Warner Ridge Developer Reconsiders Office Project

In a surprise move that would bring one of the Valley’s longest-running land-use battles full circle, developer Jerry Katell said Monday that he may consider scrapping plans for a commercial office development at Warner Ridge in favor of an all-residential development.

Katell, president of Katell Properties, is seeking an option to build about 470 luxury rental townhomes as a possible alternative to the 690,000-square-foot office complex now planned for the site.

Katell said the proposal might be more appealing to neighborhood groups that have opposed the commercial complex, while also being economical, since apartment vacancies in the area are considered very tight.

“We are trying to work it out in such a way . . . that it would be a win-win situation,” Katell said.

Traffic studies have shown the residential alternative would generate 68% less traffic, measured in car trips, than the proposed commercial project, Katell said.

Neighbors of the 21-acre Warner Ridge property had long lobbied for single-family homes to be built rather than the large commercial project long planned for the site, said Ken Bernstein, planning deputy for City Councilwoman Laura Chick.

The battle over the property, located on the east side of De Soto Avenue between Oxnard and Victory boulevards, evolved into a lengthy and costly lawsuit when an earlier developer sued the city over a zoning change the city had enacted to thwart commercial development.

The city was soundly defeated after a decade of fighting, which was thought to have contributed to the downfall of Chick’s predecessor, City Councilwoman Joy Picus. Picus was voted out of office in 1993.

Katell moved to purchase the site in 1996, and with it the right to develop the Warner Ridge commercial complex, Bernstein said.

Only a few acres were set aside for 125 apartment units, which will be built by Lincoln Property Co., which purchased the smaller property from Katell.

Bernstein said Katell’s new proposal to hold open the option of developing townhomes instead “is sort of the flip side of where we started out. . . . It’s ironic this has come full circle to residential again, because this is what the battle was about in the first place.”

Not quite, though, said Gordon Murley, president of the Woodland Hills Homeowners Assn. Murley said his group is withholding judgment on Katell’s proposed alternative, because Katell “hasn’t spelled out” what he plans.

Far from being pleased, Murley said that based on what he had heard, Katell’s proposed townhouse development is more dense than the association wants and would be undesirable because the townhouses would be rented, not owned.

Moreover, Murley said, the group is concerned that Katell will avoid being required to make costly improvements to local roads by building townhomes.

“We are concerned about anything that doesn’t make this a better community,” he said.

Bernstein said he has received mixed reactions from neighbors, with some residents concerned that the nighttime traffic townhomes would bring would be more annoying than the daytime traffic from offices.

But others, he said, “are pleased . . . they feel this is what it should have been all along.”

Katell said he is now marketing the proposed office complex to would-be commercial tenants, high-tech companies in particular. But he said he also has been contacted by various residential developers eager to convert one of the last large parcels in Woodland Hills to new apartments--evidence of an increasingly tight apartment market in the area.

It’s no wonder residential developers are interested, he said. “The views are spectacular from there,” he said.

Katell said while the return on townhomes may be a little less, the difference may not be substantial, especially if building homes means fewer required road improvements because traffic would be lighter.

However, he shied away from offering a lower-density development. “I need that density to get even close to making it work” financially, he said.

Bernstein said that under the current development agreement approved by the city, Katell must widen De Soto Avenue, a project that includes such “big ticket” items as widening a bridge over a waterway.

Katell’s plan came as a surprise to Seth Dudley, a broker with Julien J. Studley in L.A. Dudley said Katell needs a single, very large commercial tenant to get the project going, and so far hasn’t gotten one.

“There are not a lot of [such tenants] out there,” he said.

Under the circumstances, “It probably won’t hurt to have this as a background plan,” he said.

Katell emphasized that the residential plan is an option, not a replacement for the current plans. “It’s nice to have options,” he said.

Chick, whose district surrounds Warner Ridge, is seeking input from constituents before taking a position on whether the city should allow Katell to alter his development agreement to permit townhomes as an option.

The proposal will be discussed at a meeting of the Woodland/West Hills Neighborhood Planning Advisory Council scheduled for Wednesday night at 7 p.m. at Kaiser Permanente, Auditorium B, entrance No. 5, 5601 De Soto Ave.