Row on the Row

The assessed value of the property is only $2,721,306 “due to lack of water and unlikelihood of development,” County Assessor Steve Vagnini says via email.

For decades, one of the most prime pieces of commercial real estate in the Monterey Peninsula has sat vacant and blighted.

The property, 501 and 484 Cannery Row, still has approved development entitlements – for now, at least – for a project that would include 87,000 square feet of retail and restaurants, condos, a community park and history center, and 377 parking spaces. (Monterey City Council first approved the project, now called Ocean View Plaza, in 2004.)

But there remain major hurdles holding up that development, including a legal battle about who actually owns the property.

Unraveling that dispute is mind-numbingly complex and full of limited liability companies, bankruptcies and foreclosure sales, and even an embezzlement charge, in an unrelated matter, against Carl Miller, who originally serviced the loan on the property; Miller was sentenced to 12 years in state prison in 2013.

Two main principals in the current dispute are Aqualegacy Development LLC and Ruby Falls Fund LLC, both of which claim to be the rightful owners of the property; Aqualegacy purchased it in a foreclosure sale in 2013, but was foreclosed on itself in 2014. The company then sued, claiming the foreclosure was unlawful. Ruby Falls bought it in 2017.

And while Miller’s prison sentence wasn’t for conduct related to the property, he is part of why it remains mired in controversy. Per court documents, Miller kept incomplete records about the various investors of the original loan, and clear chain-of-title documents were never provided to Aqualegacy. In a lawsuit filed in 2016, Aqualegacy argued it had needed those documents to obtain a loan on the property.

Aqualegacy’s lawsuit ultimately went to trial in August 2020 in Monterey County Superior Court, and in March of 2021, Judge Lydia Villarreal rendered a decision in favor of Aqualegacy, which set aside the 2014 foreclosure because Aqualegacy was never provided the chain-of-title documents it was legally entitled to. Ruby Falls appealed that decision and, through a different LLC, continued to operate a parking lot business at 501 Cannery Row.

On Aug. 30, Villarreal issued an order granting Aqualegacy possession of the property, giving the company the legal authority to evict Ruby Falls. In a Sept. 1 letter, an attorney for Aqualegacy notified Monterey city officials of the order, and also that Ruby Falls refused to vacate.

The Monterey County Sheriff’s Office issued an eviction notice on Ruby Falls on Sept. 9, and on Nov. 12, Aqualegacy sued, seeking to recoup “hundreds of thousands of dollars per year” in alleged parking revenues from the property. The suit also alleges Ruby Falls “unlawfully removed dozens of irreplaceable historic redwood timbers” from the site.

“We’re just really hopeful this will be the end of the saga and we can put this litigation behind us,” says Dylan Crosby, an attorney for Aqualegacy. Attorneys for Ruby Falls did not respond to requests for comment.

Meanwhile, Monterey County Assessor Steve Vagnini says the county still lists Ruby Falls as the owner – his office has received no notification to indicate otherwise. The last time taxes were paid on the property was 2017.

“There are some projects that just have bad juju on them,” Vagnini says, “and they never happen.”

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