Statewide Homebuilding Proceeds Slowly amid Pandemic
Nationally, homebuilding was way up in 2020, but California, despite a housing shortage in the millions of units, saw only a modest year-over-year bump in new permits. California recorded 61,700 new permits for single-family residences, according to Census Bureau data, putting the state up 4 percent from 2019. Meanwhile, single-family permits rose 14 percent elsewhere in the U.S., and only 11 states performed worse than California. Last year, California had 42,800 multifamily permits, 15 percent lower in a year and the slowest pace since 2013. In the rest of the U.S., multifamily permits dipped 10 percent to the slowest pace since 2017. Still, California underperformed with just a 7.6 percent share of U.S. multifamily permitting in 2020 compared with a 9 percent average in the previous five years. (See related CP&DR coverage.)

State Audit Faults Homelessness Service Providers
State auditors conducted an audit of Continuum of Care (CoC) agencies charged with coordinating homeless services, were critical of state agencies that have struggled to coordinate efforts to address homelessness, and failed to comply with federal regulations or follow best practices. The homeless council has failed to coordinate existing funding and establish partnerships with stakeholders with stakeholders to develop strategies to end homelessness: as a result, the state continues to lack a comprehensive understanding of its spending to address homelessness, the specific services the programs provide, or the individuals who receive those services. The audit found three additional factors that make state guidance especially necessary, namely that CoC's are not employing best practices, have not adequately determined whether it has sufficient service providers to meet need, and two of the five CoCs failed to have current comprehensive plans.

Land Available for Single-Family Homes in California Cities Dwindling
San Diego has the fewest available lots in the nation for new single-family housing according to a real estate research firm in a new report. It also said the number of available lots had decreased 28 percent in a year. While the nationwide lot supply is down 9 percent, San Francisco and Los Angeles actually had increases. San Francisco was up 22 percent and Los Angeles was up 13 percent. The index ranking is based on lots zoned for housing, and only applies to single-family homes, so despite the lack of vacant lots and challenging terrain, the city has made gains with vertical construction, particularly downtown. However, San Diego County County homebuilding, even with multifamily construction, is down historically.

Report: State Planning Grant Program Leads to Over 11,000 New Homes
California Housing Partnership released a five-year investment impact report cataloging the more than 127 developments the Affordable Housing and Sustainable Communities (AHSC) program has invested in at a cost of $1.66 billion. The impact to date on the affordable housing front are 11,317 new affordable homes serving an estimated 155,600 households, and an estimated $9,500 average yearly savings for households living in AHSC-funded housing. For transportation, the organization created or improved over 1,300 new crosswalks, 189 miles of new and improved bike lanes, and provided 10,840 transit passes to residents. Since AHSC's goals are linked to climate targets, the impact report on those metrics as well. An estimated 21,000 cars were removed from the road each year, 3.0 million metric tons of GHG emissions avoided, and over 250 million fewer miles driven in a car each year, according to the report.

CP&DR Coverage: Housing Laws Work as Intended in Marin County
A clever developer from Los Angeles has figured out how to use SB 35 – along with low-income housing tax credits and density bonuses – to make ministerial review of an affordable housing project work in a community that’s located in an affluent county – but already has lots of affordable housing. And key to making the project work was not just SB 35, but also AB 1763, a 2019 bill that gave affordable housing developers way more leverage over local governments. The issue raised is whether SB 35, cleverly applied, will alleviate housing problems in a place like Marin County or raise environmental justice concerns related to the concentration of affordable housing – or both.

Quick Hits & Updates

The Berkeley City Council may have the votes to end single-family zoning. New legislation, introduced by the city's vice mayor, would forbid single-family zoned areas and allow more apartments, duplexes, or triplexes, and would allow for converting single-family homes to multifamily homes. (See related CP&DR coverage.)

Environmental groups are appealing Alameda County court's decision to allow a major controversial housing development to move forward. The plan calls for 469 homes on the edge of Newark's wetlands. The ruling dismissed the California Environmental Quality Act lawsuit, which argued the city of Newark "failed to consider the dramatically increased sea-level rise projections of recent years."

The San Diego County Board of Supervisors approved a climate change proposal, the Regional Sustainability Plan, that aims to bring the county's carbon issues to zero by 2035. Environmental groups have praised the plan as "a noble and necessary effort."

San Bernadino County's transportation agency approved a proposal from Elon Musk for a tunnel serving Ontario Airport, and a contract for a 4-mile underground loop appears imminent. Musk and San Bernadino's transportation agency have initiated exclusive negotiations, after which the contract would go to the board for approval. If the two sides reach an agreement, operation could begin in late 2023 or early 2024.

Los Angeles officials say three homelessness initiatives are on track to exceed initial projections, with a 7,961 supportive housing units in the pipeline from Proposition HHH. A Bridge Home, a program that creates interim housing facilities, has exceeded its goal of 15 facilities with 28 facilities completed and three in development.

Two environmental groups filed suit to reverse the approval of "Sanctuary West", a housing development that would fill 'restorable' San Francisco Bay wetlands and construct 469 luxury housing units. The site, which is within a FEMA flood zone, has been widely criticized by environmentalists, housing advocates, and climate experts.

The Newport Beach City Council voted unanimously to approve a 13-acre residential project near John Wayne airport that will bring 312 apartment units--including 13 marked as low income or affordable--atop an 825-space parking structure, as well as an approximately one-acre public park.

Inglewood will use eminent domain to secure 11 properties needed for a Los Angles Clippers basketball arena. The properties include two warehouses and a Church's Chicken. The rest are vacant or only used for billboards. Once acquired, Inglewood will transfer the land to the arena's private developers.

A new survey by the Harris Poll and the Chicago Council on Global Affairs offers evidence that rather than decamping for the suburbs, city residents remain committed to cities. The survey results indicate that the bulk of residents across community type--big city, inner suburb and outer suburb--are happy with where they live, and say they want to live in the type of community in which they currently reside. (See related CP&DR coverage.)

The Biden administration introduced new environmental directives, including a suspension of new oil and gas development on federal lands. Oil and gas companies, mostly operated off the Southern California coast and in Kern and Monterey counties, are already fighting the move. Among the other executive actions was a call to conserve 30 percent of all the nation's lands and ocean by 2030, which could include large swaths of Northern California and the Central Coast. While California won't see new fossil fuel extraction on federal lands and waters, the state still permits new drilling on private lands, where the majority of the state's oil and gas development takes place.

The real estate investment trust that operates the Queen Mary in Long Beach and owns 26 other hotels filed for bankruptcy protection. The bankruptcy filing says Eagle Hospitality has more than $500 million in liabilities. Despite the financial devastation the pandemic has wrought on the hotel industry, bankruptcies have been rare--just two hotel companies with more than $50 million of liabilities filed for bankruptcy last year.

A $2.5 billion dam near Pacheco Pass in Santa Clara County will move forward despite the discovery of unstable geology that will double the dam's cost. Over 100 test borings on the site found that crews would have to dig down 30 feet deeper to hit bedrock than previously thought, adding three years to construction and at least $1 billion in additional costs for the 319-foot-high dam.

A plan to temporarily place an observation wheel in San Diego’s Balboa Park has been abandoned by proponents. The so-called Balboa Park Star was intended as a pandemic-friendly activity that could promote more foot traffic in the park. An online petition in opposition to the project with over 3,700 signees called it a "for-profit Ferris Wheel" that would use public property for private profit.

An activist group in Santa Ana is spearheading an effort to block a city-council approved plan to demolish a budget-friendly grocery store to clear the way for a luxury apartment development. At issue is whether the loss of the grocery store would lead to a "food desert" and would further displace Santa Ana residents who would not be able to afford the estimated $1,500 to $3,500 rent prices.

In response to backlash from stakeholders in San Francisco, the Metropolitan Transportation Commission voted unanimously to study the equity impacts of Plan Bay Area 2050 and produce an alternative plan that better considers how ambitious housing, transportation and climate goals might make displacement a casualty of greenhouse gas emission reduction targets.