‘Condo’ Rentals Anger Neighbors : Developer Blames Soft Market for Decision Not to Sell Units Billed as Townhomes

Friday should have been a red-letter day for Arie Wayserman. He signed the last papers selling his house in Panorama City, giving him enough money to buy his dream townhouse in a 750-unit complex being built in Woodland Hills.

Wayserman, 38, had put his name on a list to purchase a luxury unit in the Summit at Warner Center and planned to spend about $300,000. “It’s the only reason I sold my home,” he said.

Wayserman, however, will remember Friday less than fondly. He learned that all units in the Summit will be rented as apartments, not sold as condominiums. Executives with G. H. Palmer Associates, developer of the project, said economics and an analysis of real estate conditions indicated that it was impractical to sell at this time.

In addition to ruining Wayserman’s plans, the decision has provoked rage among some Woodland Hills homeowners who feel deceived by the developer. They said that having more apartments in their neighborhood would lower their property values, as well as bring noise and traffic into the community.

“I’m furious,” said Brad Pakula, a physician who purchased a house a year ago that is two blocks from the complex, near the northeast corner of Shoup Avenue and Oxnard Street.

“When we moved here, we asked the developer what was going on, and he said it was luxury townhouses, so I felt secure,” Pakula said. “My wife and I had put a lot of effort and research into finding a good area, and we didn’t want to be near apartments.

“This is awful,” he said. “There will be four to five people living in each unit. People will live there six months and move. They just won’t care.”

Dan Palmer of Palmer Associates said that to sell the townhouses now would be impractical “unless we put them below their true value.” He said the firm based its decision on two independent market analyses.

“It’s just impractical to try and sell them at this time,” he said. “It’s a disappointment to us. But it affords an excellent opportunity for those who could not afford to live there.”

He also said the firm never promised to sell the units. Zoning for the property allows both townhouses and apartments.

“We had always said that the market would dictate how many units would be sold,” he said. “We made that very clear. It was inconceivable that we would know what the market conditions would be.” He declined to disclose the estimated price of the units.

Area real estate brokers and Los Angeles City Councilwoman Joy Picus disputed claims that the market is not good.

Temmy Walker, president of James R. Gary Ltd. East, a real estate firm, said Palmer is “making a decision that has nothing to do with the marketplace because the market is not bad under any circumstances. Condos are selling faster than anything.”

Glenn Bevilacqua, president of R. R. Gable Southwest in Woodland Hills, said the market “is not that slow. . . . This kind of project is so nice that it would generate its own market and excitement. Every place I go, people say they have been really interested in buying one. They know it would cost about $200,000 to $300,000.”

Picus said she wondered if the developer deliberately misled residents.

“My seat-of-the-pants feeling is that they would sell fantastically,” Picus said. “This doesn’t please me a whole lot. In all the newsletters that the builder sent to residents, these were always described as condos. I don’t know if they deliberately misled the residents.”

Palmer bristled Friday at criticism of the decision. “We don’t appreciate being second-guessed,” he said. “Those parties who are knocking our decision are not informed, nor do they have the ultimate responsibility for the success or failure of this venture.”

Palmer said he has scheduled a meeting with neighborhood homeowners for 7 p.m. Monday at Bob Burns restaurant in Woodland Hills. “I think once we answer everyone’s questions, they will be satisfied with the decision,” he said.

As for Wayserman, who is staying in temporary quarters, he said he is preparing to move into a rental apartment elsewhere and is looking for another place to buy. “There are a thousand places I could lease,” he said. “I believe in home ownership.”