Lottery Payoff Not Cash but Chance to Buy Condo

It was Rancho Palos Verdes’ version of the Big Spin, but the prizes were condominiums, not cash.

In a city-sponsored drawing televised on the local cable system, 10 people won the right this week to buy “affordable” units at the luxury, ocean-view Villa Capri project near the spectacular Palos Verdes coastline.

“Affordable” meant $140,000 for a one-bedroom condo with a loft.

The price drew 3,900 applicants for the 10 units.

It seemed downright cheap in Rancho Palos Verdes where 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 lower-priced condominiums to get city approval for the 49-unit project, where larger units are selling for as much as $485,000.

Overwhelmed by the unexpected thousands of applications, Rancho Palos Verdes officials decided before the drawing to reduce the number somewhat by weeding out all those from outside the city--a move that still left 1,800 in contention.

The lottery at the Hesse Community Park attracted a live audience of about 100 in addition to the cable television viewers.

Developer Eugene Schiappa pulled 35 numbers from a brass-colored metal barrel. People holding those numbers will get certified letters giving them 10 days to prove that they live in the city and meet one other criterion--an annual income of no more than $60,000 a year.

One of the numbers picked, 2440, belonged to 22-year-old Todd Steven Giordano, who 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.

34th Number Drawn

But Giordano has no guarantee he will soon be arranging for a moving van. He was the 34th number drawn, meaning at least 24 before him will have to drop out or be disqualified to move him into the magic 10. The current 10 have 90 days to line up financing.

Giordano, nevertheless, was the happiest person at the Monday night drawing. He was the only “winner” to view the event in person, having come to the park because his TV picture was fuzzy, he said. Despite its appeal, the deal lacks one of the major incentives for real estate buyers in Southern California. The 10 condo owners 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.

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, ages 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, Christopher Von Glahn said.

Von Glahn, a 48-year-old Manhattan Beach attorney whose 44-year-old wife manages his law office, said he is confident he will meet the income requirement although “people think that if you’re an attorney, you’re making more than that.”

Rancho Palos Verdes decided to limit eligibility to current residents, city spokeswoman Katie Pitcher said, in order to help “those who can no longer afford to live here because of escalating housing costs.”

‘Good of the Community’

Pitcher said that the community was under no pressure from the state or federal governments to provide for the lower-cost housing but that the City Council approved the plan “for the good of the community.”

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.

One of them, Carol Fox Belanger, an educational consultant for Los Angeles County schools, said that as a single parent in her late 40s, she is looking to live in smaller and less-expensive quarters now that her son is in college.

Laura Meng, a 62-year-old retiree, said she watched the lottery on television, saw her number drawn and was waiting to receive her official notice.

Some lottery entrants who do not live in Rancho Palos Verdes said they were disappointed that preference was given to city residents.

“The Lotto odds are better,” said Torrance resident Ed Carroll, a letter carrier whose entry was excluded.