Embattled Builder Moves to Finish 8-Year-Old Project

In the middle of a bankruptcy proceeding, the builder of an unfinished condominium development in a posh section of Los Feliz Boulevard has taken out building permits to resume construction.

The Los Angeles Building and Safety Department, which had recently begun steps to demolish the 8-year-old, nearly completed building, imposed an April 1 deadline for the work to be finished, principal inspector Richard Hovious said.

Builder Gary Mamian, whose multimillion-dollar development interests have been tied up in bankruptcy for a year, applied for the permit in person, insisting that he had to complete the project, Hovious said.

“He told me . . . he was definitely going to finish the project, he had to,” Hovious said.

The request of Mamian’s principal creditor, Canadian Commercial Bank, to foreclose on the eight-unit structure at 4155 Los Feliz Blvd. is now in trial. It is just one issue in the complex bankruptcy case.

After two days of testimony by appraisers last week, the trial is scheduled to resume Friday.

Last month, U.S. Bankruptcy Judge James J. Dooley granted the city’s request to demolish the building, but delayed the demolition until after his decision on the foreclosure. Even though the project stands about 90% complete, with windows and stucco in place, the Los Angeles city attorney’s office sought demolition as a means of ending the problem, which had produced continuing complaints from residents of the expensive neighborhood.

“They had their first building permit in 1980,” Assistant City Atty. Mike Woodward said. “This is now 1988. Enough is enough.”

Complaints Over Project

A spokesman for the Los Feliz Improvement Assn., whose complaints over the unfinished project spurred the city’s condemnation proceeding, praised the builder’s decision to resume work as a better solution to the problem than demolition.

“We just want the building to look like it’s a building,” said Edmond Stephan of the residents’ group. “For the city to knock down a building of that size would be a waste of resources for the entire city. It would lose the taxes the building would generate, and we would have eight less housing units.”

However, Mamian’s sudden move to resume construction surprised both his own attorneys and those of the bank and raised some potentially complex legal questions.

“We have never been apprised of the existence of a building permit,” said Dawn Coda-Wagener, attorney for Canadian Commercial Bank.

Coda-Wagener said she believes Mamian would need to file a motion with the bankruptcy court if he plans to borrow money to finance the construction, at one time estimated at about $200,000.

Mamian’s attorney, Linda Northrup, said she believes her client could proceed without court permission if he takes the money out of his own pocket. Essentially, that would make him his own creditor in the bankruptcy case, she said. She conceded that he could come up with nothing in a settlement.

“That is a risk he’s going to have to take as a business matter,” Northrup said. However, she added, “if the property is going to increase in value, he’ll stand to realize that increase. I believe Mr. Mamian is eager to finish that property.”

Stephan said he has noticed some activity around the building in the last three weeks. He said workers applied metal molding that appeared to be in preparation for color-coating and removed several opaque, black glass panels of the type Mamian used to sheath a 90-room hotel he built on Sunset Boulevard in Hollywood several years ago.

Residents had complained that the panels were not appropriate for the residential neighborhood.

The activity was the first sign of work on the property since last February, when Mamian transferred title of the building from his personal ownership to that of Hotel Hollywood Corp., of which he is president. The day after the transfer, the corporation filed for protection from creditors under Chapter 11 of the federal bankruptcy laws.

Since then, the three-story structure has remained as it was, with a construction barricade around it and tall scaffolding standing along one wall.

Mamian did not respond to a call from The Times.

In a previous interview, however, he said that all that remains to be done is installing cabinets, appliances, flooring and fixtures inside and decorating the exterior.