Residents Bid $52.5 Million for Mobilehome Park

Former association board member Daga Krakowizer on the park’s grounds.

Residents of Laguna Terrace Mobilehome Park delivered $500,000 in “earnest” money last week towards their $52.5 million bid to become the collective new owner of Laguna Beach’s largest remaining trailer park boasting ocean-view lots.

A recent California Supreme Court decision regarding a Los Angeles mobilehome park may bolster their offer.  The ruling, said Gary Skeen, the newly elected president of the park’s residents’ association, might serve to discourage other bidders eyeing the prime coastal real estate for its development potential.

The court’s decision, announced last Thursday, determined that the owners of Pacific Palisades Bowl Mobile Estates must seek California Coastal Commission approval before subdividing the 170-unit park from tenant occupancy to individually owned lots.  The decision upheld the state Court of Appeal’s earlier judgment.

“What that did was put us in a better light because we’re not asking to subdivide,” said Skeen. “People can’t come in and develop this into condos, scrape the land clean and put Montage condos in here.”

The Laguna Terrace Park residents’ association, said Skeen, does not want to subdivide ownership of the 156-space, 132-unit property but intends to become the new owner of the mobilehome park as it is. Because the mobilehome park, which covers 14 acres of a 46-acre plot, would not be redeveloped, Skeen said the association, as the new owner, would not be required to go through the lengthy and costly procedure of receiving Coastal Commission approval and permits.

However, Skeen said subdividing and selling individual lots to residents is a decision residents could take up in the future. He estimated the plan would take two to three years to process through Coastal Commission review.

Acceptance or rejection of any bids to buy the park was expected by the end of this week from Laguna Terrace Park owner Amy Esslinger, widow of park owner Steve Esslinger, whose grandfather was the original developer. Mrs. Esslinger did not return phone calls nor did the family’s longtime attorney, Robert Coldren of Santa Ana’s Hart, King and Coldren.

Skeen said he and Sean Schlueter, the residents’ association secretary, hand-delivered the good-faith check to Vince Reynolds, a broker at CBRE Brokerage firm in San Diego, which specializes in mobilehome park sales. Reynolds failed to return calls as well.

Skeen said the association placed their bid to buy the property on the last acceptable day because residents were waiting for the Supreme Court’s decision.

Jim Lawson, former manager of the property, is rooting for the association to win the bid.  “Nobody alive knows that property better than I do,” said Lawson, who lost his four-year position managing the property in October to Star Management, a firm specializing in mobilehome sales and management that also manages Huntington Shore Cliffs in Huntington Beach as well as several other trailer parks in Orange County.

“There are people there who could actually write a check and buy that park if they wanted to,” Lawson continued.  “It’s not about prestige, it’s not about a big show.  Its funkiness is its allure. They don’t want a condo at the Montage.  They want their cool; they like to tell their friends they have a trailer down in Laguna. Steve (Esslinger) would have really wanted to see the residents own it.”

But Lawson doesn’t see buying the park as a whole as securing its future for its residents.  He cited a 100-space mobilehome park in Miami, Fla., owned in its entirety by a nonprofit residents’ association.  “A developer plops down an unsolicited $100-million offer. So that means everyone would walk away with $1 million,” said Lawson. “All it takes is 51 percent of your neighbors to take that deal and you’re out.”  Lawson said selling the lots individually to residents, regardless of Coastal Commission involvement, guarantees the mobilehome park’s preservation and is more secure in the long run. Before his death, Esslinger won city approval for subdividing the park’s lots, but litigation to block Coastal Commission oversight of the matter delayed its taking affect.

Regardless of subdividing, city zoning laws restrict usage of the property to a mobilehome park, city planner Scott Drapkin verified. “It can be nothing other than a mobilehome park,” Drapkin said.

An analysis of the park’s current residency underlies the value of the association’s bid, said the association’s attorney, Sue Lofton. The average space rent is $2,200 a month, and two-thirds of residents hold 20-year leases, Skeen and Lofton said.

“We made an aggressive offer at a fair price,” she said.  She said she’s hoping the price and the legacy to Esslinger to maintain the trailer park will weigh in favor of the association’s blind bid, which was made without knowing the owner’s asking price.

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