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Housing Wave Raises Concerns

By Olin Ericksen
Staff Writer

April 19 -- Perhaps the largest wave of housing built by a single developer in recent history -- 1,150 studio units renting for more than $1,000 a month -- could soon go up in Santa Monica under a new law to encourage affordable housing. Instead of putting out a welcome mat, though, city officials are raising red flags.

While the five proposed buildings abide by the letter of the new law, City officials worry they will bypass public and environmental review, are not required to provide much parking and open space and don’t address a critical shortage of affordable family housing.

They also worry that the buildings, which take advantage of height and density bonuses, may throw a wrench into plans to redevelop Santa Monica’s light industrial corridor under new zoning options being reviewed by the City.

Part of 623-unit SRO slated to go up at 3025 Olympic Boulevard. (Renderings courtesy of Killefer Flamang Architects)

In an effort to address the issue, the City Council this month unanimously voted to rush a staff report that could serve as the basis for an emergency ordinance to toughen oversight of large-scale single-room occupancy (SRO) projects.

"The concept was for staff to study this and come back to us as an emergency ordinance, because I think we need to look at this," said Council member Herb Katz, who, with Bob Holbrook, made the motion on April 10 to return with the staff report next Tuesday.

The largest of five such projects slated to be built by private developer Neil Shehkter and his company NMS Properties would stand four stories and contain 623 units at prices defined as "affordable," but which will rent for between $1,000 and $1,200 a month.

If approved, the massive development would replace a hodge-podge of artists spaces, classrooms and production studios at 3025 Olympic Boulevard. Known as Drescherville for its eccentric former owner, philanthropist John Drescher, the sprawling property switched owners in a reported $27 million deal last month.

"We want families," said Katz, noting that the maximum occupancy in the residences is two people. "Obviously we want affordable housing, but we want it done properly and within scale."

The remaining 300 to 400-square-foot units would be spread among four other projects, including two more on Olympic Boulevard near 20th Street and two on Broadway near Lincoln Boulevard, according to Killefer Flammang Architects, the firm that designed all five projects.

The architects and Shehkter followed all the rules, all parties agree.

Yet council members said these projects -- and perhaps more to follow -- may not be what they intended last October when they approved the new law in an effort to head off a controversial state proposition that would have impacted the power of cities to dictate development. (see story)

"The fact that it slipped through the cracks and nobody thought about it… doesn't mean we shouldn't take another look," Katz said.

Intended to halt the onslaught of demolitions for condominium developments and to encourage the building of new affordable housing, the new law offer a host of incentives to developers to build rental stock considered affordable under County rates set annually by the State.

"We wanted to find a place and make it pencil out… based on the latest laws where they were actually giving incentives to developers to do a project like that,” said Shehkter, who own NMS properties. "So that's exactly what we put together."

Affordable builders, such as Shehkter, can not only bypass lengthy public permit and environmental impact reviews under the new law, but build as much as a third more square footage and add ten feet onto the projects.

"The whole idea came from the units we already manage and the huge need for affordable housing in the city," said Shehkter, who said his company already manages 234 units in Santa Monica.

Another part of Olympic project.

In addition to a lack of public oversight and the increased size, projects like Shehkter's would also only need to build one-quarter of a parking space per unit, would lack firm mandates on reserving livable open space and offer none of the coveted ground floor retail planners say helps keep housing vibrant.

"So there are open space, parking, and -- because they do not go through the development review process -- things we are hearing we want from the community, these things would not apply," said Planning Director Eileen Fogarty, who testified on the item at the April 10 meeting.

While Shehkter said he will provide a parking space for every unit and reserve as much as 63 percent of the largest project for landscaping, council members worry other developers may not go that route.

As to who would live in the units, architect Wade Killefer said he envisioned students from Santa Monica College or "young professionals" moving in.

"They are all rental, none of them for sale," he said "It could be a market for students and young architects."

While the apartments may seem "pricey," the units would allow someone from his firm to live in Santa Monica, he jokingly told the council.

"What I have to pay people these days, they can afford it," said Killefer, whose firm designed other affordable housing built in the city by the non-profit, Community Corporation.

In addition to students and young professionals, Shehkter said his apartments would be willing to accept the poor and homeless given federal vouchers, but who cannot find landlords willing to accept them.

"The Section 8 people call us all the time for affordable housing and we don't have enough to give them," he said. "There was especially a need for single-unit apartments because there are a lot of people who come off the shelter-plus-care and programs similar to that who are looking for those types of units."

City officials, however, said other issues that would need to be addressed include how such developments, in the heart of the City's only remaining light industrial zone, may impact future land use in that area -- which has been suggested as a potential location for artists' lofts and studios.

It also comes at time when the City is updating the Land Use and Circulation Elements of its General Plan, which will dictate development in Santa Monica for the next two decades.

Still, Killefer said his firm has followed all the rules and is addressing the City's declared needs in a way that allows his clients to make a profit.

"The biggest problem the City has is not enough affordable housing, and we are building a lot of affordable housing," he said. "Our projects are 100 percent affordable, which is very much a part of City goals for affordable housing.

“We're building small units, but we are building a lot of them and they are going to be affordable."

 

"Obviously we want affordable housing, but we want it done properly and within scale." Herb Katz

 

 

"We wanted to find a place and make it pencil out. . . based on the latest laws where they were actually giving incentives to developers to do a project like that. So that's exactly what we put together." Neil Shehkter

 

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