Fears Grow That Developers May Raze Jerry’s Deli : Studio City: The owner was told not to worry, but a three- to four-story project has been proposed.

Development plans for the Ventura Boulevard site of Jerry’s Famous Deli, known for its mixture of old-world kitsch and Hollywood glitz, have triggered intense speculation among neighbors who fear the landmark may be replaced by a large mixed-use project.

The businessmen who control the development rights to the site approached officers of the Studio City Residents Assn. in July with proposals for a three- to four-story project that would include ground floor retail shops and three floors of apartments, according to association President Polly Ward.

And in June, the developers renewed an effort to persuade the city to give up control of an adjacent street, Valleyheart Drive, which would enlarge the property by an acre and make the site even more attractive.

Jerry’s Deli owner Ike Starkman said real estate ads appearing to offer to sell the site and the petition for the city to vacate Valleyheart Drive have caused rumors to spread rapidly among business owners and patrons. But he said when he has confronted his landlords, “they have said to me nothing is happening and not to worry.”

Still, Starkman, who also owns the Jerry’s in Encino, said he was anxious. He estimated that 23,000 customers, including entertainment industry celebrities, fill the 24-hour restaurant’s bright red booths each week to munch on fare ranging from buffalo chicken wings to bagels and lox.

“I have no doubt about finding a new lease, but a place like this belongs to where it is,” Starkman said.

The developers include Robert Cohen, co-owner of the Four Seasons Hotel in Beverly Hills, and Francis Torino, a prominent Torrance builder. Jeff Lerman, Cohen’s son-in-law and business associate, confirmed that he and Cohen have been meeting with homeowners about plans for the site, but he declined to discuss them further.

“Obviously, it’s a very sensitive situation,” Lerman said. “We want to control what is said. The worst thing that can happen is that the wrong thing get said.”

According to Ward, public records and owners of businesses on and near the property, the partners appear to be piecing together a five- to seven-acre parcel at the prime location off Ventura Boulevard and Whitsett Avenue.

Cohen, Torino and Robert Schenkman own the ground leases to the land beneath Jerry’s and the Studio City Sports Center, which includes tennis courts and a popular bowling alley. The sports center was originally run by actor Joe Kirkwood, who portrayed the comic strip character Joe Palooka in movies and television during the 1950s.

In June, the partners paid a processing fee that revived a 6-year-old application to have the city give up its easement along a portion of Valleyheart Drive. The next step, according to the city engineer’s office, is for the developers to submit a plan for a turnaround point for cars entering the remaining public portion of the street from Whitsett Avenue.

Once that happens, an ordinance authorizing the change in the street’s status will be submitted to the City Council for final approval. The council granted tentative approval to the plan in 1984, but the partners let the request remain idle until this year.

Real estate advertisements placed by a Cohen company this summer touted a “Spectacular S. California Development Opportunity.” The ads offer a five- to seven-acre site on prime Ventura Boulevard in Studio City for $28 million. It could not be confirmed, however, that the ad referred to the Jerry’s Deli site.

Ward and others said they were told that the deli property may be sold to another group of developers instead of being built on by Cohen, Torino and Schenkman.

The land is owned by the Weddington Investment Co. of North Hollywood, whose founders were among the San Fernando Valley’s early land barons. But Cohen and his associates own the master lease on the approximately three-acre property. The lease, negotiated decades ago, allows them to control what is built or operated there, Barry Becker, a Weddington partner, said.

Under current zoning regulations, three-story buildings are allowed along the section of Ventura Boulevard that includes the deli. A proposed specific plan for the 17-mile-long boulevard, however, would limit buildings to two stories in that section of the busy corridor.

The proposed specific plan remains in draft form and is subject to change by the City Council. Mixed-use development, such as that reportedly envisioned by Cohen and his partners, would be encouraged along certain parts of the boulevard by offering developers incentives, such as exemptions from building fees, or allowances to build additional floor space.

Becker, a Las Vegas builder, said he knew nothing about plans to change the site. A local Weddington partner, Guy McCreary, was out of town and could not be reached for comment.

Becker said that in February, Cohen, Torino and Schenkman purchased outright from a Weddington company an adjacent two acres on Ventura Boulevard. Three businesses--Bed, Bath & Beyond, Aaron Bros. Art Marts, and Express Carney’s Limited, a hamburger stand inside an old railroad car--now occupy that property.

John Wolfe, owner of Carney’s, said he was told by Schenkman that his lease, which expires in two years, will not be renewed “at this time.” He was also told that the Cohen group is trying to sell the property.

Wolfe said he would reopen his restaurant elsewhere, if necessary, but that “you build up a reputation in an area like this and hate to move.”

“But one thing about what we have,” he said in reference to the hot dog stand’s railroad car, “is you can pick it up and move it.”