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Developers of single- and multi-family density bonus projects should submit their applications now

December 5, 2014

By Neill Brower and Sheri Bonstelle

AB2222: Significant Changes to California's Density Bonus Law Occur on January 1, 2015

On January 1, 2015, California Assembly Bill 2222 (Nazarian) goes into effect and modifies the State's Density Bonus Law by establishing significant additional constraints on density bonus projects. Key measures of this bill include:


  • Mandatory replacement of all existing affordable units on a site for the density bonus to apply. Affordable units will include, among others:

  • Affordable units;

  • Rent-stabilized units;

  • Units subject to any City ordinance or policy regarding affordability; and

  • Any units owned or occupied by low- or very-low income households, even if no ordinance or policy applies.

  • Inclusion of affordable units occupied or demolished within the previous five years within the provisions above; and

  • Increasing the term of affordable housing covenants from 30 years to 55 years.

  • AB 2222 exempts your project if you submit an application or the application is processed by December 31, 2014. Therefore, a small window still exists to submit your application for a density bonus project and avoid these new provisions.

    JMBM's experts in the State's existing and proposed density bonus laws are ready to assist you.

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    Land Use Lawyer: Downtown Los Angeles Benefits from Chinese Investment

    November 24, 2014

    By Benjamin M. Reznik

    Downtown Los Angeles' real estate market is riding a wave of success, due in no small part to investment from major firms based in China. This past August, our client Shenzhen Hazens Real Estate Group Co. acquired the 178-room Luxe City Center hotel, located across the street from Staples Center and L.A. Live, and will be adding condominiums and retail space to the site. As noted by the Wall Street Journal's Craig Karmin, this purchase is part of a "flurry of new development and property sales," and comes on the heels of two other major Chinese-based investments in major Downtown Los Angeles properties: the Greenland Group's purchase of the Metropolis site just east of L.A. Live, and Oceanwide Real Estate Group's purchase of the Fig Central site in Downtown's South Park neighborhood.

    It's important to note that Shenzhen Hazens Real Estate Group's investment is for the long-term: just after the purchase of the Luxe site, Shenzhen Hazens and the Luxe Hotel Group signed a five-year contract to continue their partnership and to maximize their opportunities.

    Why is Downtown Los Angeles appealing to large, institutional investors? First, Downtown Los Angeles' status as an urban center with a solid base of residential, retail, and hotel real estate makes it very appealing for investors looking for longer-term investments. Second, unlike San Francisco and New York City, Downtown Los Angeles still has underutilized parcels, such as parking lots, in strategically-located areas that are appealing as sites for future large-scale projects. Third, as a trading hub that is home to one of the world's busiest container shipping ports, Los Angeles is in a prime location in the Pacific Rim to benefit from future global economic growth.

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    JMBM Hotel Developers Forum: Miguel Santana advocates hotel expansion for downtown Los Angeles

    November 8, 2013

    At the recent Hotel Developers Forum hosted in JMBM's Los Angeles office, LA City Administrative Officer Miguel Santana emphasized the City's commitment to development, particularly of hotels in the downtown area. Santana is the chief financial advisor to the mayor, and his office has direct oversight over the city's budget, labor negotiations, and development incentives for the City.

    "We're big advocates for hotel expansion in the City," he said, adding that the City of Los Angeles is willing to work with property owners in a variety of ways to create projects that balance profitability with revenue for the city.

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    The Williamson Act: A Growing Obstacle for Solar and Wind Development In California

    March 5, 2012

    by Jon Welner

    California's rural landscapes are some of the most productive farmlands in the world. However, some of the qualities that make these lands suitable for farming--sunshine and wide open spaces--also make them attractive for another kind of "farming": solar and wind farms. In recent years, the conflict between farming and renewable energy production has grown more pronounced in California. Central to this conflict is the California Land Conservation Act of 1965, generally known as the Williamson Act (Gov't Code §§ 51200-51297.4).

    Continue reading "The Williamson Act: A Growing Obstacle for Solar and Wind Development In California" »

    City of LA Adopts Job Killer Policy

    January 20, 2012

    Ben Reznik

    In an attempt to appease a well-heeled group of neighbors in Benedict Canyon who want to stop one particular project, the City of Los Angeles has adopted a new interpretation of its municipal code which will result in more than $1 billion worth of construction being delayed into 2013. This equates to the loss of several thousand jobs this year.

    For the particulars, read my op-ed column from this week's Los Angeles Business Journal, reprinted with permission below.

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    Current Flux of California Redevelopment Law

    December 1, 2011

    Legislative Elimination of Redevelopment Agencies
    As part of its 2011 - 2012 budget proposal, the California Governor's Office proposed permanently shutting down local redevelopment agencies to free up $1.7 billion of tax increments to apply to the State's budget deficit. The monies were slated to help fund schools, public safety and transit districts. On June 28, 2011, Governor Jerry Brown signed AB1X26 (the "Dissolution Bill") and AB1X27 (the "Pay for Continuation Bill") into law. The Dissolution Bill would permanently eliminate redevelopment agencies by October 1, 2011. The Pay for Continuation Bill allows redevelopment agencies to continue their existence and operation if the city or county that created the redevelopment agency commits to making annual payments to special funds administered by the county auditor controller by November 1, 2011.

    Ensuing Litigation
    In response to the passage of the Dissolution Bill and the Pay for Continuation Bill (the "Bills"), on July 15, 2011, the California Redevelopment Association, League of California Cities, City of Union City and the City of San Jose (collectively, "CRA") filed a Petition for Writ of Mandate to the California Supreme Court challenging the Legislature's adoption of the Bills and seeking an immediate stay of the Bills pending the outcome of the litigation.

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    Why is L.A. determined to treat the Deputy Foreign Minister of Saudi Arabia unfairly?

    November 9, 2011

    Ben Reznik

    Why is the City of Los Angeles singling out the Deputy Foreign Minister of Saudi Arabia and forcing him to follow procedures never before imposed on others in order to allow him to build his home in the Benedict Canyon neighborhood of Los Angeles?

    That's a question being raised following the recent Vanity Fair article written by Michael Shnayerson, There Goes the Neighborhood, about my client Prince Abdulaziz bin Abdullah bin Abdulaziz al-Saud, the current Deputy Foreign Minister of Saudi Arabia.

    For some inexplicable reason, the City of Los Angeles Planning Department is erroneously maintaining and insisting that the Prince's entity developing the project, Tower Lane Properties, Inc., must undergo additional, unnecessary and inapplicable steps in the plan check review process, before the project is cleared for construction. However, other similarly-sized residential projects in Benedict Canyon and nearby neighborhoods were built without being subjected to any such additional review whatsoever. A 35,046 square-foot home on North Carolwood Drive, a 45,891 square-foot home on Bel Air Road, and a 52,503 square-foot home on S. Mapleton Drive, to name a few, were all built without the City of Los Angeles subjecting them to this procedure. It's not even the largest residential project in the area. [SOURCE: City of Los Angeles Department of City Planning, Los Angeles County Assessor's Office]

    Continue reading "Why is L.A. determined to treat the Deputy Foreign Minister of Saudi Arabia unfairly?" »

    Vanity Fair visits Benedict Canyon and exposes the real motivation of opponents to home of Saudi Prince

    November 3, 2011

    Ben Reznik

    Vanity Fair reporter Michael Shnayerson recently visited the Los Angeles hillside neighborhood of Benedict Canyon to report on a proposed residential project by JMBM client Prince Abdulaziz bin Abdullah bin Abdulaziz al-Saud, Deputy Foreign Minister of Saudi Arabia. Shnayerson's article, There Goes the Neighborhood, includes interviews with some of the property's high profile neighbors and sheds light on what is really driving the opposition.

    Tower Lane Properties, Inc., the prince's entity seeking to build the project, has reached out to the surrounding community, heard the community's issues and concerns, and has come forward with new, revised plans that reduce the project's size and significantly reduce project-related truck traffic. Tower Lane Properties, Inc. is committed to maintaining an open and ongoing dialogue with area neighbors to ensure that this residential development on private property can move forward.

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    Court decision changes CEQA-related traffic impact analyses

    May 24, 2011

    Neill Brower

    A recent court decision has already changed the way many public agencies evaluate traffic impacts in analysis reports prepared to satisfy the California Environmental Quality Act ("CEQA"). On December 16, 2010, the Sixth District of the California Court of Appeal issued its decision in Sunnyvale West Neighborhood Association v. City of Sunnyvale, invalidating an environmental impact report (EIR) for a major roadway extension project. Sunnyvale should be considered as a logical extension of case law regarding the proper baseline for CEQA analysis and the end of the future baseline scenario as the only basis of a traffic impact analysis.

    Prior to Sunnyvale, an accepted practice for traffic impact analysis involved crafting a future baseline scenario, usually based on the anticipated year of project build-out, and evaluating project impacts based on the difference between future conditions with and without project-related traffic. This approach makes intuitive sense, as under very few circumstances would traffic levels and street configurations plus project traffic represent an accurate picture of the project's ultimate effect on local and regional roadways. The Sunnyvale decision even recognized this.

    However, CEQA Guidelines require an evaluation of the effects of a project on "the environment." Generally, "the environment" means the physical conditions that exist in an area during publication of the Notice of Preparation (NOP) or, if no NOP is published, the time that environmental review began.

    Continue reading "Court decision changes CEQA-related traffic impact analyses " »

    Eldercare housing crisis looming

    May 24, 2011

    Ben Reznik

    We are getting older and living longer. The statistics for the growth of the elderly are compelling. In the past few years we have seen several types of new private eldercare facilities, such as independent living and assisted living pop up in the LA area, mostly in more affluent neighborhoods. But make no mistake: neither LA nor the rest of the nation is prepared to properly care for and house the emerging elderly population.

    When I speak with people who now must find some level of assisted housing for their elderly parents, their frustration is all too common and similar: there are too few choices and none that are located in their neighborhood. What an interesting concept - siting eldercare facilities "in our neighborhood." This notion is not just for the convenience of the adult child, who wants to remain close enough to the parent for visitation purposes, it is also important for the elder parent, who should not be relegated to living out the rest of his/her life in institutional facilities along major commercial corridors. There must be a way to integrate eldercare housing into residential neighborhoods, including single-family areas.

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    Gambol Industries, Inc.'s open letter to the Los Angeles City Council

    November 11, 2010

    Ben Reznik

    From Robert Stein, President Gambol Industries, Inc.

    For more than three years, JMBM's client, Gambol Industries, Inc. has been negotiating with the Port of Los Angeles to develop a ship repair and ship building facility in an unused portion of the port. Gambol proposes to invest approximately $75 million in private capital, which will create more than 1,000 direct and indirect jobs. The Port of Los Angeles however, continues to resist Gambol's efforts, prompting the company's president, Robert Stein, to circulate an open letter to members of the Los Angeles City Council. The following is an edited version of his letter:

    We thought we had a good idea three years ago when we proposed re-opening the historical former Southwest Marine (SWM), site for use as a ship building and repair yard. The site has been a shipyard since the 1920s, but in recent years, has been unused and in decay. Believe it or not, neither the ports of Los Angeles nor Long Beach currently house such a facility. This necessitates those needing these services to sail down to San Diego or up to San Francisco. This is unacceptable for the nation's largest port complex!

    For reasons best known to its staff, the Port of Los Angeles continues to resist our efforts. Initially their reasoning related to the Main Channel Deepening Project (MCDP) which the port is undertaking with the assistance of the Army Corp of Engineers. They claim they need the Southwest Marine facility to store the dredged materials which they want to relocate behind a rock dike to be installed across the face of the SMW site. Once this process is undertaken it will preclude the ability to develop a world class ship building and repair facility in San Pedro Bay.

    Continue reading "Gambol Industries, Inc.'s open letter to the Los Angeles City Council" »

    Area Planning Commissions need help

    November 1, 2010

    Ben Reznik

    In the City of Los Angeles we have seven Area Planning Commissions (known as "APCs"), each consisting of five volunteer members appointed by the Mayor and covering a distinct geographical part of the city. These APC commissioners need not and, in fact, do not possess any special training, knowledge or experience in land use matters, and certainly are not familiar with the body of land use and zoning laws applicable to many of their decisions. Pursuant to the city charter and zoning code, the APCs are empowered to decide many important cases. In many instances, the decision of the APC is final -- meaning there is no further right of appeal to the City Council. The only remedy left is litigation and that, all too often, is too expensive for modest projects. The impact of a negative APC decision can be devastating to an applicant, as it can result in significant financial losses -- sometimes millions of dollars. Yet, despite all this, the City of Los Angeles does not provide legal counsel to guide APCs during the hearing and in their deliberations on the merits of a case. Planning Department staff is present at the hearings, but no one from the City Attorney's Office is present to make sure that the law is followed.

    Continue reading "Area Planning Commissions need help" »

    Update: Los Angeles City Council approves ban on new supergraphics in Hollywood

    November 1, 2010

    Sheri Bonstelle

    The right to install a supergraphic on a side of a building in Hollywood has been an ongoing struggle between owners and the City for years. The attorneys at JMBM have extensive experience in representing hotel owners and sign companies in obtaining appropriate City Council approval. Call us to see how we can help.

    The Los Angeles City Council voted unanimously in September to ban the installation of new "supergraphic" advertising displays in Hollywood, while grandfathering in currently planned signs and allowing for designated "sign districts."

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    Christine Essel, CEO of CRA/LA speaks at JMBM Business Issues Forum: Inside Look

    October 29, 2010

    Ben Reznik

    Christine Essel, the newly appointed Chief Executive Officer (CEO) of the Los Angeles Community Redevelopment Agency (CRA/LA), was the featured speaker at a recent JMBM "Business Issues Forum" hosted by Ben Reznik. Ms. Essel has taken command of an agency whose governing board she chaired in the 1990s. She brings with her 30 years experience in planning and development as senior vice president at Paramount Studios where she also served as the senior vice president of Government and Community Affairs. The following is a brief summary of Ms. Essel's remarks:

    As I see it, the challenge in this new assignment is to root out dysfunctionality in an agency which is viewed as being unfriendly. It appears to be a good time to undertake this process, because we're seeing limited development in our spheres of influence which provides an opportunity to evaluate our role. We are dealing with a "good news/ bad news" scenario. The good news is CRA/LA still has $700 million in the bank! The bad news is that with most development on hold, our revenue stream -- which relies on tax increment financing -- has been significantly curtailed. Additionally, the State is taking $85 million from our budget this year. We are also in the process of reducing our 261 member staff through early retirement. We expect 40 senior staff to be leaving by January 1, 2011.

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