Manhattan Beach School Site Sold to Gardena Builder for $10 Million

A Gardena developer has paid $10,005,000 for the Manhattan Beach Heights Elementary School property--$5,000 more than the second-highest bidder and $2 million more than school officials expected.

Developers Tai-Yu Su and Rick Fukai of President Investment Co. hope to break ground in February on 24 luxury homes, each with a swimming pool, hot tub and $1-million price tag.

The Manhattan Beach School District was able to balance its $7.5-million budget this year only by dipping into reserves for $156,000, Supt. Douglas Keeler said. Officials say interest from last week’s sale of the property, at 1613 6th St., will help them balance the books next year.

“We’re not out of the red by any means,” Keeler said. “It may appear to be a tremendous windfall, but we can only use a very small portion of it, just the interest, for general-fund purposes.”

Funds Restricted

Under state law, money from the sale of school property can be used only for capital projects, such as adding a wing or replacing a roof. Only the interest earned from the sale proceeds can go to the general fund, which finances teachers’ salaries, educational programs and other operating costs.

Pete Schiff, district business manager, said the interest will bring about $725,000 a year to the general fund.

The school was closed in 1976 because of declining enrollment. Only empty buildings, dead grass and broken swings are left on the school grounds, which for a time were leased to a child-care center and a Jewish congregation.

Fukai, son of Gardena City Councilman Mas Fukai, said his company paid more than it had planned but would have gone higher to purchase the property. For a similar project three years ago, the firm spent $3.5 million for 13 lots at the South School site in Hermosa Beach.

For the Manhattan Beach site, the school district had set a minimum bid of $6.6 million.

Barclay Construction Corp., together with Weyerhaeuser Venture Co., made the second-highest bid, $10 million.

“I’m disappointed because we thought it was a good site,” said Robert Barclay, president of Barclay Construction. “Manhattan Beach is a hot market. There are not that many available parcels of that size. But I’m somewhat relieved in that the bid price--ours and the highest bidder’s--was, I feel, over market. It was a little risky.”

The property, zoned for residential use, has been divided into 24 lots. Fukai said each home will be about 5,000 square feet and will have 5 bedrooms, 4 bathrooms and a 3-car garage. Completion is expected by the end of 1989, Fukai said.