By Kathryn Reed

A long dormant piece of land between Fantasy Inn and IHOP in South Lake Tahoe may have a chance of being developed even though the California Tahoe Conservancy now owns it.

This is one of three parcels the CTC board agreed to purchase for a total of $437,500. The other lots are in Tahoe City and Kings Beach and come under the environmentally sensitive lands designation. The South Tahoe parcel, which is a half-acre, was purchased under the land coverage program.

That parcel alone cost $375,000.

CTC bought this property next to IHOP with the intention of the city of South Lake Tahoe trading for it. Photo/LTN

CTC Deputy Director Ray Lacey told the board at the meeting last week that the value of the marketable rights exceeds the value of the land. The property comes with 22,450-square-feet of coverage and 1,158-square-feet of commercial floor area.

The owners of the Fantasy Inn lost the dirt lot this summer. A private individual trust acquired it in foreclosure. There was a time when it was valued at $1 million.

While the CTC owns it, the city of South Lake Tahoe is likely to eventually own it in a trade with the state agency.

Lacey said that is why the Conservancy bought what would normally be deemed an unusual parcel for its inventory. The worry was someone else could have purchased the land and sold off the development rights, leaving this parcel vacant and forever a dust bowl.

With it being in the commercial corridor of Highway 50, the thinking is this is where development should go. At one time a Unocal gas station was on the property. The tanks were taken out in 1994.

The CTC staff report says, “The purchase of this property presents an opportunity to further the city’s redevelopment plans through the exchange of the subject property for approximately 8.2 acres owned by the city on Glenwood Way.”

That city property is where the old drive-in was.

Any exchange of property would need to be approved by the CTC board and City Council.