Dana Point Resort Proposal Scaled Back : Development: Revised plan for Headlands reduces homes by 15% and adds parkland. No changes are made in hotel overlooking harbor.

The developers of an $800-million resort proposed for the bluffs overlooking Dana Point Harbor unveiled a scaled-back plan Wednesday with fewer homes and more parkland.

Under the new proposal for the 121-acre parcel known as the Headlands, the maximum number of homes would be reduced by 15%, from 522 to 447. No changes have been proposed to the centerpiece of the resort--a 250-room luxury hotel with 150 separate bungalows.

The new parkland would come with the addition of 4.2 acres of open space and a new 5.7-acre hillside park tentatively called the Dana Strand Coastal Access Park. The park would connect the southern end of the Salt Creek Beach public parking lot with the southern end of Dana Strand Beach by a switchback trail running up and down the bluff.

William Phillips, president of PBR, the lead consultant on the project, told the city Planning Commission that the new proposal came as a response to demands from the City Council and the public for more open space and less housing.

“I hope it’s evident that we truly tried to respond to the questions that have been raised,” Phillips said.

Phillips added that 48 acres of the new plan are designated for residential use in an amount equal to 40% of the entire project.

“That’s what’s financially driving the project,” Phillips said of the residential portion. “It’s not the hotel because we don’t see that (becoming) financially viable for five to 10 years.”

Phillips was speaking for the landowners, the Newport Beach-based M.H. Sherman Co. and Chandis Securities Co.

At the heart of the new proposal is a series of alternatives for the roadways throughout the parcel. Among the suggested changes is a new entrance to the project--and the hotel--off Pacific Coast Highway from an existing intersection at Selva Road.

Ed Gallagher, a resident of the Headlands and an outspoken opponent of the project, said he was not impressed with the new plan.

“These are microscopic steps in the right direction in some cases and, in some cases, backward steps,” Gallagher said. He added that the new plan would bring major traffic problems to the established residential areas on the parcel.

The earlier plan had proposed a new intersection and traffic signal on Pacific Coast Highway called Selva Road South that would have served as the main entrance to the hotel and residential areas of the Headlands. After talks with Caltrans, however, the project entrance was changed, Phillips said.

Edward M. Knight, Dana Point’s director of community development, called the new proposal “the first real alternative put out by the developer.”