Commercial Real Estate Loans Refinancing Commercial Real Estate Commercial Mortgage 10 Year Fixed Rate 30 Year Amortization
A commercial mortgage is a mortgage loan secured by commercial property, such as an office building, shopping center, industrial warehouse, or apartment complex. The proceeds from a commercial mortgage are typically used to acquire, refinance, or redevelop commercial property.
Commercial mortgages are structured to meet the needs of the borrower and the lender. Key terms include the loan amount (sometimes referred to as "loan proceeds"), interest rate, term (sometimes referred to as the "maturity"), amortization schedule, and prepayment flexibility. Commercial mortgages are generally subject to extensive underwriting and due diligence prior to closing. The lender's underwriting process may include a financial review of the property and the property owner (or "sponsor"), as well as commissioning and review of various third-party reports, such as an appraisal.
There were $3.1 trillion of commercial and multifamily mortgages outstanding in the U.S. as of June 30, 2013. Of these mortgages, approximately 49% were held by banks, 18% were held by asset-backed trusts (issuers of CMBS), 12% were held by government-sponsored enterprises and Agency and GSE-backed mortgage pools, and 10% were held by life insurance companies.
Commercial mortgages can be structured as first liens or, if a greater loan amount is desired, the borrower may be able to obtain subordinate financing as well, sometimes structured as a mezzanine note or as preferred equity, which generally carries a higher interest rate.
Interest rates for commercial mortgages may be fixed-rate or floating rate. Fixed-rate mortgages on stabilized commercial real estate are generally priced based on a spread to swaps, with the swap spread matched to the term of the loan. Market interest rates as well as underwriting factors greatly affect the interest rate quoted on a particular piece of commercial real estate. Interest rates for commercial mortgages are usually higher than those for residential mortgages.
Many commercial mortgage lenders require an application fee or good-faith deposit, which is typically used by the lender to cover underwriting expenses such as an appraisal on the property. Commercial mortgages may also have origination or underwriting fees (paid at close as a reduction in loan proceeds) and/or exit fees (paid when the loan is repaid).
The term of a commercial mortgage is generally between five and ten years for stabilized commercial properties with established cash flows (sometimes called "permanent loans"), and between one and three years for properties in transition, for example, newly opened properties or properties undergoing renovation or repositioning (sometimes called "bridge loans"). Mortgages on multifamily properties that are provided by a government-sponsored enterprise or government agency may have terms of thirty years or more. Some commercial mortgages may allow extensions if certain conditions are met, which may include payment of an extension fee. Some commercial mortgages have an "anticipated repayment date," which means that if the loan is not repaid by the anticipated repayment date, the loan is not in default.
Commercial mortgages frequently amortize over the term of the loan, meaning the borrower pays both interest and principal over time, and the loan balance at the end of the term is less than the original loan amount. However, unlike residential mortgages, commercial mortgages generally do not fully amortize over the stated term, and therefore frequently end with a balloon payment of the remaining balance, which is often repaid by refinancing the property. Some commercial mortgages have an interest-only period at the beginning of the loan term during which time the borrower only pays interest.
Commercial loans vary in their prepayment terms, that is, whether or not a real estate investor is allowed to refinance the loan at will. Some portfolio lenders, such as banks and insurance companies, may allow prepayment flexibility. In contrast, for a borrower to prepay a conduit loan, the borrower will have to defease the bonds, by buying enough government bonds (treasuries) to provide the investors with the same amount of income as they would have had if the loan was still in place.
A commercial mortgage is typically taken on by a special purpose entity such as a corporation or an LLC created specifically to own just the subject property, rather than by an individual or a larger business. This allows the lender to foreclose on the property in the event of default even if the borrower has gone into bankruptcy, that is, the entity is "bankruptcy remote".
Commercial mortgages may be recourse or non-recourse. A recourse mortgage is supplemented by a general obligation of the borrower or a personal guarantee from the owner(s) of the property, which makes the debt payable in full even if foreclosure on the property does not satisfy the outstanding balance. A nonrecourse mortgage is secured only by the commercial property that serves as collateral. In an event of default, the creditor can foreclose on the property, but has no further claim against the borrower for any remaining deficiency.
If a sponsor is seeking financing on a portfolio of commercial real estate properties, rather than a single property, the sponsor may choose to take out a cross-collateralized loan, in which the all of the properties collateralize the loan.
Lenders may require borrowers to establish reserves to fund specific items at closing, such as anticipated tenant improvement and leasing commission (TI/LC) expense, needed repair and capital expenditure expense, and interest reserves.
Lenders usually require a minimum debt service coverage ratio which typically ranges from 1.1 to 1.4; the ratio is net cash flow (the income the property produces) over the debt service (mortgage payment). As an example if the owner of a shopping mall receives $300,000 per month from tenants, pays $50,000 per month in expenses, a lender will typically not give a loan that requires monthly payments above $227,273 (($300,000-$50,000)/1.1)), a 1.1 debt cover.
Lenders also look at loan to value (LTV). LTV is a mathematical calculation which expresses the amount of a mortgage as a percentage of the total appraised value. For instance, if a borrower wants $6,000,000 to purchase an office worth $10,000,000, the LTV ratio is $6,000,000/$10,000,000 or 60%. Commercial mortgage LTV's are typically between 55% and 70%, unlike residential mortgages which are typically 80% or above.
Lenders look at rents per square foot, cost per square foot and replacement cost per square foot. These metrics vary widely depending on the location and intended use of the property, but can be useful indications of the financial health of the real estate, as well as the likelihood of competitive new developments coming online.
Since the financial crisis, lenders have started to focus on a new metric, debt yield, to complement the debt service coverage ratio. Debt yield is defined as the net operating income (NOI) of a property divided by the amount of the mortgage.
Lenders typically do thorough extreme due diligence on a proposed commercial mortgage loan prior to funding the loan. Such due diligence often includes a site tour, a financial review, and due diligence on the property's sponsor and legal borrowing entity. Many lenders also commission and review third-party reports such as an appraisal, environmental report, engineering report, and background checks.
Providers of commercial mortgages
Banks, large and small, are traditional providers of commercial mortgages. According to the Federal Reserve, banks held $1.5 trillion of commercial mortgages on their books as of June 30, 2013.
Conduit lenders originate commercial mortgages and hold them as investments for a short period of time before securitizing the loans and selling CMBS secured by the underlying commercial mortgage loans. Conduit lenders include both banks and non-bank finance companies. Approximately $560 billion of commercial mortgages were held by issuers of CMBS as of June 30, 2013, according to the Federal Reserve.
Securitization of commercial mortgages in its current form began with the Resolution Trust Corporation's (or RTC's) commercial securitization program in 1992-1997. The RTC applied an approach similar to the one it had begun successfully using with residential mortgages, issuing multiple tranches of securities secured by diversified pools of commercial mortgage loans. Following the introduction of the securitization methods by the RTC, private banks began to originate loans specifically for the purpose of turning them into securities. These loans are typically structured to forbid prepayment beyond a specified amortization schedule. This makes the resultant securities more attractive to investors, because they know that the commercial mortgages will remain outstanding even if interest rates decline.
New CMBS issuance peaked in 2007 at $229 billion. Then, the subprime mortgage crisis and the resultant global financial crisis caused CMBS prices to fall dramatically, and new issuances of CMBS securities came to a virtual halt in 2008-2009. The market has begun to recover, with $12 billion in new issuance in 2010, $37 billion in new issuance in 2011, and $48 billion in new issuance in 2012.
Government-sponsored enterprises such as Fannie Mae and Freddie Mac, as well as government corporations such as Ginnie Mae, are active lenders for multifamily commercial real estate (that is, apartment buildings) in the United States. Approximately $390 billion of multifamily residential mortgages were held by government-sponsored enterprises or Agency and GSE-backed mortgage pools as of June 30, 2013, representing 12% of total commercial mortgages outstanding and 43% of multifamily commercial mortgages outstanding at that time.
Insurance companies are active investors in commercial mortgages, and hold approximately $325 billion of commercial mortgages as of June 30, 2013.
Mortgage brokers do not provide commercial mortgage loans, but are often used to obtain multiple quotes from different potential lenders and to manage the financing process.
Correspondent Lenders do not loan their own money, but provide front end services such as origination, underwriting, and loan servicing for lenders that utilize these types of companies. The correspondent often represents lenders in a particular geographic area.
Irvine (// UR-vyn) is an affluent city in Orange County, California, United States. It is a planned city, mainly developed by the Irvine Company beginning in the 1960s. Formally incorporated on December 28, 1971, the 66-square-mile (170 km2) city had a population of 212,375 as of the 2010 census; in 2016 the city's population was 258,386.
A number of corporations, particularly in the technology and semiconductor sectors, have their national or international headquarters in Irvine. Irvine is also home to several higher education institutions including the University of California, Irvine (UCI), Concordia University, Irvine Valley College, the Orange County Center of the University of Southern California (USC), Brandman University, California Southern University, Stanbridge College and campuses of California State University Fullerton (CSUF), University of La Verne, Pepperdine University, Alliant International University, Kaplan International Colleges, Fashion Institute of Design and Merchandising, and Webster University.
Irvine was inhabited by the Gabrieleńo indigenous group about 2,000 years ago. Gaspar de Portolą, a Spanish explorer, came to the area in 1769. This brought on the establishment of forts, missions and herds of cattle. The King of Spain parceled out land for missions and private use.
After Mexico's independence from Spain in 1821, the Mexican government secularized the missions and assumed control of the lands. It began distributing the land to Mexican citizens who applied for grants. Three large Spanish/Mexican grants made up the land that later became the Irvine Ranch: Rancho Santiago de Santa Ana, Rancho San Joaquin and Rancho Lomas de Santiago.
In 1864, Jose Andres Sepulveda, owner of Rancho San Joaquin sold 50,000 acres (200 km2) to Benjamin and Thomas Flint, Llewellyn Bixby and James Irvine for $18,000 to resolve debts due to the Great Drought. In 1866, Irvine, Flint and Bixby acquired 47,000-acre (190 km2) Rancho Lomas de Santiago for $7,000. After the Mexican-American war the land of Rancho Santiago de Santa Ana fell prey to tangled titles. In 1868, the ranch was divided among four claimants as part of a lawsuit: Flint, Bixby and Irvine. The ranches were devoted to sheep grazing. However, in 1870, tenant farming was permitted.
In 1878, James Irvine acquired his partners' interests for $150,000. His 110,000 acres (450 km2) stretched 23 miles (37 km) from the Pacific Ocean to the Santa Ana River. James Irvine died in 1886. The ranch was inherited by his son, James Irvine, Jr., who incorporated it into The Irvine Company. James, Jr. shifted the ranch operations to field crops, olive and citrus crops.
In 1888, the Santa Fe Railroad extended its line to Fallbrook Junction, north of San Diego, and named a station along the way after James Irvine. The town that formed around this station was named Myford, after Irvine's son, because a post office in Calaveras County already bore the family name. The town was renamed Irvine in 1914.
By 1918, 60,000 acres (240 km2) of lima beans were grown on the Irvine Ranch. Two Marine Corps facilities, MCAS El Toro and MCAS Tustin, were built during World War II on ranch land sold to the government.
James Irvine, Jr., died in 1947 at the age of 80. His son, Myford, assumed the presidency of The Irvine Company. He began opening small sections of the Irvine Ranch to urban development.
The Irvine Ranch played host to the Boy Scouts of America's 1953 National Scout Jamboree. Jamboree Road, a major street which now stretches from Newport Beach to the city of Orange, was named in honor of this event. David Sills, then a young Boy Scout from Peoria, Illinois, was among the attendees at the 1953 Jamboree. Sills came back to Irvine as an adult and went on to serve four terms as the city's mayor.
Myford Irvine died in 1959. The same year, the University of California asked The Irvine Company for 1,000 acres (4 km2) for a new university campus. The Irvine Company sold the requested land for $1 and later the state purchased an additional 500 acres (2.0 km2).
William Pereira, the university's consulting architect, and The Irvine Company planners drew up master plans for a city of 50,000 people surrounding the new university. The plan called for industrial, residential and recreational areas, commercial centers and greenbelts. The new community was to be named Irvine; the old agricultural town of Irvine, where the railroad station and post office were located, was renamed East Irvine. The first phases of the villages of Turtle Rock, University Park, Westpark (then called Culverdale), El Camino Real, and Walnut were completed by 1970.
On December 28, 1971, the residents of these communities voted to incorporate a substantially larger city than the one envisioned by the Pereira plan. By January 1999, Irvine had a population of 134,000 and a total area of 43 square miles (111 km2).
In the 1970s the mayor was Bill Vardoulis.
After the Fall of Saigon in 1975, there was a large influx of Vietnamese refugees settling in nearby Fountain Valley, especially in the late 1970s and throughout the 80s, forming a large percentage of Asian Americans in the city.
In late 2003, after a ten-year-long legal battle, Irvine annexed the former El Toro Marine Corps Air Station. This added 7.3 square miles (19 km2) of land to the city and blocked an initiative championed by Newport Beach residents to replace John Wayne Airport by a new airport at El Toro. Most of this land has become part of the Orange County Great Park.
Irvine borders Tustin to the north, Santa Ana to the northwest, Lake Forest to the east, Laguna Hills to the southeast, Costa Mesa to the west, and Newport Beach to the southwest. San Diego Creek, which flows northwest into Upper Newport Bay, is the primary watercourse draining the city. Its largest tributary is Peters Canyon Wash. Most of Irvine is in a broad, flat valley between Loma Ridge in the north and San Joaquin Hills in the south. In the extreme northern and southern areas, however, are several hills, plateaus and canyons.
A planned city
The layout of Irvine was designed by Los Angeles architect William Pereira and Irvine Company employee Raymond Watson, and is nominally divided into townships called villages. The townships are separated by six-lane streets. Each township contains houses of similar design, along with commercial centers, religious institutions and schools. Commercial districts are checker-boarded in a periphery around the central townships.
Pereira originally envisioned a circular plan with numerous artificial lakes and the university in the center. When the Irvine Company refused to relinquish valuable farmland in the flat central region of the ranch for this plan, the university site was moved to the base of the southern coastal hills. The design that ended up being used was based on the shape of a necklace (with the villages strung along two parallel main streets, which terminate at University of California, Irvine (UCI), the "pendant"). Residential areas are now bordered by two commercial districts, the Irvine Business Complex to the west and the Irvine Spectrum to the east. Traces of the original circular design are still visible in the layout of the UCI campus and the two artificial lakes at the center of Woodbridge, one of the central villages.
All streets have landscaping allowances. Rights-of-way for powerlines also serve as bicycle corridors, parks and greenbelts to tie together ecological preserves. The greenery is irrigated with reclaimed water. The homeowners' associations which govern some village neighborhoods exercise varying degrees of control on the appearances of homes. In more restrictive areas, houses' roofing, paint colors, and landscaping are regulated. Older parts of the Village of Northwood that were developed beginning in the early 1970s independently of the Irvine Company, have the distinction of being a larger village that is not under the purview of a homeowners' association. As a result, homeowners in the older Northwood areas do not pay a monthly village association fee; its neighborhoods are generally not as uniform in appearance as those in other villages, such as Westpark and Woodbridge. However, the more tightly regulated villages generally offer more amenities, such as members-only swimming pools, tennis courts, and parks.
In addition to association dues, homeowners in villages developed in the 1980s and later may be levied a Mello-Roos special tax, which came about in the post-Proposition 13 era. For homeowners in these areas, the association dues coupled with the Mello-Roos special tax may add significantly to the cost of living in the city.
Each of the villages was initially planned to have a distinct architectural theme.
Irvine, like most of coastal Southern California, generally has a Mediterranean climate (Köppen climate classification Csa). Summers are warm-to-hot, and winters are cool-to-warm, rarely falling below freezing. Precipitation in Irvine occurs predominantly during the winter months. Although snow is nonexistent, frost occasionally occurs.
Irvine was chosen in 2008 by CNNMoney.com as the fourth-best place to live in the United States. In 2012, it was ranked sixth nationally. In September 2011, Businessweek listed Irvine as the fifth-best city in the United States. Irvine consistently ranks as the safest city in America with a population over 100,000. In 2014, Irvine was named the best-run city in the U.S. by 24/7 Wall Street.
The 2010 United States Census reported that Irvine had a population of 212,375. The population density was 3,195.8 people per square mile (1,233.9/km²). The racial makeup of Irvine was 107,215 (50.5%) White, 3,718 (1.8%) African American, 355 (0.2%) Native American, 83,176 (39.2%) Asian, 334 (0.2%) Pacific Islander, 5,867 (2.8%) from other races, and 11,710 (5.5%) from two or more races. Hispanic or Latino of any race were 19,621 persons (9.2%). Non-Hispanic Whites were 45.1% of the population.
The census reported that 205,819 people (96.9% of the population) lived in households, 5,968 (2.8%) lived in non-institutionalized group quarters, and 588 (0.3%) were institutionalized.
There were 78,978 households, out of which 26,693 (33.8%) had children under the age of 18 living in them, 40,930 (51.8%) were opposite-sex married couples living together, 7,545 (9.6%) had a female householder with no husband present, 2,978 (3.8%) had a male householder with no wife present. There were 3,218 (4.1%) unmarried opposite-sex partnerships, and 463 (0.6%) same-sex married couples or partnerships. 18,475 households (23.4%) were made up of individuals and 4,146 (5.2%) had someone living alone who was 65 years of age or older. The average household size was 2.61. There were 51,453 families (65.1% of all households); the average family size was 3.13.
The age distribution of the population was as follows: 45,675 people (21.5%) under the age of 18, 30,384 people (14.3%) aged 18 to 24, 66,670 people (31.4%) aged 25 to 44, 51,185 people (24.1%) aged 45 to 64, and 18,461 people (8.7%) who were 65 years of age or older. The median age was 33.9 years. For every 100 females there were 94.9 males. For every 100 females age 18 and over, there were 92.4 males.
There were 83,899 housing units at an average density of 1,262.5 per square mile (487.5/km²), of which 39,646 (50.2%) were owner-occupied, and 39,332 (49.8%) were occupied by renters. The homeowner vacancy rate was 2.2%; the rental vacancy rate was 6.2%. 109,846 people (51.7% of the population) lived in owner-occupied housing units and 95,973 people (45.2%) lived in rental housing units.
During 2009–2013, Irvine had a median household income of $90,585, with 12.2% of the population living below the federal poverty line.
The census of 2000 found there were 143,072 people, 51,199 households, and 34,354 families in the city. The population density is 3,098.0 inhabitants per square mile (1,196.2/km2), as of the census. There are 53,711 housing units at an average density of 1,163.0 per square mile (449.1/km2). The racial makeup of the city is 61.1% White, 7.4% of the population are Hispanic or Latino of any race, 1.5% Black or African American, 0.2% Native American, 29.8% Asian, 1.1% Pacific Islander, 2.5% from other races, and 4.8% from two or more races.
There are 51,199 households out of which 36.0% have children under the age of 18 living with them, 53.8% are married couples living together, 9.8% have a female householder with no husband present, and 32.9% are non-families. 22.8% of all households are made up of individuals and 5.0% have someone living alone who is 65 years of age or older. The average household size is 2.70 persons and the average family size is 3.17.
In the city, the population is spread out with 23.5% under the age of 18, 14.4% from 18 to 24, 32.3% from 25 to 44, 22.6% from 45 to 64, and 7.2% who are 65 years of age or older. The median age is 33 years. For every 100 females there are 93.8 males. For every 100 females age 18 and over, there are 90.0 males.
According to 2007 Census Bureau estimates, the median income for a household in the city is $98,923, and the median income for a family is $111,455; these numbers make Irvine the seventh richest city in the USA, among cities with population 65,000 or higher. 9.1% of the population and 5.0% of families are below the poverty line. Of the total population, 6.1% of those under the age of 18 and 5.6% of those 65 and older are living below the poverty line.
In 2006, the median gross rent paid for housing was $1,660 a month. This was the highest of any place in the United States of more than 100,000 people. The skyrocketing high cost of housing is a major issue in Irvine and Orange County, as the city council faces pressure to approve future income-subsidized housing projects to meet the demands of working-class citizens.
Irvine's tourism information is coordinated through the Destination Irvine program run by the Chamber of Commerce. The program provides information on Irvine as a place to vacation and as a destination for meetings, events and other business initiatives. Irvine has been rated one of the top cities for start-up businesses and its strong, fast-growing economy helped place Orange County as one of the top ten fastest growing job markets.
Irvine is also used as a location for film projects. The city government grants free or low-cost filming permits and offers location information to prospective productions.
The following notable companies are headquartered in Irvine:
The following international companies have their North American headquarters in Irvine:
As of 2014, the top employers in the city were:
Arts and culture
The Irvine Global Village Festival
Every October, Irvine hosts the Irvine Global Village Festival to celebrate the diversity among the citizens of Irvine and Orange County. The festival consists of exhibits from local merchants, entertainment from diverse cultures, and sampling of foods from various regions of the world.
Irvine Community Television
The Irvine Community Television (ICTV) produces and broadcasts television programs on news, sports, arts, culture, safety for the Irvine community. The motto of ICTV is "For You, About You". ICTV airs on Cox Communications channel 30 and online.
According to the Internet Movie Database (IMDB), the following productions have either been partially or entirely filmed in Irvine:
Irvine has three public libraries: Heritage Park Regional Library, University Park Library, and Katie Wheeler Library. The Heritage Library serves as the regional reference library for Central Orange County and has a strong business and art focus while the University Park Library has 95,745 books, including a substantial Chinese collection. Katie Wheeler was the granddaughter of James Irvine, and the library is a replica of the house owned by Irvine in which she grew up. Additionally, most UCI Libraries are open to the public.
Points of interest
Parks and recreation
Irvine has community parks and neighborhood parks. The community parks have public facilities located on each site. Neighborhood parks provide open space and some recreational amenities within the various villages of Irvine. Northwood Community Park in particular has recently made a unique addition: The Northwood Gratitude and Honor Memorial is the first memorial in the US ever built before the wars were over. It lists the U.S. military dead from Iraq and Afghanistan, and when dedicated November 14, 2010 listed over 5,700 names (of the 8,000 available spaces). Also unique in the history of war monuments, it will be updated yearly.
According to the city's Comprehensive Annual Financial Report for FY2009-2010, as of June 30, 2010 the city has net assets of $2.08 billion. FY2009-10 revenues totaled $219.1 million, with property tax accounting for $42.7 million and sales tax accounting for $39.7 million. As of June 30, 2010 the city's governmental funds reported combined ending fund balances of $533.8 million.
The structure of the management and coordination of city services is:
The City Council consists of the Mayor and four City Council members. The Mayor serves a two-year term and Council members serve four-year terms. The city has a two-term limit for elected officials. Elections are held every two years, on even-numbered years. During each election, two Council members and the Mayor's seat is up for consideration. The City Council appoints the City Manager, who functions as the chief administrator of the city. The City Council sets the policies for the city, and the City Manager is responsible for implementing the policies. The City Council appoints volunteers that serve on various advisory boards, commissions and committees.
Mayor Steven Choi, a Republican, was elected to his first term in November 2012 after garnering 45.7% of the vote, while former Irvine Mayor and former Irvine City Councilman Democrat Larry Agran received 40.4%. Choi is the second Korean American to become mayor of Irvine, the first being Choi's predecessor Democrat Sukhee Kang.
The city of Irvine is served by seven departments. These departments are responsible for managing and performing all of the business of the City Hall and its services:
Services provided by the city include:
Support services are provided through other agencies including: Irvine Unified School District, Tustin Unified School District, Southern California Edison, Irvine Ranch Water District, and Orange County Fire Authority.
Irvine contracts with the County of Orange for fire and medical services. Fire protection in Irvine is provided by the Orange County Fire Authority with ambulance service by Care Ambulance. Law enforcement is provided by the Irvine Police Department (IPD). The IPD operates in a suburban city rated as having one of the lowest violent crime rates among cities with over 100,000 inhabitants by the FBI every year since 2005. The University of California Police Department also has jurisdiction – including arrest power – in areas of the city near the UC Irvine campus, while the California State University Police Department has similar jurisdiction in areas of the city near the CSU Fullerton Irvine campus.
State and federal
In the California State Senate, Irvine is in the 37th Senate District, represented by Republican John Moorlach. In the California State Assembly, it is split between the 68th Assembly District, represented by Republican Don Wagner, and the 74th Assembly District, represented by Republican Matthew Harper.
Most of Irvine is located in the Irvine Unified School District (IUSD). The five high schools in IUSD are University High School, Irvine High School, Northwood High School, Woodbridge High School, and *Portola High School (Opening 2016). Arnold O. Beckman High School is located in Irvine but is administered by Tustin Unified School District. The four high schools in IUSD, as well as Beckman High School, have consistently placed in the upper range of Newsweek's list of the Top 1,300 U.S. Public High Schools.
Irvine is also home to elementary and middle schools, including two alternative, year round, open enrollment K-8 schools, Plaza Vista and Vista Verde. Parts of the north and west of the city are within the Tustin Unified School District.
Colleges and universities
Irvine is home to the University of California, Irvine, which is the second-newest campus (established 1965) in the UC system after University of California, Merced. Other higher education institutions in Irvine include California Southern University, Concordia University, Paramount California University a distance learning university, Irvine Valley College, Fuller Theological Seminary, FIDM, The Fashion Institute of Design and Merchandising, Orange County Campus and a satellite campus of California State University, Fullerton. Chapman University and Soka University of America are in adjacent cities.
According to the 2000 United States Census, Irvine is ranked 7th nationwide, among cities with populations of at least 100,000, for having the highest percentage of people who are at least 25 years old with doctoral degrees, with 3,589 residents reporting such educational attainment.
Streets and intersections owned by the city have trademark mahogany signage and are fiber optically linked to the city's Irvine Traffic Research and Control Center (ITRAC). Traffic cameras and ground sensors monitor the flow of traffic throughout the city and automatically adjust signal timing to line up traffic, allowing more vehicles to pass through fewer red lights. Several major highways pass through Irvine (Interstate 5, and Interstate 405 (California), California State Route 73, California State Route 133, California State Route 241, and California State Route 261). Major arteries through Irvine are built out widely and run in a northeasterly direction with speed limits higher than 50 mph (80 km/h). As a result of the signal timing, wide streets, and road layout, Irvine's side streets are capable of handling a higher volume of traffic than other cities in Orange County.
Mass Transit and Freight Services
Bus and Shuttle services
Local bus routes are operated by the Orange County Transportation Authority.
The city of Irvine has operated its own mass-transit bus service called the iShuttle since 2008. Four weekday commuter shuttles serve major employers, residential areas, shopping centers, and transportation facilities. Two lines, Route A and Route B, connect the Tustin Metrolink Station to the Irvine Business Complex area. Route A provides service between the Tustin Metrolink Station and John Wayne Airport with stops along Von Karman Avenue. Route B heads along Jamboree Road before continuing through Main Street and Michelson Drive. The remaining two lines, Route C and Route D, offer connections between the Irvine Station and the Irvine Spectrum Area, which includes major employers, the Irvine Spectrum Center, and residential communities The Park and The Village. Route C follows Irvine Center Drive and ends at the Capital Group campus, while Route D serves the Irvine Spectrum Center, Kaiser Permanente - Irvine Medical Center, and Hoag Hospital Irvine.
Irvine is served by commuter rail to Los Angeles, San Diego, Riverside, and San Bernardino counties at both the Irvine and Tustin stations of the Metrolink Orange County Line and the IE-OC Line. OCTA is currently implementing a major service increase on the Orange County line, with trains approximately every 30 minutes during weekday commuting hours. Amtrak trains run approximately every 60 to 90 minutes all days of the week along the Pacific Surfliner route between San Diego and Los Angeles. Amtrak trains stop only at Irvine station, unlike Metrolink, which stops at both Irvine and Tustin station. Rail2Rail monthly passes allow commuters to use both Metrolink and Amtrak services, standard tickets are specific to a single operator. A four-story parking structure was recently completed at the Irvine station as part of a station renovation.
At one time Irvine intended to build a tram / guideway, but in February 2009 the city of Irvine canceled the project. Initially plans were underway to connect the Orange County Great Park to the Irvine Spectrum Center and surrounding businesses with a fixed-route transit system, also stopping at the Irvine Transportation Center (Irvine Station). In 2008, two possible routes were selected, but neither will be developed now. The entire $128 million in funding will be returned to the Measure M fund, and be available for other cities in Orange County.
A major contributing factor to the growth of Irvine was by freight rail provided by ATSF (Now BNSF) Transportation. The Venta Spur was Irvine's first spur. Built in the 1920s, it moved citrus from three processing plants in what is now Northwood to the rest of the country. The processing plants were essentially Irvine's first and biggest employers of the time.
The plants started to go out of business in the 1970s and the spur was abandoned in 1985. In 1999, following its donation to the city of Irvine, it was turned into the Venta Spur bike trail.
The Irvine Industrial Spur is the second railroad spur in Irvine. It serves various industries in Irvine's Business Complex. It currently sees little to no movement and the Irvine planning department is considering turning it into a bike path.
Irvine offers a system of bicycle lanes and trails to encourage the use of bikes as a means of transportation. There are 44.5 miles (71.6 km) of off-road bicycle trails and 282 miles (454 km) of on-road bicycle lanes in Irvine.
Main article: List of people from Irvine, California
Irvine has four sister cities:
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