Key Player Quits Civic Center Suit : Redevelopment: Wave Property says it will no longer take part in developing a cohesive plan for the area. Firm’s president cites lack of progress in negotiations between the city and the civic association.

The struggle over Malibu’s main commercial area is headed for trial late next month, without one of the principal players.

Wave Property, a subsidiary of Pepperdine University, has informed the city and its partners in the lawsuit that it would not participate further in the suit--which has a Jan. 20 court date--nor will it continue efforts to develop a cohesive plan for the 125 acres of mostly undeveloped land in and around Malibu’s civic center.

Wave Property, which owns 16 acres of prime real estate in the civic center, also notified the City Council in a letter that it was withdrawing as a member of the Malibu Village Civic Assn., a group of civic center property owners who filed the suit, and would for the time being go its own way in developing its property.

“The decision has been in the works for some time,” Mike O’Neal, president of Wave and vice chancellor at Pepperdine, said Monday.

Wave Property’s withdrawal, O’Neal said, was partly a business decision based on the cost of continuing litigation, but was also based on “how we think it is best to proceed” in working with Malibu, O’Neal said.

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Pepperdine’s relationship with the city has been rocky for several years, particularly since the university lobbied successfully in the late 1980s to be placed outside city limits when the boundaries were drawn before Malibu’s incorporation.

There are a lot of issues involved, and working through them “takes time when you have a new city,” he said. “It’s not going to happen overnight.”

In his letter to the City Council, O’Neal cited the lack of progress in two years of negotiations between the city and the civic association over development plans as the reason for bowing out of recent negotiations.

O’Neal left the door open to future talks. “We are confident that someday appropriate planning will take place, and we will continue discussions with the Malibu community, members of (the civic association), and the city toward that goal,” he said.

The association, a group of 15 civic center property owners, also said in a separate announcement that its members were free to pursue their individual development applications, and the group would proceed as planned with its lawsuit challenging the city’s interim zoning law.

The law, designed to keep development options open while the city draws up an overall development blueprint called a general plan, outlaws residential development in the civic center, prohibits new multifamily development throughout Malibu and places limits on other kinds of development.

Fearful that such elements will also be included in the general plan, the association sued the city in April, asking that the ordinance be overturned on the grounds that the City Council should not have approved it without preparing an environmental report.

The association had put the lawsuit on hold for two months during negotiations. A tentative agreement reached in October outlined a two-year public process in which a specific plan for developing the civic center would be prepared.

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The agreement called for the property owners group to drop its lawsuit in exchange for a city agreement to start work immediately on the specific plan. But the agreement unraveled soon after the council refused at its Nov. 1 meeting to go along with the association’s insistence that any plan approved be economically feasible to build, O’Neal said.

John Perenchio, spokesman for the civic association and a vice president of the Malibu Bay Co., which owns 74 acres in the civic center, agreed in a telephone interview Tuesday that the phrase had been the straw that broke the camel’s back.

The group had backed away from demanding more specific language, leaving it up to the city to define what is economically feasible, Perenchio said. “But we wanted a benchmark,” he said, stating that any plan ultimately approved would be economically feasible for the landowners to carry out.

Otherwise, he said, association members feared they would end up paying for the planning process and various amenities for the city, such as a performing arts center, and still not have the right to develop the civic center intensively enough to make a profit.

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Councilman Jeff Kramer acknowledged that the landowners had reason to be concerned about financial feasibility, but he said the city has its own nightmare of ending up with a “Century City West” in the civic center.

For Malibu to contractually guarantee the developers a profit, he said, would open the city up to possible litigation.

The proposed place to discuss economic feasibility, he said, would be in public, where the cost of amenities and the density required to pay for them can be debated.

The absence of a city-sponsored specific plan, Kramer added, does not necessarily mean that an unattractive hodgepodge of development will result.

Members of the civic association, he said, “own the bulk of the land, and they’re free to design and present an overall plan” to the community.