Affordable Housing Bringing to Light Another Issue

Just before the Los Angeles City Council and Simms Development struck a deal to reduce a requirement to set aside 25 percent of the units in Simms’ proposed apartment project for workforce housing to just under 10 percent, the developer was getting ready to make an intriguing argument to the city.

The gist was that another developer whose project was approved before the 25 percent affordable housing requirement went into effect, should not be allowed to get an extension on his project, which still has not broken ground. Instead, the entitlements for more than 800 units that developer was holding should be given to others who are ready to get building underway, namely Simms whose proposal for a 432-unit apartment complex at Variel and Eton avenues at the edge of Warner Center went to the city seven months before the 25 percent requirement was put into place.

The play was never put into action because the council heard and approved Simms’ argument that the 25 percent requirement was not only unfair, it was also illegal and lowered the number of required affordable units to 42.

But that does not mean the issue is going away anytime soon. For one thing, the council’s decision doesn’t lift the interim procedure, which means developers proposing new projects are still under the 25 percent rule, a requirement that significantly increases the cost of these developments and, according to many, does little, if anything, to solve the problem it was meant to address traffic.

At the same time, the web woven when the interim procedures were put into place late in 2005 is becoming more and more tangled.

In the same week that the council struck the deal with Simms, it also approved a request by Weintraub financial Services to extend entitlements for its proposed 800-plus unit apartment complex on a property that currently houses Panavision’s U.S. headquarters on DeSoto Avenue.

Weintraub sought and was given the entitlements several years back during a flurry of moves to convert some of Warner Center’s older industrial properties to accommodate the growing demand for residential housing. But there was a wrinkle in the plans: Panavision’s lease will not expire for several more years, so Weintraub went back before the council to get an extension for the entitlements.

Those entitlements were granted to the developer before the interim control procedures went into effect, which means the Weintraub project, as approved, will devote just 4 percent of its units to affordable housing.

More than a few developers who missed the boat before the 25 percent requirement went into effect when the number of entitled housing units reached 3,000, the limit set by the current Warner Center Specific Plan, effectively in the last two years and are now facing the 25 percent requirement, would love to get Weintraub’s deal.

And with a citywide housing shortage and demand, they may have a good case arguing that Weintraub should not have been granted the extension.

That was the argument Benjamin Reznik, partner at Jeffer Mangels Butler