Unlocking Land for High-Impact Development

Modern apartment buildingThe most recent forecast shows that California needs 1.8 million new homes by 2025 to keep pace with population growth, projected to reach 39 million to 50 million by 2050, yet annually produces fewer than half the homes necessary to meet those needs. As a result, cities and counties throughout the state now face an unprecedented affordable housing crisis that threatens economic growth.

While new sources of housing financing are part of the solution, many jurisdictions are also taking steps to maximize the development potential of existing land. According to the widely circulated “A Blueprint for Addressing the Global Affordable Housing Challenge” and its California companion report “Closing California’s Housing Gap,” both published by the McKinsey Global Institute, efforts to “unlock land” are the most important measures jurisdictions can take to reduce the costs associated with housing production. This is especially true in California where the growing population and limited availability of buildable parcels makes it imperative to prioritize sites based on their capacity for high-impact development.

In recent years, many jurisdictions have turned to transit-oriented development to unlock land with existing infrastructure near transit hubs and corridors. Since 1995, the Los Angeles County Metropolitan Transportation Authority has routinely sought opportunities to collaborate with developers to increase transit use by building pedestrian-friendly communities on Metro-owned properties. To date, the agency has completed more than 2,017 housing units, as well as nearly 1.5 million square feet of combined retail and office space, across 18 projects. In 2015, the agency updated its joint development policies to require that 35% of the total housing units be affordable to households earning no more than 60% of the area median income.

San Diego has also taken steps to develop or repurpose government-owned land. In June 2017, San Diego County Supervisors Dianne Jacob and Ron Roberts announced an affordable housing initiative that included identifying 11 county-owned properties for evaluation to determine whether they can be redeveloped. County officials are currently evaluating these sites to determine the feasibility of different redevelopment options.

Other jurisdictions are working with private landowners to spur development on underutilized or idle land. Last year, Alameda County passed a general obligation bond to provide $580 million in funding for affordable housing initiatives. One initiative capitalizes on the interest faith-based and community organizations expressed in developing their available land and buildings for affordable housing. To launch the Housing Development Capacity Building Program, the County Board of Supervisors has allocated $750,000 to provide qualifying organizations with the capacity development and training necessary to convert their assets into affordable housing. The County also seeks to leverage its contribution with other resources to expand its services.

In addition, more communities—including Santa Monica—are adopting inclusionary zoning policies. In July, the Santa Monica City Council voted to require most new developments to set aside up to 30 percent of units for low-income households.

As local governments seek to resolve the affordable housing crisis, they will need more innovative strategies to spur development by unlocking land. By analyzing how available land is currently used, local governments can determine which locations offer the greatest potential for lower-cost, high-impact housing development.

To learn more about LDC’s policy services, contact Artemis Spyridonidis, Senior Associate, at artemis@lesardevelopment.com.

LeSar-Artemis-4x5Artemis Spyridonidis covers housing policy issues, including structural solutions to the housing affordability crisis, consolidated plans, housing elements, accessory dwelling unit policy implementation, and regional issues across the state of California.