Builder Said Ready to Take Permits as Suit Settlement

Riding high on recent courtroom victories in their lawsuit against the city of Los Angeles, investors in the proposed Warner Ridge development say they will settle for permits to build a large-scale mixed-use project rather than the $100 million they sought earlier in the case, sources said Tuesday.

The City Council in executive session reviewed the real estate partnership’s settlement offer Tuesday but took no final action. The lawmakers are seeking additional information to help weigh the proposal, including real estate appraisals, several council sources said.

The impetus on the council is to settle the litigation and yet seek a way to limit its potentially far-reaching and costly effects on the city’s land-use practices.

Leading the pro-settlement faction are Council President John Ferraro and Councilman Hal Bernson, chairman of council’s Planning Committee, who are said to be hopeful a final accord will be ratified Friday by the lawmakers when they meet in executive session on the matter.

Councilwoman Joy Picus, who has led the fight against the Warner Ridge partnership’s development plans, remains the only council voice against settlement, the sources said.

To drop their litigation, the Warner Ridge investors want permits to build a project on their 21.5-acre Woodland Hills property that would include 690,000 square feet of commercial development, 125 condominiums and up to $4 million in credits for various city fees.

The developer, according to sources close to the negotiations, also has agreed not to oppose the city if it appeals to the California Supreme Court a lower court ruling in the Warner Ridge litigation that could wreak havoc on the municipality’s long-standing zoning practices.

Several sources said the city is desperately trying to narrow the impact of the Dec. 31, 1991, state Court of Appeal ruling.

That decision held that the city acted illegally by denying the Warner Ridge investors commercial zoning for the property when the local community plan identified the area as suited for such development. Picus, who was being heavily pressured by homeowners to oppose the project, led the council in a January, 1990, vote to give the developers enough zoning for only 65 single-family homes instead of an 810,000-square-foot commercial project.

But in its 3-0 ruling, the appellate panel said the developer was entitled to zoning equal to the community plan designations for the site.

Within a week of the ruling, a Superior Court judge held--in another decision critical to the case-- that the council’s actions to downzone the Warner Ridge site deprived the developer of “all economically viable use” of their property.

City officials fear that the state Court of Appeal ruling may provoke a spate of lawsuits against the city by other disappointed developers who were similarly treated.