In a last-second meeting on Tuesday, The Irvine City Council voted 3-2 to walk away from a nearly $20 million real estate deal less than an hour before the deal was scheduled to close escrow. The city waived a $1 million nonrefundable deposit.

Council originally voted 4-1 on October 22 to approve the purchase of two adjacent lots, 17572 and 17622 Armstrong Ave., with a plan to turn them into the city’s first homeless shelter.

Although the plan has not gone before any city commissions or through the normal course of public information, city staff recommended the purchase because of what City Manager Oliver Chi described as a “small window where we have to engage in the transaction” to purchase land at a below market value.

On Tuesday, he said the board discussed the potential deal in closed-session meetings at least three times before Oct. 22.

Publicly, however, until this week, only Councilman Mike Carroll expressed concern about approving the deal without more transparency.

“You shouldn’t casually throw away your vote for $20 million for a facility that hasn’t been fully developed,” Carroll told his colleagues on Oct. 22.

After that initial vote, condominium associations in the Irvine Business Complex rallied against the proposed project near their homes, meeting with city officials to voice concerns about transparency and safety. More than 100 residents of the Irvine Business Complex have signed a petition to express their displeasure with the level of input they have had on the project.

That prompted Mayor Farrah Khan, according to a memo to the city manager, to call Tuesday’s council meeting to reconsider the land deal at the eleventh hour. The board met at 11 am and the deal will close at 12:30 pm

Dozens of Irvine residents who joined the meeting at City Hall cheered when the council finally dropped the deal.

Councilors Agran and Treseder seconded their original votes.

“One lesson we learned a long time ago is that any time the city can acquire land at a reasonable price, we should do it,” Agran said. “We are in great financial shape. It is important to invest in land. Land values ​​are always going up here.”

The council could have approved the deal and later decided to use the land for a shelter or other purpose, Chi said.

“We’re not real estate speculators,” Carroll said. “This was a flawed process from the beginning.”

Eliminating the agreement could delay Irvine’s broader plans for what Chi called “a first-in-the-nation system of care for people experiencing or at risk of homelessness.”

In October, Chi said the city plans to have emergency, transitional and permanent housing options working for people who are not currently housed by early 2026.

The Armstrong Avenue properties were slated to serve as a bridge shelter, a link between emergency services and permanent housing.

“The system itself is very much needed in our city and I’m very supportive of it,” Khan said Tuesday. “But this particular property and how we got there today is what’s at issue.”

At its meeting next week, the City Council is scheduled to review a proposed ordinance against the camp in light of Supreme Court decision this summer that’s what it does easier for California cities and other states to impose restrictions on people sleeping in parks and on the streets.

Currently, according to a staff report, Irvine addresses camping and unauthorized storage of personal property on a case-by-case basis with no enforcement options.