UPDATE 10/10/2025: It’s now official; the Hive campus was acquired by Drawbridge Realty and leased 100% to Anduril. Thanks to my sources for the accurate tips: looks like y’all were right on the money.

Original post retained below.

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Sure looks that way.

First, let’s catch everybody up since I don’t think I’ve ever discussed this project other than in passing.

As many Costa Mesans will recall, the Los Angeles Chargers maintained a practice facility off of Susan Street for several seasons. However, the property opened up when the Chargers opened their new facility in El Segundo.

Since that time we’ve been wondering what would become of such a large piece of land in such a valuable part of town. Shortly after Measure K passed in 2022, we got the first hint of an answer: Legacy Partners, the developer behind the very posh 580 Anton development, proposed to build 1,050 housing units on the site it now dubbed “Hive Live”.

And this, of course, was music to the City Council’s ears. These 1,000+ housing units would take a big bite out of the 11,000+ units the City was supposed to deliver by 2029. As such, the Hive Live development sailed through its general plan screening in 2023 and recently passed through the Planning Commission earlier this year.

But something seemed to be slowing down the project behind the scenes. For at least three recent meetings the Hive Live proposal has been on the City Council’s agenda, but only as a plea to continue its item to future date. And lo and behold, this agenda features yet another continuance request from Legacy Partners, but this time with a twist: it is now requesting a continuance to a date uncertain, i.e., indefinitely.

So, is it pencils down at Hive Live?

Yes. I have spoken to both private and public figures in the community and they have all confirmed to me that this project, at least in the form that has been presented to the public, is not going forward.

Now, why it isn’t going forward is a bit more of a mystery, as these sources were somewhat reticent to divulge private business details (as they should be). But, no matter: let’s speculate!

My guess is that it has something to do with Anduril and its CEO, Palmer Luckey. Anduril Industries is a significant defense contractor startup (they make, among other things, drones and autonomous weapons) that has established its headquarters in Costa Mesa. As it happens, the main Anduril office sits adjacent to the Hive Live site. And, if you read the Planning Commission’s agenda report from the Hive Live approval earlier this year, you’ll notice a peculiar little detail:

While not proposed at this point, Anduril has a right of first offer to develop an additional office building on the Phase 1 site [of the Hive Live property]. If an office is proposed in the future of the southern parcel after the entitlement of Hive Live, then the future office project would require a Master Plan amendment, and would be reviewed on its own merits in compliance with the updated General Plan, Zoning district, and NCMSP.

I say “peculiar” because it is odd for a property owner to get as far as it did in the development of Hive Live — City Council screenings, architectural drawings, Planning Commission and CEQA work, etc. — when another party has a right of first offer over a critical part of the property. It would be a big risk that the substantial amount of time and money invested in that process would go to waste if that party exercised its right of first offer and snatched the property out from under you.

But I suspect that is what happened, and that Anduril exercised its option, even as I remain mystified by the property owner’s approach if that was the case. Let’s look at the circumstantial evidence.

First of course is that Anduril was the party that owned the option in the first place. That gives it the opportunity to critically disrupt the project.

Second, it certainly has the means to do so. Anduril just raised $2.5 billion (with a “b”!) in its latest funding round and it has been spending aggressively, not only building a state-of-the-art manufacturing facility in Ohio but also snapping up local commercial real estate. It just added 41,000+ square feet of office space on Harbor Boulevard in Costa Mesa to its lease portfolio that also includes over 163,000 square feet of warehouse and industrial space in Santa Ana.

And third, it may well have the motive. Anduril has been experiencing explosive growth, not only in terms of leased square feet but also by headcount. Its Orange County labor force has ballooned to 3,200 employees as of August 2025, making it the second largest areospace employer in Orange County behind Boeing. And why is Palmer Luckey betting so much on Orange County? Well, for one, he says it’s easier to hire and recruit here than in the Bay Area, particularly when it comes to military veterans. “Military vets don’t want to live in San Francisco either,” he quipped in a recent interview. “They do not want to pay $2 million to live in a crap shack.” (the interview is at the link; I recommend you watch it if you are interested in what Luckey is up to in Costa Mesa).

So here is my wild, completely unfounded guess: Anduril exercised its option on Hive Live and it may end up building company housing for itself. Company housing is a radical if coldly rational solution for companies trying to navigate our explosive housing cost inflation, which is far outpacing wage inflation (even for crazy successful companies like Anduril).

And look, we may have to root for that outcome. Otherwise, if it just turns into a bunch of office buildings, Costa Mesa will have a 1,000+ unit hole in its housing plan to account for. Oh boy.

The Rest of the Agenda – DHS Grants and the GOAT Gets Expanded

Thankfully the rest of the City Council’s agenda for tomorrow night is fairly routine or pertaining only to smaller matters, like municipal code clean-ups and a small residential development appeal from the Planning Commission initiated by a disgruntled neighbor.

But there are two more items I think are worth highlighting.

First, in the Consent Calendar, the City Council will consider accepting a $170,000 grant as part of Operation Stonegarden. What’s that? Uh, well: “Operation Stonegarden (OPSG) supports enhanced cooperation and coordination among Customs and Border Protection (CBP)/United States Border Patrol (USBP), and federal, state, local, tribal, and territorial law enforcement agencies to strengthen border security.”

While Costa Mesa’s piece of this grant is narrowly aimed at countering international narcotics trafficking (a very, very laudable effort), I wonder if any of the City’s local immigration activists will key-in on the Department of Homeland Security’s involvement here. Operation Stonegarden drew the attention of protesters in the first Trump Administration, and some cities that used the funds in similar ways to Costa Mesa ended up rejecting the grants.

And to be clear, I do not hope to see that happen here. On the contrary it would seem like cutting off our nose to spite our face: the communities that the Council would hope to protect with such equity theater are also the communities that are dealing with the day-to-day reality of drug trafficking, and I’d rather see the city stay laser-focused on solving that real-world problem than make grand, expensive gestures.

But who knows. People are feeling very sensitive these days, and for good reason.

The second item I’d take a closer look at is another grant, this time from the California Clean Air Resources Board (CARB), to expand service on the “Let’s Go Costa Mesa” free on-demand ride program. A couple of years ago the city was awarded a Clean Mobility Options (CMO) grant to provide the service to Costa Mesa’s poorest neighborhoods, as the purpose of the grant was to provide such neighborhoods with access to clean, electrified transportation that its residents would otherwise be unlikely to be able to afford or maintain.

Since that time the “Let’s Go Costa Mesa” program has been very successful, completing over 11,000 rides in 8 months (that works out to 40-50 rides a day, which is quite impressive given that the program only operates 3 cars for 10 hours a day, 7 days a week). And personally, I was particularly fascinated by who has been using the service, which was disclosed in a recent Active Transportation Committee meeting:

I had expected that seniors that have trouble driving or running errands would be the heaviest users, but look at that: the service is extremely popular among young people, with 55% of rides being taken by riders under the age of 28.

Now, that could be because there are other free ride services available to seniors, such as the free rides provided by the Costa Mesa Senior Center. And it could also be that young people are more accustomed to ordering up on-demand rides using an app, as Let’s Go Costa Mesa does, since it mimics the user experience of Uber or Lyft.

But in any event, I think it’s notable that young people, all of whom are old enough to drive, are flocking to an on-demand ride service.

Building on that success, the City has now been awarded a 30% increase in the grant amount for the next two years, which will permit it to expand the service area up Newport Boulevard in the Eastside. This is significant as there are a large number of low income apartments, including the Project Homekey site Mesa Vista Apartments, along that stretch. This will open a free option for these residents to access both the Westside and E. 17th Street without having to operate a private car.

While I don’t love grant–funded programs as opposed to projects — the former tend to morph into General-Fund-consuming perpetual motion machines that creep the city’s mission ever outward — I hope the City Council keeps this program rolling. The grant doesn’t fund a full-time employee and, if the money runs out, the operator may be able to switch over to a paid model. The service is clearly onto something and I hope we get a chance to see how it plays out over the next couple of years.