HomeMy WebLinkAbout2025-11-18 - PC - Special Meeting
CITY OF HERMOSA BEACH
PLANNING COMMISSION
Special Meeting Agenda
Call and Notice of Special Meeting:
The Chairperson of the City of Hermosa Beach Planning Commission has called a Special Meeting to
consider and take action on only those matters set forth on the agenda.
Tuesday, November 18, 2025
5:00 PM
Council Chambers
1315 Valley Drive
Hermosa Beach, CA 90254
Planning Commissioners
Kate Hirsh, Chairperson
Stephen Izant, Vice Chairperson
Michael Flaherty, Commissioner
Peter Hoffman, Commissioner
Greg McNally, Commissioner
Alison Becker, Community Development Director
AMERICANS WITH DISABILITIES ACT OF 1990
To comply with the Americans with Disabilities Act of 1990, Assistive Listening Devices (ALD) are
available for check out at the meeting. If you require special assistance to participate in this meeting,
you must call or submit your request in writing to the Office of the City Clerk at (310) 318-0204 or at
cityclerk@hermosabeach.gov at least 48 hours before the meeting.
PARTICIPATION AND VIEWING OPTIONS
Hermosa Beach Planning Commission meetings are open to the public and are being held in person
in the City Hall Council Chambers located at 1315 Valley Drive, Hermosa Beach, CA 90254. Public
comment is only guaranteed to be taken in person at City Hall during the meeting or prior to the
meeting by submitting an Comment fo an item on the agenda. As a courtesy only, the public may
view and participate on action items listed on the agenda via the following:
Zoom: https://us02web.zoom.us/j/82539742028?pwd=OUNTRDNvd2I6TzBpTDIjc2x6bGFwd
z09
•
Phone: Toll Free: (833) 548 0276; Meeting ID: 825 3974 2028, then #; Passcode: 207860•
eComment: Submit an eComment by 3:00 p.m. on the meeting date. •
Supplemental Email: Supplemental emails are available for agenda items only and must be
sent to planning@hermosabeach.gov. Supplemental emails should indicate the agenda item
and meeting date in the subject line and must be received no later than three (3) hours
before the meeting start time. Emails received after the deadline but before the meeting ends
will be posted to the agenda the next business day. Writings distributed to all, or majority of
all, of the Commission after the agenda has been posted shall be available for inspection at
the Community Development Department located at 1315 Valley Drive, Hermosa Beach, CA
90254 during regular business hours.
•
Please be advised that while the City will endeavor to ensure these remote participation methods are
available, the City does not guarantee that they will be technically feasible or work all the time.
Further, the City reserves the right to terminate these remote participation methods (subject to Brown
Act restrictions) at any time and for whatever reason. Please attend in person or by submitting an
eComment to ensure your public participation.
Similarly, as a courtesy, the City will also plan to broadcast the meeting via the following listed
mediums. However, these are done as a courtesy only and not guaranteed to be technically feasible.
Thus, in order to guarantee live time viewing and/or public participation, members of the public shall
attend in Council Chambers.
Cable TV: Spectrum Channel 8 and Frontier Channel 31 in Hermosa Beach•
YouTube: https://www.youtube.com/c/CityofHermosaBeach90254•
Live Stream: www.hermosabeach.gov/agenda •
Cablecast App: Available on supported devices and smart TVs•
If you experience technical difficulties while viewing a meeting on any of our digital platforms, please
try another viewing option. View the Commission staff reports and attachments at
www.hermosabeach.gov/agenda.
Page 2 of 150
Pages
PLEASE TAKE NOTICE that a Special Meeting of the Planning Commission has been called
to take place at 5:00 p.m. on Tuesday, November 18, 2025, to consider and take action on
only those matters set forth on the agenda below.
1.CALL TO ORDER
2.ROLL CALL
3.APPROVAL OF AGENDA
This is the time for Planning Commission to discuss any changes to the order of
agenda
items
4.PUBLIC COMMENT
This is the time for members of the public to address the Planning Commission
on any item(s) listed on the special meeting agenda only. Public comments are
limited to 3 minutes per speaker.
5.STAFF ITEMS
Public comment will be taken after each item listed below. Public comments are
limited to 3 minutes per speaker.
5.a 6TH CYCLE HOUSING ELEMENT IMPLEMENTATION STATUS
REPORT - 25-CDD-167
4
Alison Becker, AICP Community Development Director
Recommendation:
Staff recommends Planning Commission:
Receive and file staff presentation.1.
5.b DISCUSSION OF LAND VALUE RECAPTURE ORDINANCE A
PROGRAM OF THE 2021-2029 CERTIFIED HOUSING ELEMENT - 25-
CDD-077
44
Alexis Oropeza, Planning Manager
Recommendation:
Staff recommends the Planning Commission:
Receive a staff report and solicit public input; and1.
Provide a recommendation to City Council.2.
6.ADJOURNMENT
Page 3 of 150
City of Hermosa Beach | Page 1 of 6
Meeting Date: November 18, 2025
Staff Report No. 25-CDD-167
Honorable Chair and Members of the Hermosa Beach Planning Commission
6TH CYCLE HOUSING ELEMENT IMPLEMENTATION STATUS REPORT
Alison Becker, AICP Community Development Director
Recommended Action:
Staff recommends Planning Commission:
1. Receive and file staff presentation.
Executive Summary:
This report provides a mid-cycle progress update on the implementation of the City's
2021-2029 6th Cycle Housing Element. The Housing Element addresses five key policy
areas: conservation of existing housing, support for new housing production, identification
of adequate sites for new housing, removal of government constraints, and promotion of
equal housing opportunities. Overall implementation is progressing well, with most
programs on schedule and 384 units counted toward the City’s Regional Housing Needs
Allocation (RHNA), though certain program areas require additional attention.
Background:
State law requires that each city adopt a General Plan to guide land use and development.
One mandatory component of the General Plan is the Housing Element, which describes
City policies and programs for maintaining and improving existing housing and
accommodating development of new housing to meet the City’s assigned share of
regional growth under the Regional Housing Needs Assessment (“RHNA”). PLAN
Hermosa, the City’s General Plan, was adopted in 2017 and has a “time horizon” of 25
years. However, state law requires that the Housing Element be updated every eight
years. The City’s 6th Cycle Housing Element was developed over several years, beginning
in 2021 and received a substantial conformance determination from the California
Department of Housing and Community Development (HCD) in July 2024 (Attachment
1). The table below summarizes the project history through initial implementation.
Page 4 of 150
City of Hermosa Beach | Page 2 of 6
Past Board, Commission, and Council Actions
Meeting Date Description
November 16, 2021
The Planning Commission conducted a public hearing and
considered the revised 2021-2029 Housing Element in
response to the comment letter received from California
Department of Housing and Community Development (HCD),
requesting added sites revisions, and forwarded a
recommendation to the City Council to adopt and authorize
submittal to HCD.
December 21, 2021 City Council conducted a public hearing, adopted the 2021-
2029 Housing Element, and authorized submission to HCD.
December 5, 2021 Planning Commission held a special meeting to review Housing
Element efforts, HCD comments, and discussed integration of
the Housing Element and Zoning Update efforts.
March 21, 2023 Planning Commission conducted a study session to discuss
rezoning approaches for Housing Element implementation.
June 20, 2023 Planning Commission conducted a public hearing,
recommended the City Council adopt the Housing Element, and
discussed zoning text amendments.
July 18, 2023 Planning Commission conducted a study session to discuss the
proposed Zoning Text Amendment for Housing Element
implementation.
August 8, 2023 City Council conducted a public hearing and adopted the
revised 2021-2029 Housing Element.
August 15, 2023 Planning Commission conducted a study session to discuss the
proposed Zoning Text Amendment for the Housing Element
implementation.
September 19, 2023 Planning Commission conducted a public hearing and
recommended the City Council adopt the Housing Element
General Plan Map Changes, Zoning Map Changes, and Zoning
Text Amendment, with several minor revisions.
October 10, 2023 City Council conducted a discussion on the proposed Land
Value Recapture Program and provided feedback to staff.
October 17, 2023 Planning Commission reviewed minor revisions to the Zoning
Text Amendment discussed on September 19, 2023 and
adopted a resolution reflecting those revisions.
October 24, 2023 City Council approved General Plan and Zoning Code
Amendments necessary to effectuate programs in the 2021-
2029 Housing Element.
Page 5 of 150
City of Hermosa Beach | Page 3 of 6
Meeting Date Description
January 23, 2024 City Council adopted amendments to the Zoning Code to add
the Land Value Recapture Program and criteria for Affordable
Housing.
July 23, 2024 City council adopted amendments to the Zoning Code for
Housing Element-related regulations pertaining to mixed-use
development, review processes and multi-family residential
parking requirements.
Discussion:
The Housing Element consists of the Housing Element Policy Plan and Housing Element
Technical Report divided into two volumes. The Housing Policy Plan provides background
information and context for the Housing Element and describes the City’s policies,
programs, and objectives for the 2021-2029 planning period. The following summarizes
the policy area, associated programs, and status of program implementation.
1. Conservation of Existing Housing Resources
Implementation in this policy area is currently on track. The city maintains two active
programs in this area:
Program 1: Code Enforcement continues as an ongoing, fully funded initiative to
maintain housing quality standards.
Program 2: Affordable Housing Preservation focuses on preserving 79 existing
affordable housing spaces, including 60 mobile home park spaces and 19 RV park
spaces.
2. New Affordable Housing Development
Progress in this policy area is on track, with all programs meeting their planned
milestones. Six programs support the development of new affordable housing:
Program 3: Density Bonus regulations grant various incentives for qualifying affordable
and senior housing developments. The City’s code has been updated to comply with
state law, and program information is now available on the city's website.
Program 4: Affordable Housing Development seeks to support affordable housing
development through administrative and financial support. It is implemented through
multiple strategies, including pursuing funding for special needs populations through
participation in the South Bay Council of Governments (SBCOG) Housing Trust Fund,
engaging with affordable housing developers through the Southern California Association
of Nonprofit Housing (SCANPH) annual conference, and providing assistance with
affirmative fair marketing for affordable units.
Program 5: Facilitate High Density Housing is intended to support development of
multi-family housing by reducing physical and administrative constraints to development.
As the City’s existing development pattern has a preponderance of small lots, this
includes publicizing lot consolidation incentives on the website. Additional program
Page 6 of 150
City of Hermosa Beach | Page 4 of 6
activities include engaging with the development community through SCANPH outreach,
and conducting a progress assessment in 2025 (currently underway).
Program 6: Accessory Dwelling Units (ADUs) provide an important source of
affordable housing. Currently, the Zoning Code treats ADUs and Junior ADUs (JADUs)
largely as ministerial approvals. The most recent regulation changes have been submitted
to the California Department of Housing and Community Development (HCD) for review,
and program information is available on the city website. Several additional changes to
the City’s Ordinance will be needed in response to State legislation adopted this year.
Program 7: Land Value Recapture was established in 2024, requiring that a portion of
increased property value resulting from rezoning be dedicated to public benefits such as
affordable housing. The City Council has asked staff to have the Planning Commission
review this program as it relates to “small lots”. This discussion is scheduled for the
November 18, 2025 special meeting.
Program 8: Housing Trust Funds are dedicated sources of financial assistance for
affordable housing. The city joined the South Bay Housing Trust Fund managed by
SBCOG in 2024 and has contributed Senate Bill 2 (SB 2) funds to the effort.
3. Adequate Sites for Housing
Implementation in this policy area has experienced some delays.
Program 9: Accommodating Housing Need includes several initiatives with varying
completion status. Various zoning text and map amendments to establish the necessary
density to accommodate the City’s Regional Housing Needs Allocation (RHNA) were
completed in 2024. However, efforts to facilitate affordable housing on city-owned sites
have yet to be initiated and plans to expand mixed-use areas in commercial zones are
scheduled for 2026.
4. Remove Government Constraints
Progress in removing government constraints is lagging slightly from the planned timeline.
Three programs aim to eliminate barriers to housing production:
Program 10: Special Needs Housing encourages a variety of housing types that
support persons with disabilities and special needs. The City completed zoning text
amendments in 2024, and strategies for live/work housing are scheduled for 2026.
Program 11: Streamline Housing Permitting addresses several areas where City
processes and procedures were reformed to support the timely processing of housing
development proposals. Revisions to Preliminary Development Plans (PDP), objective
standards, Senate Bill 35 (SB 35) procedures, have been adopted. Eliminating the
conditional use permit (CUP) requirements for condominium developments will be
scheduled for review in 2026.
Program 12: Remove Government Constraints addressed development processes
and procedures that were not supportive of a variety of unit types and sizes. This includes
updating Coastal Land Use Policies for California Coastal Commission (CCC) review,
which was scheduled for 2024 but has not yet been initiated.
Page 7 of 150
City of Hermosa Beach | Page 5 of 6
5. Equal Housing Opportunity
Implementation of equal housing opportunity programs is on track. Two programs support
this policy area:
Program 13: Affirmatively Furthering Fair Housing encompasses multiple strategies
including accommodating persons with disabilities, encouraging stakeholder engagement
in decision-making, continuing fair housing outreach and education on housing
discrimination, utilizing informational materials and holding at least one public meeting
annually to discuss housing issues, and collaborating with and promoting home share
programs.
Program 14: Neighborhood Improvement ensures systematic investment across all
city areas with connections to amenities, prioritizing improvements and services based
on urgent need.
Quantified Objectives
In addition to policies and programs, the Housing Element articulates clear housing
production targets which are based on the City’s Regional Housing Needs Allocation
(RHNA). The chart below describes the production targets for this cycle.
Ex-
Low
Very
Low
Low Moderate Above
Moderate
Totals
New 116 116 127 106 93 558
Rehab 10 10
Retain 60* 60
*Mobile Homes
The City submits annual progress reports to HCD in April, which account for prior year
activities and housing development. The following table, extracted from the HCD website,
describes the City’s housing development pipeline based on data from 2021 – 2024.
Page 8 of 150
City of Hermosa Beach | Page 6 of 6
City records indicate that 384 housing units are under development or have been
completed during the first half of the 6th Cycle. The data suggest that the City will exceed
the above-moderate income production target. Housing unit development in all other
income categories appears to be lagging. Increased attention to the programs that are
behind schedule should improve likelihood of low- and moderate-income housing
development.
Public Notification:
No public notice is required for this item. However, an eblast was sent to individuals who
have signed up for the City’s Zoning Code Updates.
Attachment:
1. 6th Cycle Housing Element 2021-2029
Respectfully Submitted by: Alison Becker, AICP Community Development Director
Page 9 of 150
CITY OF
HERMOSA BEACH
HOUSING ELEMENT
POLICY PLAN
2021-2029
Adopted December 21, 2021 Re-adopted (with revisions) August 8, 2023
Revisions (January, May, and June 2024)
Page 10 of 150
Page 11 of 150
This page intentionally left blank
Page 12 of 150
Page 13 of 150
Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
i
Contents
I. Introduction ................................................................................................................................. I-1
A. Purpose of the Housing Element ...................................................................... I-1 B. Scope and Content of the Housing Element .................................................. I-1
C. Public Participation ........................................................................................... I-2
D. Consistency with Other Elements of the General Plan ................................... I-2
II. Housing Policy Plan ................................................................................................................... II-1
A. Housing Element Issues and Policies ............................................................... II-1
B. Housing Programs ............................................................................................. II-4
C. Quantified Objectives .................................................................................... II-19
D. Summary of AFFH Actions .............................................................................. II-19
List of Tables
Table II-1 Quantified Objectives 2021-2029 ..................................................................... II-19
Table II-2 Affirmatively Furthering Fair Housing Summary Actions ................................ II-199
Page 14 of 150
Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
ii
This page intentionally left blank
Page 15 of 150
Hermosa Beach 2021-2029 Housing Element I Introduction
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
I-1
I. INTRODUCTION
A. Purpose of the Housing Element
The Housing Element describes the City’s needs, goals, policies, programs and objectives
regarding the preservation, improvement, and development of housing in Hermosa
Beach. The Element reflects community housing needs in terms of affordability, availability,
adequacy, and accessibility. The Element describes the City’s strategies for addressing
housing needs over the 2021-2029 period and identifies specific programs to address those
needs.
The Housing Element is the City’s official municipal response to the State Legislature’s
declaration that adequate housing for all economic segments of the community is a
matter of statewide importance that must be addressed by all levels of government. The
2021 Housing Element update provides Hermosa Beach with the opportunity to plan for the existing and future housing needs in the community, and identifies strategies and
programs to address those needs.
B. Scope and Content of the Housing Element
The California Legislature has recognized the role of local general plans and particularly
the Housing Element in implementing statewide housing goals to provide decent and
adequate housing for all persons. The California Department of Housing and Community
Development (HCD) also has adopted detailed guidelines regarding the scope and
content of housing elements, including the following major components:
• An analysis of demographic and housing characteristics and trends (Technical Report, Chapter I);
• An evaluation of resources, including land, financial, and administrative resources, available to address the City’s housing goals (Technical Report,
Chapter II);
• A review of potential constraints, both governmental and non-governmental,
to meeting housing needs (Technical Report, Chapter III);
• The Housing Policy Plan addressing the City’s identified housing needs, including
housing issues, policies, programs and quantified objectives (Chapter II of this document);
• An evaluation of the appropriateness and effectiveness of previous policies and programs in achieving the City’s objectives, and the progress in implementing
Housing Element programs (Technical Report, Appendix A);
• A parcel-specific inventory of vacant and underutilized suitable sites for
additional housing (Technical Report, Appendix B); and
• A description of the public participation process during the preparation and
adoption of the Housing Element (Technical Report, Appendix C).
Page 16 of 150
Hermosa Beach 2021-2029 Housing Element I Introduction
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
I-2
C. Public Participation
Public participation is an important component of the planning process, and this update to the Housing Element has provided residents and other interested parties numerous
opportunities to be involved in the preparation of the element. Public meetings to discuss housing needs and policy options were conducted by the Planning Commission and City
Council, and notices of all meetings were published in advance of each meeting. The draft Housing Element was made available for review at City Hall and posted on the City’s
website and was also circulated to housing organizations representing the interests of lower-income persons and those with special housing needs. After receiving comments on
the draft Housing Element from the State Housing and Community Development Department, a proposed final Housing Element was prepared and made available for
public review prior to review by the Planning Commission and adoption by the City Council.
Appendix C provides additional information regarding opportunities for public
involvement in the preparation of this Housing Element update, as well as a list of persons
and organizations who were invited to participate.
D. Consistency with Other Elements of the General Plan
The Housing Element must be consistent with other elements of the General Plan, which was last updated in 2017. Housing Element policies and programs are closely correlated
with the development policies contained in the Land Use Element, which establishes the location, type, and intensity of land uses throughout the city. The Land Use Element
determines the number and type of housing units that can be constructed in the various land use districts. Areas designated for commercial and industrial uses create employment
opportunities, which in turn, create demand for housing. The Circulation Element establishes the location and scale of streets, highways and other transportation routes that
provide access to residential neighborhoods. Because of the requirement for consistency
among the various General Plan elements, the 2021 Housing Element update included a
review of other General Plan elements to ensure that consistency is maintained.
Government Code Section 65302 also specifically requires that the Safety and
Conservation Elements be reviewed concurrent with each Housing Element update.
SB 1087 of 2005 requires cities to provide a copy of their Housing Elements to local water
and sewer providers, and also requires that these agencies provide priority hookups for
developments that include lower-income housing. These agencies have been invited to
participate in the Housing Element update process and the Housing Element will be
provided to these agencies immediately upon adoption.
Page 17 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-1
II. HOUSING POLICY PLAN
The purpose of this Housing Policy Plan is to identify policies and programs that will help the
City in addressing its housing needs during the 2021-2029 planning period. This section includes the following components:
• Section A identifies the housing issues facing Hermosa Beach and establishes guiding policies for addressing those issues;
• Section B describe specific program actions the City will take consistent with established policies;
• Section C establishes quantified objectives for the construction of new housing, rehabilitation of existing housing in need of repair, and the conservation of
existing affordable housing.
A. Housing Element Issues and Policies
This section establishes the City’s housing policy framework. Section 65583(c) of the
California Government Code requires that actions and policies included in the Housing Element address five key issue areas:
• The manner in which the City will assist in the conservation of existing housing resources, particularly affordable housing;
• The City’s strategy in assisting in the development of new housing opportunities;
• How the City intends to provide adequate sites to achieve a variety and
diversity of housing types;
• How the City proposes to remove governmental constraints that may impact
the preservation and development of housing; and,
• How the City may help to promote equal housing opportunities.
Issue Area 1 - Conservation of Existing Affordable Housing
The City’s proximity to the Pacific Ocean and its desirability as a place to live and visit
contributes to the high land and housing costs relative to the surrounding region. The City,
nevertheless, has been successful in maintaining its more affordable housing through the
adoption of ordinances and special land use regulations. The City works proactively to
preserve and maintain the existing housing resources in the City, including affordable
housing.
This commitment is underscored by the policies listed below.
Policy 1.1 The City will continue to encourage the maintenance and improvement of the existing housing stock within the local
neighborhoods.
Policy 1.2 The City will assist in the preservation and enhancement of the
housing supply available to senior citizens.
Page 18 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-2
Policy 1.3 The City will work to minimize the conversion of existing lower-cost
rental housing in multiple-family developments to condominiums.
Policy 1.4 The City will investigate potential sources of funding and other incentives that will assist in the preservation and renovation of older
housing units.
Policy 1.5 The City will continue to implement its current code enforcement
procedures as a means to ensure the conservation and
maintenance of existing housing resources in the City.
Issue Area 2 - New Affordable Housing Development
The City’s ability to directly fund the construction of affordable housing is constrained due
to budget limitations. In addition, the construction of affordable public housing within the coastal zone would not represent an efficient expenditure of public money, given the high
land and development costs. As a result, the City continues to be an active participant in the development of more affordable housing through land use regulations and other
incentives. The City of Hermosa Beach will continue to assist in the development of new housing for all income groups through the following policies.
Policy 2.1 The City will continue to promote the development of a variety of housing types and styles to meet the existing and projected housing
needs of all segments of the community.
Policy 2.2 The City will continue to encourage the development of safe, sound,
and decent housing to meet the needs of varying income groups.
Policy 2.3 The City will continue to implement the land use policy contained in
the City’s General Plan, which provides for a wide range of housing
types at varying development intensities.
Policy 2.4 The City will continue to support and promote home ownership in
the community.
Policy 2.5 The City will continue to cooperate with other government agencies,
citizen groups, and the private sector, in order to assist in meeting
the existing and future demand for housing.
Policy 2.6 The City will encourage the addition of ADU and JADU units as a
strategy to provide new housing units for low- and moderate-income
households.
Issue Area 3 - Provision of Adequate Sites for New Housing
The majority of the city was developed during the early 1900s. More intensive development
has continued up to the present time. There are few vacant parcels of land remaining in the city, and the majority of the residential construction that has occurred involved the
“recycling” of older structures. Nevertheless, the City of Hermosa Beach will continue to
Page 19 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-3
explore potential sites for residential development as a means to achieve a variety and
diversity of housing types.
Policy 3.1 The City will evaluate new development proposals in light of the
community's environmental resources, the capacity of public
infrastructure to accommodate the projected demand, and the
presence of environmental constraints.
Policy 3.2 The City will continue to evaluate the General Plan and zoning to
ensure residential development standards are adequate to serve
future development.
Policy 3.3 The City will continue to review current zoning practices for
consistency with the General Plan as a way to facilitate new mixed-
use development within or near the commercial districts.
Issue Area 4 - Removal of Governmental Constraints to Housing
In previous years, the City has been successful in the conservation of housing, especially
affordable housing, through the implementation of land use ordinances and regulations. A key component of the City’s housing policy is to assist in the development of more
affordable housing with the use of incentives and other measures. The City of Hermosa Beach will remain committed to the removal of governmental constraints through the
following policies.
Policy 4.1 The City will continue to abide by the provisions of the Permit
Streamlining Act as a means to facilitate the timely review of
residential development proposals.
Policy 4.2 The City will work with prospective developers and property owners
to assist in their understanding of the review and development
requirements applicable to residential development in the city.
Policy 4.3 The City will continue its efforts to educate the community regarding
the development standards contained in the City of Hermosa Beach
Zoning Ordinance, including the ability to provide ADU and JADU
units on residential properties.
Policy 4.4 The City will continue to evaluate its Zoning Ordinance and General
Plan and remove governmental constraints related to development
standards. These may include, but not be limited to, parking
requirements, allowing affordable housing on commercial sites, new
standards for mixed-use development, lot consolidation incentives,
and senior housing requirements.
Issue Area 5 - Equal Housing Opportunity
Federal and State laws prohibit housing discrimination based on an individual’s race,
ethnicity, religion or other characteristics. Enforcement of fair-housing laws generally
occurs through the courts, though persons being discriminated against often lack the
Page 20 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-4
resources to obtain the necessary legal protections. As a result, alternative means to
obtain assistance must be made available. Towards this end, the City will continue to
cooperate with other public agencies and non-profit organizations providing assistance in
ensuring equal housing opportunities for all.
Policy 5.1 The City will continue to provide information and referral services to
regional agencies that counsel people on fair housing and landlord-
tenant issues.
Policy 5.2 The City will continue to cooperate with the County Housing
Authority related to the provision of rental assistance to lower-
income households.
Policy 5.3 The City will continue to cooperate with other cities and agencies in
the area in investigating resources available to provide housing for
the area's homeless population.
Policy 5.4 The City will support the expansion of shelter programs with adjacent
cities and local private interests for the temporary accommodation
of the homeless population.
Issue Area 6 – Sustainable Housing Development
The City works to promote sustainability and energy conservation in a number of ways.
Plan Hermosa, the City’s General Plan, establishes a blueprint for sustainability and a low-
carbon future, and provides a framework within which City regulations, programs, and
projects work in unison to ensure that land use, transportation, and other aspects of City
operations support sustainable development and energy conservation goals. Specifically
for the residential sector of the community, the issue of energy conservation can be
addressed at several levels: community-wide land use and transportation planning,
building technology in both new construction and rehabilitation or remodeling of existing
structures, and through lifestyle options such as walking and cycling. This is further
supported by water conservation and sustainable neighborhood design.
Policy 6.1 The City will support sustainable residential development through
land use planning, building technology and lifestyle options.
B. Housing Programs
The programs listed below describe the actions the City intends to take to address the
policy issues discussed above. The City’s main challenge in accommodating new residential development is its lack of vacant land. As a result, the vast majority of new
housing development must occur through the “recycling” of older structures and redevelopment of underutilized parcels. The lack of financial resources, coupled with high
land and development costs, will continue to be a constraint to the development of new
affordable housing. As a result, the focus of these programs is on strategies to assist the
private market in the development of affordable housing.
Page 21 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-5
Issue Area 1 - Conservation of Existing Affordable Housing
1. Code Enforcement
Program Description: Chapter 8.28 of the Municipal Code provides for the abatement of safety and nuisance conditions relating to private property. To implement this requirement,
the Code Enforcement Program emphasizes the following:
• The City actively pursues Municipal Code violations on a complaint basis, with
particular emphasis being placed on those areas clearly exposed to public view;
• All necessary steps are taken to ensure that violations are corrected in an expeditious and voluntary manner;
• Where appropriate, property owners are informed of available assistance programs for lower-income persons who may not be able to afford needed
improvements or corrections; and
• The City utilizes misdemeanor criminal prosecution only when attempts to gain
voluntary compliance have failed.
The Code Enforcement Program implements those sections of the Municipal Code related
to property maintenance, including zoning, property maintenance, illegal units, trash
container regulations, construction without permits, and sign regulations. The Code
Enforcement Officer assists and makes recommendations to other City departments, such
as conducting inspections of business licenses, home occupation offenses, and
obstructions in public rights-of-way.
Timing: This program is in place and will continue through the planning period.
Funding: General Fund.
2. Conservation of Existing Affordable Housing
Program Description: This program provides for the ongoing maintenance and
conservation of the Marine Land Mobile Home Park located at 531 Pier Avenue. The 60-
space park provides housing for extremely-low-, very-low- and low-income households.
The Hermosa Court Recreational Vehicle Park with 19 pads at 725 10th Street also provides
transitional housing space for those persons or households in transition from an RV to a more permanent home. The City's MHP Zoning District requires Planning Commission
approval in order to add or delete spaces in the park, which helps to preserve affordability by discouraging conversion from single- to double-wide spaces. In 2013 the Mobile Home
Park received over $111,000 of City funds and $1.2 million through the State’s Mobilehome Park Resident Owner Program (MPROP) and the Marineland Community Association, Inc.,
the resident association, purchased the park, ensuring the long-term security of this important affordable housing resource.
In addition to mobile homes, existing apartments provide an important source of housing at lower cost than ownership housing. To reduce the potential impact of condominium
conversions on low- and moderate-income residents of converted condominiums,
Page 22 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-6
Chapter 17.22 of the Municipal Code establishes requirements including first right of refusal
and relocation assistance for tenants.
Timing:
• To ensure that the amount of relocation assistance remains sufficient, review
and update relocation reimbursement requirements annually should
condominium conversion become a trend again in the future. (There has not
been any condominium conversion in the City for more than a decade.)
Funding: General Fund.
Issue Area 2 - New Affordable Housing Development
3. Density Bonus and Other Incentives
Program Description: State law requires cities to grant a density bonus and other incentives for qualifying affordable or senior housing developments. Section 17.42.100 of the Zoning
Ordinance establishes standards and procedures for implementing State Density Bonus
Law. In addition to State requirements, the City has adopted additional incentives that
allow increased density when small parcels are combined to create a larger residential
building site.
State density bonus law has been amended from time to time to encourage the
development of affordable and senior housing. The City has been implementing the State
density bonus law. To provide clarity and help incentivize affordable housing
development, the City will revise its density bonus regulations (Municipal Code Sec.
17.42.100) to comport with current State law. In addition, the City will inform developers
and contractors of this incentive program through brochures at the public counter and
information posted on the City’s website.
Timing:
• As part of the comprehensive Zoning Ordinance update, revise the City’s
Density Bonus regulations by the end of 2023.
• Continue to make information available on the density bonus program through
brochures and the City website throughout the planning period.
Funding: City General Fund.
Page 23 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-7
4. Affordable Housing Development Outreach and Assistance
Program Description: This program includes investigation of potential funding sources and
administrative support to assist private and non-profit organizations in the development
and/or provision of affordable housing. The City will investigate the feasibility of expanding
CDBG funding and Section 8 rental vouchers to qualifying households. The Section 8
program is one of the major sources of housing assistance for very-low- and extremely-low-
income households. If the City is successful in obtaining increased CDBG funding and/or
expanding Section 8 rental vouchers for residents, this information will be posted in the
Community Center, on the City’s website, in handouts provided in the information kiosk in
the City Hall lobby, and in the local library. Brochures will also be provided to local service
clubs including the local “Meals on Wheels” program, local dial-a-ride service, the local
recreation center, and emergency shelters in the area.
The City will also provide incentives such as priority processing, fee waivers and deferrals,
and modified development standards to projects with low- or moderate-income units, and
will assist in preparing and processing grant applications for affordable housing projects to
support the development of such units. Project sponsors will be encouraged to include
units for extremely-low-income households where feasible. As part of the 2021 Housing Element update the City consulted with a variety of housing organizations to identify
potential actions the City could take to facilitate the development of affordable housing, including to extremely-low-, very-low- and low-income households.
Timing:
• Annually pursue funding available to expand affordable housing opportunities in
the City, especially housing for special needs populations, including extremely low
income households.
• Annually contact developers to explore affordable housing opportunities, especially for developers with experience in special needs housing.
• As affordable units become available, conduct Affirmative Fair Marketing to agencies and organizations that serve low and moderate income households and
special needs populations in the South Bay region.
Funding: This program will be financed through the City’s General Fund and grant funds.
5. Facilitate Efficient Use of Sites that Allow High-Density Residential Development
Program Description: This program will facilitate affordable housing development on sites
that allow high-density residential development including reducing constraints posed by
small lot sizes.
a. While the City does not rely on small sites to meet its lower income RHNA, the City will
continue to facilitate lot consolidation by:
• Assisting affordable housing developers in identifying opportunities for lot
consolidation using the City’s GIS system and property database;
Page 24 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-8
• Continuing to expedite processing for lot consolidations processed concurrently
with planning entitlements;
• Continuing to provide a graduated density bonus for lower-income housing on
small lots consolidated into a single building site according to the following
formula (Zoning Ordinance Sec. 17.42.170):
Combined Parcel Size Allowable Base Density*
Less than 0.50 acre 33 units/acre
0.50 acre to 0.99 acre 34.7 units/acre (5% increase)
1.00 acre or more 36.3 units/acre (10% increase)
*Excluding density bonus
b. The City will continue to facilitate affordable housing development by:
• Facilitating pre-application meetings;
• Implementing incentives under the Density Bonus law;
• Reducing property development standards (e.g. reduced setbacks, reduced
parking standards) for small developments below the threshold of Density Bonus
law when affordable units targeted to the elderly or persons with disabilities are
provided;
• Allowing deferral or waiver of City fees necessary to make the project cost-
effective;
• Facilitating permit processing so that developers can take advantage of
funding opportunities;
• Expediting permit processing through concurrent review through the planning
and building processes;
• Promoting programs on the City’s website and at the Planning Counter and
biennially notify affordable housing developers of the City’s housing incentives.
Timing:
• By the end of 2023, publicize the lot consolidation incentives on the City’s
website, at the Planning counter, and by notice to affordable housing providers.
• Annually contact developers to communicate the various city incentives
available to facilitate affordable housing development.
• By the end of 2025, conduct an assessment of the City’s progress in providing affordable housing in the community. If the City is not making meaningful
progress in its affordable housing goals, the City will develop additional incentives and strategies to expand affordable housing opportunities by the
end of 2026. Additional incentives may include increasing the graduated densities for lot consolidation.
Funding: General Fund. Accessory Dwelling Units
Page 25 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-9
6. Accessory Dwelling Units
Program Description: Accessory dwelling units (ADUs) provide an important source of
affordable housing for seniors, young adults, care-givers and other low- and moderate-
income segments of the population. In recent years, the State Legislature has adopted
extensive changes to ADU law in order to encourage housing production. Among the most
significant changes is the requirement for cities to allow one ADU plus one “junior ADU” on
single-family residential lots by-right subject to limited development standards. The City
further incentivizes ADU development by allowing a second ADU in lieu of the JADU. This
flexibility facilitates the development of a range of ADU sizes to accommodate the diverse
housing needs in the community. The City will review new legislation each year and
update ADU regulations as necessary to ensure conformance with current State law.
Timing:
• Facilitate the development of 95 ADUs over the eight-year planning period, over
the RHNA projection of 64 ADUs.
• Monitor legislation and update City ADU regulations as necessary to maintain
consistency with State law by the end of 2023.
• Provide ADU standards, guidance, and resources on City website by the July
2024. For example, provide links to the California Housing Finance Agency
(CalFHA) ADU grant program that provides $40,000 in pre-development funds
to qualified homeowners.
• By the end of 2025, develop incentives to facilitate the construction of ADUs.
Incentives may include pre-approved plans, expedited review, assigned staff or
office hours for ADU review and consultation, and/or reduced fees.
• By the end of 2025, amend the Zoning Code to allow an additional JADU
(beyond current allowance under State and local laws) within the existing square footage of larger homes. A survey of completed homes in the past four
years revealed an average primary unit size of 3,500 square feet. The City proposes to allow an additional JADU in primary units over 3,000 square feet on
single-family (R-1) lots, only when the additional JADU results in a net additional dwelling unit. The City aims to add 15 additional units using this method between
2026 and 2029.
• Monitor the trend of ADU development every other year beginning in 2025. If by
2027, the ADU activities are not trending to meet the Housing Element goal, develop additional incentives (such as pursuing State funds or partnering with
nonprofits) by July 2028 to further facilitate ADU development, or to identify replacement sites or rezoning, if necessary, to address any sites capacity
shortfalls.
• Promote the use of Housing Choice Vouchers for ADUs. Create a Fair Housing
Factsheet on landlord responsibility as part of ADU application packet by July
2024.
Funding: General Fund and grant funds, if available.
Page 26 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-10
7. Land Value Recapture
Program Description: When land is rezoned to allow higher-intensity uses, the value of that
property typically increases. Land value recapture refers to a policy requiring that a portion
of the increased value be dedicated to a public benefit, such as affordable housing.
The City adopted the Housing Element on December 21, 2021, including the Land Value
Recapture Program as Program 7. This Program was introduced early in the Housing
Element discussions and has been a part of the Housing Element update since inception.
The Program was carried through to the revised adopted Housing Element on August 8,
2023. The Housing Element indicates that the City will perform a feasibility analysis on the
Land Value Recapture Program.
The premise of the Land Value Recapture Program is that properties that benefit from
zoning actions to allow for residential development increase in value. In the South Bay
region where Hermosa Beach is located, there is a decreasing desire to redevelop
commercial properties and instead an increased desire to redevelop properties into mixed
use or all residential. This desire correlates to property values. The Program levies a fee
onto any residential development on properties that benefited from a zoning action that
expanded their development ability. However, the property is exempt from the fee if the
proposed residential development includes 15% very-low-, 15% low-, or 25% moderate-
income units.
The City worked with a real estate advisory company to evaluate the economic feasibility
of Land Value Recapture. The analysis included sample business proformas indicating that
the City’s proposed Land Value Recapture fee did not render development infeasible (i.e.,
that an acceptable return on investment would be possible), and even further that in some cases, construction affordable units and taking advantage of density bonus provisions
amplified the return on investment.
Timing:
• Conducted feasibility study concurrent with rezoning in 2023 (see Program 9) and begin implementation in 2024.
Funding: General Fund and grant funds, if available.
8. Housing Trust Funds
Program Description: Housing trust funds are a dedicated source of financial assistance for
affordable housing and can be funded through a variety of mechanisms, such as governmental grants, loans, charitable contributions, development fees, and land value
recapture requirements (see also Program 7).
The City has joined the South Bay Housing Trust Fund managed by the South Bay Council
of Governments (SBayCOG). Specifically, the City has contributed SB 2 funds toward the
Trust Fund.
Timing:
Page 27 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-11
• Annually pursue funding to provide for affordable housing, especially funding
for special needs populations. As funding permits, continue to participate in the
South Bay Housing Trust Fund.
Funding: General Fund or grant funds, if available.
Issue Area 3 - Provision of Adequate Sites for New Housing
9. Adequate Sites to Accommodate Housing Needs
Program Description: State law requires cities to ensure that their land use plans and development regulations identify adequate sites with appropriate zoning to
accommodate housing needs assigned through the Regional Housing Needs Assessment (RHNA) process.
The City’s RHNA allocation is described in Section I.H of the Housing Element Technical Report, and an analysis of the City’s potential sites for additional housing is presented in
Appendix B of the Technical Report. For the 6th cycle RHNA, the City has been allocated
a RHNA of 558 units (232 very low, 127 low, 106 moderate, and 93 above moderate income
units). With projected ADUs of 64 units over eight years, the City has a remaining RHNA
obligation of 494 units (221 very low, 99 low, 102 moderate, and 72 above moderate
income units). These units are being accommodated on sites rezoned or amended to
allow mixed use and residential uses. At the State default minimum density of 20 units per
acre, up to 24.7 acres of rezoning would be required. However, the City proposes to rezone
two one-acre city-owned properties at a minimum density of 34 units per acre, and the
majority of identified parcels will be rezoned to a minimum density of 25.1 units per acre.
Overall, 23.5 acres of rezoning were identified.
The sites analysis concluded that amendments to current land use and zoning designations
are necessary in order to fully accommodate the RHNA. Specifically, the City identified a
number of sites with potential for redevelopment into residential or mixed use residential
development. An estimated 302 units can be accommodated on parcels larger than 0.5
acre (151 very low, 76 low, 44 moderate, and 31 above moderate income units). In
addition, Sites 1 and 2 (St. Cross), while comprising of multiple parcels, are under common
ownership and function as an integral campus. These two sites can accommodate 33 very
low and 13 low income units. These large parcels and St. Cross site can accommodate the
majority of the City’s remaining lower income RHNA, with 47 units (less than 15 percent) of
the remaining lower income units required to be accommodated on consolidated sites.
As discussed before, all small sites used for lower income RHNA are contiguous, under
common ownership and with no more than two owners. Moderate and above moderate
income housing can be developed on small parcels without consolidation.
This program describes the actions the City will take to ensure that adequate sites are designated consistent with Government Code Sec. 65583(c)(1)(A) and 65583.2.
• The City will process General Plan and zoning amendments, including the required CEQA analysis, for the selected sites. The rezoned sites shall include the
following components pursuant to Government Code Sec. 65583.2(i):
Page 28 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-12
o Permit owner-occupied and rental multi-family uses by-right for
developments in which 20 percent or more of the units are affordable to
lower-income households.
o Permit the development of at least 16 units per site.
o Permit a minimum of 20 dwelling units per acre.
o Ensure that either: a) at least 50 percent of the shortfall of low- and very-low-
income regional housing need can be accommodated on sites designated for exclusively residential uses; or b) if accommodating more than 50 percent
of the low- and very-low-income regional housing need on sites designated
for mixed uses, all sites designated for mixed uses must allow 100 percent
residential use and require that residential uses occupy at least 50 percent
of the floor area in a mixed-use project.
• The City will report on the status of this program each year as part of the Annual
Progress Report.
Timing:
• In November 2023, the City completed Zoning map and text amendments to
provide adequate sites:
o Rezone City-owned properties (Sites 10 and 11) from M-1 and O-S to Public
Facilities with an allowable residential density of 34-50 units per acre.
o Rezone Sites 1 and 2 (St. Cross Church properties) from R-1/R-2 to R-2A with
an allowable residential density of 22-25 units per acre.
o Amend Zoning Ordinance to add residential and mixed use development as
permitted uses to C-2, C-3, SPA-7, SPA-8, and SPA-11 RHNA sites with an
allowable residential density of 25.1-33 units per acre.
o Amend Zoning Ordinance to establish a formal procedure to monitor for the
No Net Loss of capacity for accommodating the RHNA, pursuant to SB 166.
o Amend Zoning Ordinance to establish the replacement housing
requirements when redevelopment occurs on RHNA sites where existing units occupied by or deed-restricted for lower income households are
demolished.
• In November 2023, the City amended the General Plan land use designation
for Sites 1 and 2 in the inventory from Low Density to Medium Density Residential.
• By the end of July 2024, complete text corrections regarding the rezoning
above to ensure compliance with the minimum density of 20 du/ac.
• Facilitate affordable housing development on City-owned sites:
o Develop and release a Request for Proposal by the end of 2024 to solicit a public/private partnership for affordable housing (including housing for
special needs populations). If disposition of site(s) is considered, the City will ensure compliance with the Surplus Land Act.
Page 29 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-13
o Complete design work, environmental review and associated approvals by
the end of 2025.
o Identify affordable housing developer(s) to partner with on affordable housing projects meeting the RHNA allocation of 100 affordable units on the
City sites (30 very low, 45 low, and 25 moderate income units) on City-owned
sites.
o If the City is not successful in pursuing affordable housing on these sites and
construction has not started by 2027, the City will pursue alternative actions
(such as identifying alternative sites) by the end of 2028.
• Beyond the sites required to accommodate the City’s RHNA, the City also
embarked on an effort starting in 2022 to introduce residential development
along all major commercial corridors. As of November 2023, the City
completed the zoning text changes creating mixed use (residential/
commercial) development standards in C-2 and C-3 zones, and allows mixed
use/residential only in the newly created the Housing Element Sites Overlay
(Sites Inventory sites) with a density range of 25.1 to 33 du/ac. By the end of
2026, the City will create additional mixed use overlays to include other areas
in the major commercial corridors, with a minimum density of at least 20 du/ac.
The City anticipates this will result in 100 units above the Housing Element Sites
Overlay capacity.
Funding: General Fund; grant funds.
Issue Area 4 - Removal of Governmental Constraints to Housing
10. Housing for Persons with Special Needs
Program Description: The Zoning Ordinance encourages the provision of housing for
persons with special needs, including regulations and procedures related to group homes,
emergency shelters, transitional/supportive housing and persons with disabilities. The City
is in the process of updating the Zoning Ordinance. Specific changes to address special
needs housing include:
• Emergency Shelters: Revise parking standard based on staffing level only.
Designate R-3 (Multi-Family Residential) as zone for emergency shelters by right
without discretionary review. Expand the definition of emergency shelters to include
interim housing options pursuant to State law (AB 2339), including bridge housing,
navigation centers, and respite and recuperative care. Review and revise or
remove the bed limit based on consultation with service providers.
• Transitional and Supportive Housing: These uses are currently permitted in all
residential zones as similar uses in the same zones. Revise the Zoning Ordinance to
similarly permit transitional and supportive housing in all zones that permit residential
uses.
Page 30 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-14
• Supportive Housing: Recent changes to State law (AB 2162 of 2018) require that
supportive housing (up to 50 units) meeting specific requirements be a use by-right
in zones where multi-family and mixed uses are permitted, including non-residential
zones permitting multi-family uses. Furthermore, if the development is located within
half-mile from transit, no minimum parking can be required.
• Residential Care Facilities (for seven or more persons): Revise the CUP review
process for large care facilities to an Administrative Permit in all residential zones,
with a lower fee, and establish findings for approval that are objective and provide
certainty in outcomes similar to other residential uses of the same type in the same
zone.
• Low Barrier Navigation Center: In 2019 the State Legislature adopted AB 101
establishing requirements related to local regulation of low barrier navigation
centers, which are defined as “Housing first, low-barrier, service-enriched shelters
focused on moving people into permanent housing that provides temporary living
facilities while case managers connect individuals experiencing homelessness to
income, public benefits, health services, shelter, and housing.” Revise the Zoning
Ordinance to permit low barrier navigation centers meeting specified standards by-
right in areas zoned for mixed use and in nonresidential zones permitting multi-family
uses.
• Reasonable Accommodation: In the October 2023 Zoning Ordinance amendment,
the City removed the public hearing requirement for reasonable accommodation
requests and required finding relating to traffic and parking impacts. However, the
finding relating to neighborhood character remained. In November 2023, the City
adopted the Housing Element Zoning Text Amendment and removed the finding
regarding neighborhood character to ensure objectivity. (This action is completed.)
• Live/Work Housing: The City’s Economic Subcommittee studied the increased need for live/work housing. Develop strategies for providing live/work housing and 15-
minute neighborhoods.
Timing:
• Zoning Code amendments by the end of 2024.
• Develop strategies for live/work housing by 2025.
Funding: General Fund and grants
11. Streamline Housing Permit Processing
Program Description: As part of the comprehensive Zoning Ordinance update the City will
evaluate methods to simplify the housing development review process such as eliminating the conditional use permit requirement for multi-family, condominium and mixed-use
developments and reviewing the Precise Development Plan (PDP) process including what is reviewed, typical findings and approval procedures by zone and housing type, and
impacts as potential constraints on housing supply and affordability. Consistent with new
transparency laws, zoning, development standards and fees are posted on the City
website. The Zoning Ordinance update will also include revisions to streamline PDP process
Page 31 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-15
and develop objective standards to minimize constraints on housing supply and
affordability. In addition, the City will establish procedures to process SB 35 projects.
Timing:
• Zoning Ordinance update by the end of 2023 to:
o Streamline the Precise Development Plan review process as discussed in the Housing Element Technical Report.
o Develop object standards for project review.
• By the end of 2023, establish SB 35 procedures.
• Annually update City website to provide current information on zoning,
development standards and fees.
• By the end of 2024, update Subdivision Ordinance to address CUP requirement
for condominium projects.
Funding: General Fund and grants.
12. Remove Governmental Constraints
Program Description: As part of this Housing Element update, the City has evaluated the
effectiveness of its development standards and procedures in facilitating residential and
mixed use developments. Specifically, the City’s parking standards for multi-family housing
does not support a variety of unit types and sizes.
Subsequent to the adoption of the Housing Element, the City will review any Coastal Land
Use Plan policies that must be updated and submit to the California Coastal Commission
for certification. The timeline will be more apparent once the amendments have been
submitted.
Timing:
• As part of comprehensive Zoning Ordinance update by the end of 2023, revise
parking standards to facilitate a variety of unit sizes and types, such as smaller units, senior units, and mixed use developments, and offer alternative options
such as shared parking arrangements for mixed use development. (This task has already been completed as part of the October 2023 Zoning Ordinance
update. Parking for small units (zero to one-bedroom) has been reduced from two spaces per unit to 1.5 spaces per unit. Transitional and supportive housing,
which is usually smaller in size, the parking requirements mirror that of regular residential uses, except when such housing is located within one-half mile of
transit. In that case, no parking is required.) By the end of 2024, the City will revise the parking standards to remove the guest parking requirements. The currently
adopted parking standards will remain but will be indicated as inclusive of guest parking.
• By 2024, submit updated Coastal Land Use Policies to the CCC for certification.
Funding: General Fund and grants.
Page 32 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-16
Issue Area 5 - Equal Housing Opportunity
13. Affirmatively Furthering Fair Housing
Program Description: As a participating city in the Los Angeles County CDBG program, Hermosa Beach has access to services for fair housing outreach, education, and
counseling on housing discrimination complaints. The City will continue to advertise the fair housing program through placement of fair housing service brochures at the public
counter, at the Senior Center, through the City's newsletter, and on the City website. Apartment owners and managers are provided with current information about fair housing
issues, rights and responsibilities. The Apartment Association of Greater Los Angeles conducts seminars on State, Federal and local Fair Housing laws and compliance issues.
In addition, the City will:
• Ensure that all development applications are considered, reviewed, and
approved without prejudice to the proposed residents, contingent on the development application’s compliance with all entitlement requirements.
• Accommodate persons with disabilities who seek reasonable waiver or
modification of land use controls and/or development standards pursuant to
procedures and criteria set forth in the applicable development regulations.
• Work with the County to implement the regional Analysis of Impediments to Fair
Housing Choice and HUD Consolidated Plan.
• Facilitate public education and outreach by posting informational flyers on fair
housing and housing resources at public counters, libraries, and on the City’s
website and at Senior Center. Expand the City’s outreach efforts to reach a
broader audience by:
o Advertising housing-related initiatives and programs in newspapers that
have broader circulation beyond city limits (such as the Daily Breeze.
o Making hard copies of documents to assist the technology challenged.
o Expanding notifications to agencies and organizations that serve residents in
the South Bay region.
• Conduct at least one public meeting annually to discuss housing-related issues.
Conduct public meetings at suitable times, accessible to persons with
disabilities, and near public transit. The utilizes multi-media platforms to outreach
to lower and moderate income populations and persons with special needs. The City partners with community agencies for outreach at community events on
weekends and at public locations. For community workshops and meetings, the City offers to the degree possible hybrid attendance depending on the setting.
Usually, this includes a minimum of two (2) methods of attendance consisting of in-person and one other method. Resources will be invested to provide
interpretation and translation services when requested at public meetings when feasible.
• Encourage community and stakeholder engagement during development decisions.
Page 33 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-17
• Collaborate with home share programs and promote programs to residents.
Home share programs available to South Bay residents include:
o Home Share South Bay, a program offered by the South Bay Cities Council
of Governments (SBCCOG), is a community solution that matches
homeowners with renters seeking affordable housing in the South Bay.
o Affordable Living for the Aging (ALA) offers a home share program. ALA
screens, matches, and monitors two people to share a home based on living
preferences and compatibility. Arrangements may be rent or a combination
of rent and daily living support such as cleaning, cooking, or transportation.
Timing: This program is ongoing and will continue through the planning period.
Funding: General Fund.
14. Neighborhood Improvement
Given the City’s compact size, the City’s strategies for AFFH Placed-Based Strategies for
neighborhood improvements are focused on ensuring that every area in the City receives
systematic investment while also ensuring that every area in the City is connected to
amenities, such as services, businesses, and recreation across the City as well as regionally.
Certain programs are available for senior and disabled residents as well.
Community Development Block Grant (CDBG)
The City uses CDBG funds to further mobility across all areas of the City by retrofitting
existing intersections for disabled-accessible crosswalks and ramps.
Safe Routes to School
The City, in concert with the Hermosa Beach City School District, has a Safe Routes to
School program. The Program includes educational materials, outreach, and a reporting system to ensure that routes to school are safe.
https://www.hermosabeach.gov/our-government/city-departments/police/programs-tips/safe-routes-to-school
Aging in Place
The City of Hermosa Beach offers a tax rebate and certain exemptions (sewer, lighting
assessment, utility user tax) for income-qualified elderly or disabled residents. https://www.hermosabeach.gov/our-government/finance-department/finance-
administration/rebates
The City offers a House Check program for senior citizens, including those with Alzheimer’s
to ensure that these residents are safe. https://www.hermosabeach.gov/our-government/police-department/not-alone-program-alzheimer-checklist-vacation-house-
checks
Beach Cities Health District (BCHD) has a Care Management Program to ensure senior
receive services they need to continue living in their home.
BCHD also pairs volunteers up with senior to assist them on errands so they can continue
to live in their homes.
Page 34 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-18
Maintenance of Property
Senior Grant Program – Los Angeles County Development Authority – senior homeowners
for $15,000. Examples are livability and age in place, including deferred maintenance
repairs.
BCHD’s Senior Resources includes assisting seniors with mental health issues that may affect
an individual’s ability to maintain and upkeep their home.
Capital Improvement Program (CIP)
The City’s CIP projects which are under currently construction are focused on public
amenities that are used by all residents, including repair of the Municipal Pier, accessible
beach routes, sidewalk and accessible curb ramps, and repair of City park
restrooms. https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4
f16ff6c37544a0b8bd0dc0a725452f
The City’s 5-year CIP includes repair of a wide variety of public amenities.
https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4f16ff6c3754
4a0b8bd0dc0a725452f
Clean-up Events
The City benefits from clean-up events through sponsoring and also in partnership with
many organizations. The City of Hermosa Beach, Friends of the Parks-Hermosa Beach, the
Surfrider Foundation, are some examples. These clean-up events restore public amenities
for residents. Recent events headed by the Mayor of Hermosa Beach included a painting
of classrooms in a park facility, new landscaping at park facilities, and beach clean-ups.
Timing:
• Annually during budgeting process, prioritize improvements and services that
have the most urgent need.
Funding: General Fund and grant funds.
Issue Area 6 – Sustainable Housing Development
15. Sustainable Housing Development
Program Description: In 2017 the City adopted a comprehensive update to the General
Plan (PLAN Hermosa). One of the primary themes of the new General Plan is community
sustainability. Chapter 4: Sustainability + Conservation establishes state-of-the-art policies
to improve sustainability and energy conservation in residential development. Those
policies will continue to guide City decision-making in land use decisions and the development review process.
Funding: General Fund.
Timing: Throughout the planning period.
Page 35 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-19
C. Quantified Objectives
Table II-1 describes the City’s quantified objectives for new construction, rehabilitation and conservation during the planning period.
Table II-1 Quantified Objectives 2021-2029
Income Category
Totals Extremely Low Very Low Low Moderate Above Moderate
New construction 116 116 127 106 93 558
Rehabilitation 10 10
Conservation (1) 60 60
1. Mobile homes
D. Summary of AFFH Actions
The table below summarizes the City’s actions to affirmatively further fair housing. This table supplements the descriptions, actions, and timing for citywide programs with targeted
actions for AFFH. Implementation of the housing programs and detailed shown in the table below are both considered commitments of the City of Hermosa Beach.
Table II-2
Affirmatively Furthering Fair Housing Summary Actions
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Fair Housing Enforcement and Outreach – High Priority Contributing Factors:
Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 4: Affordable Housing Development and Outreach
Make information available to affordable housing organizations regarding residential development opportunities.
Annually Agencies and organizations serving low and moderate income and special needs households in
the South Bay
region
Facilitate the development of 359 lower income units
Pursue funding available for
affordable housing development.
Annually
Conduct Affirmative Fair Marketing as affordable housing units become available.
As units become available
Page 36 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-20
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 13: AFFH Facilitate public education and outreach by posting informational flyers on fair housing and housing
resources at public counters, libraries, on the City’s website, and social media (FB, Twitter,
Instagram, Next Door, and Tik
Tok), and paid advertising such as
Daily Breeze – engage a more
diverse population, especially
relying on social media platforms
that have a younger audience.
Annually Citywide (all highest resource
areas)
Facilitate the development of 558 units,
including 359 lower income units
City newsletter (about 8,000 subscribers) Bi-weekly
Conduct public meetings to
discuss housing-related issues.
Conduct meetings at suitable
times, accessible to persons with
disabilities, and near public
transit. Resources will be invested
to provide interpretation and
translation services when
requested at public meetings
when feasible.
At least once a
year
Encourage community and stakeholder engagement during
development decisions.
At least once during
development review process
Conduct Affirmative Fair
Marketing as affordable housing units become available.
As units
become available
Agencies and
organizations serving low and moderate income and special needs households in the South Bay region
New Opportunities in High Resource Areas – High Priority Contributing Factors:
High land, rental, and ownership housing costs
Availability of affordable housing
Program 3: Density Bonus and Other Incentives
Revise Density Bonus provisions and make information available on the density bonus program through brochures and the City website.
By the end of 2023 Citywide (all highest resource areas)
Facilitate construction of 359 lower income units
Program 5:
Facilitate
Efficient Use of
Sites that Allow
High-Density
Residential Development
Facilitate lot consolidation and
affordable housing development
through implementation of
strategies outlined in Program 5.
2021-2029 Multi-family
and mixed use
zones
Promote lot
consolidation
to facilitate
development
of 100 multi-
family units
Page 37 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-21
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 6: ADUs Monitor legislation and update City ADU regulations as necessary to maintain consistency with State
law.
By the end of 2023 Single-family neighborhoods Facilitate construction of 95 ADUs,
including 15 additional JADUs Promote the use of Housing
Choice Vouchers for AUDs.
Create a fair housing factsheet to be included in ADU application.
Amend Zoning Code to allow one additional JADU on R-1 lots if the
primary unit is at least 3,000
square feet and the additional
JADU will result in a net increase in
units.
By the end of 2025
Program 9: Adequate Sites to Accommodate Housing Needs
Complete Zoning map and text amendments to provide adequate sites for RHNA.
By the end of 2023 Along commercial corridors
Accommodate 100% of the shortfall of sites to accommodate the city’s remaining housing need of 359 units for very low and low income households.
Housing Mobility– High Priority Contributing Factors:
High land, rental, and ownership housing costs
Availability of affordable housing
Program 6: ADUs Promote the use of Housing Choice Vouchers for AUDs. Create a fair housing factsheet to
be included in ADU application.
By the end of 2023 Single-family neighborhoods Facilitate construction of 95 ADUs
Amend Zoning Code to allow one
additional JADU on R-1 lots if the
primary unit is at least 3,000 square feet and the additional JADU will result in a net increase in units.
By the end of
2025
Program 9:
Adequate Sites
to
Accommodate
Housing Needs
By the end of 2026, the City will
broaden the overlay to include
the remaining sites in the major
commercial corridors. The City
anticipates this will result in 100
units above the Housing Element
Sites Overlay capacity.
By the end of
2026
Commercial
corridors
Facilitate
development
of 100 units
along
commercial
corridors
Page 38 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-22
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 10: Housing for Persons with
Special Needs
Complete zoning code amendments outlined in Program 10 to promote housing for special
needs groups.
By the end of 2023 City-owned property and along
commercial corridors
Assist with the construction of 100 units for
special needs populations, including 50
units of senior
housing on
City-owned
property
Economic Subcommittee studied increased need for live/work – develop strategies for live/work housing, co-working space, and 15-minute neighborhood, etc.
By 2025 Along commercial corridors and in light manufacturing areas
Facilitate the development of 50 live/work units
Program 13:
Affirmatively
Furthering Fair
Housing
Facilitate public education and
outreach by posting informational
flyers on fair housing and housing
resources at public counters,
libraries, and on the City’s website
and at Senior Center. Expand the
City’s outreach efforts to reach a
broader audience by:
o Advertising housing-related initiatives and programs in newspapers that have broader circulation beyond city limits (such as the Daily Breeze.
o Making hard copies of documents to assist the technology challenged.
o Expanding notifications to
agencies and organizations that
serve residents in the South Bay
region.
By the end of
2024
Single-family
neighborhoods
Provide
referrals to
services to 20
households,
with the goal
of reaching a
broader
population via
other media
platforms.
Page 39 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-23
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Collaborate with home share programs and promote programs to residents. Home share
programs available to South Bay
residents include:
o Home Share South Bay, a
program offered by the South Bay
Cities Council of Governments
(SBCCOG), is a community
solution that matches
homeowners with renters seeking
affordable housing in the South
Bay.
o Affordable Living for the Aging
(ALA) offers a home share program. ALA screens, matches, and monitors two people to share
a home based on living preferences and compatibility. Arrangements may be rent or a combination of rent and daily living support such as cleaning, cooking, or transportation.
Program 14:
Neighborhood
Improvements
Pursue community development
activities and neighborhood
improvements:
• CDBG mobility access
improvements at
crosswalks and ramps
• Safe routes to school
Annually during
budgeting
process
Area with lower
median
household
income and
along
commercial
corridors and
manufacturing
areas where
future housing
is expected
Pursue 16
improvement
projects
AFFH: Affirmative Marketing
Require the project develops of affordable housing projects or projects with affordable units to
implement an Affirmative Fair
Marketing Plan to outreach to a
diverse population, extending
outreach to nearby communities
in the South Bay, especially to
workers in the City who do not live
in the City. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and non-
profit housing organizations that
serve lower income tenants in the surrounding region.
As affordable units are developed
South Bay Achieve 30% of future occupants of
affordable
units from
outside
Hermosa
Beach,
including those
who work but
do not live in
the City
Page 40 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-24
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Develop materials for Hermosa Beach residents who may be seeking tenants for their ADUs,
which will be provided to ADU applicants at the time they apply for a building permit or ADU
permit. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and non-
profit housing organizations that
serve lower-income tenants in the
surrounding region. Interested
residents can use these materials
to find prospective tenants in a
larger market area beyond city
limits, including residents of all
races, ethnicities, ages, and abilities
By December 2025 Single-family neighborhoods and high
resource areas (citywide)
Achieve 30% of future ADU occupants
from outside Hermosa Beach,
including those
who work but
do not live in
the City
Housing Mobility Monitoring Annually review overall progress and effectiveness in April and
include information in annual
report to HCD. If the City is not on
track to meet its housing mobility
goals by 2027, the City will
consider alternative land use
strategies and make necessary
amendments to zoning or other
land use documents to facilitate
a variety of housing choices,
including but not limited to,
strategies that encourage missing
middle zoning (small-scale multi-
unit projects up to four-plexes),
adaptive reuse, within six months,
if sufficient progress toward this
quantified objective is not being met.
Annually in April Citywide 95 ADUs/JADUs (including 15
additional
JADUs)
Home match
for 20
households
Page 41 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-25
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Place-Based Strategies for Neighborhood Improvement – Medium Priority Contributing Factors: Unaffordable rental prices
Availability of affordable housing Private discrimination
Program 14:
Neighborhood Improvements
Pursue community development
activities and neighborhood improvements:
• Aging in place services, including tax rebates and exemptions for assessments
• Promote property maintenance assistance, such as LACDA senior repair grants
• Capital improvements for neighborhood amenities
Annually during
budgeting process
Area with lower
median household income and along commercial corridors and manufacturing areas where future housing is expected
Provide 20 tax
exemptions for seniors and disabled households Conduct 8 neighborhood cleanup events
Tenant Protection and Anti-Displacement– High Priority Contributing Factors:
Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 2: Conservation of
Existing Affordable Housing
Review and update relocation reimbursement requirements for
relocation assistance.
Annually Citywide 100% of displaced
households compensated.
Program 8: Housing Trust Funds
Annually pursue funding to provide for affordable housing and as funding permits, continue participation in the South Bay Housing Trust Fund
Annually South Bay Region Contribute to the development of 5 affordable housing units in the region.
Page 42 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-26
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
AFFH: Homelessness Plan
Continue to implement the City’s Homelessness Plan, including outreach for persons
experiencing homelessness:
• PATH provides dedicated outreach teams for
homeless assistance, and
also connects individuals
with medical and mental
healthcare, interim
housing, veteran services,
employment services and
providing benefits
enrollment and
advocacy.
• Through PATH, the City
has an Outreach Hotline.
• The LA County MET
performs outreach and assessments on individuals with mental health needs, and provides linkages to services.
• City staff meets quarterly with regional outreach representatives from PATH and Harbor Interfaith Services to share relevant information, assess service connections made, and identify community “hot spots”
where additional
attention is needed.
• In partnership with
SBCCOG, facilitate
landlord
outreach/education
regarding opportunities
for housing individuals at-
risk of homelessness
Ongoing Citywide with emphasis on southwest
section of the City
Assist 10 persons experiencing
homelessness through outreach
efforts
annually.
Utilize local funds outlined in the Homelessness Plan to support response efforts and special circumstances. This fund can cover items such as miscellaneous services and materials, motel vouchers, transit vouchers,
laundry services, hygiene
products, etc.
Ongoing Citywide with emphasis on southwest section of the City
Assist five persons experiencing homelessness annually.
Page 43 of 150
City of Hermosa Beach | Page 1 of 5
.
Meeting Date: October 21, 2025
Staff Report No. 25-CDD-077
Honorable Chair and Members of the Hermosa Beach Planning Commission
DISCUSSION OF LAND VALUE RECAPTURE ORDINANCE A PROGRAM OF THE
2021-2029 CERTIFIED HOUSING ELEMENT
(Planning Manager Alexis Oropeza)
Recommended Action:
Staff recommends the Planning Commission:
1. Receive a staff report and solicit public input; and
2. Provide a recommendation to City Council.
Executive Summary:
At its March 25, 2025, City Council meeting, the City Council directed staff to have the
Planning Commission review the Land Value Recapture Ordinance as it pertains to “small
lots.” Staff recommends that the Planning Commission consider, discuss, and provide a
recommendation to the City Council.
Background
Land Value Recapture (LVR) policies are founded on the principle that properties gain
value from specific city actions, such as infrastructure improvements or rezoning. As a
result, a portion of the increased value should be captured and used for public benefit.
Land Value Recapture is one of the policy programs established in the City’s 2021-2029
Housing Element to support the development of affordable housing (Attachment 1). The
City Council adopted the corresponding Zoning Text Amendment (ZTA) Ordinance No.
24-1474 to implement the LVR program on January 23, 2024, and it went into effect on
August 1, 2024, when the Housing Element was certified by the California Housing and
Community Development (HCD)(Attachment 2). In its certification letter to the city, HCD
emphasized the importance of the city’s timely and effective implementation of all adopted
programs, including, but not limited to, LVR. Furthermore, HCD established an
expectation that the LVR program would be evaluated biennially (every two
years)(Attachment 3).
Page 44 of 150
City of Hermosa Beach | Page 2 of 5
Past Board, Commission, and Council Actions
Meeting Date Description
November 16, 2021 Planning Commission Consideration of a comprehensive
amendment to the HE for the 2021-20219 planning period,
including Land Value Recapture
December 21, 2021 City Council conducted a public hearing, adopted the
2021-2029 Housing Element, and authorized submission
to HCD
July 18, 2023 Planning Commission Study Session discussing Housing
Element-related Zone Changes and Zone Text
Amendments
August 8, 2023 City Council adopt Housing Element and associated
changes to the Land Use Element of the General Plan
August 15, 2023 City Council Study Session discussing Housing Element-
related Zone Changes and Zone Text Amendments
September 19, 2023 Planning Commission recommended approval of the
General Plan Amendment, Map Changes, and Zone Text
amendment, including Land Value Recapture
October 10, 2023 City Council Discussion of Land Value Recapture
October 17, 2023 Planning Commission adopted a Resolution reflecting
Zone Text Amendments to effectuate the Housing Element
programs
October 24, 2023 City Council consideration of General Plan Amendment,
Zone Changes and Zone Text Amendments to effectuate
programs of the 2021-2019 Housing Element
December 12, 2023 City Council consideration of Zone Text Amendment
adding Land Value Recapture and amending criteria for
affordable housing and Resolution establishing fees
January 23, 2024 City Council adoption of ZTA adding the LVR and
amending the criteria for affordable housing
At the March 25, 2025, meeting, the City Council directed staff to schedule the Planning
Commission’s review of the Land Value Recapture program as it pertains to “small lots.”
As of August 2025, the LVR Ordinance has been in effect for one year.
Page 45 of 150
City of Hermosa Beach | Page 3 of 5
Discussion:
The City’s Land Value Recapture Ordinance is structured to capture a portion of the land
value gained from adding residential development capacity to properties that were
previously zoned for non-residential uses only. The LVR ordinance applies to properties
on the Housing Element Inventory list that benefited from the rezoning of the property
with the Housing Element Overlay (HE-) zone (Attachment 4). The HE overlay expanded
the allowed uses on the rezoned parcels to include residential and mixed-use uses.
However, the property is exempt from the fee if the proposed residential development
includes 15 percent very-low-income, 15 percent low-income, or 25 percent moderate-
income units. The City Council established a two-tiered fee structure aimed at providing
a lower fee for “smaller lots” or lots that would accommodate a minimum density of four
(4) or fewer residential units (Tier 1) and a higher fee for larger lots where a minimum
density of five (5) or more residential units could be developed.
LVR Exemption Tiers Fee
Tier 1 – Minimum Density 4 or fewer residential units $76/per square foot
Tier 2 – Minimum Density 5 or more residential units $104/per square foot
The LVR fee was calculated to be the equivalent cost of creating affordable residential
units on-site, on non-residentially zoned properties that can now include residential
development. Fees collected from Land Value Recapture would then be used to develop
affordable housing locally. This could take the form of development subsidies for
constructing affordable housing or funding for converting existing units into affordable
housing. Additionally, funding could be used to support the South Bay Regional Housing
Trust Fund. Contributing to the Housing Trust Fund is another strategy to create
affordable housing and is incorporated into the Housing Element as Program 8.
The City’s Land Value Recapture regulations were structured to incentivize the
construction of affordable housing rather than the payment of the exemption fee. For this
reason, the City Council elected to study and ultimately impose a cost greater than
originally proposed in the Land Value Recapture analysis prepared by Kosmont
Companies (Attachments 5 and 6). In addition to evaluating the equivalent value, the
market analysis assessed the market’s tolerance of the LVR fee. The pro forma for the
small lot showed a return on investment of approximately 12.3 percent, which was
deemed financially viable for a typical developer.
As of August 2025, the Housing Element has been certified for a year, and we are in the
fifth year of implementation of the 6th Cycle (2021-2029) Housing Element. The city has
continued to make progress in developing new housing units, although all new units
remain at market rate. To date, no entitlement applications have been submitted on HE
Overlay sites that include the development of affordable units or developments
necessitating the payment of LVR fees.
Page 46 of 150
City of Hermosa Beach | Page 4 of 5
The small lots comprise 24.6 percent of the 558 residential units the city is responsible
for planning for during the 2021-2029 Housing Element.
RHNA and LVR TIER 1 (“Small Lots”)
Income Category
Very Low Low Moderate Above Moderate Total
RHNA
(2021-2029 232 127 106 93 558
LVR Tier 1
(“Small
Lots”)
16 27 84 10 137
When the LVR Ordinance was adopted, the City Council and staff recognized the
importance of periodically reevaluating it, as numerous factors impact housing production.
As the Planning Commission discusses Land Value Recapture and “small lots” ability to
support affordable housing, staff recommend that the Planning Commission consider the
following possible recommendations to the City Council:
A. Recommend the City Council maintain the current regulations without any
change and commit to a reevaluation next fall with an updated economic
feasibility analysis;
B. Recommend the City Council exempt smaller lots, with a minimum density of
1-2 units from any LVR fee;.
C. Recommend the City Council direct staff to assess the economic feasibility of
and establish additional fee tiers with the small lots category (lots with a
minimum density of 4 or fewer units);
D. Recommend the City Council direct staff to explore zoning regulations that
could encourage development of residential units on “small lots” on the Housing
Inventory List; or
E. Recommend that the City Council implement a temporary fee reduction for 18
months for any project building to the minimum required density on small lots
and promote the program to affected property owners.
The Planning Commission may also make an alternative recommendation to those
above.
Next Steps:
Staff will present the recommendation to the City Council as an item for discussion at a
future meeting of the City Council.
Page 47 of 150
City of Hermosa Beach | Page 5 of 5
Public Notification:
No public notification was required for this item. However, an eblast was sent to
individuals who have signed up for updates.
Attachments:
1. Housing Element (HE) 2021-2029
2. Ordinance 24-1474
3. Housing Community Development Letter Dated August 1, 2024
4. HE Sites Inventory List and Map
5. Land Value Recapture Analysis dated October 2023
6. Land Value Recapture Analysis dated December 2023
Respectfully Submitted by: Alexis Oropeza, Planning Manager
Approved: Alison Becker, AICP, Community Development Director
Page 48 of 150
CITY OF
HERMOSA BEACH
HOUSING ELEMENT
POLICY PLAN
2021-2029
Adopted December 21, 2021 Re-adopted (with revisions) August 8, 2023
Revisions (January, May, and June 2024)
Page 49 of 150
Page 50 of 150
This page intentionally left blank
Page 51 of 150
Page 52 of 150
Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
i
Contents
I. Introduction ................................................................................................................................. I-1
A. Purpose of the Housing Element ...................................................................... I-1 B. Scope and Content of the Housing Element .................................................. I-1
C. Public Participation ........................................................................................... I-2
D. Consistency with Other Elements of the General Plan ................................... I-2
II. Housing Policy Plan ................................................................................................................... II-1
A. Housing Element Issues and Policies ............................................................... II-1
B. Housing Programs ............................................................................................. II-4
C. Quantified Objectives .................................................................................... II-19
D. Summary of AFFH Actions .............................................................................. II-19
List of Tables
Table II-1 Quantified Objectives 2021-2029 ..................................................................... II-19
Table II-2 Affirmatively Furthering Fair Housing Summary Actions ................................ II-199
Page 53 of 150
Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
ii
This page intentionally left blank
Page 54 of 150
Hermosa Beach 2021-2029 Housing Element I Introduction
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
I-1
I. INTRODUCTION
A. Purpose of the Housing Element
The Housing Element describes the City’s needs, goals, policies, programs and objectives
regarding the preservation, improvement, and development of housing in Hermosa
Beach. The Element reflects community housing needs in terms of affordability, availability,
adequacy, and accessibility. The Element describes the City’s strategies for addressing
housing needs over the 2021-2029 period and identifies specific programs to address those
needs.
The Housing Element is the City’s official municipal response to the State Legislature’s
declaration that adequate housing for all economic segments of the community is a
matter of statewide importance that must be addressed by all levels of government. The
2021 Housing Element update provides Hermosa Beach with the opportunity to plan for the existing and future housing needs in the community, and identifies strategies and
programs to address those needs.
B. Scope and Content of the Housing Element
The California Legislature has recognized the role of local general plans and particularly
the Housing Element in implementing statewide housing goals to provide decent and
adequate housing for all persons. The California Department of Housing and Community
Development (HCD) also has adopted detailed guidelines regarding the scope and
content of housing elements, including the following major components:
• An analysis of demographic and housing characteristics and trends (Technical Report, Chapter I);
• An evaluation of resources, including land, financial, and administrative resources, available to address the City’s housing goals (Technical Report,
Chapter II);
• A review of potential constraints, both governmental and non-governmental,
to meeting housing needs (Technical Report, Chapter III);
• The Housing Policy Plan addressing the City’s identified housing needs, including
housing issues, policies, programs and quantified objectives (Chapter II of this document);
• An evaluation of the appropriateness and effectiveness of previous policies and programs in achieving the City’s objectives, and the progress in implementing
Housing Element programs (Technical Report, Appendix A);
• A parcel-specific inventory of vacant and underutilized suitable sites for
additional housing (Technical Report, Appendix B); and
• A description of the public participation process during the preparation and
adoption of the Housing Element (Technical Report, Appendix C).
Page 55 of 150
Hermosa Beach 2021-2029 Housing Element I Introduction
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
I-2
C. Public Participation
Public participation is an important component of the planning process, and this update to the Housing Element has provided residents and other interested parties numerous
opportunities to be involved in the preparation of the element. Public meetings to discuss housing needs and policy options were conducted by the Planning Commission and City
Council, and notices of all meetings were published in advance of each meeting. The draft Housing Element was made available for review at City Hall and posted on the City’s
website and was also circulated to housing organizations representing the interests of lower-income persons and those with special housing needs. After receiving comments on
the draft Housing Element from the State Housing and Community Development Department, a proposed final Housing Element was prepared and made available for
public review prior to review by the Planning Commission and adoption by the City Council.
Appendix C provides additional information regarding opportunities for public
involvement in the preparation of this Housing Element update, as well as a list of persons
and organizations who were invited to participate.
D. Consistency with Other Elements of the General Plan
The Housing Element must be consistent with other elements of the General Plan, which was last updated in 2017. Housing Element policies and programs are closely correlated
with the development policies contained in the Land Use Element, which establishes the location, type, and intensity of land uses throughout the city. The Land Use Element
determines the number and type of housing units that can be constructed in the various land use districts. Areas designated for commercial and industrial uses create employment
opportunities, which in turn, create demand for housing. The Circulation Element establishes the location and scale of streets, highways and other transportation routes that
provide access to residential neighborhoods. Because of the requirement for consistency
among the various General Plan elements, the 2021 Housing Element update included a
review of other General Plan elements to ensure that consistency is maintained.
Government Code Section 65302 also specifically requires that the Safety and
Conservation Elements be reviewed concurrent with each Housing Element update.
SB 1087 of 2005 requires cities to provide a copy of their Housing Elements to local water
and sewer providers, and also requires that these agencies provide priority hookups for
developments that include lower-income housing. These agencies have been invited to
participate in the Housing Element update process and the Housing Element will be
provided to these agencies immediately upon adoption.
Page 56 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-1
II. HOUSING POLICY PLAN
The purpose of this Housing Policy Plan is to identify policies and programs that will help the
City in addressing its housing needs during the 2021-2029 planning period. This section includes the following components:
• Section A identifies the housing issues facing Hermosa Beach and establishes guiding policies for addressing those issues;
• Section B describe specific program actions the City will take consistent with established policies;
• Section C establishes quantified objectives for the construction of new housing, rehabilitation of existing housing in need of repair, and the conservation of
existing affordable housing.
A. Housing Element Issues and Policies
This section establishes the City’s housing policy framework. Section 65583(c) of the
California Government Code requires that actions and policies included in the Housing Element address five key issue areas:
• The manner in which the City will assist in the conservation of existing housing resources, particularly affordable housing;
• The City’s strategy in assisting in the development of new housing opportunities;
• How the City intends to provide adequate sites to achieve a variety and
diversity of housing types;
• How the City proposes to remove governmental constraints that may impact
the preservation and development of housing; and,
• How the City may help to promote equal housing opportunities.
Issue Area 1 - Conservation of Existing Affordable Housing
The City’s proximity to the Pacific Ocean and its desirability as a place to live and visit
contributes to the high land and housing costs relative to the surrounding region. The City,
nevertheless, has been successful in maintaining its more affordable housing through the
adoption of ordinances and special land use regulations. The City works proactively to
preserve and maintain the existing housing resources in the City, including affordable
housing.
This commitment is underscored by the policies listed below.
Policy 1.1 The City will continue to encourage the maintenance and improvement of the existing housing stock within the local
neighborhoods.
Policy 1.2 The City will assist in the preservation and enhancement of the
housing supply available to senior citizens.
Page 57 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-2
Policy 1.3 The City will work to minimize the conversion of existing lower-cost
rental housing in multiple-family developments to condominiums.
Policy 1.4 The City will investigate potential sources of funding and other incentives that will assist in the preservation and renovation of older
housing units.
Policy 1.5 The City will continue to implement its current code enforcement
procedures as a means to ensure the conservation and
maintenance of existing housing resources in the City.
Issue Area 2 - New Affordable Housing Development
The City’s ability to directly fund the construction of affordable housing is constrained due
to budget limitations. In addition, the construction of affordable public housing within the coastal zone would not represent an efficient expenditure of public money, given the high
land and development costs. As a result, the City continues to be an active participant in the development of more affordable housing through land use regulations and other
incentives. The City of Hermosa Beach will continue to assist in the development of new housing for all income groups through the following policies.
Policy 2.1 The City will continue to promote the development of a variety of housing types and styles to meet the existing and projected housing
needs of all segments of the community.
Policy 2.2 The City will continue to encourage the development of safe, sound,
and decent housing to meet the needs of varying income groups.
Policy 2.3 The City will continue to implement the land use policy contained in
the City’s General Plan, which provides for a wide range of housing
types at varying development intensities.
Policy 2.4 The City will continue to support and promote home ownership in
the community.
Policy 2.5 The City will continue to cooperate with other government agencies,
citizen groups, and the private sector, in order to assist in meeting
the existing and future demand for housing.
Policy 2.6 The City will encourage the addition of ADU and JADU units as a
strategy to provide new housing units for low- and moderate-income
households.
Issue Area 3 - Provision of Adequate Sites for New Housing
The majority of the city was developed during the early 1900s. More intensive development
has continued up to the present time. There are few vacant parcels of land remaining in the city, and the majority of the residential construction that has occurred involved the
“recycling” of older structures. Nevertheless, the City of Hermosa Beach will continue to
Page 58 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-3
explore potential sites for residential development as a means to achieve a variety and
diversity of housing types.
Policy 3.1 The City will evaluate new development proposals in light of the
community's environmental resources, the capacity of public
infrastructure to accommodate the projected demand, and the
presence of environmental constraints.
Policy 3.2 The City will continue to evaluate the General Plan and zoning to
ensure residential development standards are adequate to serve
future development.
Policy 3.3 The City will continue to review current zoning practices for
consistency with the General Plan as a way to facilitate new mixed-
use development within or near the commercial districts.
Issue Area 4 - Removal of Governmental Constraints to Housing
In previous years, the City has been successful in the conservation of housing, especially
affordable housing, through the implementation of land use ordinances and regulations. A key component of the City’s housing policy is to assist in the development of more
affordable housing with the use of incentives and other measures. The City of Hermosa Beach will remain committed to the removal of governmental constraints through the
following policies.
Policy 4.1 The City will continue to abide by the provisions of the Permit
Streamlining Act as a means to facilitate the timely review of
residential development proposals.
Policy 4.2 The City will work with prospective developers and property owners
to assist in their understanding of the review and development
requirements applicable to residential development in the city.
Policy 4.3 The City will continue its efforts to educate the community regarding
the development standards contained in the City of Hermosa Beach
Zoning Ordinance, including the ability to provide ADU and JADU
units on residential properties.
Policy 4.4 The City will continue to evaluate its Zoning Ordinance and General
Plan and remove governmental constraints related to development
standards. These may include, but not be limited to, parking
requirements, allowing affordable housing on commercial sites, new
standards for mixed-use development, lot consolidation incentives,
and senior housing requirements.
Issue Area 5 - Equal Housing Opportunity
Federal and State laws prohibit housing discrimination based on an individual’s race,
ethnicity, religion or other characteristics. Enforcement of fair-housing laws generally
occurs through the courts, though persons being discriminated against often lack the
Page 59 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-4
resources to obtain the necessary legal protections. As a result, alternative means to
obtain assistance must be made available. Towards this end, the City will continue to
cooperate with other public agencies and non-profit organizations providing assistance in
ensuring equal housing opportunities for all.
Policy 5.1 The City will continue to provide information and referral services to
regional agencies that counsel people on fair housing and landlord-
tenant issues.
Policy 5.2 The City will continue to cooperate with the County Housing
Authority related to the provision of rental assistance to lower-
income households.
Policy 5.3 The City will continue to cooperate with other cities and agencies in
the area in investigating resources available to provide housing for
the area's homeless population.
Policy 5.4 The City will support the expansion of shelter programs with adjacent
cities and local private interests for the temporary accommodation
of the homeless population.
Issue Area 6 – Sustainable Housing Development
The City works to promote sustainability and energy conservation in a number of ways.
Plan Hermosa, the City’s General Plan, establishes a blueprint for sustainability and a low-
carbon future, and provides a framework within which City regulations, programs, and
projects work in unison to ensure that land use, transportation, and other aspects of City
operations support sustainable development and energy conservation goals. Specifically
for the residential sector of the community, the issue of energy conservation can be
addressed at several levels: community-wide land use and transportation planning,
building technology in both new construction and rehabilitation or remodeling of existing
structures, and through lifestyle options such as walking and cycling. This is further
supported by water conservation and sustainable neighborhood design.
Policy 6.1 The City will support sustainable residential development through
land use planning, building technology and lifestyle options.
B. Housing Programs
The programs listed below describe the actions the City intends to take to address the
policy issues discussed above. The City’s main challenge in accommodating new residential development is its lack of vacant land. As a result, the vast majority of new
housing development must occur through the “recycling” of older structures and redevelopment of underutilized parcels. The lack of financial resources, coupled with high
land and development costs, will continue to be a constraint to the development of new
affordable housing. As a result, the focus of these programs is on strategies to assist the
private market in the development of affordable housing.
Page 60 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-5
Issue Area 1 - Conservation of Existing Affordable Housing
1. Code Enforcement
Program Description: Chapter 8.28 of the Municipal Code provides for the abatement of safety and nuisance conditions relating to private property. To implement this requirement,
the Code Enforcement Program emphasizes the following:
• The City actively pursues Municipal Code violations on a complaint basis, with
particular emphasis being placed on those areas clearly exposed to public view;
• All necessary steps are taken to ensure that violations are corrected in an expeditious and voluntary manner;
• Where appropriate, property owners are informed of available assistance programs for lower-income persons who may not be able to afford needed
improvements or corrections; and
• The City utilizes misdemeanor criminal prosecution only when attempts to gain
voluntary compliance have failed.
The Code Enforcement Program implements those sections of the Municipal Code related
to property maintenance, including zoning, property maintenance, illegal units, trash
container regulations, construction without permits, and sign regulations. The Code
Enforcement Officer assists and makes recommendations to other City departments, such
as conducting inspections of business licenses, home occupation offenses, and
obstructions in public rights-of-way.
Timing: This program is in place and will continue through the planning period.
Funding: General Fund.
2. Conservation of Existing Affordable Housing
Program Description: This program provides for the ongoing maintenance and
conservation of the Marine Land Mobile Home Park located at 531 Pier Avenue. The 60-
space park provides housing for extremely-low-, very-low- and low-income households.
The Hermosa Court Recreational Vehicle Park with 19 pads at 725 10th Street also provides
transitional housing space for those persons or households in transition from an RV to a more permanent home. The City's MHP Zoning District requires Planning Commission
approval in order to add or delete spaces in the park, which helps to preserve affordability by discouraging conversion from single- to double-wide spaces. In 2013 the Mobile Home
Park received over $111,000 of City funds and $1.2 million through the State’s Mobilehome Park Resident Owner Program (MPROP) and the Marineland Community Association, Inc.,
the resident association, purchased the park, ensuring the long-term security of this important affordable housing resource.
In addition to mobile homes, existing apartments provide an important source of housing at lower cost than ownership housing. To reduce the potential impact of condominium
conversions on low- and moderate-income residents of converted condominiums,
Page 61 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-6
Chapter 17.22 of the Municipal Code establishes requirements including first right of refusal
and relocation assistance for tenants.
Timing:
• To ensure that the amount of relocation assistance remains sufficient, review
and update relocation reimbursement requirements annually should
condominium conversion become a trend again in the future. (There has not
been any condominium conversion in the City for more than a decade.)
Funding: General Fund.
Issue Area 2 - New Affordable Housing Development
3. Density Bonus and Other Incentives
Program Description: State law requires cities to grant a density bonus and other incentives for qualifying affordable or senior housing developments. Section 17.42.100 of the Zoning
Ordinance establishes standards and procedures for implementing State Density Bonus
Law. In addition to State requirements, the City has adopted additional incentives that
allow increased density when small parcels are combined to create a larger residential
building site.
State density bonus law has been amended from time to time to encourage the
development of affordable and senior housing. The City has been implementing the State
density bonus law. To provide clarity and help incentivize affordable housing
development, the City will revise its density bonus regulations (Municipal Code Sec.
17.42.100) to comport with current State law. In addition, the City will inform developers
and contractors of this incentive program through brochures at the public counter and
information posted on the City’s website.
Timing:
• As part of the comprehensive Zoning Ordinance update, revise the City’s
Density Bonus regulations by the end of 2023.
• Continue to make information available on the density bonus program through
brochures and the City website throughout the planning period.
Funding: City General Fund.
Page 62 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-7
4. Affordable Housing Development Outreach and Assistance
Program Description: This program includes investigation of potential funding sources and
administrative support to assist private and non-profit organizations in the development
and/or provision of affordable housing. The City will investigate the feasibility of expanding
CDBG funding and Section 8 rental vouchers to qualifying households. The Section 8
program is one of the major sources of housing assistance for very-low- and extremely-low-
income households. If the City is successful in obtaining increased CDBG funding and/or
expanding Section 8 rental vouchers for residents, this information will be posted in the
Community Center, on the City’s website, in handouts provided in the information kiosk in
the City Hall lobby, and in the local library. Brochures will also be provided to local service
clubs including the local “Meals on Wheels” program, local dial-a-ride service, the local
recreation center, and emergency shelters in the area.
The City will also provide incentives such as priority processing, fee waivers and deferrals,
and modified development standards to projects with low- or moderate-income units, and
will assist in preparing and processing grant applications for affordable housing projects to
support the development of such units. Project sponsors will be encouraged to include
units for extremely-low-income households where feasible. As part of the 2021 Housing Element update the City consulted with a variety of housing organizations to identify
potential actions the City could take to facilitate the development of affordable housing, including to extremely-low-, very-low- and low-income households.
Timing:
• Annually pursue funding available to expand affordable housing opportunities in
the City, especially housing for special needs populations, including extremely low
income households.
• Annually contact developers to explore affordable housing opportunities, especially for developers with experience in special needs housing.
• As affordable units become available, conduct Affirmative Fair Marketing to agencies and organizations that serve low and moderate income households and
special needs populations in the South Bay region.
Funding: This program will be financed through the City’s General Fund and grant funds.
5. Facilitate Efficient Use of Sites that Allow High-Density Residential Development
Program Description: This program will facilitate affordable housing development on sites
that allow high-density residential development including reducing constraints posed by
small lot sizes.
a. While the City does not rely on small sites to meet its lower income RHNA, the City will
continue to facilitate lot consolidation by:
• Assisting affordable housing developers in identifying opportunities for lot
consolidation using the City’s GIS system and property database;
Page 63 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-8
• Continuing to expedite processing for lot consolidations processed concurrently
with planning entitlements;
• Continuing to provide a graduated density bonus for lower-income housing on
small lots consolidated into a single building site according to the following
formula (Zoning Ordinance Sec. 17.42.170):
Combined Parcel Size Allowable Base Density*
Less than 0.50 acre 33 units/acre
0.50 acre to 0.99 acre 34.7 units/acre (5% increase)
1.00 acre or more 36.3 units/acre (10% increase)
*Excluding density bonus
b. The City will continue to facilitate affordable housing development by:
• Facilitating pre-application meetings;
• Implementing incentives under the Density Bonus law;
• Reducing property development standards (e.g. reduced setbacks, reduced
parking standards) for small developments below the threshold of Density Bonus
law when affordable units targeted to the elderly or persons with disabilities are
provided;
• Allowing deferral or waiver of City fees necessary to make the project cost-
effective;
• Facilitating permit processing so that developers can take advantage of
funding opportunities;
• Expediting permit processing through concurrent review through the planning
and building processes;
• Promoting programs on the City’s website and at the Planning Counter and
biennially notify affordable housing developers of the City’s housing incentives.
Timing:
• By the end of 2023, publicize the lot consolidation incentives on the City’s
website, at the Planning counter, and by notice to affordable housing providers.
• Annually contact developers to communicate the various city incentives
available to facilitate affordable housing development.
• By the end of 2025, conduct an assessment of the City’s progress in providing affordable housing in the community. If the City is not making meaningful
progress in its affordable housing goals, the City will develop additional incentives and strategies to expand affordable housing opportunities by the
end of 2026. Additional incentives may include increasing the graduated densities for lot consolidation.
Funding: General Fund. Accessory Dwelling Units
Page 64 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-9
6. Accessory Dwelling Units
Program Description: Accessory dwelling units (ADUs) provide an important source of
affordable housing for seniors, young adults, care-givers and other low- and moderate-
income segments of the population. In recent years, the State Legislature has adopted
extensive changes to ADU law in order to encourage housing production. Among the most
significant changes is the requirement for cities to allow one ADU plus one “junior ADU” on
single-family residential lots by-right subject to limited development standards. The City
further incentivizes ADU development by allowing a second ADU in lieu of the JADU. This
flexibility facilitates the development of a range of ADU sizes to accommodate the diverse
housing needs in the community. The City will review new legislation each year and
update ADU regulations as necessary to ensure conformance with current State law.
Timing:
• Facilitate the development of 95 ADUs over the eight-year planning period, over
the RHNA projection of 64 ADUs.
• Monitor legislation and update City ADU regulations as necessary to maintain
consistency with State law by the end of 2023.
• Provide ADU standards, guidance, and resources on City website by the July
2024. For example, provide links to the California Housing Finance Agency
(CalFHA) ADU grant program that provides $40,000 in pre-development funds
to qualified homeowners.
• By the end of 2025, develop incentives to facilitate the construction of ADUs.
Incentives may include pre-approved plans, expedited review, assigned staff or
office hours for ADU review and consultation, and/or reduced fees.
• By the end of 2025, amend the Zoning Code to allow an additional JADU
(beyond current allowance under State and local laws) within the existing square footage of larger homes. A survey of completed homes in the past four
years revealed an average primary unit size of 3,500 square feet. The City proposes to allow an additional JADU in primary units over 3,000 square feet on
single-family (R-1) lots, only when the additional JADU results in a net additional dwelling unit. The City aims to add 15 additional units using this method between
2026 and 2029.
• Monitor the trend of ADU development every other year beginning in 2025. If by
2027, the ADU activities are not trending to meet the Housing Element goal, develop additional incentives (such as pursuing State funds or partnering with
nonprofits) by July 2028 to further facilitate ADU development, or to identify replacement sites or rezoning, if necessary, to address any sites capacity
shortfalls.
• Promote the use of Housing Choice Vouchers for ADUs. Create a Fair Housing
Factsheet on landlord responsibility as part of ADU application packet by July
2024.
Funding: General Fund and grant funds, if available.
Page 65 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-10
7. Land Value Recapture
Program Description: When land is rezoned to allow higher-intensity uses, the value of that
property typically increases. Land value recapture refers to a policy requiring that a portion
of the increased value be dedicated to a public benefit, such as affordable housing.
The City adopted the Housing Element on December 21, 2021, including the Land Value
Recapture Program as Program 7. This Program was introduced early in the Housing
Element discussions and has been a part of the Housing Element update since inception.
The Program was carried through to the revised adopted Housing Element on August 8,
2023. The Housing Element indicates that the City will perform a feasibility analysis on the
Land Value Recapture Program.
The premise of the Land Value Recapture Program is that properties that benefit from
zoning actions to allow for residential development increase in value. In the South Bay
region where Hermosa Beach is located, there is a decreasing desire to redevelop
commercial properties and instead an increased desire to redevelop properties into mixed
use or all residential. This desire correlates to property values. The Program levies a fee
onto any residential development on properties that benefited from a zoning action that
expanded their development ability. However, the property is exempt from the fee if the
proposed residential development includes 15% very-low-, 15% low-, or 25% moderate-
income units.
The City worked with a real estate advisory company to evaluate the economic feasibility
of Land Value Recapture. The analysis included sample business proformas indicating that
the City’s proposed Land Value Recapture fee did not render development infeasible (i.e.,
that an acceptable return on investment would be possible), and even further that in some cases, construction affordable units and taking advantage of density bonus provisions
amplified the return on investment.
Timing:
• Conducted feasibility study concurrent with rezoning in 2023 (see Program 9) and begin implementation in 2024.
Funding: General Fund and grant funds, if available.
8. Housing Trust Funds
Program Description: Housing trust funds are a dedicated source of financial assistance for
affordable housing and can be funded through a variety of mechanisms, such as governmental grants, loans, charitable contributions, development fees, and land value
recapture requirements (see also Program 7).
The City has joined the South Bay Housing Trust Fund managed by the South Bay Council
of Governments (SBayCOG). Specifically, the City has contributed SB 2 funds toward the
Trust Fund.
Timing:
Page 66 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-11
• Annually pursue funding to provide for affordable housing, especially funding
for special needs populations. As funding permits, continue to participate in the
South Bay Housing Trust Fund.
Funding: General Fund or grant funds, if available.
Issue Area 3 - Provision of Adequate Sites for New Housing
9. Adequate Sites to Accommodate Housing Needs
Program Description: State law requires cities to ensure that their land use plans and development regulations identify adequate sites with appropriate zoning to
accommodate housing needs assigned through the Regional Housing Needs Assessment (RHNA) process.
The City’s RHNA allocation is described in Section I.H of the Housing Element Technical Report, and an analysis of the City’s potential sites for additional housing is presented in
Appendix B of the Technical Report. For the 6th cycle RHNA, the City has been allocated
a RHNA of 558 units (232 very low, 127 low, 106 moderate, and 93 above moderate income
units). With projected ADUs of 64 units over eight years, the City has a remaining RHNA
obligation of 494 units (221 very low, 99 low, 102 moderate, and 72 above moderate
income units). These units are being accommodated on sites rezoned or amended to
allow mixed use and residential uses. At the State default minimum density of 20 units per
acre, up to 24.7 acres of rezoning would be required. However, the City proposes to rezone
two one-acre city-owned properties at a minimum density of 34 units per acre, and the
majority of identified parcels will be rezoned to a minimum density of 25.1 units per acre.
Overall, 23.5 acres of rezoning were identified.
The sites analysis concluded that amendments to current land use and zoning designations
are necessary in order to fully accommodate the RHNA. Specifically, the City identified a
number of sites with potential for redevelopment into residential or mixed use residential
development. An estimated 302 units can be accommodated on parcels larger than 0.5
acre (151 very low, 76 low, 44 moderate, and 31 above moderate income units). In
addition, Sites 1 and 2 (St. Cross), while comprising of multiple parcels, are under common
ownership and function as an integral campus. These two sites can accommodate 33 very
low and 13 low income units. These large parcels and St. Cross site can accommodate the
majority of the City’s remaining lower income RHNA, with 47 units (less than 15 percent) of
the remaining lower income units required to be accommodated on consolidated sites.
As discussed before, all small sites used for lower income RHNA are contiguous, under
common ownership and with no more than two owners. Moderate and above moderate
income housing can be developed on small parcels without consolidation.
This program describes the actions the City will take to ensure that adequate sites are designated consistent with Government Code Sec. 65583(c)(1)(A) and 65583.2.
• The City will process General Plan and zoning amendments, including the required CEQA analysis, for the selected sites. The rezoned sites shall include the
following components pursuant to Government Code Sec. 65583.2(i):
Page 67 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-12
o Permit owner-occupied and rental multi-family uses by-right for
developments in which 20 percent or more of the units are affordable to
lower-income households.
o Permit the development of at least 16 units per site.
o Permit a minimum of 20 dwelling units per acre.
o Ensure that either: a) at least 50 percent of the shortfall of low- and very-low-
income regional housing need can be accommodated on sites designated for exclusively residential uses; or b) if accommodating more than 50 percent
of the low- and very-low-income regional housing need on sites designated
for mixed uses, all sites designated for mixed uses must allow 100 percent
residential use and require that residential uses occupy at least 50 percent
of the floor area in a mixed-use project.
• The City will report on the status of this program each year as part of the Annual
Progress Report.
Timing:
• In November 2023, the City completed Zoning map and text amendments to
provide adequate sites:
o Rezone City-owned properties (Sites 10 and 11) from M-1 and O-S to Public
Facilities with an allowable residential density of 34-50 units per acre.
o Rezone Sites 1 and 2 (St. Cross Church properties) from R-1/R-2 to R-2A with
an allowable residential density of 22-25 units per acre.
o Amend Zoning Ordinance to add residential and mixed use development as
permitted uses to C-2, C-3, SPA-7, SPA-8, and SPA-11 RHNA sites with an
allowable residential density of 25.1-33 units per acre.
o Amend Zoning Ordinance to establish a formal procedure to monitor for the
No Net Loss of capacity for accommodating the RHNA, pursuant to SB 166.
o Amend Zoning Ordinance to establish the replacement housing
requirements when redevelopment occurs on RHNA sites where existing units occupied by or deed-restricted for lower income households are
demolished.
• In November 2023, the City amended the General Plan land use designation
for Sites 1 and 2 in the inventory from Low Density to Medium Density Residential.
• By the end of July 2024, complete text corrections regarding the rezoning
above to ensure compliance with the minimum density of 20 du/ac.
• Facilitate affordable housing development on City-owned sites:
o Develop and release a Request for Proposal by the end of 2024 to solicit a public/private partnership for affordable housing (including housing for
special needs populations). If disposition of site(s) is considered, the City will ensure compliance with the Surplus Land Act.
Page 68 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-13
o Complete design work, environmental review and associated approvals by
the end of 2025.
o Identify affordable housing developer(s) to partner with on affordable housing projects meeting the RHNA allocation of 100 affordable units on the
City sites (30 very low, 45 low, and 25 moderate income units) on City-owned
sites.
o If the City is not successful in pursuing affordable housing on these sites and
construction has not started by 2027, the City will pursue alternative actions
(such as identifying alternative sites) by the end of 2028.
• Beyond the sites required to accommodate the City’s RHNA, the City also
embarked on an effort starting in 2022 to introduce residential development
along all major commercial corridors. As of November 2023, the City
completed the zoning text changes creating mixed use (residential/
commercial) development standards in C-2 and C-3 zones, and allows mixed
use/residential only in the newly created the Housing Element Sites Overlay
(Sites Inventory sites) with a density range of 25.1 to 33 du/ac. By the end of
2026, the City will create additional mixed use overlays to include other areas
in the major commercial corridors, with a minimum density of at least 20 du/ac.
The City anticipates this will result in 100 units above the Housing Element Sites
Overlay capacity.
Funding: General Fund; grant funds.
Issue Area 4 - Removal of Governmental Constraints to Housing
10. Housing for Persons with Special Needs
Program Description: The Zoning Ordinance encourages the provision of housing for
persons with special needs, including regulations and procedures related to group homes,
emergency shelters, transitional/supportive housing and persons with disabilities. The City
is in the process of updating the Zoning Ordinance. Specific changes to address special
needs housing include:
• Emergency Shelters: Revise parking standard based on staffing level only.
Designate R-3 (Multi-Family Residential) as zone for emergency shelters by right
without discretionary review. Expand the definition of emergency shelters to include
interim housing options pursuant to State law (AB 2339), including bridge housing,
navigation centers, and respite and recuperative care. Review and revise or
remove the bed limit based on consultation with service providers.
• Transitional and Supportive Housing: These uses are currently permitted in all
residential zones as similar uses in the same zones. Revise the Zoning Ordinance to
similarly permit transitional and supportive housing in all zones that permit residential
uses.
Page 69 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-14
• Supportive Housing: Recent changes to State law (AB 2162 of 2018) require that
supportive housing (up to 50 units) meeting specific requirements be a use by-right
in zones where multi-family and mixed uses are permitted, including non-residential
zones permitting multi-family uses. Furthermore, if the development is located within
half-mile from transit, no minimum parking can be required.
• Residential Care Facilities (for seven or more persons): Revise the CUP review
process for large care facilities to an Administrative Permit in all residential zones,
with a lower fee, and establish findings for approval that are objective and provide
certainty in outcomes similar to other residential uses of the same type in the same
zone.
• Low Barrier Navigation Center: In 2019 the State Legislature adopted AB 101
establishing requirements related to local regulation of low barrier navigation
centers, which are defined as “Housing first, low-barrier, service-enriched shelters
focused on moving people into permanent housing that provides temporary living
facilities while case managers connect individuals experiencing homelessness to
income, public benefits, health services, shelter, and housing.” Revise the Zoning
Ordinance to permit low barrier navigation centers meeting specified standards by-
right in areas zoned for mixed use and in nonresidential zones permitting multi-family
uses.
• Reasonable Accommodation: In the October 2023 Zoning Ordinance amendment,
the City removed the public hearing requirement for reasonable accommodation
requests and required finding relating to traffic and parking impacts. However, the
finding relating to neighborhood character remained. In November 2023, the City
adopted the Housing Element Zoning Text Amendment and removed the finding
regarding neighborhood character to ensure objectivity. (This action is completed.)
• Live/Work Housing: The City’s Economic Subcommittee studied the increased need for live/work housing. Develop strategies for providing live/work housing and 15-
minute neighborhoods.
Timing:
• Zoning Code amendments by the end of 2024.
• Develop strategies for live/work housing by 2025.
Funding: General Fund and grants
11. Streamline Housing Permit Processing
Program Description: As part of the comprehensive Zoning Ordinance update the City will
evaluate methods to simplify the housing development review process such as eliminating the conditional use permit requirement for multi-family, condominium and mixed-use
developments and reviewing the Precise Development Plan (PDP) process including what is reviewed, typical findings and approval procedures by zone and housing type, and
impacts as potential constraints on housing supply and affordability. Consistent with new
transparency laws, zoning, development standards and fees are posted on the City
website. The Zoning Ordinance update will also include revisions to streamline PDP process
Page 70 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-15
and develop objective standards to minimize constraints on housing supply and
affordability. In addition, the City will establish procedures to process SB 35 projects.
Timing:
• Zoning Ordinance update by the end of 2023 to:
o Streamline the Precise Development Plan review process as discussed in the Housing Element Technical Report.
o Develop object standards for project review.
• By the end of 2023, establish SB 35 procedures.
• Annually update City website to provide current information on zoning,
development standards and fees.
• By the end of 2024, update Subdivision Ordinance to address CUP requirement
for condominium projects.
Funding: General Fund and grants.
12. Remove Governmental Constraints
Program Description: As part of this Housing Element update, the City has evaluated the
effectiveness of its development standards and procedures in facilitating residential and
mixed use developments. Specifically, the City’s parking standards for multi-family housing
does not support a variety of unit types and sizes.
Subsequent to the adoption of the Housing Element, the City will review any Coastal Land
Use Plan policies that must be updated and submit to the California Coastal Commission
for certification. The timeline will be more apparent once the amendments have been
submitted.
Timing:
• As part of comprehensive Zoning Ordinance update by the end of 2023, revise
parking standards to facilitate a variety of unit sizes and types, such as smaller units, senior units, and mixed use developments, and offer alternative options
such as shared parking arrangements for mixed use development. (This task has already been completed as part of the October 2023 Zoning Ordinance
update. Parking for small units (zero to one-bedroom) has been reduced from two spaces per unit to 1.5 spaces per unit. Transitional and supportive housing,
which is usually smaller in size, the parking requirements mirror that of regular residential uses, except when such housing is located within one-half mile of
transit. In that case, no parking is required.) By the end of 2024, the City will revise the parking standards to remove the guest parking requirements. The currently
adopted parking standards will remain but will be indicated as inclusive of guest parking.
• By 2024, submit updated Coastal Land Use Policies to the CCC for certification.
Funding: General Fund and grants.
Page 71 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-16
Issue Area 5 - Equal Housing Opportunity
13. Affirmatively Furthering Fair Housing
Program Description: As a participating city in the Los Angeles County CDBG program, Hermosa Beach has access to services for fair housing outreach, education, and
counseling on housing discrimination complaints. The City will continue to advertise the fair housing program through placement of fair housing service brochures at the public
counter, at the Senior Center, through the City's newsletter, and on the City website. Apartment owners and managers are provided with current information about fair housing
issues, rights and responsibilities. The Apartment Association of Greater Los Angeles conducts seminars on State, Federal and local Fair Housing laws and compliance issues.
In addition, the City will:
• Ensure that all development applications are considered, reviewed, and
approved without prejudice to the proposed residents, contingent on the development application’s compliance with all entitlement requirements.
• Accommodate persons with disabilities who seek reasonable waiver or
modification of land use controls and/or development standards pursuant to
procedures and criteria set forth in the applicable development regulations.
• Work with the County to implement the regional Analysis of Impediments to Fair
Housing Choice and HUD Consolidated Plan.
• Facilitate public education and outreach by posting informational flyers on fair
housing and housing resources at public counters, libraries, and on the City’s
website and at Senior Center. Expand the City’s outreach efforts to reach a
broader audience by:
o Advertising housing-related initiatives and programs in newspapers that
have broader circulation beyond city limits (such as the Daily Breeze.
o Making hard copies of documents to assist the technology challenged.
o Expanding notifications to agencies and organizations that serve residents in
the South Bay region.
• Conduct at least one public meeting annually to discuss housing-related issues.
Conduct public meetings at suitable times, accessible to persons with
disabilities, and near public transit. The utilizes multi-media platforms to outreach
to lower and moderate income populations and persons with special needs. The City partners with community agencies for outreach at community events on
weekends and at public locations. For community workshops and meetings, the City offers to the degree possible hybrid attendance depending on the setting.
Usually, this includes a minimum of two (2) methods of attendance consisting of in-person and one other method. Resources will be invested to provide
interpretation and translation services when requested at public meetings when feasible.
• Encourage community and stakeholder engagement during development decisions.
Page 72 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-17
• Collaborate with home share programs and promote programs to residents.
Home share programs available to South Bay residents include:
o Home Share South Bay, a program offered by the South Bay Cities Council
of Governments (SBCCOG), is a community solution that matches
homeowners with renters seeking affordable housing in the South Bay.
o Affordable Living for the Aging (ALA) offers a home share program. ALA
screens, matches, and monitors two people to share a home based on living
preferences and compatibility. Arrangements may be rent or a combination
of rent and daily living support such as cleaning, cooking, or transportation.
Timing: This program is ongoing and will continue through the planning period.
Funding: General Fund.
14. Neighborhood Improvement
Given the City’s compact size, the City’s strategies for AFFH Placed-Based Strategies for
neighborhood improvements are focused on ensuring that every area in the City receives
systematic investment while also ensuring that every area in the City is connected to
amenities, such as services, businesses, and recreation across the City as well as regionally.
Certain programs are available for senior and disabled residents as well.
Community Development Block Grant (CDBG)
The City uses CDBG funds to further mobility across all areas of the City by retrofitting
existing intersections for disabled-accessible crosswalks and ramps.
Safe Routes to School
The City, in concert with the Hermosa Beach City School District, has a Safe Routes to
School program. The Program includes educational materials, outreach, and a reporting system to ensure that routes to school are safe.
https://www.hermosabeach.gov/our-government/city-departments/police/programs-tips/safe-routes-to-school
Aging in Place
The City of Hermosa Beach offers a tax rebate and certain exemptions (sewer, lighting
assessment, utility user tax) for income-qualified elderly or disabled residents. https://www.hermosabeach.gov/our-government/finance-department/finance-
administration/rebates
The City offers a House Check program for senior citizens, including those with Alzheimer’s
to ensure that these residents are safe. https://www.hermosabeach.gov/our-government/police-department/not-alone-program-alzheimer-checklist-vacation-house-
checks
Beach Cities Health District (BCHD) has a Care Management Program to ensure senior
receive services they need to continue living in their home.
BCHD also pairs volunteers up with senior to assist them on errands so they can continue
to live in their homes.
Page 73 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-18
Maintenance of Property
Senior Grant Program – Los Angeles County Development Authority – senior homeowners
for $15,000. Examples are livability and age in place, including deferred maintenance
repairs.
BCHD’s Senior Resources includes assisting seniors with mental health issues that may affect
an individual’s ability to maintain and upkeep their home.
Capital Improvement Program (CIP)
The City’s CIP projects which are under currently construction are focused on public
amenities that are used by all residents, including repair of the Municipal Pier, accessible
beach routes, sidewalk and accessible curb ramps, and repair of City park
restrooms. https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4
f16ff6c37544a0b8bd0dc0a725452f
The City’s 5-year CIP includes repair of a wide variety of public amenities.
https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4f16ff6c3754
4a0b8bd0dc0a725452f
Clean-up Events
The City benefits from clean-up events through sponsoring and also in partnership with
many organizations. The City of Hermosa Beach, Friends of the Parks-Hermosa Beach, the
Surfrider Foundation, are some examples. These clean-up events restore public amenities
for residents. Recent events headed by the Mayor of Hermosa Beach included a painting
of classrooms in a park facility, new landscaping at park facilities, and beach clean-ups.
Timing:
• Annually during budgeting process, prioritize improvements and services that
have the most urgent need.
Funding: General Fund and grant funds.
Issue Area 6 – Sustainable Housing Development
15. Sustainable Housing Development
Program Description: In 2017 the City adopted a comprehensive update to the General
Plan (PLAN Hermosa). One of the primary themes of the new General Plan is community
sustainability. Chapter 4: Sustainability + Conservation establishes state-of-the-art policies
to improve sustainability and energy conservation in residential development. Those
policies will continue to guide City decision-making in land use decisions and the development review process.
Funding: General Fund.
Timing: Throughout the planning period.
Page 74 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-19
C. Quantified Objectives
Table II-1 describes the City’s quantified objectives for new construction, rehabilitation and conservation during the planning period.
Table II-1 Quantified Objectives 2021-2029
Income Category
Totals Extremely Low Very Low Low Moderate Above Moderate
New construction 116 116 127 106 93 558
Rehabilitation 10 10
Conservation (1) 60 60
1. Mobile homes
D. Summary of AFFH Actions
The table below summarizes the City’s actions to affirmatively further fair housing. This table supplements the descriptions, actions, and timing for citywide programs with targeted
actions for AFFH. Implementation of the housing programs and detailed shown in the table below are both considered commitments of the City of Hermosa Beach.
Table II-2
Affirmatively Furthering Fair Housing Summary Actions
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Fair Housing Enforcement and Outreach – High Priority Contributing Factors:
Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 4: Affordable Housing Development and Outreach
Make information available to affordable housing organizations regarding residential development opportunities.
Annually Agencies and organizations serving low and moderate income and special needs households in
the South Bay
region
Facilitate the development of 359 lower income units
Pursue funding available for
affordable housing development.
Annually
Conduct Affirmative Fair Marketing as affordable housing units become available.
As units become available
Page 75 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-20
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 13: AFFH Facilitate public education and outreach by posting informational flyers on fair housing and housing
resources at public counters, libraries, on the City’s website, and social media (FB, Twitter,
Instagram, Next Door, and Tik
Tok), and paid advertising such as
Daily Breeze – engage a more
diverse population, especially
relying on social media platforms
that have a younger audience.
Annually Citywide (all highest resource
areas)
Facilitate the development of 558 units,
including 359 lower income units
City newsletter (about 8,000 subscribers) Bi-weekly
Conduct public meetings to
discuss housing-related issues.
Conduct meetings at suitable
times, accessible to persons with
disabilities, and near public
transit. Resources will be invested
to provide interpretation and
translation services when
requested at public meetings
when feasible.
At least once a
year
Encourage community and stakeholder engagement during
development decisions.
At least once during
development review process
Conduct Affirmative Fair
Marketing as affordable housing units become available.
As units
become available
Agencies and
organizations serving low and moderate income and special needs households in the South Bay region
New Opportunities in High Resource Areas – High Priority Contributing Factors:
High land, rental, and ownership housing costs
Availability of affordable housing
Program 3: Density Bonus and Other Incentives
Revise Density Bonus provisions and make information available on the density bonus program through brochures and the City website.
By the end of 2023 Citywide (all highest resource areas)
Facilitate construction of 359 lower income units
Program 5:
Facilitate
Efficient Use of
Sites that Allow
High-Density
Residential Development
Facilitate lot consolidation and
affordable housing development
through implementation of
strategies outlined in Program 5.
2021-2029 Multi-family
and mixed use
zones
Promote lot
consolidation
to facilitate
development
of 100 multi-
family units
Page 76 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-21
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 6: ADUs Monitor legislation and update City ADU regulations as necessary to maintain consistency with State
law.
By the end of 2023 Single-family neighborhoods Facilitate construction of 95 ADUs,
including 15 additional JADUs Promote the use of Housing
Choice Vouchers for AUDs.
Create a fair housing factsheet to be included in ADU application.
Amend Zoning Code to allow one additional JADU on R-1 lots if the
primary unit is at least 3,000
square feet and the additional
JADU will result in a net increase in
units.
By the end of 2025
Program 9: Adequate Sites to Accommodate Housing Needs
Complete Zoning map and text amendments to provide adequate sites for RHNA.
By the end of 2023 Along commercial corridors
Accommodate 100% of the shortfall of sites to accommodate the city’s remaining housing need of 359 units for very low and low income households.
Housing Mobility– High Priority Contributing Factors:
High land, rental, and ownership housing costs
Availability of affordable housing
Program 6: ADUs Promote the use of Housing Choice Vouchers for AUDs. Create a fair housing factsheet to
be included in ADU application.
By the end of 2023 Single-family neighborhoods Facilitate construction of 95 ADUs
Amend Zoning Code to allow one
additional JADU on R-1 lots if the
primary unit is at least 3,000 square feet and the additional JADU will result in a net increase in units.
By the end of
2025
Program 9:
Adequate Sites
to
Accommodate
Housing Needs
By the end of 2026, the City will
broaden the overlay to include
the remaining sites in the major
commercial corridors. The City
anticipates this will result in 100
units above the Housing Element
Sites Overlay capacity.
By the end of
2026
Commercial
corridors
Facilitate
development
of 100 units
along
commercial
corridors
Page 77 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-22
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Program 10: Housing for Persons with
Special Needs
Complete zoning code amendments outlined in Program 10 to promote housing for special
needs groups.
By the end of 2023 City-owned property and along
commercial corridors
Assist with the construction of 100 units for
special needs populations, including 50
units of senior
housing on
City-owned
property
Economic Subcommittee studied increased need for live/work – develop strategies for live/work housing, co-working space, and 15-minute neighborhood, etc.
By 2025 Along commercial corridors and in light manufacturing areas
Facilitate the development of 50 live/work units
Program 13:
Affirmatively
Furthering Fair
Housing
Facilitate public education and
outreach by posting informational
flyers on fair housing and housing
resources at public counters,
libraries, and on the City’s website
and at Senior Center. Expand the
City’s outreach efforts to reach a
broader audience by:
o Advertising housing-related initiatives and programs in newspapers that have broader circulation beyond city limits (such as the Daily Breeze.
o Making hard copies of documents to assist the technology challenged.
o Expanding notifications to
agencies and organizations that
serve residents in the South Bay
region.
By the end of
2024
Single-family
neighborhoods
Provide
referrals to
services to 20
households,
with the goal
of reaching a
broader
population via
other media
platforms.
Page 78 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-23
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Collaborate with home share programs and promote programs to residents. Home share
programs available to South Bay
residents include:
o Home Share South Bay, a
program offered by the South Bay
Cities Council of Governments
(SBCCOG), is a community
solution that matches
homeowners with renters seeking
affordable housing in the South
Bay.
o Affordable Living for the Aging
(ALA) offers a home share program. ALA screens, matches, and monitors two people to share
a home based on living preferences and compatibility. Arrangements may be rent or a combination of rent and daily living support such as cleaning, cooking, or transportation.
Program 14:
Neighborhood
Improvements
Pursue community development
activities and neighborhood
improvements:
• CDBG mobility access
improvements at
crosswalks and ramps
• Safe routes to school
Annually during
budgeting
process
Area with lower
median
household
income and
along
commercial
corridors and
manufacturing
areas where
future housing
is expected
Pursue 16
improvement
projects
AFFH: Affirmative Marketing
Require the project develops of affordable housing projects or projects with affordable units to
implement an Affirmative Fair
Marketing Plan to outreach to a
diverse population, extending
outreach to nearby communities
in the South Bay, especially to
workers in the City who do not live
in the City. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and non-
profit housing organizations that
serve lower income tenants in the surrounding region.
As affordable units are developed
South Bay Achieve 30% of future occupants of
affordable
units from
outside
Hermosa
Beach,
including those
who work but
do not live in
the City
Page 79 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-24
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Develop materials for Hermosa Beach residents who may be seeking tenants for their ADUs,
which will be provided to ADU applicants at the time they apply for a building permit or ADU
permit. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and non-
profit housing organizations that
serve lower-income tenants in the
surrounding region. Interested
residents can use these materials
to find prospective tenants in a
larger market area beyond city
limits, including residents of all
races, ethnicities, ages, and abilities
By December 2025 Single-family neighborhoods and high
resource areas (citywide)
Achieve 30% of future ADU occupants
from outside Hermosa Beach,
including those
who work but
do not live in
the City
Housing Mobility Monitoring Annually review overall progress and effectiveness in April and
include information in annual
report to HCD. If the City is not on
track to meet its housing mobility
goals by 2027, the City will
consider alternative land use
strategies and make necessary
amendments to zoning or other
land use documents to facilitate
a variety of housing choices,
including but not limited to,
strategies that encourage missing
middle zoning (small-scale multi-
unit projects up to four-plexes),
adaptive reuse, within six months,
if sufficient progress toward this
quantified objective is not being met.
Annually in April Citywide 95 ADUs/JADUs (including 15
additional
JADUs)
Home match
for 20
households
Page 80 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-25
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
Place-Based Strategies for Neighborhood Improvement – Medium Priority Contributing Factors: Unaffordable rental prices
Availability of affordable housing Private discrimination
Program 14:
Neighborhood Improvements
Pursue community development
activities and neighborhood improvements:
• Aging in place services, including tax rebates and exemptions for assessments
• Promote property maintenance assistance, such as LACDA senior repair grants
• Capital improvements for neighborhood amenities
Annually during
budgeting process
Area with lower
median household income and along commercial corridors and manufacturing areas where future housing is expected
Provide 20 tax
exemptions for seniors and disabled households Conduct 8 neighborhood cleanup events
Tenant Protection and Anti-Displacement– High Priority Contributing Factors:
Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 2: Conservation of
Existing Affordable Housing
Review and update relocation reimbursement requirements for
relocation assistance.
Annually Citywide 100% of displaced
households compensated.
Program 8: Housing Trust Funds
Annually pursue funding to provide for affordable housing and as funding permits, continue participation in the South Bay Housing Trust Fund
Annually South Bay Region Contribute to the development of 5 affordable housing units in the region.
Page 81 of 150
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023
Revised January, May, June 2024
II-26
Program Specific Commitment Timeline Geographic Targeting Eight-Year Metric
AFFH: Homelessness Plan
Continue to implement the City’s Homelessness Plan, including outreach for persons
experiencing homelessness:
• PATH provides dedicated outreach teams for
homeless assistance, and
also connects individuals
with medical and mental
healthcare, interim
housing, veteran services,
employment services and
providing benefits
enrollment and
advocacy.
• Through PATH, the City
has an Outreach Hotline.
• The LA County MET
performs outreach and assessments on individuals with mental health needs, and provides linkages to services.
• City staff meets quarterly with regional outreach representatives from PATH and Harbor Interfaith Services to share relevant information, assess service connections made, and identify community “hot spots”
where additional
attention is needed.
• In partnership with
SBCCOG, facilitate
landlord
outreach/education
regarding opportunities
for housing individuals at-
risk of homelessness
Ongoing Citywide with emphasis on southwest
section of the City
Assist 10 persons experiencing
homelessness through outreach
efforts
annually.
Utilize local funds outlined in the Homelessness Plan to support response efforts and special circumstances. This fund can cover items such as miscellaneous services and materials, motel vouchers, transit vouchers,
laundry services, hygiene
products, etc.
Ongoing Citywide with emphasis on southwest section of the City
Assist five persons experiencing homelessness annually.
Page 82 of 150
Page 1 of 4 ORD NO. ORD-24-1474
CITY OF HERMOSA BEACH
ORDINANCE NO. ORD-24-1474
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERMOSA
BEACH, CALIFORNIA, AMENDING THE HERMOSA BEACH MUNICIPAL
CODE TO IMPLEMENT THE LAND VALUE RECAPTURE PROGRAM FOR
AFFORDABLE HOUSING AND DETERMINE PURSUANT TO THE CALIFORNIA
ENVIRONMENTAL QUALITY ACT THAT THE PROJECT IS CONSISTENT WITH
THE PLAN HERMOSA ENVIRONMENTAL IMPACT REPORT
THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES HEREBY ORDAIN
AS FOLLOWS:
SECTION 1. Section 17.39.050 (Land Value Recapture for Affordable
Housing) is hereby added to Title 17 (Zoning) of the Hermosa Beach Municipal
Code to read as follows:
17.39.50 Land Value Recapture for Affordable Housing
A.Sites designated as (--HE) that have underlying non-residential zones are
subject to the City’s Land Value Recapture Program for Affordable Housing,
as follows:
1.Proposed projects that are entirely non-residential are exempt.
2.Projects on sites with a Sites Inventory capacity are subject to the
Land Value Recapture Program fee, as follows:
a.For sites on the Sites Inventory with a capacity of 5 or more
units:
1.Projects proposing a minimum of 15% very-low income
units, 15% low-income units, or 25% moderate income
units, or combination thereof, (calculated from base
density) shall be exempt from the fee;
2.Projects proposing a portion of the above affordability
requirements shall be subject to the corresponding
proportional amount of the fee.
3.Projects not proposing any affordable units shall be
subject to the Tier 2 fee.
b.For sites on the Sites Inventory with a capacity of 1 to 4
dwelling units:
1.Projects constructing to minimum density and proposing
at least 1 affordable unit (very low, low, or moderate)
are exempt from the fee.
2.Projects not proposing any affordable units shall be
subject to the Tier 1 fee.
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B
Page 83 of 150
Page 2 of 4 ORD NO. ORD-24-1474
B.The fee amounts for the Land Value Recapture Program for Affordable
Housing shall be set by City Council resolution.
SECTION 2. Section 17.42.100(A)(3) of Title 17 (Zoning) of the Hermosa
Beach Municipal Code is hereby amended as follows:
2.Compatibility. All affordable housing units shall be dispersed within
market-rate projects. Affordable housing units within market-rate
projects shall be comparable with the size and bedroom count,
design, and use of market-rate units in appearance, use of materials,
and finished quality. The design and appearance of the affordable
housing units shall be compatible with the design of the total housing
development and consistent with the surrounding neighborhood.
Forms, materials and proportions that are compatible with the
character of the surroundings shall be used.
SECTION 3. Section 17.42.100(B)(2) of Title 17 (Zoning) of the Hermosa
Beach Municipal Code is hereby amended as follows:
2.Applicability. The provisions of subsection (B)(1) of this section shall be
applicable to residential projects of five (5) or more units, and senior
citizen housing developments of at least thirty-five (35) units.
Additionally, projects proposing a percentage of moderate-income
rental units equivalent to the percentage of for-sale moderate
income units may utilize the corresponding density bonus allowance
specified in Government Code Section 65915.
SECTION 4. Land Value Recapture Program. Regarding proposed Section
17.39.050, the City makes the following findings:
1.The City’s 2021-2029 Housing Element Sites Inventory identifies sites
that may be used to meet the City’s Regional Housing Needs
Assessment (RHNA) allocation. The City’s RHNA allocation consists of
over 60 percent of units in the very low- and low-income categories.
2.Due to lack of available residentially zoned land, most of the sites in
the Sites Inventory are on non-residentially zoned sites.
3.The City must amend the zoning in order to allow for residential or
mixed-use development on non-residentially zoned sites.
4.The City’s Housing Element includes strategies to facilitate the
creation of affordable housing, including very low-, low-, and
moderate-income units.
5.There are currently no affordable housing units in the City.
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B
Page 84 of 150
Page 3 of 4 ORD NO. ORD-24-1474
6.As a part of the rezoning effort, the City wishes to capture land value
associated with the zoning amendments which enable residential
development on non-residentially zoned sites.
7.In accordance with California Government Code 66001, the City
Council finds:
a.The purpose of the fee (if applicable) is to create much
needed affordable residential units in the City.
b.Any fees paid would be to fund the creation of affordable
residential units and any associated services required by those
units (open space, residential amenities, etc).
c.The amount of the fee is calculated to be the equivalent cost
of creating affordable residential units on-site, on non-
residentially zoned properties that now have the ability to
include residential development. There is a reasonable
relationship to requiring properties that can now include
residential development (and may be the bulk of the new
residential units coming online in the City) to offset the lack of
affordable units in each project with the fee.
d.The City has an established need for affordable housing, as
supported by the adopted 2021-2029 Housing Element.
SECTION 5. Severability. If any section, subsection, subdivision, sentence,
clause, phrase, or portion of this ordinance is for any reason held to be invalid or
unconstitutional by the decision of any court of competent jurisdiction, such
decision will not affect the validity of the remainder of this ordinance. The City
Council hereby declares that it would have adopted this ordinance, and each
and every section, subsection, subdivision, sentence, clause, phrase, or portion
thereof, irrespective of the fact that any one or more sections, subsections,
subdivisions, sentences, clauses, phrases, or portions thereof is declared invalid or
unconstitutional.
SECTION 6. Effective Date. This Ordinance shall take effect thirty (30) days
after its passage and adoption pursuant to California Government Code section
36937, or upon certification of the City’s 2021–2029 Housing Element (6th Cycle)
by the California Department of Housing and Community Development,
whichever is later.
SECTION 7. Certification. The City Clerk is directed to certify the passage
and adoption of this Ordinance; cause it to be entered into the City’s book of
original ordinances; make a note of the passage and adoption in the records of
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B
Page 85 of 150
Page 4 of 4 ORD NO. ORD-24-1474
this meeting; and, within fifteen (15) days after the passage and adoption of this
Ordinance, cause it to be published or posted in accordance with California law.
PASSED, APPROVED and ADOPTED on this 23rd day of January, 2024.
Mayor Justin Massey
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA
ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________
Myra Maravilla, Patrick Donegan,
City Clerk City Attorney
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B
Page 86 of 150
Intro: 12/12/2023
Adopt: 1/23/2024
ss
State of California )
County of Los Angeles )
City of Hermosa Beach )
March 4, 2024
Certification of Council Action
ORDINANCE NO. ORD-24-1474
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERMOSA
BEACH, CALIFORNIA, AMENDING THE HERMOSA BEACH MUNICIPAL
CODE TO IMPLEMENT THE LAND VALUE RECAPTURE PROGRAM FOR
AFFORDABLE HOUSING AND DETERMINE PURSUANT TO THE
CALIFORNIA ENVIRONMENTAL QUALITY ACT THAT THE PROJECT IS
CONSISTENT WITH THE PLAN HERMOSA ENVIRONMENTAL IMPACT
REPORT
I, Myra Maravilla, City Clerk of the City of Hermosa Beach, California, do hereby
certify that the above and foregoing Ordinance No. ORD-24-1474 was duly
approved and adopted by the City Council of said City at its regular meeting
thereof held on the 23rd day of January 2024 and passed by the following vote:
AYES: MAYOR MASSEY, MAYOR PRO TEM FRANCOIS, and
COUNCILMEMBERS SAEMANN, DETOY, AND JACKSON
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
_____________________________
Myra Maravilla,
City Clerk
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B
Page 87 of 150
STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY GAVIN NEWSOM, Governor
DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT DIVISION OF HOUSING POLICY DEVELOPMENT 651 Bannon St, Suite 400 Sacramento, CA 95811 (916) 263-2911 / FAX (916) 263-7453 www.hcd.ca.gov August 1, 2024
Suja Lowenthal, City Manager City of Hermosa Beach 1315 Valley Drive
Hermosa Beach, CA 90254
Dear Suja Lowenthal: RE: City of Hermosa Beach’s 6th Cycle (2021-2029) Adopted Housing Element
Thank you for submitting the City of Hermosa Beach’s Ordinance Number ORD-24-1481 (Ordinance) that was adopted July 23, 2024 and received on July 30, 2024. Pursuant to Government Code section 65585, the California Department of Housing and Community Development (HCD) is reporting the results of its review.
HCD is pleased to find the City has completed actions to address the requirements that were described in HCD’s July 12, 2024 review. The Ordinance was found to be substantially the same as the draft amendments HCD’s July 12, 2024 review
determined met statutory requirements. As a result, the adopted element now
substantially complies with State Housing Element Law (Gov. Code, § 65580 et seq) as of the date of this letter. Additionally, the City must continue timely and effective implementation of all programs
including but not limited to the following:
• Program 3 (Density Bonus and Other Incentives)
• Program 4 (Affordable Housing Development Outreach and Assistance)
• Program 5 (Facilitate Use of Sites that Allow High Density Development)
• Program 6 (Accessory Dwelling Units)
• Program 7 (Land Value Recapture)
• Program 9 (Adequate Sites to Accommodate Housing Needs)
• Program 10 (Housing for Persons with Special Needs)
• Program 11 (Streamline Housing Permit Processing)
• Program 12 (Remove Governmental Constraints)
• Program 13 (Affirmatively Further Fair Housing)
• Program 14 (Neighborhood Improvement)
Page 88 of 150
Suja Lowenthal, City Manager Page 2
The City must monitor and report on the results of these and other programs through the annual progress report, required pursuant to Government Code section 65400. Please be aware, Government Code section 65585, subdivision (i) grants HCD authority to review any action or failure to act by a local government that it determines is
inconsistent with an adopted housing element or housing element law. This includes failure to implement program actions included in the housing element. HCD may revoke housing element compliance if the local government’s actions do not comply with state law.
In addition, as part of Program 7 (Land Value Recapture), the City should monitor the
effectiveness of the Program in facilitating development, including development affordable to lower and moderate-income households and impacts on financial feasibility of development. The City should monitor effectiveness at least every other year and make adjustments as appropriate to achieve the goals and objectives of the
housing element, including addressing governmental constraints.
Several federal, state, and regional funding programs consider housing element compliance as an eligibility or ranking criteria. For example, the CalTrans Senate Bill (SB) 1 Sustainable Communities grant, the Affordable Housing and Sustainable
Communities program, and HCD’s Permanent Local Housing Allocation consider
housing element compliance and/or annual reporting requirements pursuant to Government Code section 65400. With a compliant housing element, the City now meets housing element requirements for these and other funding sources.
HCD appreciates the efforts and cooperation provided throughout both the housing
element update and ordinance adoption processes. HCD wishes the City success in implementing its housing element and looks forward to following its progress through the General plan annual progress reports required pursuant to Government Code section 65400. If HCD can provide assistance in implementing the housing element,
please contact Hilda Boyadjian, of our staff, at Hilda.Boyadjian@hcd.ca.gov.
Sincerely,
Paul McDougall Senior Program Manager
Page 89 of 150
Kosmont Companies
Mailing Address: 1601 N. Sepulveda Blvd., #382 (424) 297-1070 Physical Address: 2301 Rosecrans Ave, Ste. 4140
Manhattan Beach, CA 90266 www.kosmont.com El Segundo, CA 90245
October 5, 2023
Carrie Tai Director Community Development
City of Hermosa Beach 1315 Valley Drive Hermosa Beach, CA 90254 Re: City of Hermosa Beach Land Value Recapture – Summary of Methodology Dear Ms. Tai, The City of Hermosa Beach (“City”) retained Kosmont Companies (“Kosmont”) to evaluate
potential provisions of the City’s proposed Land Value Recapture (“LVR”) program. The LVR program is intended to “capture” added land value on properties within certain commercial corridors on which the City is allowing residential development through rezoning actions. The LVR
program is intended to incentivize the development of affordable housing within the City. To ensure that new developments result in production of affordable housing units in the City, the City proposes to levy this fee. Developments may be exempted from the fee if they include affordable
housing. Fees paid would support the development of affordable housing units elsewhere in the City. The summary of methodology herein (“Summary”) highlights pertinent assumptions utilized in evaluating the potential number of affordable units to be required within a residential
development in order to be exempt from the fee, as well as the potential amount of the fee that the City may desire to initially levy under the LVR program.
As summarized herein, Kosmont’s analysis (“Analysis”) generally indicates that requiring residential projects to include a set aside of 10% very low-income, 15% low-income, 20% moderate-income units, or alternatively, pay a fee of approximately $60 per net residential square foot may be justifiable for the initial implementation of the LVR program. It is expected that the City will need to regularly revisit the amount of the fee, and potentially the exemption set-aside requirements, as fundamental inputs to the Analysis highlighted in this Summary will change over time.
The figures presented in this Summary are based on an evaluation of the potential impact to value of requiring the various percentages of affordable housing in a given multifamily (rental) development versus an exclusively market rate development. The impact of requiring affordable
housing as part of a for sale development is generally considered to be greater than the figures presented herein. Given current real estate market conditions, it is expected that the developer of a for sale project would likely opt to pay the fee rather than include affordable housing in such
development. However, each development has unique economics.
Page 90 of 150
City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 2 | Page
(424) 297-1070
www.kosmont.com
The assumptions presented in this Summary represent one of many potential development scenarios evaluated as part of the Analysis completed, though could generally be considered a
baseline set of assumptions. Finally, the assumptions herein are based on a review and modeling of inputs including real estate market conditions specific to the City, current affordable housing guidelines in the State of California (“State”), Los Angeles County Development Authority
(“LACDA”) guidance on monthly housing expenditures for utilities, and the potential relationship between the LVR program and State Density Bonus Law (Government Code § 65915 – 65918). Summary of Baseline Assumptions & Methodology 1. Maximum Housing Expenditures (Multifamily / For Rent)
Maximum monthly affordable housing expenditures were calculated based on Health & Safety
Code § 50053 which provides that very low-, low-, and moderate-income households shall not
expend more than 30% of 50%, 60%, and 110% of the area median income (“AMI”) on housing,
respectively. The AMI for Los Angeles County as published by the California Department of
Housing and Community Development (“HCD”) is $98,200 for 2023. The calculated amounts were
adjusted for unit sizes (bedrooms) and household size (persons) based on HCD guidance. To
determine the maximum amount of monthly rent as a share of total housing expenditures,
allowances for utilities as published by LACDA for the 2023 all electric schedule were deducted
from the calculated amounts. The household size assumptions and utility allowances follow
below.
Based on these factors, the maximum monthly rent for very low-, low-, and moderate-income households was calculated to be the amounts below.
2. Market Unit Size, Distribution, & Rent Based on a review of data from sources including CoStar, Zillow, and the Los Angeles County Office of the Assessor, assumptions on the square footage of units of different sizes (bedrooms),
Studio 1 2 3
Household Size (Persons)1 2 3 4
Household Size Adjustment 70%80%90%100%
Monthly Utility Allowance 193$ 227$ 262$ 309$
Bedrooms
Studio 1 2 3
Very Low 666$ 755$ 843$ 919$
Low 838 951 1,064 1,164
Moderate 1,697 1,933 2,168 2,392
BedroomsMaximum
Monthly Rent
Page 91 of 150
City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 3 | Page
(424) 297-1070
www.kosmont.com
the ratio of unit sizes, and market rents were developed. A summary of these assumptions follows below. For reference, monthly market rents are based on rates of $4.75 / $4.50 / $4.00 / $3.75 per square foot for studio / one-bedroom / two-bedroom / three-bedroom units, respectively, and
are considered moderately conservative relative to general market comparables in the City.
3. State Density Bonus Provisions
Density Bonus Law allows residential developments that include income restricted units to develop more units than may otherwise be provided under City code. The increase in total units allowed is based on the percentage and depth of affordability provided. The contemplated LVR
program requirement of 10% very low-, 15% low-, or 20% moderate-income units would entitle a developer to increase the total number of units in a development by 32.5%, 27.5%, and 15.0%, respectively. Density Bonus Law applies to developments with five or more units, includes a
roundup provision on calculations, and provides for other concessions by right including increases in height, and reductions in setback requirements. As an example, assuming a 100-unit residential development, if 10 units were restricted to very low-income households, a total of 133 units could be developed; if 15 units were restricted to low-
income households, a total of 128 units could be developed; and if 20 units were restricted to moderate-income households, a total of 115 units could be developed. The calculations in this Summary assume that a development including enough affordable units to be exempt from the
LVR fee would utilize the benefits of Density Bonus Law. 4. Impact on Rental Revenue
Despite the accretive provisions of Density Bonus Law, the inclusion of affordable units within a residential development was generally found to have a negative impact on overall rental revenue.
It is assumed that market and affordable units will have similar operating costs. The overall impact to blended gross rent is provided below. For reference, the figures are compared to assumed market rents illustrated above, and blended figures are weighted averages based on unit bedroom
count distributions / ratios identified in Section 2 above. As an example, this calculation provides that a 115-unit residential development that included 20 units restricted to moderate income households with 15% studio / 45% one-bedroom / 35% two-bedroom / 5% three-bedroom units
would realize an average reduction in gross revenue of $226 for each of the 115 units, each month.
Studio 1 2 3
Ratio 15%45%35%5%
Square Feet 475 700 950 1,150
Market Rent 2,256$ 3,150$ 3,800$ 4,313$
Bedrooms
Page 92 of 150
City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 4 | Page
(424) 297-1070
www.kosmont.com
5. Capitalized Value
Multifamily real estate is generally valued based on capitalization (“cap”) rates that convert net
annual rental income to a present value. Cap rates represent the initial rate of return on the total
cost of project investment. Cap rates in the City are generally lower than other regional markets,
indicating that investors are willing to pay more for properties in the City than they would for
another property with the same income stream in an inferior market with more perceived risk. In
this step of the Analysis, the impact of the inclusion of affordable housing units within a given
development was evaluated on a present value basis utilizing a hypothetical 4.5% cap rate. This
rate is higher than recent multifamily property transactions in the City, however is thought to be
reasonable on a forward-looking basis as cap rates are increasing due to increases in interest
rates and required rates of return. For reference, a lower assumed cap rate would increase the
value impact per square foot discussed in Section 6 below.
Note: The value / cost impacts illustrated above are based on a 133-, 128-, and 115-unit
development that included 10% very low-, 15% low-, or 20% moderate-income units, respectively.
6. Value Impact Per Square Foot
The final step of this method of evaluation is to consider the impact to value on a per square foot
basis. The total leasable square footage, and impact to value on a per square foot basis are
illustrated below. These figures reflect the unit square footages identified in Section 2 above, and
the total unit counts identified in Section 3 above (e.g., a 133-, 128, and 115-unit development).
Average Rent Studio 1 2 3 Blended
Very Low 2,137$ 2,970$ 3,578$ 4,057$ 3,112$
Low 2,090 2,892 3,479 3,944 3,030
Moderate 2,159 2,938 3,516 3,978 3,076
Delta From Market Studio 1 2 3 Blended
Very Low 120$ 180$ 222$ 255$ 190$
Low 166 258 321 369 272
Moderate 97 212 284 334 226
Bedrooms
Bedrooms
Studio 1 2 3 Blended
Very Low 4,200,000$ 6,400,000$ 7,900,000$ 9,100,000$ 6,700,000$
Low 5,700,000 8,800,000 10,900,000 12,600,000 9,300,000
Moderate 3,000,000 6,500,000 8,700,000 10,200,000 6,900,000
BedroomsCapitalized
Impact to Value
Page 93 of 150
City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 5 | Page
(424) 297-1070
www.kosmont.com
Based on the blended rates in the table above, and given the assumptions identified herein,
levying a fee of $66 – 94 per net (leasable) square foot of residential development would conceptually be considered economically equivalent to a developer as delivering affordable housing as part of a given development.
Findings
Based on the information presented in this Summary, a LVR fee of approximately $66 – 94 per net square foot of residential development is appropriate given a requirement for the inclusion of 10% very low-, 15% low-, or 20% moderate-income units as part of a residential development on eligible commercial properties in the City. In light of current real estate market conditions, and the infancy of the LVR program, Kosmont finds a fee of approximately $60 per net square foot of residential development is justifiable as an initial rate. The City should plan on revisiting the fee based both on the market response relative to the intent of the LVR program, and as the inputs to the calculation illustrated herein change over time. Kosmont is available to further discuss its findings as desired at your convenience.
Yours truly,
Wil Soholt
Senior Vice President
Studio 1 2 3 Blended
Very Low 63,175 93,100 126,350 152,950 103,241
Low 60,800 89,600 121,600 147,200 99,360
Moderate 54,625 80,500 109,250 132,250 89,269
Studio 1 2 3 Blended
Very Low 67$ 69$ 62$ 59$ 66$
Low 93 98 90 86 94
Moderate 55 81 80 77 76
Gross
Leasable SF
Value
Impact / SF
Bedrooms
Bedrooms
Page 94 of 150
LAND VALUE RECAPTURE ANALYSIS
HERMOSA BEACH, CA
December 2023
Prepared By:
KOSMONT COMPANIES
1601 N. Sepulveda Blvd. #382
Manhattan Beach, CA 90266
Telephone: (424) 297-1070
www.kosmont.com
Page 95 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS
Table of Contents
1.0 Background & Summary ................................................................................................. 3 2.0 Fee Equivalency ............................................................................................................. 4 2.1 Maximum Monthly Housing Expenditures (Multifamily / For Rent) ................................ 4
2.2 Market Unit Size, Distribution, & Rent .......................................................................... 5 2.3 State Density Bonus Provisions ................................................................................... 5 2.4 Impact on Rental Revenue ........................................................................................... 6 2.5 Capitalized Value ......................................................................................................... 7 2.6 Value Impact Per Square Foot ..................................................................................... 7 2.7 For Sale Developments ............................................................................................... 8 3.0 Market Capacity ............................................................................................................. 9 3.1 Incremental Value ........................................................................................................ 9 4.0 Hypothetical Development Program Pro Forma .............................................................11 5.0 Appendices ...................................................................................................................21 Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent .........................22 Appendix B: Sample Rent & Unit Size Comparables .............................................................23 Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts ...................25 Appendix D: Estimated Value Impact Per Square Foot for One to Four Units ........................26
Appendix E: Hypothetical Development Pro Forma ...............................................................27
Index of Tables & Figures
Table 1: Household Size, Income Adjustment, & Monthly Utility Allowance Assumptions .......... 4
Table 2: Estimated Maximum Monthly Rent for Very Low-, Low-, and Moderate-Income
Households ................................................................................................................................ 5
Table 3: Assumed Unit Size & Distribution, Market Rent ............................................................ 5
Table 4: Average Rent (Including Income Restricted Units) ....................................................... 6
Table 5: Delta Between Market & Average Rent ........................................................................ 7
Table 6: Estimated Capitalized Impact to Value of Including Income Restricted Units ................ 7
Table 7: Gross Leasable Square Feet ........................................................................................ 8
Table 8: Value Impact Per Square Foot ..................................................................................... 8
Figure 1: Hypothetical Small Site Pro Forma – Market Rate Project (LVR Fee Paid) ................12
Figure 2: Hypothetical Medium Site Pro Forma – Market Rate Project (LVR Fee Paid) .............13
Figure 3: Hypothetical Medium Site Pro Forma – Project w/ Very Low-Income Unit(s) ..............14
Figure 4: Hypothetical Medium Site Pro Forma – Project w/ Moderate-Income Unit(s)..............15
Figure 5: Hypothetical Medium Site Pro Forma –Very Low- & Moderate-Income Unit(s) ...........16
Figure 6: Hypothetical Large Site Pro Forma – Market Rate Project (LVR Fee Paid) ................17
Figure 7: Hypothetical Large Site Pro Forma – Project w/ Very Low-Income Unit(s) .................18
Figure 8: Hypothetical Large Site Pro Forma – Project w/ Moderate-Income Unit(s) .................19
Figure 9: Hypothetical Large Site Pro Forma – Very Low- & Moderate-Income Unit(s) .............20
Page 96 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 3
1.0 Background & Summary
The City of Hermosa Beach (“City”) retained Kosmont Companies (“Kosmont”) to evaluate
potential provisions of the City’s proposed Land Value Recapture (“LVR”) program. The LVR
program seeks to retain portions of land value added to properties within certain commercial
corridors on which the City may allow residential development through rezoning actions. The LVR
program is intended to produce affordable housing within the City. Under the LVR program,
developments would pay a fee to support the development of affordable housing units elsewhere
in the City or alternatively, include affordable housing within the project. This document
(“Analysis”) summarizes the analysis completed in evaluating potential LVR program elements
and includes three primary elements: (i) an analysis of the estimated equivalency of the fee versus
the economics of including affordable units in a given project, (ii) a discussion of the proposed fee
amounts and ability of the market to support the same, and (iii) order of magnitude pro forma for
hypothetical developments illustrating the potential economics of the LVR program.
Pursuant to guidance from the City Council and City leadership, the LVR program evaluated
herein is framed around a requirement that residential projects include a set-aside of (i) 15% very
low-income units, (ii) 15% low-income units, (iii) 25% moderate-income units, or alternatively (iv),
pay a fee of approximately $76 per net residential square foot for project with four or fewer
dwelling units, or approximately $104 for developments with five or more dwelling units.
While every development is relatively unique, pursuant to the Analysis highlighted herein, these
potential fee amounts are generally thought to be sufficient to induce some projects to include
affordable housing units as part of a given development. Some projects would also be expected
to elect to pay the fee rather than include affordable units. Additionally, the fee appears low
enough so as not to obstruct the development of residential uses in newly eligible areas of the
City. Finally, it is expected that the City will need to regularly revisit the amount of the fee, and
potentially the exemption set-aside requirements, as fundamental inputs and calculations
highlighted in this Analysis will change over time.
Page 97 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 4
2.0 Fee Equivalency
The first element of the Analysis summarized herein is the calculation of the general economic
equivalency of including a prescribed percentage and depth of (very low-, low-, or moderate-
income) affordable housing within a given development versus a set fee. This calculation is not
an evaluation of what the market can bear, but rather an estimate of the effective cost of requiring
a development to restrict units to 15% very low-, 15% low-, or 25% moderate-income households.
The assumptions presented in this section represent one of multiple potential development
scenarios evaluated as part of the Analysis completed, though could generally be considered a
baseline set of assumptions. The assumptions herein are based on a review and modeling of
inputs including real estate market conditions specific to the City, current affordable housing
guidelines in the State of California (“State”), Los Angeles County Development Authority
(“LACDA”) guidance on monthly housing expenditures for utilities, and the potential relationship
between the LVR program and State Density Bonus Law (“Density Bonus”, Government Code §
65915 – 65918), including recent changes under Assembly Bill 1287 (“AB 1287”).
2.1 Maximum Monthly Housing Expenditures (Multifamily / For Rent)
Maximum monthly affordable housing expenditures were calculated based on Health & Safety
Code § 50053 which provides that very low-, low-, and moderate-income households shall not
expend more than 30% of 50%, 60%, and 110% of the area median income (“AMI”) on housing,
respectively. The AMI for Los Angeles County as published by the California Department of
Housing and Community Development (“HCD”) is $98,200 for 2023. The calculated amounts were
adjusted for unit sizes (bedrooms) and household size (persons) based on HCD guidance. To
determine the maximum amount of monthly rent as a share of total housing expenditures,
allowances for utilities as published by LACDA for the 2023 all electric schedule were deducted
from the calculated amounts. It was assumed that the cost of trash service would be included in
rent. The household size assumptions and utility allowances follow in Table 1 below.
Table 1: Household Size, Income Adjustment, & Monthly Utility Allowance Assumptions
Source: HCD, LACDA, Kosmont (2023)
Based on these factors, the maximum monthly rent for very low-, low-, and moderate-income
households were calculated as provided in Table 2 below. Additional details are provided in
Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent on page 22.
Studio 1 2 3
Household Size (Persons)1 2 3 4
Household Size Adjustment 70% 80% 90% 100%
Monthly Utility Allowance 151$ 185$ 220$ 267$
Bedrooms
Page 98 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 5
Table 2: Estimated Maximum Monthly Rent for Very Low-, Low-, and Moderate-Income Households
Source: HCD, HSC § 50053, LACDA, Kosmont (2023)
2.2 Market Unit Size, Distribution, & Rent
Based on a review of data from sources including CoStar, Rent.com, Zillow, and the Los Angeles
County Office of the Assessor, assumptions on the square footage of units of different sizes
(bedrooms), the ratio of unit sizes, and market rents were developed. A summary of these
assumptions follows in Table 3 below and additional information on sample comparables is
provided in Appendix B: Sample Rent & Unit Size Comparables on page 23. For reference,
monthly market rents are based on rates of $4.75 / $4.50 / $4.00 / $3.75 per square foot for studio
/ one-bedroom / two-bedroom / three-bedroom units, respectively, and are considered moderately
conservative relative to general market comparables in the City.
Table 3: Assumed Unit Size & Distribution, Market Rent
Source: CoStar, Kosmont, Rent.com, Zillow (2023)
2.3 State Density Bonus Provisions
Density Bonus law allows residential developments that include income restricted units to develop
more units than may otherwise be provided under City density regulations. The increase in total
units allowed is based on the percentage and depth of affordability provided. Density Bonus law
applies to developments with five or more units, includes a roundup provision on calculations, and
provides for other concessions by right including increases in height, and reductions in setback
requirements. For reference Density Bonus provisions for moderate income units generally only
apply to for sale product, however, the City proposes to permit Density Bonus provisions to apply
to moderate income for rent product as well.
The following are examples of how Density Bonus provisions can be applied, assuming a
residential development with 100 “base” dwelling units:
• If 15 units were restricted to very low-income households, a total of 150 units could be
developed.
Studio 1 2 3
Very Low 708$ 797$ 885$ 961$
Low 880 993 1,106 1,206
Moderate 1,739 1,975 2,210 2,434
Maximum
Monthly Rent
Bedrooms
Studio 1 2 3
Ratio 15% 45% 35% 5%
Square Feet 475 700 950 1,150
Market Rent 2,256$ 3,150$ 3,800$ 4,313$
Bedrooms
Page 99 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 6
• If 15 units were restricted to low-income households, a total of 128 units could be
developed.
• If 25 units were restricted to moderate-income households, a total of 120 units could be
developed.
The calculations in this Summary assume that a development including a sufficient number of
affordable units to be exempt from the LVR fee would utilize the benefits of Density Bonus Law.
The contemplated LVR program requirement of 15% very low-, 15% low-, or 25% moderate-
income units would entitle a developer to increase the total number of units in a development by
50%, 27.5%, and 20.0%, respectively.
For reference, AB 1287 was recently codified, and provides for additional increases in density
should projects maximize very low-, low-, or moderate-income unit dedications and bonuses
(15%, 24%, and 44% respectively). Under those circumstances additional bonuses for very low-
or moderate-income units are permitted to be developed and additional bonuses are available.
Kosmont modeled the provisions of AB 1287 and found the provisions to be accretive for some
of the hypothetical development programs. Ultimately the potential benefit of the new provisions
may depend on the capacity to efficiently fit additional units on a given site.
2.4 Impact on Rental Revenue
Despite the accretive provisions of Density Bonus law, the inclusion of affordable units within a
residential development was generally found to have a negative impact on overall rental revenue.
It is assumed that market-rate and affordable units will have similar operating costs. The overall
impact to blended gross rent is provided below in Table 4. For reference, the figures are compared
to assumed market rents illustrated above, and blended figures are weighted averages based on
unit bedroom count distributions / ratios illustrated in Table 3 above.
Table 4: Average Rent (Including Income Restricted Units)
Source: Kosmont (2023)
Calculation: ((Market Rent x Market Units) + (Affordable Rent x Affordable Units)) / Total Units
As illustrated in Table 5 below, this calculation provides that a 115-unit residential development
that included 25 units restricted to moderate income households with 15% studio / 45% one-
bedroom / 35% two-bedroom / 5% three-bedroom units would realize an average reduction in
gross revenue of $262 for each of the 115 units, each month.
Average Rent Studio 1 2 3 Blended
Very Low 2,101$ 2,915$ 3,508$ 3,977$ 3,054$
Low 2,095 2,897 3,484 3,948 3,035
Moderate 2,149 2,905 3,469 3,921 3,040
Bedrooms
Page 100 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 7
Table 5: Delta Between Market & Average Rent
Source: Kosmont (2023)
Calculation: Market Rent – Average Rent
2.5 Capitalized Value
Multifamily real estate is generally valued based on capitalization (“cap”) rates whereby the
present value of a given property is equal to the net annual rental income divided by the cap rate.
Cap rates represent the initial rate of return on the total cost of project investment. Cap rates in
the City are generally lower than other regional markets, indicating that investors are willing to
pay more for properties in the City than they would for another property with the same income
stream in an inferior market with more perceived risk. In this step of the Analysis, the impact of
the inclusion of affordable housing units within a given development was evaluated on a present
value basis utilizing a hypothetical 4.5% cap rate. This rate is higher than recent multifamily
property transactions in the City, however is thought to be reasonable on a forward-looking basis
as cap rates are increasing due to increases in interest rates and required rates of return. For
reference, a lower assumed cap rate would increase the value impact per square foot discussed
in Section 2.6 below.
The total value / cost impacts based on a 150-, 128-, and 120-unit development that included
15% very low-, 15% low-, or 25% moderate-income units, respectively is provided in Table 6
below (figures have been rounded).
Table 6: Estimated Capitalized Impact to Value of Including Income Restricted Units
Source: Kosmont (2023)
Calculation: Delta Between Market & Average Rent x Total Units
2.6 Value Impact Per Square Foot
The final step of this method of evaluation is to consider the impact to value on a per square foot
basis. The total leasable square footage, and impact to value on a per square foot basis are
illustrated in Table 7 and Table 8 below. These figures reflect the unit square footages identified
Delta From Market Studio 1 2 3 Blended
Very Low 155$ 235$ 292$ 335$ 248$
Low 161 253 316 364 267
Moderate 108 245 331 391 262
Bedrooms
Studio 1 2 3 Blended
Very Low 6,200,000$ 9,400,000$ 11,700,000$ 13,400,000$ 9,900,000$
Low 5,500,000 8,600,000 10,800,000 12,400,000 9,100,000
Moderate 3,400,000 7,800,000 10,600,000 12,500,000 8,400,000
Capitalized
Impact to Value
Bedrooms
Page 101 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 8
in Table 3 above, and the total unit counts identified in Section 2.3 above (e.g., a 150-, 128-, and
120-unit development).
Table 7: Gross Leasable Square Feet
Source: Kosmont (2023)
Calculation: Unit Square Feet x Total Units
Table 8: Value Impact Per Square Foot
Source: Kosmont (2023)
Calculation: Capitalized Impact to Value / Gross Leasable Square Feet
Based on the blended rates in Table 8 above, and given the assumptions identified herein, levying
a fee of $86 – 92 per net (leasable) square foot of residential development would conceptually be
considered economically equivalent to a developer as delivering affordable housing as part of a
given development (assuming a 100-dwelling unit project before considering density bonuses). A
table and chart showing the estimated equivalency for different project sizes / dwelling unit counts
can be found in Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts
on page 25. Additionally, figures for developments with one to four units for which Density Bonus
provisions do not apply is provided in Appendix D: Estimated Value Impact Per Square Foot for
One to Four Units on page 26.
2.7 For Sale Developments
The equivalency figures presented in this Summary are based on an evaluation of the potential
impact to value of requiring the various percentages of affordable housing in a given multifamily
(rental) development versus an exclusively market rate development. The impact of requiring
affordable housing as part of a for sale development is generally considered to be greater than
the figures presented herein. Given current real estate market conditions, it is expected that the
developer of a for sale project would likely opt to pay the fee rather than include affordable housing
in such development. However, each development has unique economics.
Studio 1 2 3 Blended
Very Low 71,250 105,000 142,500 172,500 116,438
Low 60,800 89,600 121,600 147,200 99,360
Moderate 57,000 84,000 114,000 138,000 93,150
BedroomsGross
Leasable SF
Studio 1 2 3 Blended
Very Low 87$ 90$ 82$ 78$ 86$
Low 91 96 89 84 92
Moderate 60 93 93 91 88
Value
Impact / SF
Bedrooms
Page 102 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 9
3.0 Market Capacity
In this section the question of the market’s capacity to support an LVR fee is discussed. The City
proposes to allow the development of residential use where such use is not currently permitted
so long as such residential use either includes a component of affordable housing or an LVR fee
is paid to support the development of affordable housing elsewhere.
The City is not considering requiring owners to develop residential uses on their property. Rather,
the City is adding a right and value to certain areas of the City, with the condition that a portion of
the incremental value conveyed be used to support affordable housing for residents of the City.
Every property and potential development is relatively unique. If adding residential use to a given
property does not make economic sense, that property owner should not, and is not required to
add such use. Regardless of the LVR fee ultimately levied, or amount of affordable housing
required to be provided in a given development under the proposed policy, eligible properties and
their owners would at worst be left at status quo. No existing property rights are proposed to be
constrained or eliminated in any way. Property owners only have the potential to benefit from the
LVR program, and the quantity of housing delivered within the City only has the potential to
increase.
3.1 Incremental Value
As part of the Analysis, recent commercial and residential property transactions were reviewed.
In general, of the sales reviewed, most properties sold for between ~$700 - 1,500 per gross*
square foot. Based on the data reviewed, values of $800 - 1,000 per gross square foot were
considered indicative of typical market performance, and the higher end of this range could readily
be ascribed to newer, quality product.
To evaluate the potential incremental value of the LVR program, the incremental value of newly
permissible residential development (perhaps $800 to $1,000 per gross square foot, or more) can
be compared to the cost of development. Construction costs can vary widely from project to
project based on factors such as site prep required, construction type / materials, the quality of
finishes, etc. Broadly, for the purposes of this analysis, a cost range of $400 to $600 per net
square foot (excluding land) may be applicable, and this figure conceptually includes typical
building permit fees, financing costs, and contractor overhead. It is possible to build many product
types such as tract homes or basic additions for substantially less, and it can certainly cost
substantially more to build high end or highly engineered product.
*The conversion of gross to net square foot can vary substantially, but efficiency factors approaching 80%
are common for larger buildings with interior corridors and indoor amenities, and higher ratios are possible
for buildings with exterior corridors and without indoor amenities.
Page 103 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 10
Given a potential value of $800 to $1,000 per gross square foot, and development costs of $400
to $600 per net square foot (excluding land), the net residual value or incremental value of adding
residential use to a property could conceptually range from $400 to $600 per square foot of
residential use, before accounting for net versus gross building area. The lower, or worst case
from the assumptions above would yield $200 to $400 per square foot in new / incremental value
before any potential adjustment for gross versus net square feet ($800 – $600 = $200, or $1,000
- $600 = $400).
For illustrative purposes only, should the City elect to levy an LVR fee of $100 per net square foot,
the remaining incremental / residual value would be $100 to $300 per square foot of building area
(given a building with a 100% gross to net efficiency). Assuming the owner of a small property
was considering adding a single, 950 square foot two-bedroom unit above an existing commercial
use, if the unit could be developed within a budget of $600 per square foot ($570,000), and the
unit were valued at $900 per square foot ($855,000), the property owner would yield a net benefit
of $190,000, after considering the LVR fee of $100 per square foot. This residual / new
incremental value of $190,000 would be purely attributable to the City allowing residential uses in
areas where such uses are not currently allowed. Thus, in this perhaps moderately conservative
example, the City would retain $95,000 or 1/3rd of the value being conveyed (for the duration of
the affordability covenants), and $190,000 or 2/3rds of the balance of the value being conveyed
would be retained by the property owner (100% after the expiration of the affordability covenants).
Alternatively, a property owner could elect not to develop residential uses on their property and
pursue the continuation of existing uses or other uses as currently permitted by right, without
realizing any diminution in value.
Page 104 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 11
4.0 Hypothetical Development Program
Pro Forma
In this section a series of high-level proforma are provided illustrating hypothetical development
programs on a sample “small”, “medium”, and “large” site. For each hypothetical site, first a base
case with all market rate units (wherein the LVR fee is paid) is evaluated, and subsequently
hypothetical programs that include affordable housing are provided. Additionally, three
hypothetical affordable housing pro forma were prepared for the medium and large site, and they
evaluate the performance of a project with (i) very low-income units, (ii) moderate-income units,
or (iii) a combination of very low- and moderate-income units as permitted under AB 1287.
The sites and programs presented are theoretical in nature, and prepared without the benefit of
massing studies or order of magnitude construction cost estimates. They are intended to be for
general demonstration purposes only. At the bottom of each pro forma, a “Return on Cost” figure
is provided, and is one of many measures of potential profitability for a given project. In general,
for projects of the scale evaluated herein, a Return on Cost of 8 – 12% or more would suggest a
hypothetical development program may be financially feasible to a typical developer. Finally, the
same pro forma for the medium and large sites are presented side-by-side in Appendix E:
Hypothetical Development Pro Forma on page 27 for easier comparison.
Page 105 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 12
Figure 1: Hypothetical Small Site Pro Forma – Market Rate Project (LVR Fee Paid)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 3,250 SF
Existing Improvements 1,750 SF 900$ /SF 1,575,000$
Existing Parking 8 Stalls (Tandem)
Existing Value 1,575,000$
Proposed Program
Description
Commercial 1,750 SF
Residential 1,650 SF
Parking 8 Stalls (Tandem)
Base Residential Units 2 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 2 DU (Two Bedroom Units)
Development Value
Commercial 1,750 SF 1,000$ /SF 1,750,000$
Market Rate Residential 1,650 SF 950 /SF 1,567,500
Affordable Residential - SF - /SF -
Total 3,317,500$
Development Costs
Site Acquisition 1,750 SF 900$ /SF 1,575,000$
Commercial 1,750 SF 150 /SF 262,500
Residential 1,650 SF 600 /SF 990,000
Parking - SF - /SF -
LVR Fee 1,650 SF 76 /SF 125,400
Total 2,952,900$
Net Margin 12.3%Return on Cost 364,600$
Keep existing first floor commercial, add one
story of residential, no affordable units
Existing commercial / store front retail or office
use
Market Rate Project (LVR Fee Paid)
Page 106 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 13
Figure 2: Hypothetical Medium Site Pro Forma – Market Rate Project (LVR Fee Paid)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF 800$ /SF 4,000,000$
Existing Parking 15 Stalls
Existing Value 4,000,000$
Proposed Program
Description
Commercial 5,000 SF
Residential 5,000 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 6 DU (One & Two Bedroom Units)
Development Value
Commercial 5,000 SF 900$ /SF 4,500,000$
Market Rate Residential 5,000 SF 950 /SF 4,750,000
Affordable Residential - SF - /SF -
Total 9,250,000$
Development Costs
Site Acquisition 5,000 SF 800$ /SF 4,000,000$
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 5,000 SF 500 /SF 2,500,000
Parking - SF - /SF -
LVR Fee 5,000 SF 104 /SF 520,000
Total 9,020,000$
Net Margin 2.5%Return on Cost 230,000$
Existing commercial / store front retail or office
use
Replace first floor commercial, add one story of
residential, no affordable units
Market Rate Project (LVR Fee Paid)
Page 107 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 14
Figure 3: Hypothetical Medium Site Pro Forma – Project w/ Very Low-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF 800$ /SF 4,000,000$
Existing Parking 15 Stalls
Existing Value 4,000,000$
Proposed Program
Description
Commercial 5,000 SF
Residential 8,100 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 1 DU 17%Affordable
Density Bonus Units 3 DU
Total Units 9 DU (Two Bedroom Units)
Development Value
Commercial 5,000 SF 900$ /SF 4,500,000$
Market Rate Residential 7,200 SF 925 /SF 6,660,000
Affordable Residential 900 SF - /SF -
Total 11,160,000$
Development Costs
Site Acquisition 5,000 SF 800$ /SF 4,000,000$
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 8,100 SF 500 /SF 4,050,000
Parking 3,500 SF 125 /SF 437,500
LVR Fee 8,100 SF - /SF -
Total 10,487,500$
Net Margin 6.4%Return on Cost 672,500$
Project w/ Very Low-Income Unit(s)
Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, one very low unit
Page 108 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 15
Figure 4: Hypothetical Medium Site Pro Forma – Project w/ Moderate-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF 800$ /SF 4,000,000$
Existing Parking 15 Stalls
Existing Value 4,000,000$
Proposed Program
Description
Commercial 5,000 SF
Residential 7,600 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 2 DU 33%Affordable
Density Bonus Units 2 DU
Total Units 8 DU (Two Bedroom Units)
Development Value
Commercial 5,000 SF 900$ /SF 4,500,000$
Market Rate Residential 5,700 SF 925 /SF 5,272,500
Affordable Residential 1,900 SF 425 /SF 807,500
Total 10,580,000$
Development Costs
Site Acquisition 5,000 SF 800$ /SF 4,000,000$
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 7,600 SF 500 /SF 3,800,000
Parking 3,500 SF 125 /SF 437,500
LVR Fee 7,600 SF - /SF -
Total 10,237,500$
Net Margin 3.3%Return on Cost 342,500$
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, two moderate units
Page 109 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 16
Figure 5: Hypothetical Medium Site Pro Forma – Project w/ Very Low- & Moderate-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF 800$ /SF 4,000,000$
Existing Parking 15 Stalls
Existing Value 4,000,000$
Proposed Program
Description
Commercial 5,000 SF
Residential 9,900 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 2 DU 33%
Density Bonus Units 6 DU
Total Units 12 DU (One & Two Bedroom Units)
Development Value
Commercial 5,000 SF 875$ /SF 4,375,000$
Market Rate Residential 8,250 SF 950 /SF 7,837,500
Affordable Residential 1,650 SF 225 /SF 371,250
Total 12,583,750$
Development Costs
Site Acquisition 5,000 SF 800$ /SF 4,000,000$
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 9,900 SF 525 /SF 5,197,500
Parking 3,500 SF 125 /SF 437,500
LVR Fee 9,900 SF - /SF -
Total 11,635,000$
Net Margin 8.2%Return on Cost 948,750$
Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add two stories
of residential, one very low, one moderate unit
Page 110 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 17
Figure 6: Hypothetical Large Site Pro Forma – Market Rate Project (LVR Fee Paid)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF 250$ /SF 3,750,000$
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value 3,750,000$
Proposed Program
Description
Commercial 3,500 SF
Residential 11,400 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 12 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF 900$ /SF 3,150,000$
Market Rate Residential 11,400 SF 925 /SF 10,545,000
Affordable Residential - SF - /SF -
Total 13,695,000$
Development Costs
Site Acquisition 15,000 SF 250$ /SF 3,750,000$
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 11,400 SF 450 /SF 5,130,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 11,400 SF 104 /SF 1,185,600
Total 12,865,600$
Net Margin 6.4%Return on Cost 829,400$
Replace first floor commercial, add two stories
of residential, no affordable units
Market Rate Project (LVR Fee Paid)
Existing commercial / store front retail or office
use
Page 111 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 18
Figure 7: Hypothetical Large Site Pro Forma – Project w/ Very Low-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF 250$ /SF 3,750,000$
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value 3,750,000$
Proposed Program
Description
Commercial 3,500 SF
Residential 17,100 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 2 DU 17%Affordable
Density Bonus Units 6 DU
Total Units 18 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF 900$ /SF 3,150,000$
Market Rate Residential 15,200 SF 925 /SF 14,060,000
Affordable Residential 1,900 SF - /SF -
Total 17,210,000$
Development Costs
Site Acquisition 15,000 SF 250$ /SF 3,750,000$
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 17,100 SF 450 /SF 7,695,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 17,100 SF - /SF -
Total 14,245,000$
Net Margin 20.8%Return on Cost 2,965,000$
Replace first floor commercial, add two or three
stories of residential, two very low units
Project w/ Very Low-Income Unit(s)
Existing commercial / store front retail or office
use
Page 112 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 19
Figure 8: Hypothetical Large Site Pro Forma – Project w/ Moderate-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF 250$ /SF 3,750,000$
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value 3,750,000$
Proposed Program
Description
Commercial 3,500 SF
Residential 14,250 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 3 DU 25%Affordable
Density Bonus Units 3 DU
Total Units 15 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF 900$ /SF 3,150,000$
Market Rate Residential 11,400 SF 925 /SF 10,545,000
Affordable Residential 2,850 SF 425 /SF 1,211,250
Total 14,906,250$
Development Costs
Site Acquisition 15,000 SF 250$ /SF 3,750,000$
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 14,250 SF 450 /SF 6,412,500
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 14,250 SF - /SF -
Total 12,962,500$
Net Margin 15.0%Return on Cost 1,943,750$
Replace first floor commercial, add two stories
of residential, three moderate units
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use
Page 113 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 20
Figure 9: Hypothetical Large Site Pro Forma – Project w/ Very Low- & Moderate-Income Unit(s)
Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF 250$ /SF 3,750,000$
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value 3,750,000$
Proposed Program
Description
Commercial 3,500 SF
Residential 19,800 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 4 DU 33%Affordable
Density Bonus Units 12 DU
Total Units 24 DU (One & Two Bedroom Units)
Development Value
Commercial 3,500 SF 875$ /SF 3,062,500$
Market Rate Residential 16,500 SF 950 /SF 15,675,000
Affordable Residential 3,300 SF 225 /SF 742,500
Total 19,480,000$
Development Costs
Site Acquisition 15,000 SF 250$ /SF 3,750,000$
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 19,800 SF 450 /SF 8,910,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 19,800 SF - /SF -
Total 15,460,000$
Net Margin 26.0%Return on Cost 4,020,000$
Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add three stories of
residential, two very low, two moderate units
Page 114 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 21
5.0 Appendices
Page 115 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 22
Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent
2023 Area Median Income 98,200$
Income Thresholds
Very Low
Low
Moderate
Bedrooms Studio 1 2 3
Household Size 1 2 3 4
Household Size Adj.70% 80% 90% 100%
Utility Allowance - 2023 Multifamily All Electric
Heating 14$ 20$ 25$ 32$
Cooking 7 10 13 16
Water Heating 14 19 25 31
Basic Electric 27 33 40 48
Water 73 82 91 109
Trash 42 42 42 42
Air Conditioning 10 15 20 25
Refrigerator 6 6 6 6
Total 193$ 227$ 262$ 309$
Allowed Monthly Housing Expenditures (Multifamily / For Rent)
Bedrooms Studio 1 2 3
Very Low 666$ 755$ 843$ 919$
Low 838 951 1,064 1,164
Moderate 1,697 1,933 2,168 2,392
Percent of AMI
50%
60%
110%
Max Household Exp %
30%
30%
30%
Page 116 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 23
Appendix B: Sample Rent & Unit Size Comparables
CoStar Properties (~July 2023)
Zillow & Rent.com Properties (~July 2023)
Address Bed Bath SF Rent $/SF Source
415 Herondo St - 1 360 2,337$ 6.49$ Zillow
415 Herondo St - 1 408 2,331 5.71 Zillow
720 Monterey Blvd - 1 450 2,250 5.00 Zillow
415 Herondo St - 1 512 2,523 4.93 Zillow
415 Herondo St - 1 562 2,563 4.56 Zillow
Average 458 2,401$ 5.34$
Median 450 2,337 5.00
Address Bed Bath SF Rent $/SF Source
1140 Hermosa Ave 1 1 400 2,350$ 5.88$ Zillow
1346 Bayview Dr 1 1 400 2,500 6.25 Zillow
1821 Pacific Coast Hwy 1 1 550 2,495 4.54 Rent.com
707 Manhattan Ave 1 1 408 2,830 6.94 Zillow
2001 Pacific Coast Hwy 1 1 500 2,295 4.59 Zillow
2001 Pacific Coast Hwy 1 1 500 2,395 4.79 Zillow
2001 Pacific Coast Hwy 1 1 500 2,495 4.99 Zillow
2026 Hermosa Ave 1 1 500 2,850 5.70 Zillow
718 21st St 1 1 550 2,500 4.55 Zillow
454 Longfellow Ave 1 1 590 2,800 4.75 Zillow
2100 Hermosa Ave 1 1 600 3,550 5.92 Zillow
216 Hermosa Ave 1 1 630 3,200 5.08 Zillow
415 Herondo St 1 1 644 3,004 4.66 Zillow
137 27th St 1 1 650 3,500 5.38 Zillow
225 30th PL 1 1 750 3,300 4.40 Zillow
415 Herondo St 1 2 758 3,585 4.73 Zillow
415 Herondo St 1 2 855 3,047 3.56 Zillow
3101 Manhattan Ave 1 1 858 3,100 3.61 Zillow
Average 591 2,878$ 5.02$
Median 570 2,840 4.77
One Bedroom Units
Studio Units
Page 117 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 24
Address Bed Bath SF Rent $/SF Source
721 Manhattan Ave 2 1 560 3,200$ 5.71$ Zillow
1154 Cypress Ave 2 1 690 3,600 5.22 Zillow
2011 Manhattan Ave 2 1 700 2,595 3.71 Zillow
2100 Hermosa Ave 2 1 700 3,800 5.43 Zillow
415 Herondo St 2 1 717 3,450 4.81 Zillow
950 1st St 2 1 759 2,875 3.79 Zillow
1821 Pacific Coast Hwy 2 2 900 3,125 3.47 Rent.com
404 Hermosa Ave 2 1 779 4,495 5.77 Zillow
2411 Prospect 2 2 855 3,395 3.97 Zillow
10 Meyer Ct 2 1 900 3,200 3.56 Zillow
1707 E Pacific Coast Hwy 2 2 974 3,598 3.69 Zillow
75 18th St 2 2 832 4,300 5.17 Rent.com
77 15th St 2 2 981 4,500 4.59 Zillow
1836 The Strand 2 2 1,000 5,995 6.00 Zillow
1652 Monterey Blvd 2 2 1,050 4,800 4.57 Zillow
1656 Monterey Blvd 2 2 1,050 4,800 4.57 Zillow
101 Monterey Blvd 2 2 1,074 3,300 3.07 Zillow
676 5th St 2 2 1,100 3,850 3.50 Zillow
1442 Bayview Dr 2 2 1,200 4,500 3.75 Zillow
1636 Palm Drive 2 2 1,200 5,995 5.00 Zillow
20 22nd St 2 2 1,276 6,000 4.70 Zillow
47 8th St 2 3 1,288 6,000 4.66 Zillow
408 Ocean View Ave 2 3 1,296 6,500 5.02 Zillow
743 24th PL 2 2 1,500 4,900 3.27 Zillow
Average 974 4,282$ 4.46$
Median 978 4,075 4.58
Address Bed Bath SF Rent $/SF Source
639 1st St 3 3 1,200 4,800$ 4.00$ Zillow
428 The Strand 3 2 1,846 9,500 5.15 Zillow
Average 1,523 7,150$ 4.57$
Median 1,523 7,150 4.57
Two Bedroom Units
Three Bedroom Units
Page 118 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 25
Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts
*Dwelling unit counts are prior to use of density bonus provisions
Units*Very Low Low Moderate
5 107$ 112$ 121$
6 95 98 106
7 156 143 94
8 143 131 85
9 123 121 106
10 115 112 98
11 101 105 91
12 95 98 85
13 86 93 99
14 123 118 94
15 112 112 89
16 107 107 85
17 99 103 96
18 95 98 92
19 89 94 92
20 86 91 88
30 95 98 91
40 86 93 88
50 92 97 90
60 86 92 88
70 90 95 90
80 86 93 88
90 89 94 89
100 86 92 88
Page 119 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 26
Appendix D: Estimated Value Impact Per Square Foot for One to Four Units
Studio 1 2 3 Blended
Very Low 869$ 896$ 818$ 777$ 859$
Low 773 822 756 720 786
Moderate 290 447 446 436 423
Very Low 435$ 448$ 409$ 389$ 430$
Low 386 411 378 360 393
Moderate 145 224 223 218 211
Very Low 290$ 299$ 273$ 259$ 286$
Low 258 274 252 240 262
Moderate 97 149 149 145 141
Very Low 217$ 224$ 205$ 194$ 215$
Low 193 205 189 180 197
Moderate 73 112 112 109 106
One Unit w/ One Affordable Unit (100% Affordable)
Two Units w/ One Affordable Unit (50% Affordable)
Three Units w/ One Affordable Unit (33% Affordable)
Four Units w/ One Affordable Unit (25% Affordable)
Value
Impact / SF
Bedrooms
Page 120 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 27
Appendix E: Hypothetical Development Pro Forma
Page 121 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 28
Hypothetical Medium Site Pro Forma
Property ProfileDescription of ImprovementsLot Area8,500 SF8,500 SF8,500 SF8,500 SFExisting Improvements5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ Existing Parking15 Stalls15 Stalls15 Stalls15 StallsExisting Value4,000,000$ 4,000,000$ 4,000,000$ 4,000,000$ Proposed ProgramDescriptionCommercial5,000 SF5,000 SF5,000 SF5,000 SFResidential5,000 SF8,100 SF7,600 SF9,900 SFParking15 Stalls15 Stalls15 Stalls15 StallsBase Residential Units6 DU6 DU6 DU6 DUAffordable Units- DU1 DU17%Affordable2 DU33%Affordable2 DU33%Density Bonus Units- DU3 DU2 DU6 DUTotal Units6 DU(One & Two Bedroom Units)9 DU(Two Bedroom Units)8 DU(Two Bedroom Units)12 DU(One & Two Bedroom Units)Development ValueCommercial5,000 SF900$ /SF4,500,000$ 5,000 SF900$ /SF4,500,000$ 5,000 SF900$ /SF4,500,000$ 5,000 SF875$ /SF4,375,000$ Market Rate Residential5,000 SF950 /SF4,750,000 7,200 SF925 /SF6,660,000 5,700 SF925 /SF5,272,500 8,250 SF950 /SF7,837,500 Affordable Residential- SF- /SF- 900 SF- /SF- 1,900 SF425 /SF807,500 1,650 SF225 /SF371,250 Total9,250,000$ 11,160,000$ 10,580,000$ 12,583,750$ Development CostsSite Acquisition5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ 5,000 SF800$ /SF4,000,000$ Site Clearance- SF- /SF- - SF- /SF- - SF- /SF- - SF- /SF- Commercial5,000 SF400 /SF2,000,000 5,000 SF400 /SF2,000,000 5,000 SF400 /SF2,000,000 5,000 SF400 /SF2,000,000 Residential5,000 SF500 /SF2,500,000 8,100 SF500 /SF4,050,000 7,600 SF500 /SF3,800,000 9,900 SF525 /SF5,197,500 Parking- SF- /SF- 3,500 SF125 /SF437,500 3,500 SF125 /SF437,500 3,500 SF125 /SF437,500 LVR Fee5,000 SF104 /SF520,000 8,100 SF- /SF- 7,600 SF- /SF- 9,900 SF- /SF- Total9,020,000$ 10,487,500$ 10,237,500$ 11,635,000$ Net Margin2.5%Return on Cost230,000$ 6.4%Return on Cost672,500$ 3.3%Return on Cost342,500$ 8.2%Return on Cost948,750$ Project w/ Very Low- & Moderate-Income Existing commercial / store front retail or office use Replace first floor commercial, add two stories of residential, one very low, one moderate unit Project w/ Moderate-Income Unit(s) Existing commercial / store front retail or office use Replace first floor commercial, add one or two stories of residential, two moderate units Existing commercial / store front retail or office use Replace first floor commercial, add one story of residential, no affordable units Market Rate Project (LVR Fee Paid)Project w/ Very Low-Income Unit(s) Existing commercial / store front retail or office use Replace first floor commercial, add one or two stories of residential, one very low unit Page 122 of 150
HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 29
Hypothetical Large Site Pro Forma
Property ProfileDescription of ImprovementsLot Area15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ Existing Improvements5,000 SF5,000 SF5,000 SF5,000 SFExisting Parking- Stalls- Stalls- Stalls- StallsExisting Value3,750,000$ 3,750,000$ 3,750,000$ 3,750,000$ Proposed ProgramDescriptionCommercial3,500 SF3,500 SF3,500 SF3,500 SFResidential11,400 SF17,100 SF14,250 SF19,800 SFParking30 Stalls30 Stalls30 Stalls30 StallsBase Residential Units12 DU12 DU12 DU12 DUAffordable Units- DU2 DU17%Affordable3 DU25%Affordable4 DU33%AffordableDensity Bonus Units- DU6 DU3 DU 12 DUTotal Units12 DU(Two Bedroom Units)18 DU(Two Bedroom Units)15 DU(Two Bedroom Units)24 DU(One & Two Bedroom Units)Development ValueCommercial3,500 SF900$ /SF3,150,000$ 3,500 SF900$ /SF3,150,000$ 3,500 SF900$ /SF3,150,000$ 3,500 SF875$ /SF3,062,500$ Market Rate Residential11,400 SF925 /SF10,545,000 15,200 SF925 /SF14,060,000 11,400 SF925 /SF10,545,000 16,500 SF950 /SF15,675,000 Affordable Residential- SF- /SF- 1,900 SF- /SF- 2,850 SF425 /SF1,211,250 3,300 SF225 /SF742,500 Total13,695,000$ 17,210,000$ 14,906,250$ 19,480,000$ Development CostsSite Acquisition15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ 15,000 SF250$ /SF3,750,000$ Site Clearance5,000 SF50 /SF250,000 5,000 SF50 /SF250,000 5,000 SF50 /SF250,000 5,000 SF50 /SF250,000 Commercial3,500 SF400 /SF1,400,000 3,500 SF400 /SF1,400,000 3,500 SF400 /SF1,400,000 3,500 SF400 /SF1,400,000 Residential11,400 SF450 /SF5,130,000 17,100 SF450 /SF7,695,000 14,250 SF450 /SF6,412,500 19,800 SF450 /SF8,910,000 Parking11,500 SF100 /SF1,150,000 11,500 SF100 /SF1,150,000 11,500 SF100 /SF1,150,000 11,500 SF100 /SF1,150,000 LVR Fee11,400 SF104 /SF1,185,600 17,100 SF- /SF- 14,250 SF- /SF- 19,800 SF- /SF- Total12,865,600$ 14,245,000$ 12,962,500$ 15,460,000$ Net Margin6.4%Return on Cost829,400$ 20.8%Return on Cost2,965,000$ 15.0%Return on Cost1,943,750$ 26.0%Return on Cost4,020,000$ Project w/ Very Low- & Moderate-Income Existing commercial / store front retail or office use Replace first floor commercial, add three stories of residential, two very low, two moderate units Replace first floor commercial, add two stories of residential, no affordable units Replace first floor commercial, add two or three stories of residential, two very low units Replace first floor commercial, add two stories of residential, three moderate units Project w/ Very Low-Income Unit(s) Existing commercial / store front retail or office use Project w/ Moderate-Income Unit(s) Existing commercial / store front retail or office use Market Rate Project (LVR Fee Paid) Existing commercial / store front retail or office use Page 123 of 150
From: Claudia Berman <its_42@yahoo.com>
Sent: Monday, July 07, 2025 2:23 PM
To: Planning Commission <Planningcommission@hermosabeach.gov>
Cc: City Council <citycouncil@hermosabeach.gov>; Alison Becker
<abecker@hermosabeach.gov>; Steve Napolitano <snapolitano@hermosabeach.gov>
Subject: My Comments on Upcoming LVR Item, Zoning
Dear Planning Commission, I noticed that on the future agenda items for the planning commission is the LVR topic and 54 Hermosa Ave.
I've been getting my thoughts together for a while on the LVR discussion coming back. Since this topic touches so many parts of zoning, I decided to write up a comprehensive list of comments/recommendations. See Attached PDF. I may update once the staff report is out, but I'm sending out early since it's so long.
I realize that not all my comments are under the purview of the planning commission, so I'm also ccing council. I'm not addressing 54 Hermosa Ave. specifically, but my Appendix A on page 6 has
some history that could be helpful.
As always, thanks for listening. If you have any questions, please don't hesitate to reach out to me.
Best, Claudia Berman
Page 124 of 150
Page 1 of 8
Land Value Recap (LVR) & Zoning
Comments - C. Berman
A bit about me for context on my comments:
You may know me as a volunteer docent at the Hermosa Beach Museum, Community
Police Advisory Board member, or PLAN Hermosa participant. What you may not know
is my professional background: As an Oracle Applications sales engineer I sold into the
Store Lifecycle Development (lifecycle of a brick-and-mortar store – site identification,
analysis go/no go, construction, opening, remodeling/reformatting, closure) space to
major retailers like Starbucks, GAP, and Jack in the Box.
Less than a year after Housing Element approval, a handful of Upper Pier property
owners continue lobbying against Land Value Recapture (LVR) fees for smaller lots.
(Note: I recall that small lots represent a significant percentage. I think 40+%, but that
number should be verified.) These owners received free up-zoning from Commercial to
Residential, an incredible windfall at zero cost, yet claim the LVR fee makes residential
development financially unviable. They also claim their projects will boost economic
development. Yet, they have not presented any data to support their claims. See
APPENDIX A: Hermosa Ave Mixed Used Development – A Cautionary Tale for an example
of a mixed-use luxury residential property mixed with a ground floor vacation rental.
My comments with recommendations fall into the following three areas:
1. LVR IS NOT AN IMPEDIMENT TO DEVELOPMENT, PER KOSMONT
2. TIME, EFFORT & RISK
3. DROPPING LVR ON SMALL SITES, NOT A GUARANTEE OF ECON. DEV.
LVR IS NOT AN IMPEDIMENT TO DEVELOPMENT, PER KOSMONT
Council asked Kosmont to analyze the LVR fees and determine whether the fees would
obstruct development. Kosmont determined the fees would not deter development.
(12/23).
Page 125 of 150
Page 2 of 8
RECOMMENDATION 1: Property Owner/Developer Provides High Level Plan and
Financial Projection
Each downtown commercial property owner/developer who says that paying into
LVR or building one below market unit is an impediment to their development,
should show why Kosmont is not correct. It’s possible that their project
scope/design is the impediment, not the lot size. It’s also possible they may not
have investigated the incentives available for building below market housing.
For each property targeted for development, the developer should provide the
city and the public the following:
• The address/addresses of the development project.
• Estimated start date.
• High level build plan with number of housing units, very rough floor plan,
and square footage estimates, and target market (e.g., moderate,
premium, luxury).
• Whether this is a renovation or tear down/new construction.
• Will there be any lot consolidation?
• Will they be building condos for sale, or will they be building rentals? Or a
combination?
• What type of commercial is targeted for the ground floor?
• Show us the numbers. Show a financial projection with assumptions, why
building one small affordable unit or paying into LVR is not financially
feasible on the lot.
RECOMMENDATION 2: Give the property owners one year to submit their plans
(above) to the city and post on the city’s website.
This will provide the city with data necessary to understand what the appetite is
for housing development on upper Pier and to match those plans to housing
element site list. It will be interesting to see if the development plans do the
minimum number of units per the site list, or if they plan to maximize what could
be developed on the lot.
HCD requires community input, which is why it’s important to post publicly.
Page 126 of 150
Page 3 of 8
TIME, EFFORT & RISK
TIME & EFFORT:
All upper management staff who participated in the housing element are no longer with
the city: City Manager, Deputy City Manager, City Attorney, and Community Services
Director.
We have a new a new Community Development director who likely needs to focus on
her team and learning about processes, projects, and ordinances unique to Hermosa.
Adding an off-cycle housing element update, could negatively impact Community
Development’s current workload.
RECOMMENDATION 3: Community Development should focus on the Zoning Code
Update
The modernization of the zoning code impacts all businesses and residents;
therefore, the Zoning Code Update should be completed before adding non-
critical, new projects to Community Development workload.
RISK:
1. Reduction of LVR fund will negatively impact the ability to subsidize developers
who are open to building below-market units. How will the state react to this?
2. Some small lots are tagged in the site list with a required below-market unit. If
that developer chooses to not build a below-market unit, the city not only loses
needed LVR funds, but it also must find another site to put on the list in its place.
Housing Element Map:
https://hermosabeach.maps.arcgis.com/apps/webappviewer/index.html?id=c8928e777d71462da500de9e5188d0da
3. These changes could trigger a whole new review cycle with public hearings. That
seems likely since the site list and LVR process was so integral to the approval.
Could HCD then reevaluate other parts of the Housing Element for scrutiny?
RECOMMENDATION 4: After the high-level development plans are submitted and the
zoning code update is complete, then perform a risk assessment on an off-cycle
housing element update.
Page 127 of 150
Page 4 of 8
DROPPING LVR ON SMALL SITES, NOT A GUARANTEE OF ECON.
DEV.
Assuming average density in Hermosa Beach, there are approximately 600 residences
within a 5–10 minute walk (4 block radius of upper Pier). Per the housing element map,
multifamily zoning surrounds this area, so the 600 count would be higher. For example,
the Commodore & Hermosa Surf Condominiums combined have 174 units. Many
residences have more than one resident, so there is already a good number of people
living within a short walk. Per the housing element map on upper Pier, if every property
built to their minimum allotment in the sites inventory, that would add ~10% increase in
residential units.
However, just adding 2nd and 3rd story housing on upper Pier without addressing our
downtown business mix and layout issues, will not ensure economic development
growth. Over the past 30 years, our demographics have changed dramatically, and our
downtown’s ground floor storefront mix has declined in variety. We have seen a
proliferation of office space and personal services. We have more hospitality businesses
than ever before (except during the time of the long-gone Biltmore Hotel), and yet
downtown weekday, daytime foot traffic continues to be light. (Side Note: foot traffic
doesn’t necessarily convert to increased revenue.)
Ten years ago, the Roma report recommended limiting ground floor commercial to
pedestrian uses to increase vibrancy. Six years ago, this sentiment was codified in PLAN
Hermosa: “Uses on the ground floor are reserved for retail, restaurant, and other sales-
tax revenue generating uses, while offices and personal service uses are encouraged on
upper floors. Mixed use developments (including residential uses) may be allowed.”
RECOMMENDATION 5: As part of the Zoning Code Update, the city should do an
analysis of the approved Housing Element’s impact on our zoning code to understand
the unintended consequences and formulate contingency plans.
I’m quite concerned that without a strong zoning plan, that the adding of
residences on Upper Pier will be so lucrative, that the ground floor commercial
will slowly erode into more office space, more personal services, or short-term
rentals, which will not address state housing requirements as intended nor
contribute to economic development in a meaningful way. This is happening now
Page 128 of 150
Page 5 of 8
at 60 Hermosa Ave in the C-1 Limited Business and Residential zone. See
APPENDIX A: Hermosa Ave Mixed Used Development – A Cautionary Tale.
RECOMMENDATION 6: City Council to create a subcommittee working with
community development and a few local developers to come up with an “incentive
plan” to ensure that we don’t continue to lose sales-tax revenue ground floor
businesses, or even better, reverse this trend over time.
This subcommittee should be given a due date, say no more than six months.
Incentives should not have a monetary cost to taxpayers. This could be done in
conjunction with the zoning code update.
Four years ago, Marlin Equity demoed a building with pedestrian-oriented
retail/restaurant and replaced with a 2-story office building. This would be a good
use case to “test” incentive policies against. The million-dollar question being:
What could have incentivized Marlin Equity to change their office space project
and build out the ground floor for sales-tax generating uses and use the 2nd and
3rd floors for their employees?
RECOMMENDATION 7: If no policies result from Recommendation 6, then I would like
to see a ban on ground floor non-tax generating for new businesses that take over a
space vacated by a sales tax generating business.
I do think a ban would be wildly unpopular with property owners, but if there is
no movement on incentives, I think this should be seriously explored.
RECOMMENDATION 8: After the Zoning Code Update is done, explore waiving the LVR
fee for upper Pier small with the obligation that they 1) lease the ground floor for
sales tax generating uses 2) Do not allow the ground floor to remain vacant.
Since economic development is not a driver of HCD requirements, I don’t know if
it’s even possible to put restrictions on the ground floor commercial in exchange
the waiving of LVR. Losing LVR could still be problematic in this scenario.
Page 129 of 150
Page 6 of 8
Appendix A – Hermosa Ave Mixed Used Development – A
Cautionary Tale
July 15, 2014 a commercial property was approved by the planning commission to allow
for mixed use at 60 Hermosa Ave.
PC Meeting 7/15/2014 Item 9:
https://hermosabeach.granicus.com/player/clip/3182?view_id=6&meta_id=154838&re
direct=true
Figure 1 shows the lot before the
mixed-use development. Lot size
30’x80’= 2,400 SQF.
Concerns by a neighboring
property owner:
• Long term viability of the
commercial
• Concerns about the façade, all
concrete and glass
• All 3 commercial sites south are
empty, up for sale for months
• Putting commercial in to justify
2,800 sqf residence
• “Let’s not repeat mistakes”
Fast forward to now.
The residential unit is large with a very small
commercial component. There is no activated ground
floor commercial. I’m very concerned that this type of
development will occur on Upper Pier if there is no
zoning plan to prevent this.
Figure 1 60 Hermosa Ave Pre-Development
Figure 2 Post Development Hermosa Ave. Frontage
Page 130 of 150
Page 7 of 8
As of 6/24/2025 when I took the screenshot below from the AirBNB link, the downstairs
commercial is not even office space. It’s turned into a vacation rental at $16K+/mo.
https://www.airbnb.com/rooms/34999162?check_in=2025-10-01&check_out=2025-10-
31&location=Hermosa%20Beach%2C%20CA&search_mode=regular_search&source_impression_id=p3_17440502
03_P3oVKAXZUWRwBYf8&previous_page_section_name=1001&federated_search_id=cc75785e-7d3
Figure 3 Post Development Back View
Figure 4 Ground Floor Vacation Rental
Page 131 of 150
Page 8 of 8
The residential unit is also furnished and is rented out part time when it is not occupied
by the owner. Screenshot from Nestfully 6/24/2025. https://www.nestfully.com/rentals/60-
Hermosa-Avenue-Hermosa-Beach-CA-90254-344554482
It would be heartbreaking to see this on Upper Pier. I also don’t think this is what HCD
intended to address housing needs.
Figure 5 Main Residence
Page 132 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-14
Table B-5 Sites Inventory
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
10 552 11th Place 4187-020-907 PF Public Facilities M-1 Light Manufacturing PF Public Facility 34 50 1.00 Self-Storage - 25 25 - 50
FAR: 0.0 ILR: 0 Year Built: NA Height: 1 This city-owned property currently has a month-to-month lease for a public storage facility. It is surrounded on two sides by medium density housing. City is currently working with a real estate development analysis firm to determine potential public-private-partnership for housing development, including affordable housing. Proposed General Plan and Public Facility zoning is 34-50 units per acre, for a total yield of 50 units. Potential RFP in 2025 and construction in 2026. Factors for Selection: a, d, e, f, g, h
Y City of HB
11 710 Pier Avenue 4187-024-902 PF Public Facilities O-S Open Space PF Public Facility 34 50 1.00 Community Center 30 20 - - 50
FAR: 0.0 ILR: 0 Year Built: NA Height: Mostly unoccupied land with only 16% of site with a 2-story building This city-owned community center property is currently under study by a real estate development analysis firm to determine potential public-private-partnership for senior affordable housing development of up to 50 units. This site is ideal for senior housing due to smaller units, reduced parking needs, services offered at community center, available onsite parking and proximity to PCH bus transportation and grocery/drug stores directly across Pier Avenue.
Y City of HB
Page 133 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-15
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
Proposed General Plan and Public Facility zoning will be changed to 34-50 units per acre, for a total yield of 50 units. Potential RFP in 2024 and construction in 2026 or 2027. The Community Center building is two stories and designated historic, and occupies 0.75 acre of the site. The rest of the site is developed with surface parking, lawn area, and tennis courts that could be reconfigured or redeveloped to accommodate potential residential development. The Sites Inventory list this as one (1) acre, but there are actually 3.75 acres of space that is not currently occupied by any building. Factors for Selection: a, d, e, f, g, h
28 911 1st Street 4186-026-047 CC Community SPA-7 Specific Plan 25.1 33 0.46 Commercial Parking - - - 12 12
FAR: 0.0 ILR: 0 Year Built: NA Height: 0 Currently zoned commercial, this vacant former parking lot site is surrounded on three sides by low-to-medium density residential. The owner is interested in developing 12 for-sale units, likely at the moderate and above-moderate income levels. Factors for Selection: a, d, e, f, g, h
Y
1ST STREET PARTNERS LLC C/O LUIGI SCHIAPPA DEVELOPMENT
28 102 PCH 4186-026-804 CC Community SPA-7 Specific Plan 25.1 33 0.4 Utility Switching Station - - 5 5 10 FAR: 1.0 ILR: NA Year Built: NA Height: 2 Built in 1975, this telephone/ internet utility structure and supporting parking lots once served hundreds of employees and included
Y
GTE CALIF INC SBE 201-19-874B PAR 5 6PTS
28 102 PCH 4186-026-806 CC Community SPA-7 Specific Plan 25.1 33 0.2 Utility Switching Station - - 5 - 5
28 102 PCH 4186-026-801 CC Community SPA-7 Specific Plan 25.1 33 0.1 Utility Switching Station - - 3 - 3
28 102 PCH 4186-026-805 CC Community SPA-7 Specific Plan 25.1 33 0.09 Utility Switching Station - - 3 - 3
Page 134 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-16
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
28 1st Street and PCH 4186-026-800 CC Community SPA-7 Specific Plan 25.1 33 0.5 Commercial Parking - - 6 7 13
a credit union, cafeteria, executive offices, technician desks and large number of phone operator desks. The building currently houses telephone/internet equipment in approximately 20% of the building with only a handful of employees. The owner has recently approached the City to discuss adaptive reuse of this Art Deco building, with equipment consolidation and introduction of housing uses. At least two affordable housing developers have expressed interest in working with the property owner to convert a portion of the building into residential units. Of 1.49 acres, about 0.62 acre (27,000 sq. ft.) is a surface parking lot. An existing building with a footprint of about 0.85 acres (37,000 sq. ft.) A 20,000 square-foot portion of the building is 2 stories tall and currently vacant. There is potential for conversion to residential use. This building is 80% vacant and only has telecommunications switching equipment inside. Factors for Selection: a, d, e, f, g
19 1103 Aviation Boulevard 4185-017-015 GC Gateway C-3 General and Highway Commercial 25.1 33 1.3 Multi-tenant Commercial 24 8 - - 32
FAR: 1.0 ILR: 0.34 Year Built: 1964 Height: 0 and 1 Older 1975 commercial site with multiple tenant retail. Developer inquired about adding residential uses to commercial property. Low density residential is adjacent to the rear of the property. These parcels are currently functioning as an integral site.
Y
KENNARD,BARBARA S TR BARBARA S KENNARD TRUST AND HOROWITZ,RALPH TR HOROWITZ TRUST
19 1209 Aviation Boulevard 4185-017-014 GC Gateway C-3 General and Highway Commercial 25.1 33 0.5 Commercial Parking 6 5 - - 11 Y SELECTIVE API ONE LLC
Page 135 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-17
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
Factors for Selection: a, d, f, g, h
19 1062 AVIATION 4186-001-008 CC Community C-3 General and Highway Commercial 25.1 33 0.12 Retail - Nursery - - 3 - 3 FAR: 0.7 ILR: 0.11 Year Built: 1964 Height: 1 Factors for Selection: d, e, f, g, h
- MARIE SOLYMOSI 19 1062 AVIATION 4186-001-007 CC Community C-3 General and Highway Commercial 25.1 33 0.11 Retail - Nursery - - 2 - 2
2 1732 Monterey Boulevard 4183-016-028 MD Medium Density/ No Change
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 0.07 1 Unit - 1 - - 1 FAR: 0.5 ILR: 0.56 Year Built: 1923-1968 Height: Average 1 (5 0-story, 4 1-story, 6 2-story) The St. Cross church site consists of 15 parcels, developed with a church sanctuary and administrative offices, education building (24,000 sq. ft. footprint), 18 residential units (with about 7,000 sq. ft. of 2-story construction), and surface parking lots. The surface parking areas and underdeveloped properties on the site create potential for additional residential units. These parcels are currently functioning as one campus. Leaders at St. Cross Church reached out the City to explore ways to add additional units to their property portfolio, which includes 15 lots with historic church, 18 existing units and parking lots. The church seeks to add housing units for the dual purpose of providing affordable housing to the community and market rate units to help offset costs for affordable units. The church has rented units to homeless veterans, refugees, and formerly to a women’s shelter.
Y
RECTOR, WARDENS AND VESTRYMEMBERS ST CROSS PARISH HERMOSA BEACH
2 1736 Monterey Boulevard 4183-016-029 MD Medium Density/ No Change
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 0.07 1 Unit - 1 - - 1
2 1818 Monterey Boulevard 4183-016-040 MD Medium Density/ No Change
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 1.2 Religious Institution 27 - - - 27
2 302 19th Street 4183-016-033 MD Medium Density/ No Change
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 0.07 5 Units and Wireless Comm. Site - - - - -
1 1900 Monterey Boulevard 4182-019-001 MD Medium Density/ No Change
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.08 3 Units - - - - -
1 1908 Monterey Boulevard 4182-019-002
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.06 Private Parking Lot 1 1 - - 2
1 1914 Monterey Boulevard 4182-019-003
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.06 2 units - - - - -
2 1718 Loma Drive 4183-016-011
MD Medium Density/ MD Medium Density
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 0.06 2 Units - - - - -
2 1722 Loma Drive 4183-016-012
MD Medium Density/ MD Medium Density
R-2 Two Family Residential
R-2A Medium Density Residential (22) 22 25 0.06 1 Unit - 1 - - 1
Page 136 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-18
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
2 1730 Loma Drive 4183-016-035
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.1 1 Unit 1 1 - - 2
It is recommended to explore options to help add affordable units, including consideration of SROs or a Planned Unit Development (PUD). St. Cross Church wrote a letter of support for Housing Element recommending RHD zoning. Factors for Selection: a, d, e, g, h
2 1734 Loma Drive 4183-016-036
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.1 2 Units - 1 - - 1
2 Loma Drive and 19th Street 4183-016-037
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.09 Private Parking Lot 1 1 - - 2
2 Loma Drive and 19th Street 4183-016-038
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.1 Private Parking Lot 1 2 - - 3
2 1854 Loma Drive 4183-016-039
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.1 Private Parking Lot 1 2 - - 3
2 1902 Loma Drive 4183-023-022
LD Low Density/ MD Medium Density
R-1 Single-Family Residential
R-2A Medium Density Residential (22) 22 25 0.1 Private Parking Lot 1 2 - - 3
5 565 Pier Avenue 4183-018-013 CC Community SPA-11 Specific Plan 25.1 33 0.24 Multi-tenant Commercial - - 3 3 6 FAR: 0.6 ILR: 0.57 Year Built: 1957-1963 Height: Mostly 1 This 32,000 sq. ft. site is developed with about 16,000 sq. ft. of building footprint. A 7,600 sq. ft. portion (0.037 acre) of the building is currently two stories. Property owner communicated to staff regarding interest in redevelopment. Factors for Selection: a, d, e, g, h
Y
555 PIER AVENUE LLC C/O RIVIERA CENTER MGMT CO 5 555 Pier Avenue 4183-018-015 CC Community SPA-11 Specific Plan 25.1 33 0.49 Multi-tenant Commercial - - 6 6 12
Page 137 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-19
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
4 517 Pier Avenue 4183-018-018 CC Community SPA-11 Specific Plan 25.1 33 0.07 Offices - - - 1 1
FAR: 0.6 ILR: 0.57 Year Built: 1957-1963 Height: 1 Factors for Selection: d, e, g, h
-
WRAY,RICHARD AND DOLORES TRS WRAY FAMILY TRUST
4 513 Pier Avenue 4183-018-017 CC Community SPA-11 Specific Plan 25.1 33 0.07 Offices - - - 1 1
FAR: 0.7 ILR: 0.37 Year Built: 1939-1957 Height: Mostly 1 (8 1-story and 1 2-story) These parcels are all being accessed from Oak Street behind the buildings with no individual driveways. Shared access is conducive to consolidation. Factors for Selection: d, e, f, g, h
- BAKER AND BURTON
4 509 Pier Avenue 4183-018-016 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1 - WWS PIER LLC
4 507 Pier Avenue 4183-018-007 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1
- REFOUA LLC 4 445 Pier Avenue 4183-018-006 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1
4 433 Pier Avenue 4183-018-005 CC Community SPA-11 Specific Plan 25.1 33 0.07 Restaurant - - - 1 1
4 425 Pier Avenue 4183-018-004 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1 -
CAPALDI, DINO AND LEA TRS D AND L CAPALDI TRUST
4 405 Pier Avenue 4183-018-001 CC Community SPA-11 Specific Plan 25.1 33 0.07 Personal Services - - - 1 1 -
DANESHMAND, MEHDI K AND ROSA TRS DANESHMAND FAMILY TRUST
4 337 Pier Avenue 4183-018-026 CC Community SPA-11 Specific Plan 25.1 33 0.08 Restaurant - - 2 - 2 -
SACKLEY,STUART H TR SACKLEY FAMILY TRUST
4 321 Pier Avenue 4183-017-025 CC Community SPA-11 Specific Plan 25.1 33 0.17
Personal Service ground floor and residential on second floor
- - 4 - 4 - HB 321 PIER AVE LLC
4 419 Pier Avenue 4183-018-003 CC Community SPA-11 Specific Plan 25.1 33 0.05 Multi-tenant Commercial - - - 1 1
FAR: 0.6 ILR: 0.38 Year Built: 1955 Height: 1
Y 419 PIER AVENUE LLC
Page 138 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-20
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
Owner provided preliminary plans for 4 residential units on 2nd and 3rd floor. Currently zoned commercial only. Zoning development standards to be determined with residential standards. Factors for Selection: a, d, e, f, g, h
4 411 Pier Avenue 4183-018-002 CC Community SPA-11 Specific Plan 25.1 33 0.07 Personal Services - - - 1 1
FAR: 0.5 ILR: 0.42 Year Built: 1945 Height: 1 Owner interested in adding small residential units on 2nd and 3rd floors. Factors for Selection: a, d, e, f, g, h
Y
AESTHETIC HORIZONS INC C/O JONATHAN DAVID
7 338 Pier Avenue 4187-011-054 CC Community SPA-11 Specific Plan 25.1 33 0.17 Office - - 4 - 4
FAR: 3.84 ILR: 1.65 Year Built: 2010 Height: 2 While this parcel appears newer, it is located between blocks of parcels that exhibit potential for conversion into mixed use development. Office buildings also often have higher FAR and ILR. However, with increased remoting working, this site can present opportunity for redevelopment. This is included only as a RHNA buffer site and is not needed to accommodate the City’s moderate income RHNA. Factors for Selection: b, d
-
BLAKE HOLDINGS LLC C/O DAVID MCGOVERN
8 400 Pier Avenue 4187-019-037 CC Community SPA-11 Specific Plan 25.1 33 0.21 Offices - - 5 - 5
FAR: 1.0 ILR: 0.60 Year Built: 1915-2010 Height: Primarily 1 (2 1-story and 1 2-story) Potential for office conversion.
-
BLAKE HOLDINGS LLC C/O DAVID MCGOVERN
8 420 Pier Avenue 4187-019-003 CC Community SPA-11 Specific Plan 25.1 33 0.11 Restaurant - - 2 - 2 -
Page 139 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-21
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
8 422 Pier Avenue 4187-019-022 CC Community SPA-11 Specific Plan 25.1 33 0.23 Multi-tenant Commercial - - 5 - 5 Factors for Selection: d, e, f, g, h PIER PROPERTIES LLC
9 506 Pier Avenue 4187-020-020 CC Community SPA-11 Specific Plan 25.1 33 0.1 Offices - - 1 - 1 FAR: 1.0 ILR: 0.27 Age of Structure: 1925-1966 Height: Average 1 (1 0-story, 1 1-story, 1 2-story) Potential for office conversion. Factors for Selection: d, f, g, h
- SAILFISH HOLDINGS LLC
9 514 Pier Avenue 4187-020-032 CC Community SPA-11 Specific Plan 25.1 33 0.1 Private Parking Lot - - 1 - 1
-
REDDY, DAMODER P AND SOUMITRI TRS PATI FAMILY TRUST 9 526 Pier Avenue 4187-020-017 CC Community SPA-11 Specific Plan 25.1 33 0.08 Retail Business - - 2 - 2
3 301 Pier Avenue 4183-017-001 CC Community SPA-11 Specific Plan 25.1 33 0.19 Retail Business - - 5 - 5
FAR: 0.6 ILR: 0.87 Year Built: 1959 Height: 1 Factors for Selection: d, e, g, h
-
SANDY FEET LLC C/O DONALD ENGLISH
6 308 Pier Avenue 4187-011-012 CC Community SPA-11 Specific Plan 25.1 33 0.09 Retail Business - - 2 - 2 FAR: 0.7 ILR: 1.0 Age of Structure: 1923-1944 Height: 1 Common ownership; currently functioning as one site. Factors for Selection: d, e, g, h
- VISION HERMOSA 1 0 LLC 6 318 Pier Avenue 4187-011-013 CC Community SPA-11 Specific Plan 25.1 33 0.11 Retail Business and Residential - - 2 - 2
18 1214 Owosso Avenue 4185-015-021 CC Community C-3 General and Highway Commercial 25.1 33 0.1 1 Unit - - 3 - 3 FAR: 0.1 ILR: 0.16 Year Built: 1923 Height: 1 Common ownership; currently functioning as one site. Factors for Selection: d, e, f, g, h
- CASNER,CRAIG
18 1055 Aviation Boulevard 4185-015-024 CC Community C-3 General and Highway Commercial 25.1 33 0.05 Vacant Land - - 1 - 1
26 530 6th Street 4188-018-028 CI Light Industrial M-1 Light Manufacturing 25.1 33 0.33 Self-Storage - 4 4 - 8 FAR: 1.4 ILR: 0.97 - HUNT, PRISCILLA TR
Page 140 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-22
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
26 6th and Cypress (530 6th St.) 4188-018-027 CI Light Industrial M-1 Light Manufacturing 25.1 33 0.12 Self-Storage - 1 2 - 3 Year Built: 1946 Height: 2 2-story warehouse building with self-storage use in residential adjacent neighborhood. This is expected to be developed due to zoning changes now allowing residential development. Warehouse building existed in the 1950s when the freight line ran through town. The four parcels are under common ownership that function as a cohesive site with shared access. The property is located in the M1 zone where residential has never been permitted. Rezoning to allow residential uses in M1 will increase redevelopment potential. This rezoning is not comparable to past Housing Element programs, since there were no rezoning programs nor were non-residential sites contemplated at that point. As demonstrated in Table B-2 Redevelopment Trends in the South Bay, there are examples of storage facilities (RV parking, truck storage, equipment rental yard, etc) being converted to housing developments. There is currently also a self-storage site in Carson, within the South Bay, marketed for housing. Factors for Selection: d, f, g
PRISCILLA HUNT TRUST C/O HUNT ENTERPRISES INC 26 Valley Drive (530 6th St.) 4188-018-031 CI Light Industrial M-1 Light Manufacturing 25.1 33 0.17 Self-Storage - 2 2 - 4
26 Valley Drive (530 6th St.) 4188-018-008 CI Light Industrial M-1 Light Manufacturing 25.1 33 0.05 Self-Storage - - 1 - 1
27 2nd Street and Pacific Coast Hwy 4186-025-029 CC Community SPA-7 Specific Plan 25.1 33 0.08 Auto Repair - - 2 - 2 FAR: 0.4 ILR: 0.16 Year Built: 1905-1925 Height: <1 (2 0-story, 2 1-story) Common ownership; currently functioning as one site.
- GRAND PROPERTY GROUP LLC 27 204 Pacific Coast Hwy 4186-025-028 CC Community SPA-7 Specific Plan 25.1 33 0.15 Auto Repair - - 4 - 4
27 210 Pacific Coast Hwy 4186-025-027 CC Community SPA-7 Specific Plan 25.1 33 0.08 Auto Repair - - 2 2
Page 141 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-23
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
27 2nd Street and Pacific Coast Hwy 4186-025-002 CC Community SPA-7 Specific Plan 25.1 33 0.05 Auto Repair - - 1 - 1 Factors for Selection: d, e, f, g, h
25 747 5th Street 4188-030-002 SC Service SPA-7 Specific Plan 25.1 33 1 Auto Repair 20 5 - - 25 FAR: 0.4 ILR: 0.29 Year Built: 1923-1978 Height: 1 Factors for Selection: d, e, f, g, h
- SMILE LLC AND MARDIKIAN, GEORGE
25 715 5th Street 4188-030-001 SC Service SPA-7 Specific Plan 25.1 33 0.37 Auto Repair/Fitness Center - - - 9 9 -
FISHER, ANDREW AND ELIZABETH AND FISHER, ANDREW W
22 635 Pacific Coast Hwy 4187-032-027 SC Service SPA-7 Specific Plan 25.1 33 1 Lumber Yard 20 5 - - 25
FAR: 0.2 ILR: 0.04 Year Built: 1988 Height: <1 (5 0-story, 1 1-story) Site 24 is part of Site 22 owned by the same party. Currently, the two sites function as an integral site. Factors for Selection: d, e, f, g, h
-
LEARNED, MICHAEL CO TR LEARNED TRUST
24 709 6th Street 4187-033-022 SC Service SPA-7 Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2
24 721 6th Street 4187-033-021 SC Service SPA-7 Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2
24 723 6th Street 4187-033-020 SC Service SPA-7 Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2
24 Pacific Coast Hwy and 6th Street 4187-033-019 SC Service SPA-7 Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2
24 725 6th Street 4187-033-018 SC Service SPA-7 Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2
23 600 Pacific Coast Highway 4186-013-019 SC Service SPA-7 Specific Plan 25.1 33 0.36 Auto Repair 6 3 - - 9 FAR: 0.5 ILR: 0.32 Year Built: 1923-1978 Height: Average 1 (1 0-story, 1 1-story, 1 2-story) Site 23 is 0.86 acre, consisting of three parcels with two owners, currently functioning as a cohesive site with shared access, operating as interrelated auto businesses. If consolidated, the site would benefit from the City’s current lot consolidation allowances. Most of the site is automobile-related uses developed with only surface automobile storage/parking or single-
- SMILE LLC 23 612 Pacific Coast Highway 4186-013-018 SC Service SPA-7 Specific Plan 25.1 33 0.14 Fitness Studio 2 2 - - 4
23 620 Pacific Coast Highway 4186-013-064 SC Service SPA-7 Specific Plan 25.1 33 0.36 Car Rental Agency 6 3 - - 9 - NOOR ESTATE LLC
Page 142 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-24
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
story automobile-related buildings. There is a two-story building with two small office suites above. (At least one office was vacant as of summer 2023). The two-story portion of the building is approximately 1,400 square feet. Factors for Selection: d, e, f, g, h
13 1100 Pacific Coast Highway 4185-011-039 GC Gateway C-3 General and Highway Commercial 25.1 33 0.55 Retail Market 10 4 - 14 FAR: 0.7 ILR: 0.65 Year Built: 1977 Height: Average 1 (1 0-story, 1 2-story) This is a 2.8-acre shopping center with one owner and operating as a cohesive site and would need to be consolidated for shared access if redeveloped. About 0.9 acres are occupied by buildings, with the rest (almost two acres) being surface parking lot and undeveloped land. The site is developed with about 40,000 square feet of building area. All buildings are single story with the exception of one 7,500 square foot portion which is two-story. This two-story portion has been partially vacant for over a year. This indicates that there are no significant second-story encumbrances on the development of the site for mixed use or residential purposes. The 2.8 acre center comprises two parcels. One parcel is 0.55 acre, is coterminous with the footprint of one building and is entirely nestled (landlocked) in the 2.27 acre parcel. As such, the entire site already functions as one cohesive site with driveway access points and internal circulation.
Y
BACON, STEPHEN F CO TR ROGER E BACON DECD TRUST 13 1100 Pacific Coast Highway 4185-011-061 GC Gateway C-3 General and Highway Commercial 25.1 33 2.27 Parking Lot/Pad Shops 30 6 5 16 57
Page 143 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-25
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
Factors for Selection: d, e, g, h
12 1601 Pacific Coast Highway 4185-011-061 GC Gateway C-2 Commercial SPA-8 25.1 33 1.92 Personal Services with office space 24 8 8 8 48
FAR: 3.7 ILR: 1.80 Year Built: 1988 Height: 0 Given the high vacancy and the reliance on one anchor (gym), there is a likelihood that residential may be a viable conversion. The building also has similar massing as other nearby multi-family residential buildings (like the adjacent one). This property has the potential to redevelop through use of internal conversion into residential. Factors for Selection: b, d, g, h
- 1601 PCH LP C/O SHAOUL LEVY
14 900 AVIATION 4186-003-024 CC Community C-3 General and Highway Commercial 25.1 33 0.15 Retail - - 3 - 3
FAR: 0.8 ILR: 0.39 Year Built: 1940-1981 Height: <1 (6 0-story, 5 1-story, 1 2-story) These sites are under common ownership and is about 0.7 acres (30,000 sq ft). About 7,200 square feet of building footprint is two stories. Factors for Selection: d, f, g, h
- EDDIE TALBOT TRUST
14 916 AVIATION 4186-003-030 CC Community C-3 General and Highway Commercial 25.1 33 0.21 Retail - - 5 - 5
14 950 AVIATION 4186-003-019 CC Community C-3 General and Highway Commercial 25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-018 CC Community C-3 General and Highway Commercial 25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-017 CC Community C-3 General and Highway Commercial 25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-027 CC Community C-3 General and Highway Commercial 25.1 33 0.08 Parking Lot - - 2 - 2
14 950 AVIATION 4186-003-028 CC Community C-3 General and Highway Commercial 25.1 33 0.14 Multi-tenant Commercial - - 3 - 3
Page 144 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-26
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
15 1000 AVIATION 4186-002-020 CC Community C-3 General and Highway Commercial 25.1 33 0.07 Multi-tenant Commercial - - 1 - 1
15 1014/1016 AVIAITION 4186-002-013 CC Community C-3 General and Highway Commercial 25.1 33 0.03 Multi-tenant Commercial - - 1 - 1
15 1016 AVIAITION 4186-002-012 CC Community C-3 General and Highway Commercial 25.1 33 0.03 Parking Lot - - 1 - 1
15 1036 AVIATION 4186-002-011 CC Community C-3 General and Highway Commercial 25.1 33 0.03 Parking Lot - - 1 - 1
15 1036 AVIATION 4186-002-021 CC Community C-3 General and Highway Commercial 25.1 33 0.09 Multi-tenant Commercial - - 2 - 2
16 1021 AVIATION 4185-014-015 CC Community C-3 General and Highway Commercial 25.1 33 0.11 Multi-family - - 2 - 2 FAR: 0.4 ILR: 0.57 Year Built: 1947-1962 Height: 1 Factors for Selection: d, e, g, h
- HBAVIATION LLC 16 1029 AVAITION 4185-014-015 CC Community C-3 General and Highway Commercial 25.1 33 0.11 Multi-family - - 2 - 2
16 1035 AVAIATION 4185-014-001 CC Community C-3 General and Highway Commercial 25.1 33 0.17 Multi-tenant Commercial - - 4 - 4
29 824 1ST STREET 4186-031-102 CC Community SPA-7 Specific Plan 25.1 33 0.13 Abandoned Office Condos - - 3 - 3
FAR: 0.9 ILR: 0.18 Year Built: 1979 Height: 1 Factors for Selection: c, d, f, g, h
- KOCHDVPMT LLC
21 700 Pacific Coast Highway 4186-012-014 SC Service C-3 General and Highway Commercial 25.1 33 0.33 Abandoned Auto Repair - - 4 4 8
FAR: 0.4 ILR: 0.28 Year Built: 1945 Height: 1 Owner communicated to staff regarding interest in redevelopment. Factors for Selection: a. c, d, e, f, g, h
Y
LOWENSTEIN,JOSEPH R AND GAIL TRS LOWENSTEIN TRUST
Page 145 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-27
Site/Area No. Address APN Existing/ Proposed GP Existing Zoning Proposed Zoning Min. Den. Max. Den.
Parcel Size (acres) Existing Use Capacity Based on Minimum Density Factors for Selection Owner/ Developer Interest Owners Very Low Low Mod Above Mod Total
30 8 N PACIFIC COAST HWY 4186-031-001 CC Community SPA-7 Specific Plan 25.1 33 0.14 Auto Related 2 2 0 0 4 FAR: 1.03 ILR: 0.15 Year Built: 1955 Height: <1 (3 0-story, 1 1-story) Owner submitted a letter of interest for redevelopment. Factors for Selection: a, d, f, g, h
Y 900 North PCH LLC c/o Peter Nolan
30 No Address 4186-031-002 CC Community SPA-7 Specific Plan 25.1 33 0.14 Auto Related 1 2 0 0 3
30 18 N PACIFIC COAST HWY 4186-031-003 CC Community SPA-7 Specific Plan 25.1 33 0.25 Auto Related 3 3 0 0 6
30 26 N PACIFIC COAST HWY 4186-031-036 CC Community SPA-7 Specific Plan 25.1 33 0.21 Auto Related 2 3 0 0 5
31 1734 PACIFIC COAST HWY 4185-002-007 CC Community SPA-8 Specific Plan 25.1 33 0.13 Retail 0 0 3 0 3 FAR: 0.14 ILR: 0.29 Year Built: 1952 Height: 1 Only occupied by a 1-story single-family home. Owner submitted a letter of interest for redevelopment. Factors for Selection: a, c, d, e, f, g, h
Y Egerer, Joseph J and Egerer, Thomas C 31 1706 PACIFIC COAST HWY 4185-002-014 CC Community
SPA-8 Specific Plan
25.1 33 0.17 Retail 0 0 4 0 4
Total 224 129 171 80 604
Notes: *Income level assigned to lower for parcels at least 0.5 ac. and smaller parcels that can be consolidated, or moderate for other small parcels less than 0.5 ac. Site 7 is excluded as a site to meet the RHNA as it only meet two of the five criteria for underutilization.
Page 146 of 150
Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory
Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023
CERTIFIED August 1, 2024 Revised January, May, June 2024
B-28
Figure B-1 Sites Inventory
Page 147 of 150
November 17, 2025
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach CA 90254
RE: Mixed-use and Land Value Recapture
Dear City Council and Mayor:
The Hermosa Beach Chamber of Commerce and Visitors Bureau supports mixed-use
development as a strategy to strengthen downtown vitality, enhance foot traffic, and attract
private investment into our commercial corridors throughout the year. However, since the
Land Value Recapture (LVR) Program was adopted in 2023, no mixed-use applications have
been submitted on the small downtown lots subject to the fee. This lack of investment
underscores that the program, as currently structured, has created a barrier to
redevelopment rather than an incentive.
These small parcels face physical and financial limitations that make new construction
challenging even before the fee is applied. Even a reduced LVR fee would continue to make
these projects infeasible. Smaller sites cannot offset the cost through economies of scale or
density bonuses, nor can they blend affordable and market-rate units to balance returns. As a
result, the program has stalled all reinvestment interest in these small commercial lots.
Both Manhattan Beach and Redondo Beach do not impose a Land Value Recapture fee on
mixed-use development, placing our City at a competitive disadvantage when it comes to
attracting investment and achieving long-term revitalization goals.
To better align the City’s housing, economic development, and sustainability objectives,
the Chamber respectfully recommends that the City:
1. Exempt Small Downtown Lots from the LVR fee entirely.
a. This exemption recognizes the unique physical and financial constraints of our
City’s small downtown lots, which cannot utilize density bonuses or achieve the
scale needed to make development feasible.
b. It also aligns with City Council’s recent direction to the Planning Commission to
exempt our small downtown commercial lots from an LVR fee.
Page 148 of 150
2. Streamline the Review Process for small mixed-use projects by allowing
qualifying proposals to undergo Administrative Review.
a. Expediting approvals for small, low-impact projects would reduce costs and
delays, making these developments more achievable.
b. Streamlining is consistent with the City’s Economic Development Strategy #28,
which emphasizes increasing certainty and reducing approval times through
improved efficiency.
c. This approach would promote reinvestment while maintaining appropriate
design oversight.
Together, these actions would strike the right balance, protecting public interests while
unlocking the potential of small lots that have remained underutilized for years.
The Chamber appreciates the City’s continued collaboration in fostering downtown
revitalization while preserving our City’s character and local business base. By exempting
small lots and streamlining their review, our City can remove barriers to progress, encourage
local reinvestment, and demonstrate leadership in practical, community-based economic
development.
Thank you for your consideration and continued partnership with our business community.
Thank you for your consideration,
Board of Directors
Hermosa Beach Chamber of Commerce & Visitors Bureau
Page 149 of 150
Page 150 of 150