The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Wednesday, August 28, 1996            TAG: 9608280436
SECTION: LOCAL                   PAGE: B1   EDITION: FINAL 
SOURCE: BY KAREN WEINTRAUB, STAFF WRITER 
DATELINE: VIRGINIA BEACH                    LENGTH:   64 lines

VIRGINIA BEACH CITY COUNCIL: COUNCIL RETRACTS EARLIER APPROVAL OF DEVELOPMENT OFFICIALS EXPECTED BETTER DESIGN, LOWER RENT AT RETIREMENT COMPLEX.

In a resolution Tuesday, the City Council reiterated its concerns about a retirement home on Shore Drive that was torched earlier this month by an arsonist.

The council said it would fight reconstruction of the Sunstates House retirement community unless the project's developers promise to dedicate all 109 units to low- and moderate-income tenants.

The retirement home, under construction since late last year, was burned down Aug. 6 by a still-unidentified arsonist. The motive for the burning is not known.

The council reluctantly approved the 109-unit complex a year ago, saying its desire for low-income housing for the elderly outweighed its dislike for the home's design, which crowded residents into a relatively small area.

But the council decided to try to block reconstruction after seeing what the complex would look like, and after realizing that the developer intended to reserve as few as 20 percent of the units for seniors of modest means.

The council voted 10-0 Tuesday to ask the developers to take down what is left of the building and to warn the development group that it would lose its zoning permit unless all 109 units were rented at below-market prices. Council member Reba S. McClanan abstained from the vote because she was not a member of the council last year when the body approved the project.

Representatives of three local civic leagues - Cape Henry Shores, Cape Henry by the Sea and Lynnhaven Colony - supported the council's action, saying the project looked more like ``a warehouse'' than a home for the aged.

``Not a person out of our civic league. . . is in favor of this (building),'' Andy Anderson of the Lynnhaven Colony Civic League told the council.

According to the council's resolution, the developers never mentioned that only a certain number of units would be available at reduced rents, and the council approved the project only because it believed the apartments would be reserved for residents with modest incomes.

``The rental of less than all the 109 units would be in clear violation of their conditional use permit,'' said council member William W. Harrison, who sponsored the motion. ``(We) ask them to remove an eyesore in a very attractive part of our city.''

Michael B. Hamar, the developer's lawyer, said the council never explicitly said it wanted all the apartments reserved for low- or moderate-income tenants, and should have known because of the proposed financing plan that some units would be rented at market rates.

``We continue to be dumbfounded by this,'' Hamar said after the council vote. ``They certainly should have known what that meant.''

The development group includes SunAmerica Inc., a California financial services company with $36 billion in assets; Tidewater Westminster Inc., a local consortium of Presbyterian churches that has developed other retirement communities in the area; and Dr. Richard Barrick, a Portsmouth physician who has been involved in other local projects for senior citizens.

Lou R. Joyner, development administrator for Barrick Multi-family Enterprises, the group's managing partner, said her company's immediate goal is to take down what's left of the building. But her company and the other developers do not intend to drop a project they believe to be legal, she and Hamar said.

``I guess this is just going to have to be settled in a legal arena,'' Joyner said.

KEYWORDS: FIRE ARSON SENIOR CITIZEN RETIREMENT HOME

RECONSTRUCTION by CNB