Warner Ridge Debacle Offers Valuable Lesson : Zoning Code Is Not the Vehicle for Thwarting Development
When it was recently announced that the Warner Ridge office development project in Woodland Hills had finally secured the major tenant that it needed to help move toward actual groundbreaking, the moment was rich in irony. It ought to be remembered as perhaps the crowning moment of an embarrassing saga, and as an example of one of the worst ways to try to scale back or alter development projects.
We begin this exercise with a date in October of 1984. That’s when the Los Angeles City Council adopted the Woodland Hills Community Plan that designated a particular site for commercial use. Three months later, a development group formed Warner Ridge Associates and bought that land, east of De Soto Avenue and near Pierce College, and planned to build an office complex. Next, Councilwoman Joy Picus responded to objections by nearby homeowners and said she would try to rezone the land for single-family residences.
In 1989, the Los Angeles Planning Commission approved the Warner Ridge project proposal as a “quality development.” Despite this, and the Community Plan that designated the site for commercial use, the City Council tried an ill-considered end run. It approved zoning changes for the site that would only allow a small number of single-family residences.
Predictably, the developers sued, arguing that the council’s rezoning has illegally deprived them of the true value of their property. Predictably, just two months later, a Superior Court judge sided with the developers and ordered the council to zone the site for commercial use. The Warner Ridge developers offered a scaled-down project in May, 1991, but instead of saving face and taxpayer money, the council rejected the offer and continued its appeal of the court decision.
Predictably, the city lost again at the state Court of Appeal in December, 1991. The Superior Court next ruled that the council rezoning had, in fact, stripped the Warner Ridge property of economically viable use.
Forced to settle, the City Council finally agreed to the 690,000-square-foot commercial office and condominium project originally sought by the Warner Ridge developers, and even decided to waive $20 million in city fees. The council later learned, from the city attorney’s office, that its legal defense alone in this case had cost the city’s taxpayers $700,000.
In September, the council formally approved the project and the zoning change to commercial use, and agreed to take no action whatsoever to restrict use at the property for 10 years.
Still hanging here is the fact that the Warner Ridge case highlighted other potential problems, such as other parcels around town where there are discrepancies between city planning designations, which may stipulate commercial use, and zoning designations, which may stipulate residential use. Some could be as radically opposed to each other as the Warner Ridge site. One major firm, for example, owns another large parcel of land in Studio City that is zoned for residential use, but the planning designation calls for commercial use.
Some homeowners persisted in trying to breathe life into the Warner Ridge case and challenged in Superior Court the city’s environmental-impact review of the development project. The homeowners lost. Undaunted, they asked the state Court of Appeal to invalidate the settlement between the city and the Warner Ridge developers. The homeowners lost again.
But the point that must be stressed here is simply stated. In those areas where planning designations allow for development that is far more dense than desired, the City Council must first act to amend those plans. This is not rocket science. Trying to shift the zoning restrictions without first amending the plan simply will not work. Surely the courts have proven that by now.
