New California Law Promotes Housing Development Near Transit

A new law in California, known as the Abundant and Affordable Homes Near Transit Act or Senate Bill 79, will take effect in July. This legislation permits denser housing development near major transit stops, facilitating the construction of over 1 million new housing units in urban centers. The law mandates that cities allow taller residential buildings, such as apartments and condominiums, near rail stations, ferry terminals, and rapid transit bus stops. This approach overrides previous local restrictions that might have hindered such developments.

Senate Bill 79, introduced by State Senator Scott Wiener from San Francisco, is among the state’s most decisive efforts to address the housing shortage. Real estate developers are considering the new opportunities to proceed with more projects once the law is active. Sean Burton, Chief Executive of Cityview, one of the state’s prominent apartment developers, explained that the law greatly reduces the uncertainty around project approvals. Burton highlighted that the law limits local governments’ power to block new housing as long as projects conform to the bill’s guidelines. He predicts a significant increase in housing production in Los Angeles and other areas.

The law introduces new zoning rules, legalizing multi-story buildings for residential purposes near transit points. It allows buildings up to nine stories adjacent to certain transit stops, seven stories within a quarter-mile, and six stories within a half-mile. There are tiered zoning guidelines; Tier 1 covers areas with heavy-rail lines like L.A. Metro B and D lines, permitting up to nine stories, while Tier 2 involves light-rail lines and specific bus routes, allowing up to eight stories.

The legislation affects counties with at least 15 passenger rail stations, including Los Angeles, Orange, San Diego, Alameda, San Francisco, San Mateo, Santa Clara, and Sacramento. Preliminary assessments indicate Los Angeles, with approximately 150 covered transit stops, will experience significant impact as developers prepare new projects under reduced restrictions.

SPF:architects, based in Los Angeles, has designed two potential residential projects set to launch with the new law’s implementation, according to Renzo Pali, director of operations. However, exact locations remain undisclosed to prevent potential city opposition. Cities can defer the new zoning requirements until 2030 by independently increasing density. Without a density plan by the law’s start date, they must comply with SB 79. Cities may rush to submit proposals to adhere to the new law before deadlines.

Los Angeles shows resistance towards SB 79, citing concerns over undermining local governance and community burdens. The City Council moved to delay SB 79 by upzoning certain areas, allowing multifamily units in low-density zones, temporarily stalling the legislation until 2030. Burton expressed frustration over this delay, while acknowledging that new state laws, including a partial rollback of the California Environmental Quality Act, might spur development. He noted Measure ULA’s ‘mansion tax’ remains a barrier in Los Angeles but expects other areas like Santa Monica and Glendale to benefit from SB 79.

Jonathan Curtis, head of Glendale’s Cedar Street Partners, indicated that state-mandated increases in density near transit hubs are necessary, emphasizing the importance of utilizing existing transit infrastructure to address the housing crisis.