Introduction to CEQA Victory
Housing advocates sealed a victory this week with some big changes to the California Environmental Quality Act. The statute, which was made law in 1970 by then-governor Ronald Reagan, has long been the source of nightmares for California developers, who view it as an easy path for lawsuits that cost time and money and push some projects out of the range of feasibility. And while the rollback that comes in the form of two laws passed to adjust CEQA last week certainly helps mostly housing, it doesn’t apply broadly across markets or property types.
Understanding Assembly Bill 130 and Senate Bill 131
The legislation applies to projects in U.S. Census Bureau-designated urban areas–essentially infill projects–caps at 85 feet high and can’t be used on projects of more than 20 acres. That goes down to five acres in the case of Builder’s Remedy projects. The new laws will cut red tape for many multifamily and single-family housing developments. But itadil’s more of the same for many projects outside of that. Some view it as a positive that any changes favoring developers were made to a statute that many thought would continue untouched in its long-established status as a third rail of California politics.
Impact on Developers
The limited changes to CEQA were enough, however, to raise the question of whether this marks the first crack in a broader dismantling–or perhaps an evolution, depending on one’s perspective–of the law. The victory is seen as a significant step forward for housing developers, who have long been frustrated with the bureaucracy and litigation associated with CEQA.
Measure ULA Proceeds Offer Affordable Housing Windfall
Affordable housing and homelessness program advocates received another win in the city of Los Angeles. The City Council approved a $424.8 million expenditure plan — the largest amount to date — for the current fiscal year’s Measure United to House L.A. property tax funds. The expense plan total is up about 40 percent from the previous fiscal year.
Josh Flagg Walks Back Hacking Allegations Against Ex-Elliman Boss
Former Douglas Elliman western region CEO Stephen Kotler was erased as a defendant in Josh Flagg’s hacking lawsuit. Kotler and Compass’ Flagg offered a joint statement on Wednesday to announce the latest development in the lawsuit, offering “Mr. Flagg has confirmed that Mr. Kotler is not the party responsible for this conduct.”
Turnaround Talk for Mandarin Oriental Residences, The Harland
Centurion’s looking for a comeback story, and it’s bullish on L.A.’s condo market to drive a feel-good narrative. Two struggling properties, now under the condo turnaround specialist’s ownership, have been re-listed with a new strategy and pricing. The Harland in West Hollywood has gone from for-sale condos to rentals during the pandemic. It’s now flipped back to for-sale units that start at $1.7 million for one- and two-bedrooms.
Related, Newland Snap Up Former Forever 21 Headquarters
Forever 21’s former Lincoln Heights headquarters will be redeveloped into an industrial complex, called Mission Crossing, under its new owners. Blackstone and Worthe Real Estate Group sold the fast-fashion retailer’s former headquarters at 3880 North Mission Road to Related Companies and Newland Capital Group for $120 million.
Nordstrom to Head Out of Santa Monica Place
Nordstrom is reportedly packing up its bags at Santa Monica Place in what some might say is the other shoe dropping for the open-air retail center. The planned departure in late August will leave about 122,000 square feet empty. That piles on to what the Santa Monica Daily Press reported is a vacancy at Santa Monica Place hovering around nearly 70 percent.
Trousdale Nabs New 2025 Record
Trousdale Estates, the Beverly Hills neighborhood known for its mid-century modern designs, notched its priciest trade this year with the sale of a tennis court estate. The sale of 1120 Wallace Ridge for $32.3 million is the neighborhood’s most expensive closing so far this year. The mystery buyer walks away with a steal, considering the home first hit the market for $48 million in October.
Conclusion
The changes to CEQA and the various developments in the Los Angeles real estate market signal a shift towards more housing development and a potential increase in affordability. While the changes to CEQA are limited, they mark an important step forward for developers and housing advocates. The city’s efforts to address the housing crisis through measures like Measure ULA and the redevelopment of properties like the former Forever 21 headquarters are also noteworthy.
FAQs
- What is CEQA?: The California Environmental Quality Act is a statute that requires developers to assess the environmental impact of their projects.
- What are the changes to CEQA?: The changes include exemptions for certain infill projects and a cap on the size of projects that can be exempted.
- How will the changes to CEQA affect developers?: The changes will cut red tape for many multifamily and single-family housing developments, making it easier for developers to build.
- What is Measure ULA?: Measure ULA is a property tax that funds affordable housing and homelessness programs in the city of Los Angeles.
- How much will the city spend on affordable housing and homelessness programs?: The city has approved a $424.8 million expenditure plan for the current fiscal year.
