Newport buys offices for $4.3 million in legal settlement

The Newport Beach City Council Tuesday night voted to buy an office building at Monrovia Avenue and 15th Street for $4.3 million, quietly putting to rest a legal battle with the property's owner.

Kenneth Kaplan sued the city for inverse condemnation in late 2011 after the building was rezoned for residential use in 2010.

That move, Kaplan alleged, effectively rendered the building at 1499 Monrovia Ave. useless. The 17,000-square-foot building — which occupies prime real estate neighboring the future Banning Ranch development — was once home to Road & Track Magazine.

At its meeting, the council authorized the purchase, and in return, Kaplan agreed to drop all legal action regarding the property, a staff report said. The deal followed a series of negotiations, beginning in March, when Kaplan first offered to settle for between $4.8 and $5 million. The sale is expected to close on Nov. 15. The report said the property could be used for any number of public facilities, including a city community center for west Newport.

Although the vote appeared on the consent calendar, meaning staff didn't believe it would garner further discussion, frequent council meeting public speaker Jim Mosher pulled the item to question why the city is shouldering the full multimillion-dollar price tag.

Private developers, he said, will likely benefit from the city's purchase if 15th Street is eventually extended over the property to connect with Banning Ranch developments.

"If we're buying property, even in part to help a private developer, they should be picking up some of the tab," he said.

The council voted unanimously to approve the purchase without comment.

In other business, the council unanimously approved the city's response to an Orange County Grand Jury report on public employee pension transparency, accepted an annual report on group home operator Sober Living By the Sea's continued compliance with the terms of a zoning agreement and approved a $500,000 purchase for the city's library expansion project.

A special meeting on the proposed commercial marina lease template was set for Tuesday, Oct. 23 at 4 p.m., just before the regularly scheduled council meeting.

The council also waived fees for the Oct. 28 Memorial Bike Ride in honor of two cyclists killed last month and officially established a bicycle safety improvement fund. The ride will raise money for that fund, with the city matching donations three-to-one, up to $450,000.

April Morris, a volunteer helping plan the ride, told the council that so far, about 200 people have said they plan to show up.

In the nine days since fundraising started, Morris said, about $18,728 has been raised.

Twitter: @jillcowan

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