Lender Forecloses on Ritter Ranch Housing Development

Property foreclosures are nothing new in Palmdale, where the real estate recession has been lengthy and severe, but Wednesday’s dwarfed all others.

The foreclosure was against Ritter Ranch Co., the group behind what was potentially one of the largest housing developments in the state.

Ritter Ranch was to be a planned community for 20,000 people located on the fringe of Palmdale.

But before a single house was built, the project became mired in debt. In a court proceeding Wednesday, ownership of the 18-square-mile Ritter Ranch property reverted to the lender, Bankers Trust Co. of New York.

Bankers Trust began foreclosure proceedings against the Ritter Ranch Co. in July, citing $26 million in outstanding payments.

About the same time, the city of Palmdale, frustrated with the slow pace of the development, moved to freeze payments to the developer for drainage projects and other public improvements on the land.

Still, Palmdale city manager Robert Toone said he was surprised at the abruptness in this chapter of the saga of Ritter Ranch.

“I am still at a loss to understand why they walked away from this project so quickly,� he said.

The Ritter Ranch Co. was backed by Merv Adelson, founder of Lorimar Telepictures, and Irwin Molasky, a former Lorimar executive. They launched plans for the massive development of 7,200 homes, along with schools, golf courses and fire stations in the late 1980s, just before the real estate market crashed.

Adelson and Paul Nadel, a director of Ritter Ranch Co. and former spokesman for the company, did not return telephone calls Wednesday.