The controversial Quarry Creek housing development cleared a large hurdle last week when developer Corky McMillin Cos. made several significant concessions to settle lawsuits filed by environmentalists last spring.

McMillin agreed to shrink the project, lower some building heights and buy 60 acres of nearby private hiking and recreation land so it can become permanent open space owned by the city of Carlsbad.

The concessions were enough to persuade environmental group Preserve Calavera to settle lawsuits it filed against the city for allegedly approving the project without adequate review of its effects on traffic and sensitive land.

McMillin, Preserve Calavera and city officials all praised the settlement as a fair compromise that will allow construction of the sprawling project to begin as early as late next year.

“It is really a win-win-win for everybody,” said Escondido attorney Everett Delano, who filed the Preserve Calavera lawsuits four weeks after the Carlsbad City Council approved the project in early April.

Quarry Creek will include 636 condos and apartments on a 156-acre site along the south side of state Route 78 and west of College Boulevard. Before the settlement, 656 units had been planned.

“This allows a well-designed project that meets a critical housing need in our community to move forward, while providing Carlsbad residents with increased access to open space and trails,” Mayor Matt Hall said.

McMillin’s biggest concession was buying 60 acres of mostly undeveloped private land at Carlsbad Village Drive and Victoria Avenue. Called the “Village H” land, the property has been fenced off for nearly five years after serving as a popular hiking area for decades before that.

Brian Milich, a senior vice president for McMillin, declined to say how much the property cost. He said McMillin thought preserving the land was the right move.

“This is great for the community because it creates an open-space corridor,” he said. “It was a top acquisition target for the city and Preserve Calavera.”

Milich said McMillin officials were “satisfied” with the compromise and pleased that the project can move forward.

“We were willing to accommodate their additional requests,” he said.

Reducing the number of units will decrease the amount of traffic generated by Quarry Creek, he said.

McMillin also agreed to lower building heights and change the landscaping in the northern portion of the site known as “the panhandle.” Those changes will help preserve views of the Marron Adobe, a ranch house that dates back to the 1850s.

Delano, the Preserve Calavera attorney, said that concession was a particularly good example of mutual compromise because his clients had initially wanted no development at all on the panhandle.

Diane Nygaard, president of Preserve Calavera, said she was pleased with the compromises. But she also said her group’s efforts to preserve nature in the Buena Vista Creek Valley for future generations had just begun.

“We really see this as just one step in a long-term effort to preserve the heart of that valley,” she said. “It’s going to take many more years of work.”

Her group also fought the adjacent Quarry Creek shopping center, which opened in 2004, to keep the development as far as possible from a waterfall sacred to American Indians.

Milich said McMillin still must secure some permits from wildlife agencies, estimating that process would be complete next fall. He said ground could be broken in late 2014, with the first homes complete in early 2016.

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