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By Matthew Hinks
Governor Brown signed into law on September 27, 2014, AB2222, which amends the State’s Density Bonus Law (“DBL”), Gov’t Code §§ 65915, et seq. to establish significant constraints upon the use of the incentives provided by DBL in connection with certain real estate developments. The main purpose of AB2222 is to eliminate density bonuses and other incentives previously available unless the developer agrees to replace pre-existing affordable units on a one-for-one basis. The impact of the bill will be significant because it will remove the economic incentive to undertake density bonus projects where existing units are subject to rent control ordinances or similar restrictions.
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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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On September 25, 2014, Governor Brown signed Assembly Bill 52 (“AB 52”), which modifies the California Environmental Quality Act (“CEQA”) to add new protections for Native American cultural resources and enhances the role of Native American tribes in the environmental review process. AB 52 is a significant amendment to CEQA that poses both challenges and opportunities for project applicants. A brief summary of the new law, which takes effect July 1, 2015, is provided below.

AB 52 Creates a New Category of Potentially-Significant Environmental Impacts

Under current CEQA law, lead agencies typically evaluate whether a project would impact historic or archaeological resources. Although impacts to Native Americans may be evaluated, AB 52 specifically mandates evaluation of whether a project will impact “tribal cultural resources” which include sites, features, places, cultural landscapes, sacred places, and objects with cultural value to tribes. If the potential for impacts to such resources exists, as with other environmental impacts, increasing levels of CEQA analysis, mitigation measures, and the consideration of alternatives is required. Input from a tribe as to what is culturally significant to that tribe will drive the analysis for a given project. These changes take effect on July 1, 2015.
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JMBM Named as a 2015 Best Law Firm in Land Use and Zoning Law
JMBM’s Land Use Group Recognized for Third Year in a Row

Best Law Firms BadgeLOS ANGELES – Jeffer Mangels Butler & Mitchell LLP (JMBM) is pleased to announce it is has been named a 2015 Best Law Firm by U.S. News & World Report / Best Lawyers® and is recognized with a Metropolitan First-Tier Ranking in the area of Land Use and Zoning Law. This is the third year in a row that JMBM’s Land Use practice has been included in the first tier for Metropolitan Los Angeles.

“Our clients are involved in development projects that range from urban mixed use developments and master planned communities, to coastal development and industrial siting. We are also involved in both traditional and renewable energy projects, representing the land use and environmental needs of solar energy companies as well as those in the oil and gas industry,” said Benjamin M. Reznik, Chair of JMBM’s Government, Land Use, Environment and Energy Department and publisher of the California Land Use Blog.
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by Benjamin M. Reznik
Once considered an area of Los Angeles that had virtually nothing to do after 5pm, downtown Los Angeles is experiencing a development boom. Sure, part of it is due to the fact that our regional economy is on an upswing. But it’s more than that – what we’re now seeing is an entire section of Los Angeles undergoing an incredible transformation that’s changing the minds of the most hardened skeptics.

New residential, mixed-use, office, and hotel projects make up nearly 100 active development projects in the downtown area, with 14 projects alone announced since May of 2014, according to the Downtown News. My firm and I are proud to be part of this boom firsthand. JMBM is working on behalf of a major hotel project in the area, which will also include condominiums and retail space, on the site of the current Luxe City Center across from LA Live and Staples Center.

So, what accounts for downtown Los Angeles’ new-found appeal?
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by Kerry Shapiro
This article was first published in The Conveyor, a publication of the California Construction and Industrial Materials Association.

Mining companies are subject to myriad requirements under the Surface Mining and Reclamation Act (SMARA) and implementing regulations that can trip up even the most diligent of operators from time to time. When a potential violation occurs, SMARA holds that either the lead agency or the Department of Conservation (read OMR) may initiate enforcement proceedings by issuing a notice of violation (NOV). All too often, the process results in an order to comply issued against the operator, which in turn can jeopardize the operator’s AB 3098 List eligibility. Removal from the AB 3098 List forecloses an operator’s ability to sell materials to State and/or local agencies, often a major component of many operators’ customer bases.

Enter SB 447. Under this new CalCIMA-driven legislation operators can maintain AB 3098 List eligibility while working to resolve enforcement issues required by an order to comply, and may now also negotiate the terms of, and stipulate to, such an order. These are called stipulated orders to comply.
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By Matthew Hinks
Sometimes in land use law, the most impactful court holdings come from the simplest of cases. That may be the situation with the new California Court of Appeal decision in Bowman v. California Coastal Commission, issued by the court on March 18, 2014.

Factual Background

Walton Emmick owned property in San Luis Obispo County. In May 2002, Emmick applied to the County for a Coastal Development Permit (“CDP”) to rehabilitate an uninhabitable home on the property. Emmick died in March 2003. The County subsequently issued the CDP (“CDP-1”) to Emmick’s successor, SDS, subject to a condition that SDS dedicate a lateral access easement for public access along the shorefront portion of the property. SDS did not appeal the condition.

In December 2004, SDS applied to the County for a second CDP (“CDP-2”) for construction of a new barn. The application included a request that the lateral access easement condition of CDP-1 be removed. The County approved CDP-2, including the removal of the coastal access condition. Environmental groups and coastal commissioners appealed the County’s decision to the California Coastal Commission. After hearing, the Commission determined that the easement condition contained in CDP-1 is “permanent and binding on the landowner” and conditioned its grant of CDP-2 upon implementation of the easement condition. SDS sued.
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By Matthew Hinks
In a victory for California property owners, the California Court of Appeal, on March 13, 2014, issued a new opinion holding that the State of California’s proposed entry onto hundreds of properties in Northern California for geological and environmental testing amounted to a taking under the state constitution. The opinion of the court in Property Reserve, Inc. v. Superior Court may have a profound impact upon major public works projects throughout the state.
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by Kerry Shapiro, Esq.

The recent submittal of significant proposed revisions to California’s mining law, the Surface Mining and Reclamation Act (“SMARA”), signals potentially broad-reaching changes to the statute. On February 21, 2014, Senator Fran Pavely (D) introduced SB 1270, a bill proposing to overhaul various sections of SMARA. SB 1270 proposes fundamental changes to SMARA. Click here for a copy of SB 1270.

If these changes go through, mine owners and operators will be subject to a new regulatory system under which the State will assume a far greater and centralized role in various aspects of SMARA, including mine inspections, enforcement, and establishment of financial assurance mechanisms. The mining industry also faces the likely prospect of increased carrying costs, arising from such proposals as changes to the annual reporting fee structure (proposed at a minimum of $1,000/year on a per-acre basis, and with no maximum cap), to increased ability to appeal decisions relating to the State’s “3098” list.
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