Montage expands its holdings

Barbara Diamond

Montage Hotels and Resorts and its partners have become major

landowners in South Laguna in the past two years with no plans

announced for the two most recent acquisitions.

The partnership created by hotel industry veteran Alan Fuerstman,

president of Montage, unnamed investors and Athens Group, developers

of the former Treasure Island Mobile home Park, bought the Colony at

Laguna Beach in 2002 and renamed it. In March, the partnership

acquired the 80-acre Aliso Creek Inn and Golf Course and on April 1,

escrow closed on the 228.5-acre hillside parcel known as Driftwood

Estates.

Spadework had been done on all three properties when the

partnership made the deals.

Athens Group had already reached agreement with the city on almost

every detail of the entitlements for the redevelopment the oceanfront

mobile home park when the partners bought it for $190 million.

The inn, restaurant, golf course and pro shop package on Aliso

Creek was bought from the Brown Family, which had owned it since the

1950s. Developer Steve Vliss had spent years negotiating an agreement

for the Driftwood property, 218 acres of which he offered to donate

to the city as open space in perpetuity. However, Vliss only had

options on the property, not the deed.

Just how the two recent acquisitions will affect the South Laguna

landscape is unknown.

“We don’t really know exactly what we will be doing until we have

evaluated the land, but we are very excited,” Clarke said Tuesday.

“Once we have plans, we will announce them.”

Her comment echoed what she said in February when the Aliso Creek

deal was made public in a Coastline Pilot story published before

escrow closed.

The partnership could keep Aliso Creek the same, do some minor

tinkering or a major overhaul and proceed with the Driftwood project

as approved by the City Council or scrap the whole thing and start

from scratch.

City approvals are good for two years, which means the new

Driftwood owner has about 18 months left to decide if they want to go

forward with the approved project.

“If they complied with all the conditions of approval and reached

an agreement with the adjacent property owner for access, they could

immediately take the project to the [California] Coastal Commission

for a coastal development plan and local coastal plan amendment and

then submit a tract map to the city,” said John Montgomery, director

of Community Development Department.

Councilwoman Toni Iseman, who voted against the project, sits on

the commission.

Developer Vliss obtained city approval in October 2003 for 11

homes with 35% maximum lot coverage, which allowed 6,300 square feet

on a single story or 12,600 square feet on two stories, excluding

garages.

The project was scaled down 15 homes recommended the previous

February by the Planning Commission. Vliss spent the interim months

in negotiations with protesting neighbors, proposed and chaired by

Councilman Steve Dicterow.

The reduction in homes from the original 19 Vliss had envisioned

to the 11 finally approved prompted him to appeal to the trust that

administered the property for an adjustment in the price. Vliss

announced in January that he had put the project on hold while

trustee Ken Cummins, who expressed great respect for Vliss, explored

options mandated by his fiduciary responsibility, but hoped

ultimately to be the developer.

“I spent almost four years getting my project approved by the

city,” Vliss said at the time. “It would be a reasonable conclusion

that it would already have been underway if the council had approved

the project when it was recommend by the Planning Commission.”

Vliss was traveling this week and unavailable for comments at

press time.

Most of the opposition to Vliss’ project came from the neighbors

below the proposed development. Property owners above Driftwood

Estates supported it because of the donation of open space in

perpetuity.

“We’re remaining watchful about anything proposed for the

beautiful Hobo/Aliso Ridge,” said project opponent Penny Elia. “I

have spoken with Bill Claypoole and he has promised open

communications.”

Claypoole is the Montage vice president of technical services and

often its spokesman at council meetings.

“When Driftwood came out of Planning Commission, it looked like a

win-win project all around,” said Commissioner Anne Johnson. “It was

a modest development for the size of the parcel, with improved

hydrology and more than 200 acres of open space dedicated to the

city.

“The commission had held more than 10 public hearings and made two

trips to the site as well as countless individual trips with the

architect, environmentalists and neighbors both for and against the

project.”

Vliss declined in January to discuss how much the project had cost

him, but architects, geologists, hydrologists, environmental impact

reports and attorneys don’t come cheap for a project of the magnitude

he proposed, even with a reduced number of units.

All in a lost cause.

The city could be the loser in terms of the open space Vliss

promised the city.

“I think it would be a tremendous blow to the city to lose 218

acres of open space,” Kinsman said. “I hope we will receive that kind

of offer again.”