Aquino Will Control Marcos-Linked Project : Development in S.F. Valued at $33 Million

Representatives of the government of Philippine President Corazon Aquino will assume control of a $33-million downtown office building project that has been among the suspected U.S. holdings of exiled President Ferdinand E. Marcos, lawyers announced here Thursday.

The agreement, involving a choice parcel of land in this city’s fashionable Union Square shopping district, is believed to be the first transfer of such holdings to the new Aquino administration.

The arrangement was reached even as lawyers and investigators for the Aquino government expanded their nationwide search for Marcos’ assets in the hope of recovering them for the Philippines.

San Francisco lawyers Charles Garry, who represented the Aquino government, and Joseph L. Alioto, representing the local developers who had won city approval for the project, announced the agreement late Thursday afternoon after all-day negotiations.

Alioto said he agreed to the arrangement on the condition that the project, on which construction began recently, be allowed to proceed.

“It is in the interest of the present Philippine government to keep the project going,” said the former San Francisco mayor, now a lawyer in private practice.

Alioto said the project was backed by the Philippine government pension fund, whose trustees had been appointed by Marcos. But the official in charge of the fund, Roman A. Cruz Jr., resigned from the pension fund board at the height of last month’s military rebellion against Marcos.

Cruz, who also headed the government-owned airline, said he was protesting fraud committed by Marcos forces during the Feb. 7 presidential election.

The project belongs to the pension fund, “which is under the control of the government of Mrs. Aquino,” Alioto said.

Allegations that the Marcoses secretly own hundreds of millions of dollars worth of real estate in this country have increased steadily since they left the Philippines. Those charges are being investigated now by, among others, a congressional committee, various American lawyers representing the new Aquino government and by an Aquino-appointed committee, headed by a Yale-trained lawyer, Jovito Salonga.

Mansion in Pasadena

In Southern California, meanwhile, the pursuit led Thursday to a Pasadena mansion belonging to a wealthy former B-movie actress from Tennessee, who claims that she was Marcos’ lover for two years more than a decade ago.

State Sen. Paul Carpenter (D-Cypress) held a press conference in the driveway of a home owned by Dovie Beams DeVillagran, 53, and released a list of more than 100 pieces of Southern California property which he said are worth “in excess of $11 million” and have “connections” to Marcos.

The list, winnowed from the Board of Equalization’s master property file list at Carpenter’s request, gave the address and assessed valuation of property purportedly belonging to Dovie DeVillagran and her husband, Sergio, and Marcos’ sister, Fortuna Marcos Barba.

The press conference, however, quickly turned into a media event with political overtones, evidently because Carpenter is expected to be a June candidate for the State Board of Equalization.

And when pressed by reporters, Carpenter--saying he was acting as the chairman of the Senate select committee on the Pacific Rim--conceded that he has no evidence to support his claim.

Denies Receiving Money

Attorney Richard Caballero, representing Dovie DeVillagran and her husband, heatedly denied that his longtime clients had received any money from Marcos.

“The senator obviously wants some publicity,” he told reporters who were pressed against a wrought-iron gate.

In earlier interviews, Dovie DeVillagran also has steadfastly denied that her wealth or properties are connected with Marcos.

“I’ve worked hard,” she said. “If anyone checked the chain of title, they could see exactly how I bought it. Marcos had nothing whatsoever to do with it in any way at any time.” She said she amassed a fortune on her own by buying and selling real estate and from a car business.

Also on Thursday, a separate property list was presented to reporters outside the same Pasadena mansion by Mark Ryavec, special assistant for public information for Los Angeles County Assessor Alexander H. Pope, who also is expected to run for the Board of Equalization.

To Seek Freeze Order

The statement, disclosing properties owned by the DeVillagrans and by Fortuna Marcos Barba, described Barba’s property as “modest” and said that the real estate owned by Dovie DeVillagran, either in her own name or jointly with her husband, is “extensive.”

In Washington, a spokesperson for Rep. Stephen J. Solarz (D-N.Y.), chairman of the House subcommittee on Asian and Pacific affairs, said there is nothing in the committee’s files relating to the DeVillagrans or Barba or the property lists released Thursday. The subcommittee has been conducting an investigation of the Marcoses’ holdings in New York City.

In San Francisco, Garry, who was retained Sunday by Aquino representatives in this country, said he is continuing his West Coast investigation into Marcos’ holdings, adding that he will seek a court order to freeze suspected Marcos holdings “as soon as we get the stuff together,” possibly by next week.

Last week, a court in New York imposed such a freeze on suspected Marcos holdings there, barring Marcos or his business agents from selling the property and giving the Aquino government time to seek its return.

The Union Square project had been conceived and financed by the main Philippine government pension fund, Government Service Insurance System, via its wholly owned American subsidiary, Jamestown Corp.

Project Controversial

A 1983 Philippine government report, quoted in a copyrighted article in the San Francisco Examiner, called GSIS an “attached corporation” of the nation’s government.

Questions were raised about who would ultimately own the building, in part because the report said GSIS funds were supposed to be invested in the Philippines to support “the creation of (Philippine) infrastructure, schools and hospitals.” Investment overseas was not a primary goal.

In San Francisco, the project was controversial from the start because of the many exemptions it received from the city.

The building was allowed to be taller and larger than permitted under a new growth-control plan, and it was allowed to cast its shadow on Union Square, despite the intent of another new law protecting public parks. A requirement that new buildings have loading docks was waived, opening more room for rent but threatening to further clog one of the most congested street corners in the city.

The city also waived a requirement for an environmental impact report even though a Nieman-Marcus store across the street and other projects in the area were forced to compile detailed and expensive environmental assessments.

Planning Director Dean Macris said the exemptions were not unusual. He said a half-dozen other major developments going through the planning process in 1984 also were exempted from various city ordinances that were then new.

Nonetheless, those exemptions have raised questions because the developers had donated heavily to local political campaigns.

Political Donations

For example, a lawyer for the project, Timothy A. Tosta, who does significant amounts of business at City Hall on behalf of a number of developers, donated more than $5,000 to 10 supervisors and $4,700 to Mayor Dianne Feinstein in the three years that the Union Square project was under consideration, campaign records show.

In addition, Sylvia Lichauco, the San Francisco agent for the project, either on her own or on behalf of several companies that she runs, donated at least $4,375 and perhaps as much as $7,000 to the mayor and all but one member of the Board of Supervisors.

On the day after questions about the project were raised by the Examiner on Sunday, a lawyer for the developer, John C. Lyon, 38, was found dead at his desk, apparently from a self-inflicted gunshot wound. Later that same day, Dist. Atty. Arlo Smith announced that he had begun investigating potential violations of state and federal campaign-financing laws stemming from the project.

Board of Supervisors President John Molinari and Supervisor Willie B. Kennedy have said they will return the money, $1,500 and $150, respectively, that they got from a real-estate agent representing the project.

Other supervisors and the mayor are waiting for a formal opinion from the city attorney on the legality of the contributions before deciding whether to keep them.

Also contributing to this article were Times staff writers John Kendall and Deborah Hastings in Los Angeles and Ruth Snyder in San Francisco.