WaMu's Los Angeles development in limbo

LOS ANGELES: A 17-year public affairs battle by Washington Mutual, the nation's seventh-largest banking company, to create a housing development near Los Angeles ended last week with reports that the company is abandoning its plans in the face of ongoing legal and PR challenges. The company reportedly has agreed to sell the property at the center of the controversy, Ahmanson Ranch, to the state of California.

LOS ANGELES: A 17-year public affairs battle by Washington Mutual, the nation's seventh-largest banking company, to create a housing development near Los Angeles ended last week with reports that the company is abandoning its plans in the face of ongoing legal and PR challenges. The company reportedly has agreed to sell the property at the center of the controversy, Ahmanson Ranch, to the state of California.

Seattle-based Washington Mutual (WaMu) has been trying for years to win approval to build 3,050 homes on a tract of undeveloped land on LA County's northern border.

But the project has been plagued repeatedly by legal and community challenges, leading to extensive media coverage and PR problems. The situation became even more high-profile two years ago, when former TV star and Hollywood director Rob Reiner founded an advocacy organization, Rally To Save Ahmanson Ranch, which enlisted Hollywood celebrities to help stop the development. Foes of the project gathered by Reiner and others have included former President Bill Clinton, activist Erin Brockovich, actress Alfre Woodard and actor Martin Sheen.

WaMu's plans were further hurt by the discovery of two endangered species - a frog and a flower - on the land.

However, WaMu has remained mostly silent toward the press, giving only sparse comment over the years. WaMu spokesman Tim McGarry said that it was "premature for the company to make any comment" on the sale because "no agreement has been reached."

But last week, media widely quoted state conservation organizations that a tentative deal had been reached with WaMu to to sell the land for $150 million.

The bank has been working with the L.A. office of Havas' The Abernathy McGregor Group for both public affairs and financial communications, according to McGarry.

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