On Beach Boulevard in Buena Park, Porto’s Bakery stays packed with Cuban pastry lovers. Just down the street, Rock and Brews is always, well…rockin’. The Butterfly Palladium hoped to be the newest buzz-worthy tourist trap in the city’s Entertainment Zone along the highway between Knott’s Berry Farm and the Source, but remains cocooned in a state of stalled development.
With all faith lost in the project, Buena Park is suing to buy back the nine-acre parcel where the Movieland Wax Museum once stood for its original $2.5 million selling price.
In January, Buena Park city council rejected a last-ditch 18-month extension sought by Rubin Stahl, the project’s developer. By that time, the Butterfly Palladium missed its Oct. 4, 2018 deadline to complete construction. The city surmised the project to be only 10 to 15 percent completed. The resolution council passed scorched Stahl for, among other reasons, failing to provide evidence of secured financing of the project as well as not offering compelling reasons why twice the construction time would be needed.
Buena Park followed by filing a lawsuit on Mar. 25 alleging breach of contract and fraud. “The city’s decision to file suit against us is extremely disappointing,” says Stahl, in a press release. “It’s not right, it’s unfair, and frankly it’s unconscionable. We aren’t going to let the city of Buena Park rob people of experiencing our vision. We’re not going away.”
So what went wrong?
A mega-mall tycoon, Stahl got a steal of a deal from Buena Park when he first purchased the property in 2015. The city bought the parcel for $9.1 million and sold it to Stahl for just $2.5 million in hopes of drawing another attraction to Beach Blvd. With the success of a similar “Butterfly Wonderland” in Scottsdale, Arizona, the Buena Park project sought to recreate an immersive Costa Rican rain forest experience with thousands of butterflies flapping around an atrium. A bakery, restaurant and gift shop also were slated to come.
According to the city’s lawsuit, Buena Park wanted reassurance in the form of an option agreement to buy back the land for its $2.5 million purchase price if the projected failed to complete grounding and foundation work within a year of acquiring the property. In May 2016, the city formally conveyed the title to Stahl. Everything started off well enough. The developer met such obligations in June 2017 and the city terminated the “buy back” option agreement.
Former mayor Elizabeth Swift, currently a councilwoman, touted the Butterfly Palladium during a Feb. 2017 state of the city address. A year later, former Register reporter Joseph Pimentel’s write up in BisNow quoted the CEO of the design-construction company as saying the anticipated attraction would open its doors by the first quarter by 2019.
That optimism didn’t come to pass. “In the months following June 2017…progress on the project slowed dramatically,” the suit claims. No inspections occurred in 2018 between the months of February and June on that account. The complaint further alleges that the developer “allowed the property to fall in a state of disrepair.” Buena Park’s city attorney followed up by asking the developer if the project site had been abandoned and if documentation of secured financing could be provided within a proscribed set of time. The deadline came and passed.
By July 2018, the Butterfly Palladium sent a letter to Buena Park asking for an extension, one council ultimately rejected in January. The developer had protested in vain that the chief delays to the project included the 17,500 square foot atrium being constructed in Belgium. Once delivered by this summer, it’d allow for a grotto and a Japanese jellyfish aquarium touted to be the biggest of its kind to be built within it.
Questions loomed as to what would come next. After the council meeting, the city sent the developer a notice of default and followed up last month with their intent to buy back the property, not under the previously terminated option agreement; this time they cited a provision of the development agreement.
John Bowerbank, an attorney retained by Stahl, shot back at the city just before they filed suit. “The developer has complied with the requirements of the development agreement, timely requested an extension to complete its construction, and has previously provided sufficient documentation to satisfy the city’s required findings to grant the requested extension,” he wrote city attorney Christopher Cardinale in a Mar. 21 letter denying the development was in material default. “Instead, the city acted arbitrarily and capriciously to deny the extension to complete the construction.”
The beleaguered Butterfly Palladium’s counsel called the city’s intention to buy the property back “a frivolous attempt at a land grab,” one with no standing under the development agreement. Even with the tense relationship and terse words, Stahl still hoped to resolve the issue and complete the project. To date, an estimated $22.2 million has already been spent on it, a figure that the developer insists would be the true cost for the city to buy back the land–that is, if it had legal grounds to do so.
But now, Buena Park’s suit complicates matters. Three days after filing in court, Buena Park code enforcement inspected the project site and sent a letter outlining numerous violations including overgrown vegetation, abandoned electrical wires and damaged sandbags. Bowerbank sees it as more bad faith by Buena Park to paint the project as a nuisance.
There may be no butterfly attraction on Beach, but code enforcement noted insects of another kind. Standing pools of water on the construction site have apparently become “infested with mosquito larva.”
Gabriel San Román is from Anacrime. He’s a journalist, subversive historian and the tallest Mexican in OC. He also once stood falsely accused of writing articles on Turkish politics in exchange for free food from DönerG’s!