Berkeley files suit against owner of blighted Telegraph lot

The city of Berkeley holds $640,000 in liens against this lot at 2501 Haste Street. Photo: Frances Dinkelspiel

The city of Berkeley has filed a lawsuit against Ken Sarachan, telling him they intend to seize his lot at the intersection of Telegraph and Haste to pay off the $640,000 he owes in liens and interest.

Berkeley filed the suit against the businessman in Alameda County Superior Court on January 28th and served Sarachan’s place of business, Rasputin Records, on Monday, according to Zach Cowan, the city attorney.

“The city is alleging that Mr. Sarachan has not lived up to his agreement to pursue development of the site in a diligent and timely manner,” said Cowan. “As a result, we want to recover the liens we offered to waive if he did so.”

Mr. Sarachan could not be reached for comment. The suit also names Laurie Brown, his wife, as a co-defendant since California is a community property state.

The suit stems from the 20-year troubled history of the lot at 2501 Haste at Telegraph Avenue. It was once the location of the 80-room Berkeley Inn, a hotel that evolved into a low-cost rooming house. The inn suffered two devastating fires, one in 1986 and one in 1990. Berkeley paid for clean-up and removal of the debris and fencing to block off the lot, and filed a lien against the then property owner to recover its costs. The $500,000 in liens has ballooned to $640,00 with interest, said Cowan.

Sarachan, who has extensive property on Telegraph Avenue, including Blondie’s Pizza, the old Cody’s building, and the large glass and steel shopping mall at 2350 Telegraph, bought the lot in 1994. He also owns 2503 and 2509 Haste, the latter acquired from UC Berkeley in 2006.

The city worked with Sarachan for years to help and encourage him to build affordable housing and retail on the site. Sarachan asked – and received – a promise from city officials that they would not collect the liens filed against the property if he got a building permit and started construction. The agreement was renewed numerous times in the past 15 years.

In September 2011, the City Council got so frustrated that the lot, which is on a major commercial thoroughfare, had stood vacant for more than 20 years that members voted to pursue legal action against Sarachan.

Sarachan told the council he was not to blame for the inaction. He said he had submitted numerous plans to the Building Department, including one called the Pagoda Project, which he promised would be the greenest building in the city. The various projects have never been approved.

“This  whole delay in the Pagoda Project is really due to the Planning Department’s lack of competence to make a decision and get work done,” Sarachan said in a Sept. 6, 2011 letter to the city council.

The lawsuit contends that Sarachan missed deadline after deadline set by the city and never submitted complete plans.

No hearing date has been set yet.

View a copy of the lawsuit.

Related:
The rats of Telegraph Avenue [01.28.11]
City says it is addressing Telegraph Avenue rat problem [02.10.11]
What about that vacant lot on Haste and Telegraph? [08.11.11]
City to consider suing owner of blighted Telegraph lot [09.06.11]
City hands ultimatum to Sarachan on vacant Telegraph lot [09.07.11]
Urban think tank: Student visions for blighted Berkeley lot [10.03.11]

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  • Bryan Garcia

    It’s about time! Awesome news!

  • Improve Telegraph

    The City should take the property by eminent domain, pay the value of the property by waiving the fines, and build something that would be beneficial to the community.  A decent hotel with a good restaurant, being close to campus, would bring some needed jobs, customers and tax revenue to the City.  

  • Completely Serious

    Call me a cynic, but I expect Saruman to counter sue, and sometime next year, our spineless Council will approve a payment to him to settle the suit.

  • jjohannson

    They should seize the old Cody’s building while they’re at it.  Sarachan has proven himself to a completely unreliable landlord, and Cody’s has been closed already for four years this June.  No sense in waiting for another 16 years to fill the place.  In my personal opinion — and not Berkeleyside’s — the guy is a slumlord par excellence.  This city deserves much, much better from its commercial property owners.

  • Charles_Siegel

    My guess is that Sarachan will offer to develop the lot in order to settle the suit. 

    The architect, Kirk Peterson, wrote a letter to the Daily Planet, where he mentioned that he was working on this site. 

    Incidentally, if you look at the site across the street, where the fire was, you will see a public notice posted saying that Peterson is also the architect there.  He has proposed creating temporary structures made of shipping containers and tents to house the businesses that were on the site temporarily, until a permanent structure is approved for the site.

  • Anonymous

    Hooray!  I like @3b9ced83125ff8bd6d31c946fc6ed366:disqus ‘s idea, though it would be a small hotel, it’s amazing that a world class university has so few places for visitors or conference goers to stay.  And I hope that @517935116f722b0a4d6c49eb2c2f16eb:disqus is wrong, as that will have been a waste of time and a death knell to any momentum going forward.

  • Bruce Love

    BRILLIANT!

    He has proposed creating temporary structures made of shipping
    containers and tents to house the businesses that were on the site
    temporarily, until a permanent structure is approved for the site.

    Much needed.  A huge attraction.  Quickly actionable.  Inexpensive.   Low commitment. 

    F-ing brilliant.   Seriously, I’m tearing up slightly.  I hope the specifics of his plan don’t suck.

    Is there a lunch truck nearby?

  • Charles_Siegel

    It is not as easy to take property by eminent domain as some people seem to think. You need to create a redevelopment district, and you need to compensate the owner for the market value of his property.  I think that lot is worth more than $640,000

  • Bruce Love

    That’s the number I’m curious about:  today’s fair market value compared to $640K in today dollars plus whatever the purchase price was in then dollars, inflation adjusted.

    If you look at the linked legal filing the history is a  torturous mess and I pity the judge.  A settlement for some or all of the $640K might still leave the owner sitting pretty and the city with some needed revenue.  (In which case, I say: brilliant!)

  • Bruce Love

    (I should add that in calculating the fair market value the situation isn’t symmetric.  The surrounding properties owned by the same owner make the lot more valuable to him than it would be to a third party.   My outside-the-fray view is that the guy is brilliant in business and political satire — and, frankly, the vacancy as it stands contributes a (weird but on-balance positive) bunch to the neighborhood and the periodic street festivals — if we can get people to stop farming rats on it.   It’s really really helpful to light and sound at that intersection and the weeds make something green in an urban setting but somehow at least a little better than what Kunstler calls a “nature band-aid”.)

  • jjohannson

    “My outside-the-fray view is that…, frankly, the vacancy as it stands contributes a (weird but on-balance positive) bunch to the neighborhood and the periodic street festivals — if we can get people to stop farming rats on it.”

    There’s never a laugh track around when you need one…

  • Loki

    Gosh Telegraph Ave has been on the skids since the mid 60’s why the rush?

  • Bruce Love

    Have you ever lingered for hours around there?  Taken the time to observe what goes on? 

  • Bryan Garcia

    “My outside-the-fray view is that [...] the vacancy as it stands contributes a (weird but on-balance positive) bunch to the neighborhood and the periodic street festivals”

    This is a joke, right? No one could actually be this out of touch with reality, right? Please tell me you’re joking.

  • Bruce Love

    Why would I joke?  It admits light to that intersection.   At street festivals, it expands the utility of the east branch of Haste as a stage location.   It provides an interlude between the retail fronts where people are able to (and do) linger in ways that lingering in front of retail space doesn’t afford.   It is visually a green respite yet, strangely enough, due to the fence, is mostly immune from human low-level contention over control of the greenspace.    It helps to break up the canyon effect of a narrow-street corridor like that.   It made Cody’s more attractive when Cody’s was there.  It made Intermezzo and Raleighs much more attractive while they were there.   It helped shine light on both the mural it hosts and the People’s Park mural on Amoeba.   It’s present form helped the avenue to sparkle.  The notion that its presence harms rather than helps nearby businesses is risible.   

    To be sure, some folks are caught up in their narrative about how Sarachan must be the evil Saurun overlord who keeps everyone down.  I guess he must be The Man.   And, sure, some a-holes farmed some rats there (and in the park).   But look past the social soap opera and you might notice that having that lot undeveloped has had a hell of a lot of benefits.  But sure, please feel free to resume using the lot as proxy for decades old neighborhood personal animosities — that’s the dominant political truth.   Knock yrself out.

  • Charles_Siegel
  • Anonymous

    the people of Berkeley should sue the city council for blight they are not easy on the eyes!

  • Anonymous

    I predict that in three years time, Telegraph will be in the exact situation it is now.

  • Anonymous

    Occupy Cody’s?

  • berkopinionator

    Everybody loves Detroit! 
    http://metrotimes.com/

  • Billbartell

    no question this will do nothing to motivate the owner to build anything there-  he’s got lawyers that will tie it up for many years to come–as the city has known all along–why they never sued him before.

  • John Holland

    It’s really lost it since about the time Cody’s moved out, though. Also, Amazon and iTunes have moved book and music culture online. Sure there was an exodus of stores like Poppy Fabrics in the 70s, but even in the 80s and some of the 90s, you would still see people heading to Telegraph as a destination… people that looked like professors, parents, etc.

    it’s much worse than it was in the 60s.

    Now it’s a wasteland. I also think that the demographics have changed, and partying a la Blake’s is not what it used to be.

  • John Holland

    Right, or even let lunch trucks park there. It would solve the problem of the trucks getting evicted from Bancroft.

  • Dan

    Good for the city. I love Berkeley, and I want to love Telegraph, but that street needs major TLC. This is exactly the place to start.