Proposal pits developer against Va. Beach luxury home owners

VIRGINIA BEACH

Darren Skinner was one of the first people to buy a custom home in North Shore at Ridgely Manor, a luxury subdivision plotted out on an old farm on the banks of Lake Smith.

The retired naval aviator assumed the prime waterfront tract would eventually be filled with large homes like his. About half were built before the housing market crashed. Now the developer wants a zoning change to build 166 single-family homes as a condominium community instead. The new plan calls for more than double the number of homes that current zoning allows.

Skinner and his neighbors are livid and have formed a group to fight the rezoning, which is set to go before the City Council on Aug. 23.

The conflict is an example of how the changing housing market could transform a suburban neighborhood. It also raises questions about the role of local government in influencing housing in a depressed economy.

Skinner and his group, Friends of North Shore Community Organization, fear the condo project will devalue their homes, many of which have already plummeted in value during the recession.

"This was my dream home," said Skinner, who paid $880,000 in 2006 for the home now assessed at $696,000. "I invested in it, and to get the rug pulled out from under my feet just is not right. It's the ultimate bait-and-switch."

Developer John Peterson, chairman of the Terry-Peterson Companies, disagreed that the project, Waterview at Ridgely Manor, will depress nearby property values.

He said he had to change plans for the site because the market for large, expensive homes is mostly dead.

"The only way to move the next section is to get the price down," he said.

The price of a home at Waterview would be around $350,000, he said.

Peterson said his company owns 47 undeveloped lots in North Shore and has an interest in maintaining those values. (A spot check of undeveloped lots in North Shore showed that many have fallen in value in the past few years. Several, for example, dropped to $160,000 from $250,000.)

"We wouldn't do anything to hurt ourselves," he said. "They don't buy that. What it boils down to is they don't like it because it's not what they have."

Waterview is designed in the New Urbanism style, the dominant form of city planning in the country today and one that is embraced at Virginia Beach City Hall.

The condo community of two- and three-story, free-standing homes is designed to be pedestrian and bike friendly while keeping cars out of view as much as possible. Plans show alleys running behind houses leading to driveways in the rear of vibrant-colored homes. Small parks, gardens, a campus-style quadrangle and a canoe launch would fulfill the project's open-space requirements.

One of the most distinguishing - and controversial - features is a ring road around the development along the lake. The design echoes two Norfolk waterfront roads: Mowbray Arch in The Hague and Mayflower Road in Colonial Place. The idea is to make the waterfront an amenity for all residents, Peterson said.

"Rather than putting back doors to the lake, they're proposing a lake-front drive," said Carolyn Smith, the city planner reviewing the project. "We think that's a really great design feature."

Opponents say ring roads might work in downtown Norfolk but not in this part of Virginia Beach.

John Eason is president of a civic league that includes Haygood Point, the neighborhood on the other side of Lake Smith from the development.

It's fine for people to look from Brambleton Avenue across the water to The Hague, Eason said, but people in Haygood Point don't want to look across the lake to a condo development.

For the 33 years that Deanna Rumney has lived in Haygood Point along a finger of Lake Smith, she's enjoyed unspoiled views across the water of towering trees. She said she knew development would come one day, but figured it would be luxury homes on large lots.

"I don't think anybody would want this in their backyard," she said of the condo project. "I don't care who they are. It's just such a waste of a beautiful piece of land."

The city's planning staff and planning commission support the project.

This has led its opponents to accuse the city of helping the developer sell his project in the stagnant economy.

"We think this is a bailout of the developer," Skinner said.

Only one of the 11 planning commissioners, Jay Bernas, voted against the project.

"I don't believe we should be making land-use decision based on current economics," he said.

But city planner Smith said the housing market was not part of the evaluation process.

"While the economy has taken a downturn, staff standards for reviews certainly have not," she said. "The question we pose is: Would we approve this project during any time frame? And the answer we came up with is 'yes.' "

Peterson said the changing market has left him few options.

"When the market disappears for a particular product, you have to shift markets," he said. "We've got a piece of property. The question is what do we do with it?"

Skinner believes a market for homes like his will return.

"We want the developer to wait the market out, and he's not willing to do that."

Aaron Applegate, (757) 222-5122, aaron.applegate@pilotonline.com