in review.
- Plans for Anchors 1 and 2, Shops A and Pad 3 Retail are in review.
- Plans for site improvements are in review.
The list follows the agreement closely. The plans now in review are for the anchors and Shops A, two of the Phase One required pieces, plus one retail pad. The work on the ground so far is clearing old auto-service buildings. Nothing in the October entry mentions Village Park. That matches its place in Phase Two.
The Tenants Who Stayed
Three restaurants on the site are part of the plan. The Register reported that BJ's Restaurant & Brewhouse, King's Fish House and In-N-Out Burger are expected to remain as part of the Village. They will be the established neighbors of the anchors and Shops A as those buildings move from plan review to construction.
The Register also reported that the developer expects the project, tentatively split into three phases, to take about a decade. The Register's three phases and the agreement's two may not line up exactly, and the agreement sets deadlines but no calendar dates. In the Register story, Mayor Don Caskey described the new center as a place built around gathering: "This is about bringing people together." Under the agreement, the 3-acre park for those gatherings is a Phase Two requirement.
If you would like to talk through how the Village's phases might affect your street, your commute or your plans for a home nearby, the team at Arbor Real Estate is glad to share what we are watching on the site. Let's Connect.
