Group added to fairgrounds talks

Unable to finalize agreements with American Fairs and Festivals, the group offering to run the Orange County Fairgrounds, Costa Mesa has begun negotiations with another company, Facilities Management West.

The city has considered Facilities Management as a potential partner in its goal to pay the state $96 million for the 150-acre fairgrounds.

“It wasn’t until today that it became clear that we didn’t have a final agreement with American Fairs,” City Atty. Kimberly Hall Barlow said during Tuesday’s council meeting.

But on Wednesday, Fred Armendariz, who represents American Fairs, said the city signed an exclusive right to negotiate with his group.

“We’re all good now,” he said.

When asked about the city’s announcement to include Facilities Management in the negotiations, Armendariz said, “I don’t know that anymore.”

About 5 p.m., before the council went into closed session, it was announced that Facilities Management would be included in the negotiations on the fairgrounds.

Many residents were not happy with the city’s move as they fear that it could put the fairgrounds out of public hands.

“To me, this is just like the last kick in the rear-end for the public,” said former Mayor Sandy Genis, who serves as the president of the Orange County Fairgrounds Preservations Society.

Other residents were even more upset when, for a brief moment, they were told they couldn’t comment on the agenda item because it was already discussed.

“I want to know what the heck just happened? ... We did not know in public comments that you guys were even going to bring up changing it to adding Facilities West,” said Kathy Hoffstetter, a Costa Mesa resident. “So how could we possibly comment when you didn’t even have it agendized?”

Expanding negotiations to include Facilities Management West allows the city to work with both groups until an agreement is reached, Barlow said.

After an agreement to exclusively negotiate with the state for a purchase of the fairgrounds, Costa Mesa reached out to four of the groups that initially offered to buy the fairgrounds during January’s live auction.

Two of the four groups partnered to work with the city: Advanced Real Estate Services, which offered $56 million, and American Fairs, a newly formed group comprising fairgrounds vendors and stakeholders. American Fairs includes Tel Phil Enterprises, which runs the Orange County Market Place and bid $1,000 as a protest.

The third company Costa Mesa City Hall reached out to is Facilities Management West, which offered $55 million. The fourth was Craig Realty Group, a Newport Beach-based outlet developer that topped the auction with is $56.5-million bid. Craig Realty later dropped from negotiations with the city.

American Fairs is proposing to operate the fairgrounds, pay the down payment and the rest of its debt over a 40-year period, a plan that is consistent with Costa Mesa’s goal of preserving the fairgrounds while keeping it in public’s hands.

Facilities Management is interested in buying the fairgrounds and privately operating it.

Calls to Barlow, City Manager Allan Roeder, Mayor Allan Mansoor, and council members Katrina Foley and Gary Monahan were not returned Wednesday.