The Beverly Hills City Council discussed the possibility of vastly expanding a potential affordable housing development on City-owned property at the Dec. 8 Study Session. But while the project offers the City a unique opportunity to construct affordable housing on a large scale, Councilmembers grappled with the corresponding price tag.
“We recognize the need for affordable housing,” said Councilmember John Mirisch. “Here, we have an extremely unique opportunity.”
The City first came across the idea of developing the land on 9298 West 3rd Street into affordable housing in early 2019. The West Hollywood Community Housing Corporation, a nonprofit affordable housing development corporation, approached the City with an unsolicited proposal to transform the site into the City’s second affordable housing development. While the City ultimately passed on the offer, it continued to explore the possibility of future development of the property.
In the interest of finding the right developer for the property, City staff prepared a draft Request for Qualifications and Conceptual Proposals (RFP), a step necessary for screening and soliciting bids. The Council planned on reviewing the RFP in March, but the COVID-19 pandemic put the project on the backburner. In the meantime, the City-owned property next door to the lot opened up, and with it, the possibilities for future development. The first property at 9298 covers about 12,100 square feet. The newly-vacated property stretches over about 51,200 square feet.
At earlier discussions, the City Council expressed support for developing affordable housing for senior citizens with preference for residents of Beverly Hills. The development would be multiple stories with the possibility of commercial use on the ground floor. Though the properties are not zoned for residential use, the City is able to circumvent zoning restrictions.
But expanding the scope of the project would also expand the cost. At the Dec. 8 Study Session, staff presented the Council with three size options for possible developments: 60 units costing $8,086,000; 150 units costing $20,923,000; and 300 units costing $39,286,000. While the City has about $1.5 million available in its Affordable Housing Fund, the project would require additional resources from the City’s general fund or from other sources.
At question at the Study Session was the scale of the proposals the City would solicit from developers. “You’re going to put the RFP out for the general parameters of what you’d like to see and then the development community is going to tell you what they would like to build,” said Kathe Head, President of affordable housing consultant Keyser Marston Associates.
“This is a once in a generation opportunity to make an impact and address the housing needs of those left behind by the market,” said Jesse Slansky, President and CEO of the West Hollywood Community Housing Corporation, who called into the Study Session. “Time is of the essence. Let’s stop wasting time. Let’s move forward.”
Some on the Council balked at the number of decimals following the dollar sign. Councilmember Dr. Julian Gold cast doubt on the feasibility of the project. “My instinct today is, I don’t see a path forward to do the whole project. I just think the numbers are staggering,” he said. He was still in favor of the project at a later date, but that the price tag gave him “indigestion.”
These discussions come as the City faces a steep demand by the State to enable more development within Beverly Hills. As a part of the State’s Regional Housing Needs Assessment (RHNA), California has determined that Beverly Hills must enable development of more than 3,096 new units in the City. The upper ends of the 3rd Street project could cover nearly 10 percent of that.
According to John Douglas, a land-use consultant for the City, the move would help the City’s image with the State in the upcoming RHNA effort. “I think it demonstrates very clearly the City’s seriousness to try to address the housing shortage,” he said.
The Council seemed hesitant on committing to a project of any size before seeing less speculative cost figures. As such, City staff will now put out an RFP for proposals that consider a two phased approach that starts with a smaller development with the possibility of expanding to the larger lot.
