Condo Lotto : 10 Win Right to Buy Affordable Units in Luxury Project
It was Rancho Palos Verdes’ version of the Big Spin, only the prizes were condominiums, not cash.
In a city-sponsored drawing televised on the local cable system this week, 10 people won the right to buy “affordable” units at the luxury, ocean-view Villa Capri project near the spectacular Palos Verdes coastline. About 1,800 city residents entered the lottery for the right to buy a one-bedroom apartment with a loft for $140,000.
That’s downright cheap in Rancho Palos Verdes, where the median family income is estimated at more than $71,000, condominiums sell for as much as $500,000, and single-family residences fetch up to $3.6 million. The developer, E. S. Development of Redondo Beach, had to provide the 10 lower-priced apartments to get city approval for the 49-unit project, where larger units are selling for as much as $485,000.
Monday night’s lottery at Hesse Community Park attracted only about 100 people, but officials believe many others were watching on cable television. As participants looked on quietly, developer Eugene Schiappa drew an initial 35 numbers from a brass-colored metal barrel. People holding those numbers will get certified letters from the city giving them 10 days to prove that they live in the city and earn no more than $60,000 a year. Then they will have 90 days to line up financing.
One of the winners, 22-year-old Todd Steven Giordano, said he is “very eligible,” with an income “between $29,000 and $50,000.” Giordano, a sheet metal worker who lives with his parents and works in his family’s business in Glendale, called the development “a great place to live.”
“I like surfing and I’ll be right there,” he said.
Giordano was the only winner to attend the drawing, and he came only because his TV picture was fuzzy, he said. Giordano’s number, 2440, was the 34th drawn.
Despite its appeal, the deal lacks one of the major incentives for real estate buyers in Southern California: The 10 winners will not be allowed to reap speculative profits on the units. They will be required to live in the units, and resale prices will be limited to the purchase price plus improvements and cost-of-living increases, they said.
The limit on profit is “no problem” for Sherryl and Christopher Von Glahn, whose entry was drawn first. They said they had come to believe that buying property in Rancho Palos Verdes was hopeless. Priced out of the local housing market, the Von Glahns rent a three-bedroom house for themselves and their two children, 7 and 9. The family will have to squeeze a bit to fit into the 1,250-square-foot condominium, but they are not complaining, Von Glahn said cheerfully.
Von Glahn, a 48-year-old Manhattan Beach attorney whose 44-year-old wife manages his law office, said he is confident that he will meet the income requirement.
“People think that if you’re an attorney, you’re making more than that,” said Von Glahn, whose one-man practice specializes in wills, trusts and contracts.
Some Rejected
The city had 3,900 applications but drew from only those with Rancho Palos Verdes addresses because the program is designed to provide lower-cost housing for city residents, said spokeswoman Katie Pitcher.
“Priority is being given to RPV residents in order to give current residents, who can no longer afford to live here because of escalating housing costs . . . the opportunity to live in the community,” Pitcher said.
In addition to the top 35 who will be notified, the city drew 65 more numbers to provide a pool of 100 Rancho Palos Verdes residents as potential buyers. The list of 100 is posted at City Hall, Hesse Community Center, Ladera Linda Community Center, Palos Verdes and Miraleste libraries, and Point Vicente Park.
At least three of the top-10 winners already own homes in Rancho Palos Verdes, but this will not disqualify them if they meet income requirements, officials said. They are:
Carol Fox Belanger, an educational consultant for Los Angeles County schools. A single parent in her late 40s, she said she would like to live in smaller and less expensive quarters now that her son is in college.
Laura Meng, a 62-year-old retiree. She said she watched the lottery on television, saw her number drawn and is eager to receive her official notice.
Richard Yaussi, 40, owns a pest control company. His wife, Irene Ordon, also 40, is a Harbor College professor of interior design, and they have a 4-year-old son. Ordon said she entered their names while at City Hall completing paper work on one of her design projects. She said getting the lower-cost condominium might give them the financial leeway to return to school--her husband would seek a master’s degree in public administration and she would seek a doctorate in community college education.
Others in the top 10 are Jennifer M. Dick, William Payne III, Naoma Stow, Mary Louise Fong, Lily Wan and Clay Nestlerode.
Preference Criticized
Some lottery entrants who do not live in Rancho Palos Verdes said they were disappointed that preference was given to city residents.
“I didn’t know about the preference and I’m upset,” said James Stevens, a research technician who lives in San Pedro.
“The Lotto odds are better,” said Torrance resident Ed Carroll, a letter carrier whose entry was also excluded.
Although the intent from the start was to give preference to Rancho Palos Verdes residents, officials said the city took outside applications because they had no idea how many would apply and thought there could be some units available after all local residents had been satisfied.
In accordance with state law, Rancho Palos Verdes’ General Plan calls for “affordable housing” in the city. But lower-priced housing is scarce in this well-to-do community.
The City Council debated for several years over the complexities of providing affordable housing in conjunction with the Villa Capri project. Eventually, the council agreed to rezone the Villa Capri property to residential from commercial, while the developer agreed to provide 10 “affordable” units in the luxury project.
Pitcher said the city was under no pressure from the state or federal governments to provide for the lower-cost housing. She said the council approved the plan “for the good of the community.”
