Sherman Oaks Mall Stays Open Despite Expired Permit

Once a landmark movie house, now a small mall with a marquee, the problem-ridden La Reina Fashion Center in Sherman Oaks became a theater of the absurd this week as city officials trying to revoke its occupancy permit discovered the permit expired two weeks ago.

Although the mall is operating illegally, city officials said they probably will not close it. Instead, their aim is to use the lack of a permit to pressure the mall’s builder to carry out an agreement to widen a nearby intersection.

The snafu began when City Councilman Zev Yaroslavsky’s staff decided last month to have the 2 1/2-year-old shopping center’s occupancy permit revoked because its developer had repeatedly failed to add a second left turn lane, with its own signal light, on Van Nuys Boulevard at Ventura Boulevard.

After waiting for a response from building officials for two weeks, only to be referred this week to public works officials, one of Yaroslavsky’s planning deputies learned that La Reina’s temporary certificate of occupancy had expired May 18 without any apparent attempt to shut down the mall or notify its operators.

The expired permit was also news to La Reina’s current owner, Robert Dollar Building Associates of San Francisco, whose Los Angeles attorney said she did not learn of Yaroslavsky’s efforts until The Times contacted a mall manager for comment.

Shopkeepers in the two-story shopping center also said they had no idea the mall was in danger of being closed.

The mall--centerpiece of a stretch of fashionable shops that has earned that part of Ventura Boulevard the nickname “Melrose of the Valley,” after the trendy street in Hollywood--appears to be half-vacant, but has tenants such as the Gap, Banana Republic and a Chopstix restaurant.

“It’s a bizarre episode,” Richard Close, president of the Sherman Oaks Homeowners Assn., said Thursday. “Remember, this used to be a movie theater. Doesn’t this sound like a Hollywood script? Is this something out of the movies?”

“How can the city allow a shopping center to operate without a Certificate of Occupancy?” Close asked in a letter he mailed to Yaroslavsky on Friday.

Vivian Rescalvo, a planning deputy to Yaroslavsky, acknowledged Thursday that because its occupancy permit had lapsed, the mini-mall was operating illegally and could be shut. But Rescalvo said Yaroslavsky’s aim was not to close the mall or put its tenants out of business, but to require construction of the street improvements.

“Now, I can close them tomorrow and put a lot of people in misery, or I can give them another deadline,” Rescalvo said. “I think the threat of closure will get the improvements done.”

Katherine B. Warwick, attorney for Robert Dollar Building Associates, said she would work with the city to force the mall’s original owner, Century City developer Dennis Bass, to complete the promised street project.

Bass, who promised the street improvements in return for a building permit, did not return repeated phone calls this week.

According to Warwick, Robert Dollar Building Associates assumed ownership of the mall early this year after a Bass company defaulted on a loan from them. Part of an out-of-court settlement between the two companies required that Bass’ firm complete the street-widening project, Warwick said, adding that her client has reapplied for an occupancy permit.

Close said Yaroslavsky’s office had been too lenient, and he expressed frustration that a mall without an occupancy permit could remain open--especially when its builder had a history of “thumbing his nose at the city” because the street work went undone.

“How would you like to be a tenant spending money on advertising and promotion and trying to build up a business and not even be in a building with a legal permit?” Close asked.

“You as a tenant could be shut down tomorrow and the city never told you, the council office never told you, the owner never told you.”