Whatever slim hopes the city of Malibu might have had of buying the 35 acres known as Trancas Town, located on the west side of Trancas Canyon Road, just north of PCH, were dashed last week in Federal Court. Bankruptcy Judge Kathleen Lax decided, after a day of hearings and testimony, to accept the plan proposed by the developer, Dean Isaacson, which apparently had first received the concurrence of the creditors’ committee. The final approval of the Isaacson plan means the city’s plan to buy the land is dead, at least for now. City Manager Harry Peacock said, however, the city still had an interest in the land and was keeping an eye on the Isaacson deal as it progressed.
The Isaacson plan requires him to first cash out, in the aggregate amount of about $1 million, the holder of the first and second trust deeds, a bank in Texas, and the holder of the third trust deed, local attorney Allan Block. The holders of trust deeds Nos. 4 through 10, which had earlier been reported to be in the neighborhood of a couple of million dollars, have agreed to the plan. So they’ll wait to get their money as a part of a share of the profits, which insiders report means when the land is sold or the housing built and sold, the creditors will get 20 percent after costs and the developer 80 percent.
The great unknown is just how many units will ultimately be allowed on the 35 acres. The city has zoned them for seven five-acre estate lots. Earlier, however, before Malibu became a city, the County of Los Angeles had zoned them for 15 single-family residences and 52 townhouses. The developers had obtained a permit from the California Coastal Commission to develop. Before they could begin the project, however, the city of Malibu incorporated, and the city immediately put the brakes on the development.
The Trancas Homeowners Association sued the developer, the Coastal Commission and the city to block the project, alleging the old coastal permit had run out. That lawsuit has not yet gone to trial because the filing of the bankruptcy stayed the entire lawsuit. Now that the bankruptcy is settled, that lawsuit will probably start up again. Some of the attorneys involved, however, said the Coastal Commission has looked over the permit again and is of the opinion the original coastal permit issued is still valid. No one will know for sure until the issue is finally litigated.
Even if the Coastal Commission permit is valid, there is still another underlying legal question: Is the original L.A. County permit, issued before Malibu cityhood, still valid? If it is, and again we’ll only know after a lawsuit, the developer might have a vested right to as many as 15 single-family residences and 52 townhouses on that 35-acre parcel. On the other hand, if the homeowners association or someone else wins, the builder will probably be limited to the seven five-acre lots.
A third alternative is that the developer might cut some sort of a deal with the homeowners association or the city, or both, and take some compromise number. The city in the past has not been particularly receptive to negotiating. Now that the city needs land for ballfields, however, some of that flat Trancas Town acreage, which would be ideal for ballfields, might push the city into entering into some serious negotiations.
According to Patt Healy, a west-end “slow-growth” activist, she would “love to see the city buy all of it for parkland, if that’s still possible.”