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City, commission pull the plug on Village Lofts project

Plans for the four-story Village Lofts are no more, at least for the foreseeable future.

The planning commission voted unanimously Tuesday night to uphold Community Development Director Brian Desatnik’s voidance of the project and to deny the appeal of property owner and developer Denley Investment and Management. The commission cited an unusually slow development process that has seen multiple delays and virtually no movement from Denley since September 2015 as a reason to deny the appeal.

The ruling casts doubt on the future of the project, the design of which was approved by the architectural commission in December 2012. At the time, it was widely seen as the final piece of the Village West puzzle. Denley bought the property in 2011 for $2.5 million, according to real estate records.

Denley can appeal the planning commission’s decision to the city council within 10 days, but if they lose, they would have to resubmit plans to the architectural commission.

In other words, Denley would have to start from scratch.

During his presentation to the commission, Mr. Desatnik noted the unusual nature of the hearing, saying he had never been in a situation to “make a decision on a project such as this.”

He presented a timeline of events leading up to the January 30 decision to void the design approvals. Denley was granted a 90-day extension in December 10, 2014, two days before the two-year expiration date of the plans, according to Mr. Desatnik. They applied for a demolition permit in March 2015, one week before the extension deadline, and demolished the Rich’s Products building later that year.

Virtually nothing has happened since then, save for approvals of lighting and landscaping and a little back-and-forth regarding a shade structure on the southeast corner of the proposed building, the city says. A green fence lines the perimeter of an empty and dusty lot the city says should be the home of a four-story mixed-use building by now.

The city even floated an idea late last year to convert the parcel into a temporary parking lot as a placeholder, but Denley passed on the idea. The parking lot would have required an additional amendment to the Village Expansion Specific Plan (VESP)—the city added a previous amendment to relax height limits when the four-story building was approved—because temporary lots are currently not allowed.

In his presentation, Mr. Desatnik painted a picture of a development in disarray. There was apparently a disagreement between Denley President Mehdi Bolour and his son, Denley Vice President and project manager David Bolour, over the future of the project. David Bolour wanted to move forward with construction, Mr. Desatnik said, but Mehdi Bolour did not, citing housing market concerns.

David Bolour informed the city on January 3 that he would no longer be the project manager, Mr. Desatnik said.

According to the city timeline, Denley did not answer repeated emails and phone calls from the city from November 2016 to January 2017.

Mr. Desatnik officially put the kibosh on the project in a January 30 letter to Denley, citing a part of the Claremont Municipal Code that states the Director of Community Development could stop a project if it wasn’t moving at a “commercially reasonable pace.”

Denley appealed on February 10.

Areg Sarkissian, Denley’s general counsel, told the commission the project was put on hold because the elder Mr. Bolour thought a recession was looming around the corner. The opposite happened, and the housing market is currently thriving.

He also took the notion of “commercially reasonable pace” into question. “It could be different for me, it could be different for you, it could be different for Brian [Desatnik],” he said.

“If we go based on the demolition permit and the demolition being completed, I have a feeling we can meet the definition of something that is commercially reasonably paced,” Mr. Sarkissian said.

Mr. Sarkissian noted that he had been in regular contact with the city since January 30, providing a pro forma, a name and resume of the new project manager and a letter noting Denley was about to receive a $52 million loan at the end of the week. He stressed that Denley was ready, willing and able to move forward on the project, and warned of the possibility of blight and an increase in crime if the lot was to remain undeveloped.

But the commission was tasked with considering only what had happened up to January 30.

“I am here today, belated once again, to recommend the commission uphold the appeal and allow Denley another opportunity,” Mr. Sarkissian said. “I know you have [before], and I’m here one more time.”

The commission was not swayed. In his remarks, Commissioner James Jackson lamented the demolition’s effect on surrounding residences and highlighted the number of years it took from approval to demolition.

“If that’s moving at a reasonable speed, I don’t understand a snail’s pace,” he said.

Commissioner K.M. Williamson noted the city offered Denley a two-year extension on the project as an incentive for building the parking lot, calling it a “very generous offer” from the city.

“It suggests strongly to me that this developer is in no way prepared to move forward with this project and has not been prepared,” she said.

Commissioner Leigh Anne Jones, an architect by profession, called into question the main reason why Denley decided to not move forward with the project. In her mind, the fact that demolition took place indicated Denley actually thought the economy was going to pick up.

“And something happened, some reason happened, either funding was pulled or perhaps something else that they’re not sharing with us,” she said. “But I don’t mean to speculate. They could have very quickly moved along and actually gotten it built and been ahead of the market.”

The commission unanimously denied the appeal.

When reached after the meeting and asked what was next for Denley, Mr. Sarkissian simply said, “We’re not going to build anymore.”

He added that Denley would discuss a possible appeal to the council, but noted they currently do not have the money or the time to start from scratch.

—Matthew Bramlett

news@claremont-courier.com

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