Writing another chapter in one of the longest-running land use battles in the San Fernando Valley, the developer of Warner Ridge will seek city approval this month of the option to build 471 townhomes on the site instead of a commercial project.
Jerry Katell, president of Katell Properties, said if the city agrees, the real estate market will determine whether he builds homes or offices when he breaks ground on the project this summer.
"It's nice to have two options," he said. 'There's a very good chance we'll go in that [townhome] direction."
Katell wants approval for construction of a 690,000-square-foot commercial and office development on about 16 acres on the east side of De Soto Avenue between Oxnard and Victory boulevards.
Although some potential office tenants have expressed interest in the project, no one has yet been signed, the developer said. Katell began considering the residential option a few years ago when the vacancy rate for office buildings was 20% in Woodland Hills. Now it's down to 8%, he said.
"The office market has gotten better and better," he said.
In a mailer to neighbors of the site last year, Katell described the benefits of a high-end townhome development over a commercial project, including a 50% reduction in traffic and a 25% reduction in building heights.
Residents sought for the townhomes would have an average annual income of $70,000.
City Councilwoman Laura Chick prefers the residential project to the commercial one, a spokeswoman said, but Gordon Murley, president of the Woodland Hills Homeowners Organization, said there are too many residential units for the site.
"We think it shouldn't be over 350 units. That might make it manageable," Murley said.
The proposal for 471 units could mean that about 1,500 people would live on the property, adding to traffic problems and requiring at least five acres to be dedicated to parkland, Murley said.
Katell said under existing zoning, he could build 1,800 to 2,000 apartments.
"We're not asking for high density," he said.
Murley also said he would prefer that the townhomes not be rentals.
"We've always said it should be owner-occupied. They are better taken care of usually," Murley said.
The homeowner group also wants to make sure Katell honors conditions requiring improvements to accommodate additional traffic and residents, including specific requirements for access to the site.
The battle of Warner Ridge goes back more than a decade. In 1988, the City Council used zoning ordinances to thwart plans that included commercial space. Another developer sued and won a court order that the city approve the mixed-use development, despite neighbors' concerns about traffic problems. Homeowner leaders wanted single-family homes only.
Katell still faced neighborhood opposition when he took over the proposed commercial development three years ago, so he announced last April that he was considering a townhome development as an alternative.
"Markets shift all the time, and one reason we can't make a definitive decision is that things are constantly changing," Katell said.
Design work has already begun on a first-phase commercial development, which would include 274,000 square feet planned for the northern part of the property.
The Planning Department hearing on the residential project is scheduled for 1 p.m. on March 26 at the Sherman Oaks Woman's Club, 4808 Kester Ave.