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Community Digest

Whittier : City Threatens Foreclosure on Shopping Center Project

March 19, 1992

The City Council has voted to begin foreclosure proceedings later this month on the controversial Whittier Station Center, a $26-million, 16-acre shopping center under construction near Whittier's western border.

The council action last week came after the developer failed to make a required interest payment on $3.8 million in bonds used to finance part of the half-finished project, Assistant City Manager Hank Cunningham said. The Encino-based developer, Urbatec, was supposed to have paid bondholders $207,000 by March 1.

Urbatec attorney Mark Novak blames the missed bond payment on Whittier. He said his company is ready to make the required biannual payment but is waiting for Whittier to pay its share of the interest cost.

Under an earlier pact between the city and developer, Whittier officials had agreed to have the city pay half of the March bond tab if the City Council and developer could agree on the supermarket company to be selected for the center. The developer has assured the city that an Alpha Beta store will be built. City officials said they want to see a signed lease.

Both sides expressed confidence that the disagreement would be worked out. If it isn't, city officials said they would file foreclosure papers in court after March 27. Cunningham said he still expects the shopping center, scheduled to open late this year, to be a financial mainstay for the city.

To make way for the development, the city moved a historic train depot and permanently closed a section of Magnolia Street, a popular north-south shortcut. Both actions displeased many residents. Critics also have panned the project for its cost to the city, which includes a $6 million subsidy.

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