Item G-1 Agenda Report — Beverly Hills City Council, December 9, 2025

AGENDA REPORT
Meeting Date: December 9, 2025
Item Number:

To: Honorable Mayor & City Council
From: Chloe Chen, Principal Planner
Andrez Parra, Assistant Planner
Subject: MEDICAL USE ORDINANCE UPDATE AND CONSIDERATION OF

POTENTIAL AMENDMENTS TO MEDICAL USE REGULATIONS
Attachments: 1. Supplemental Tables

2. Second Annual Medical Ordinance Update Report

3. Fiscal Year (FY) 2025-26 Schedule of Taxes, Fees and Charges

4. Public Correspondence

RECOMMENDATION
Staff recommends that the City Council:
• Provide staff with input and direction on any potential changes to medical use regulations; and
• Provide direction on potential changes to the tax structure and any associated ballot initiatives pending a full analysis by the City's consultants. The analysis on medical taxation will be incorporated into the comprehensive, city-wide business tax modernization study being conducted by the Finance Department.

INTRODUCTION
In 2022, the City Council adopted Ordinance No. 22-O-2864 (also known as the “Medical Conversion Ordinance”, included in Attachment 2) that revised the City’s medical use regulations to allow the conversion of existing commercial space to certain medical uses, while prohibiting “specialty clinics” as defined by the Beverly Hills Municipal Code (BHMC) §10-3-100 and medical uses at the ground floor of a building. This report provides an annual update on medical conversion permit issuance and satisfies the requirement for the revised regulations to be reviewed approximately three years from the date of adoption of the ordinance to ensure that an increase in medical uses has not created unforeseen adverse impacts on commercial or residential properties and uses. As part of this review, the report also provides an initial discussion regarding potential changes to medical use Meeting Date: December 9, 2025

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regulations, such as allowing ground floor medical uses and expanded surgery uses, and the taxation structure for medical uses. This analysis of the tax structure will serve as a valuable input for the City’s comprehensive, in-progress business tax modernization study, which is being led by the Finance Department.

No new regulations will be adopted by the City Council at this time. However, if the Council directs staff to amend medical regulations, staff will prepare a draft ordinance with amendments for consideration by the Planning Commission before returning to City Council for adoption. If the City Council decides to make changes to any taxation classifications, this would require a ballot measure initiated by City Council or a voter initiative.

DISCUSSION
Background
Medical uses are currently defined as “uses including medical offices, medical laboratory, or any combination thereof”. Prior to the adoption of an urgency ordinance in 2020, medical uses were regulated primarily by an ordinance adopted in 2011 (Ordinance No. 11-O-2602) that defined medical uses as separate from office uses and required more parking spaces for medical uses than commercial offices. The previous medical regulations allowed existing medical space to remain as legally nonconforming (and allowed the relocation or reinstatement of medical uses as long as the amount of medical square footage was registered through an application process) but required that the establishment of new medical space be approved through a Planned Development Permit and be added to the Medical Use Overlay Zone (C-PD-M). The regulations also allowed a limited expansion of existing medical space upon meeting certain criteria, such as parking requirements greater than required for commercial uses and the prohibition of ground floor medical uses. The medical regulations adopted in 2011 limited the expansion of medical space in the city beyond what generally existed prior to 2011, until the adoption of the urgency ordinance in 2020.

The adoption of the Medical Conversion Ordinance in 2022 continued the provisions of an urgency ordinance that had been in place for two years since November 2020, which was intended to provide flexibility for the use of commercially zoned properties during the Covid-19 pandemic when vacancies of commercial spaces were increasing and demand for commercial uses (e.g., retail, office, etc.) was decreasing. Other provisions of the Medical Conversion Ordinance included:
• Established a new definition for ambulatory surgical care, which is defined as “one or more surgical procedures performed by a licensed medical professional that do not require an overnight stay and may be performed on an outpatient basis”; • Permitted ambulatory surgical care uses within one operating room with a maximum floor area of 250 square feet (SF) or 10% of the total floor area of the overall medical suite floor area, whichever is greater; • Modified the applicable parking regulations to make them consistent with other commercial uses, at one parking space per 350 SF; the prior requirement was one parking space per 200 SF; and
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• Amended permitted and excluded use sections of the various commercial zone regulations to clarify that medical uses are no longer prohibited so long as they comply with the regulations of the medical use code sections.

The Medical Conversion Ordinance continued the prohibition on ground floor medical uses in order limit potential detrimental impacts to neighboring residential and commercial properties, and to preserve the pedestrian-oriented character of the city’s commercial corridors per direction of the City Council. Similarly, the Medical Conversion Ordinance limited ambulatory surgical care uses in order to promote the expansion of medical uses that met community needs such as general practice/family medicine, to limit medical uses that could be less compatible with neighboring commercial uses, and due to concerns from the City Council regarding the taxation of surgical uses.

As required by the Medical Conversion Ordinance, staff has prepared annual reports documenting its implementation and providing data on how much commercial office space has been converted to medical uses. On March 18, 2024, staff presented the annual report for the period between the adoption of the ordinance and the first full year of its effectuation (October 21, 2022, through the end of 2023) to the City Council. On March 18, 2025, staff presented the annual report for the year 2024 to the City Council. The second annual report on medical uses is Attachment 2 and includes information on the first annual report.

Update on Medical Conversions in 2025
From the adoption of the Medical Conversion Ordinance to October 2025, a total of 88 permits have been issued for the conversion of commercial space to new medical uses, with 17 permits issued since January 1, 2025. Of the 17 permits issued so far in 2025, one was for the conversion of a nail salon to a medical spa, three were for the conversion of general office space to ambulatory surgical uses, and two were for the conversion of general office space to dental offices. The remaining 11 were for the conversion of general offices/suites into medical offices/suites. Table 1A of Attachment 1 provides a further breakdown of medical conversions to date.

The second annual report on the medical use ordinance to the City Council outlines that, in calendar year 2024, 13 permits were issued for medical conversions with an average of 1.1 permits per month issued for medical conversions. This represented a decrease from the peak period of medical conversions issued from October 21, 2022, through December 31, 2023 (the initial 14 months of the medical use ordinance being in effect), which saw an average of two permits issued per month. The 2025 data to date suggests that the normalization in the number of medical conversion permits issued is between oneand-two permits per month. The increase in the rate of permits issued within the current calendar year may also be a result of familiarity with the medical use conversion regulation and more opportunities for conversions due to vacated commercial spaces.

Based on the above information, staff’s assessment is that the current medical use regulations are operating as intended by providing flexibility in the use of commercial space throughout the city, without resulting in a surge of office space conversions to medical uses or causing unforeseen adverse impacts. Furthermore, staff is not aware of adverse impacts on commercial or residential properties or uses caused by medical office conversions.

Considerations for Further Amendments to Medical Use Regulations Meeting Date: December 9, 2025

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The Medical Conversion Ordinance also requires that the medical use regulations are reviewed approximately three years from their adoption. Since the implementation of the Medical Conversion Ordinance, staff has received requests to amend certain provisions of the ordinance. The following section discusses such potential changes and considerations for the City Council under each topic.

Ground Floor Medical Uses
There remains continued interest from commercial property owners, brokers, and medical providers to establish ground floor medical space, which is currently prohibited under the Medical Conversion Ordinance. There are several considerations if the City Council were to amend the ordinance to allow medical uses in ground floor commercial spaces:

Potential Impacts to Commercial Uses and Districts
If medical uses were to be allowed in ground floor commercial spaces, there may be adverse impacts related to the replacement of commercial storefronts with medical uses.

Ground floor commercial uses generally promote pedestrian-oriented retail corridors and reduce parking congestion because of the convenience of concentrating various commercial uses and services. The replacement of these commercial spaces with medical uses would likely reduce foot traffic to neighboring commercial storefronts and potentially to commercial districts overall. This is because medical uses typically appear as blank frontages devoid of window displays and views into the interior, which is less pedestrianfriendly and could deter patrons from the area unless they are specifically seeking out the medical use. Additionally, the city’s commercial districts are limited, and the ground floor spaces in these areas are arguably the most important component for maintaining vibrant commercial spaces and the pedestrian character of the city. In contrast to medical uses, retail stores and restaurants generate pedestrian traffic and can contribute to a pedestrian atmosphere and sense of community. Intensive medical uses such as ambulatory surgical uses are more likely to pose additional adverse impacts on the ground floor than less intensive medical uses such as general medical practitioner offices. While ambulatory surgical centers as defined by the BHMC may provide a wide range of procedures, in general, it can be expected that these procedures may require longer patient waiting periods and visits, and greater patient privacy considerations than less intensive, routine medical treatments such as physical examinations. These factors can contribute to an inactive storefront that may deter pedestrian traffic to neighboring businesses.

Additionally, patients departing surgical centers are likely to require more intensive recovery and are less likely to patronize nearby businesses before or after their procedures.

Potential Positive Impacts
Allowing ground floor commercial conversions to medical uses could potentially provide several benefits for the City and its residents. First, allowing ground floor medical uses in commercial spaces would allow for the utilization of currently vacant storefronts. Second, the use of ground floor space for less intensive medical uses such as dental, general practice/family medicine, and non-surgical specialties can potentially promote foot traffic in an area, if the patient decides to patronize adjacent businesses and does not need to recover from treatment. Additionally, as mentioned above, allowing limited medical uses to be set back from a retail storefront (“medtail”) could further promote foot traffic and avoid concerns that may arise from more visible medical uses. Certain general medical office uses such as dermatology may be more compatible with retail uses, if such uses were Meeting Date: December 9, 2025

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located within the same suite towards the street because they may sell skincare products or other services more analogous to a cosmetic spa or facialist.

Potential Regulations for Ground Floor Medical Uses
There are several potential regulations that could help alleviate any adverse impacts of ground floor medical uses:
• Limit medical uses to the rear of the space by requiring a minimum interior setback from the storefront entrance of a complimentary retail space (a model sometimes referred to “medtail”). This arrangement is already allowed for consultations with an optometrist within retail spaces and for cosmetic spas that offer aesthetic treatments (also known as medical spas);
• Restrict establishment of medical uses to corner lots and lots adjacent to only one other business or property, as this could reduce the foot traffic impact of ground floor medical uses that would otherwise be places in between two pedestrianoriented storefronts. Non-retail uses for buildings located at the corner of two streets are already restricted to a maximum of 25 feet of ground floor frontage on each street in the pedestrian-oriented area (BHMC §10-3-1654(B)). o Additionally, stricter frontage requirements or alternative layouts such as those required by pharmacies, which are prohibited on the ground floor within the first 30 feet behind the storefront facing façade (BHMC §10-3- 1654(D)) could be implemented; and
• If allowing ambulatory surgery uses on the ground floor, dedicated alternative entrances set in the rear or a set distance away from neighboring uses may be appropriate.

To mitigate potential impacts of ground floor medical conversions, the City Council could also consider whether ground floor medical uses should be approved through a discretionary review process, similar to how non-retail uses are allowed. Options for a discretionary review process include:
• A Minor Accommodation reviewed at the Director level; • A Conditional Use Permit (CUP) at the Planning Commission level; or • Add a threshold for either Director or Planning Commission review dependent on the size of the potential ground floor medical conversion storefront.

Staff has also received a letter (Attachment 4) from representatives of Cedar-Sinai to amend the medical use code sections to allow hospital-affiliated medical uses on the ground floor of the southeast commercial areas of the city. If the City Council wishes to allow some medical ground floor uses, they may consider the proposed criteria set forth in the letter as well.

Meeting Date: December 9, 2025

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Additional Floor Area for Surgical Uses
Applicants have also continued to express interest in expanding the allowable floor area for surgical uses. Currently, the Medical Conversion Ordinance allows ambulatory surgical care uses within one operating room with a maximum floor area of 250 SF or 10% of the total floor area of the overall medical suite floor area, whichever is greater. This allowance for surgical uses was intended to allow some space within a medical office to provide surgical treatments, while preventing new medical conversions from being solely used for surgery centers.

Allowing greater floor area or more than one room for surgical uses poses similar considerations as allowing ground floor medical uses. The current medical use regulations limiting the maximum space allowed to be converted to surgical or operating space imposes a hard cap on the number of procedures than can be undertaken with a given number of staff as smaller medical offices. Greater floor area would mean an increased capacity for more intensive medical procedures to be performed, which are uses that could potentially deter pedestrian traffic to nearby pedestrian-oriented businesses given the nature of the procedure. As described above, patients recovering from surgical procedures may be less likely to shop, dine, or seek other services immediately before or after a procedure. Increasing the maximum floor area allowed for surgical uses may encourage additional medical conversions since surgical procedures are likely more profitable than routine medical treatments.

Wellness Uses
Commercial property owners and brokers have indicated increased interest in allowing ground floor wellness uses such as body scans, preventative medicine, health screenings, and cryotherapy. The wellness uses mentioned may often fall under the umbrella of a “cosmetic spa” use (staff typically assesses how to classify uses based on their operational qualities and services offered), which may be permitted through the Medical Conversion Ordinance, or if they are located on the ground floor, through the approval of a conditional use permit (CUP). Alternatively, it is possible that a wellness use may fall under the definition of medical uses which are prohibited on the ground floor in most cases.

In addition to the approval of a CUP, cosmetic spas located on the ground floor are subject to a number of requirements including: the use of the front portion of the building for retail space of either 100 feet or 1% of the ground floor area, whichever is greater; not providing treatment within the first 10 feet of the storefront facing street; design standards that promote transparent storefronts; and may include services provided by a medical professional but not services that are eligible for coverage by medical insurance, among other requirements (BHMC §10-3-1620.2).

Staff has received input from commercial property owners and brokers that classifying wellness uses as a cosmetic spa and requiring the approval of a CUP for wellness uses proposed on the ground floor has deterred potential commercial tenants from establishing these businesses in the city. Wellness and healthcare practices have continued to evolve along with technology, and the distinction between medical, cosmetic, and wellness uses have increasingly overlapped. Given this overlap, a more refined definition of cosmetic spa and medical uses may be warranted. Potential considerations for amending code sections regulating cosmetic spa and medical uses include:
• Carve out wellness uses and allow defined wellness uses by right; Meeting Date: December 9, 2025

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• Remove requirements for a CUP and allow cosmetic spas by right; or • Create a Director-level approval options for a cosmetic spa CUP.

Tax Considerations of Medical Uses
There are several considerations related to the current business taxation structure for medical versus other commercial businesses. For the fiscal year 2024 to 2025, there were 814 registered medical businesses across the city. Medical businesses are classified into 4 categories for the purposes of collecting business taxes: ambulatory surgery center, medical clinic, physician, and plastic surgery (Table 1B of Attachment 1 provides the breakdown of medical businesses within the city, their categorization, and the average business taxes paid for the previous fiscal year).

For the purposes of collecting business taxes, medical uses are classified as “Classification C – Professionals, Minimum Tax” and “Classification C – Professionals, Additional Tax” with taxes applied per the “first 2,080 hours of professional/semiprofessional payroll or billed hours” and “each additional hour of professional/semiprofessional payroll or billed hours over 2,080 hours” (see Attachment 3). For the purposes of these taxes, doctors and nurses would be considered professional/semi-professional payees. Additionally, medical business support staff and administrative workers are classified as “Classification C – Non-professionals, additional tax” per “each hour of nonprofessional employee payroll.” 2,080 hours equates to a 40-hour work week for 52 weeks over a one-year period. The median amount of business taxes paid by medical professionals for Fiscal Year 2024-25 was $2,214.35. This indicates that the majority of medical businesses in the city paid at or close to the base tax rate of $1,8901 , with less
than 4% of businesses paying a prorated amount lower than the base rate.

For the fiscal year 2024-2025, Class C – Professional and Semi-Professional revenue accounted for 11.5% of total revenues by business tax classification paid to the City, with medical uses specifically accounting for 46.2% of all Class C business taxes (or about

5.3% of all business taxes paid to the City). Table 2 provides a summary of business taxes paid by different business tax classifications for Fiscal Year 2023 – 2024 (data for FY 2024 – 2025 is expected to be released in December 2025).

TABLE 2. BUSINESSES TAXES PAID BY RATE TYPE,
FISCAL YEAR 2023 – 2024
Rate Type Taxes Paid % of Total
Class A (Business & Personal Services) $2,335,705.00 3.81% Class B (Retail, Wholesale, Manufacturing) $6,634,598.00 10.83% Class C (Professional) $7,052,519.00 11.51%
Class C-1 (Non-Professional) $1,041,488.00 1.70%
Class D (Used Car Dealers) $957,812.00 1.56%
Class E (Residential Property Rental) $8,379,548.00 13.68% Class F (Commercial Property Rental) $24,726,117.00 40.36% Class G (Agencies, Lenders, Brokerages) $9,708,027.00 15.85% 1 The base business tax for Classification C will rise to $1,950 beginning January 1, 2026.

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Class G1 (Real Estate Agents) $276,685.00 0.45%
Class O.1 $153,635.00 0.25%
Class O.2 N/A N/A
Total $61,266,134.00 100.00%
Within medical uses, ambulatory surgery centers generate more tax revenue on average (see Table 1B of Attachment 1). This is likely explained by larger staff sizes, composed of professional- and semi-professional-support staff such as nurses and nonprofessional staff such as medical assistants, whereas individual medical practices may have only one or two employees, including the physician. Surgery centers may also operate on a per procedure basis, where the surgeon or medical professional may not actually have a permanent office in the city, but utilizes the surgery center as needed. If a Class C business registered in the city has a valid license and address in another city, the business operator reports the number of labor hours performed in the City of Beverly Hills and pays an apportioned tax based on the percentage of hours worked in the city (the amount of labor hours is generally self-reported for the purposes of business tax collection).

However, since the work is being done by a business operating under Classification C – Professional and Semi-Professional for the purposes of business tax, any procedure or operation within the space is being taxed by payroll and/or billable hours instead of as a commercial property rental. This is despite the space being operated as a temporary commercial rental space which are typically taxed based on gross receipts (Classification F, see Attachment 3).

This results in a situation where ambulatory surgery providers (plastic surgery services would be ambulatory as defined in the BHMC) are paying the same amount of tax per labor hour – and some cases less for providers who pay an apportioned rate – as less intensive medical uses despite likely generating far more in gross revenue. While exact data on medical salaries or gross revenue for medical providers within the city are not readily available and online estimates vary, general and plastic surgeons are expected to earn significantly more than a general practitioner. Although ambulatory surgery providers make up a small portion of medical uses in the City, the higher revenue potential for these businesses may help explain the desire for expanding allowable space for medical uses.

Comparison to Neighboring Jurisdictions
Beverly Hills appears to have a significantly higher concentration of medical uses compared to other local jurisdictions. Data from CoStar reveals up to 26% of rentable office space in the city is dedicated to medical office space. Total rentable office space available for medical office uses in cities such as West Hollywood, Culver City, and Santa Monica range between up to 4% and 9% of total rentable office space.2 While limited to available rental space data, these figures are indicative of the demand for medical space within Beverly Hills compared to other cities nearby. The current schedule of business taxes in Beverly Hills based on labor hours rather than gross receipts may partially explain the sustained higher concentration and demand for medical space in Beverly Hills as 2 The CoStar data for space included in the amount of total rentable medical space may also be inclusive of non-medical uses within the same space, office, or building, and these percentages may be an overestimate of the true figures for all cities.

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opposed to neighboring jurisdictions (Table 1C of Attachment 1 provides a summary of the business tax schedules as they relate to medical providers in neighboring cities).

All neighboring jurisdictions levy business taxes on medical professionals as a percentage of gross receipts whereas the City levies business taxes per payroll and/or billable hour recorded (Attachment 3). As noted above, taxes paid based on a fee per labor hour are likely to be significantly lower than the taxes that would be paid as a percentage of gross receipts for medical providers performing procedures with higher margins such as ambulatory surgical services.

Potential Change to Medical Taxation Structure
In consideration of the various circumstances related to medical taxation, this matter is being comprehensively addressed as part of the City’s business tax modernization study, which was initiated by the Finance Department based on recommendations from the 2024 Mayor’s Blue Ribbon Committee report. The Finance Department has completed the RFP process and will be recommending the consulting team to perform the study in the near future. A change to tax medical uses based on gross receipts or to tax surgery uses as a specific subset of medical uses based on gross receipts is more aligned with neighboring cities and will be a primary focus of the business tax modernization study. Such a potential change to the business tax structure would require voter approval.

SUMMARY OF CONSIDERATIONS
Medical conversions of commercial space have occurred at a steady pace of around oneto-two conversions per month since the adoption of the Medical Conversion Ordinance.

Concurrently, interest in allowing medical uses on the ground floor has continued to increase, especially related to allowing wellness and med spa uses on the ground floor.

Staff recommends that the City Council consider the following issues:
• Demand for ground floor medical uses continues to increase as property owners seek to fill vacant tenant spaces as demand fluctuates for commercial office and retail space;
• If the City Council is interested in allowing ground floor medical uses, consider limiting them to non-pedestrian-oriented areas;
• Instead of or in addition to limiting ground floor uses geographically, consider allowing ground floor medical uses on a case-by-case basis through a discretionary review process such as a conditional use permit to mitigate potential adverse impacts on neighboring businesses and pedestrian activity; and • Consider whether to limit the types of medical uses allowed on the ground floor, such as continuing to prohibit ambulatory surgical uses, or requiring that ground floor uses be affiliated with a hospital or larger medical group.

If the Council is interested in facilitating the establishment of cosmetic and med spa uses on the ground floor, staff recommends that the Council consider the following:
• Amend the definition of cosmetic spas and medical uses to define such uses more narrowly and clearly allow cosmetic and med spa uses as a permitted retail use on the ground floor; or
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• Amend code sections regulating cosmetic spas and wellness uses to change the requirement for Planning Commission approval of a CUP to a Director-level approval to streamline the review and establishment of such uses.

The analysis in this report validates the need for the ongoing, city-wide business tax modernization study. The potential for amendments to the business tax schedules for medical and surgical uses will be a central component of this larger project, which will likely begin during the first half of 2026.

Any change to the regulation or taxation of medical uses has the potential to increase or decrease the demand and concentration of medical businesses operating in the city, and the Council will have to consider if any changes in this respect are desired.

FISCAL IMPACT
There is no fiscal impact to the City for this informational report. Any medical conversion permit is subject to permitting fees and business taxes as set forth in the City’s Comprehensive Schedule of Taxes, Fees, and Charges for Fiscal Year 2025-2026.

NEXT STEPS
If the City Council wishes to amend the medical use regulations, staff will prepare a draft ordinance for review and recommendation by the Planning Commission and for adoption by City Council. Finance Department staff will provide the analysis from this report to the City's business tax modernization consultants to be incorporated into their comprehensive review. Recommendations on potential changes to the tax structure for all business classifications, including medical uses, and any associated ballot measures will be brought back to City Council as part of that project's deliverables.

Michael Forbes, AICP,
Director of Community Development
Department
Approved By
Jeff Muir,
Director of Finance
Department
Approved By
Attachment 1
Supplemental Tables

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ATTACHMENT 1: SUPPLEMENTAL TABLES
TABLE 1A. MEDICAL CONVERSION PERMITTING
Period Effective Ordinance Permits
Issued
Monthly
Average
(Permits Per
Month)
Total SF
(approx.)
1/1/25 – 10/1/25
(10 mos.) Medical Use 17 1.8 87,660
1/1/24 – 12/31/24
(12 mos.) Medical Use 13 1.1 35,320
10/21/22 – 12/31/23
(14 mos.) Medical Use 25 2 81,575
11/17/20 – 10/20/22
(23 mos.) Urgency 33 1.4 90,400
Total -- 88 1.5 294,955
TABLE 1B. NO. OF REGISTERED MEDICAL BUSINESS AND
AVG. BUSINESS TAX PAID (FISCAL YEAR 2024 – 2025)
Business Type Count Taxes Paid Avg. Tax
Ambulatory Surgery Center 72 $620,825.33 $8,622.57
Medical Clinic 385 $1,464,285.09 $3,803.34
Physician 280 $734,299.99 $2,622.50
Plastic Surgery 77 $256,051.07 $3,325.34
Total 814 $3,075,4651.48 $3,778.21

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TABLE 1C. MEDICAL PROVIDER BUSINESS TAX RATES

IN NEIGHBORING JURISDICTIONS
Jurisdiction Tax Categorization
of Medical Providers Tax Rate Code Section
Los Angeles
Gross Receipts Fund
Class 9
(Tax Rate F)
$4.25 for every $1,000 or
fractional part thereof gross
receipts
LAMC
§§21.49 and

21.33(f)(3)
West
Hollywood Professionals $1.44 per $1,000 of gross receipts WHMC §3-

36.040(j)
Culver City GRT-G $3.50 for every $1,000 or fraction
thereof of gross receipts*
CCMC
§11.01.245(a)
Santa
Monica
Professions
(Group IV)
$75 in addition to $5 for every
$1,000 in gross receipts
SMMC
§§6.08.100
and

6.08.010(d)
*Note: Per CCMC §11.01.245(a), the first $200,000 in annual gross receipts are exempted from the tax for businesses whose tax rate is based on the gross receipts and an additional tax of 0.01% is assessed on gross receipts when reported gross receipts is more than $100,000,000 annually Attachment 2
Second Annual Medical
Ordinance Update Report

STAFF REPORT
Meeting Date: March 18, 2025
To: Honorable Mayor & City Council
From: Masa Alkire, AICP, Assistant Director of Community Development/City Planner
Cindy Gordon, AICP, Principal Planner
Subject: Annual Medical Use Ordinance Update
Attachments: 1. BHMC Section 10-3-1620.1

2. Medical Conversions (January 1, 2024 to December 31, 2024)

3. First Annual Medical Ordinance Update Report

INTRODUCTION
On September 20, 2022, the City Council adopted an ordinance (22-O-2864) that revised the City’s medical use regulations to allow the conversion of commercial space to certain types of medical uses. The ordinance continued the provisions of an urgency ordinance that had been in place for two years, which was intended to create more flexibility for property owners regarding the use of space in commercially zoned properties during the Covid-19 pandemic when vacancies of commercial spaces were increasing and demand for typical commercial uses (e.g., retail, office, etc.) was decreasing.

The adopted ordinance includes a requirement that the revised regulations be reviewed approximately three years from the date of adoption with a report to the City Council every year thereafter in order to ensure that an increase in medical uses has not created unforeseen adverse impacts to commercial or residential properties and uses.

This is the second annual report and the information provided reflects the period from January 1, 2024 to December 31, 2024. The first annual report, which provided information from the ordinance’s effective date (October 21, 2022) through the end of 2023, is included as Attachment 3.

DISCUSSION
The revised regulations, outlined in Subsection F of Beverly Hills Municipal Code (BHMC) §10-3-1620.1 (Attachment 2), allow for the establishment of new medical uses in commercial zones throughout the city by converting existing commercial space provided the proposed medical use complies with the following requirements:
 No new medical uses may be located on the ground floor of a building; and Meeting Date: March 18, 2025

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 No 'specialty clinic' uses are permitted, as defined in BHMC §10-3-1604.5.

However, ambulatory surgical care uses, as defined in BHMC §10-3-100, are permitted within one operating room with a maximum floor area of 250 square feet or 10% of the total floor area of the overall medical suite floor area, whichever is greater.

Other modifications in the ordinance included the following:
 Established a new definition for ambulatory surgical care, which is defined as “one or more surgical procedures performed by a licensed medical professional that do not require an overnight stay, and may be performed on an outpatient basis”;
 Modified the applicable parking regulations to make them consistent with other commercial uses, at one parking space per 350 square feet (SF); the prior requirement was one parking space per 200 SF; and
 Amended permitted and excluded use sections of the various commercial zone regulations to clarify that medical uses are no longer prohibited so long as they comply with the regulations of the medical use code sections.

Medical Conversion Permit Tracking
Table 1 provides permitting data for the effective period of the urgency ordinance and the first two years of implementation of the medical use ordinance.

TABLE 1. MEDICAL CONVERSION PERMITTING
Period Effective
Ordinance Permits Issued Monthly Average (permits per month) Total SF
(approx.)
1/1/24 – 12/31/24
(12 mos.) Medical Use 13 1.1 35,320
10/21/22 – 12/31/23
(14 mos.) Medical Use 28 2 81,575
11/17/20 – 10/20/22
(23 mos.) Urgency 33 1.4 90,400
TOTAL -- 74 1.5 207,295
The first year of the medical use ordinance saw an increase in the number of permits issued for medical conversion beyond what occurred during the urgency ordinance; however, the second year saw a decrease of approximately 50% in the number of permits issued when compared to the first year. While it’s difficult to conclude exactly why such decrease occurred, initial interest in the medical use ordinance may have surged after its adoption, while the data for the second year could be reflective of a more standard level of interest.

Staff continues to receive inquiries on medical conversion from commercial property owners and brokers but, as supported by the permitting data, interest over the past year has decreased when compared to prior years. However, based on the types of inquiries received by staff, interest has remained high as it relates to the establishment of ground floor medical, which is currently prohibited under the medical conversion ordinance.

In reviewing the available permitting data, staff’s assessment is that the current medical use regulations are operating as intended by providing flexibility in the use of commercial space throughout the city, without resulting in a surge of office space conversions to Meeting Date: March 18, 2025

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medical or causing unforeseen adverse impacts. Furthermore, staff is not aware of any adverse impacts to commercial or residential properties or uses.

In addition to the annual reporting on implementation, the BHMC requires that the medical use ordinance be reviewed by the City Council approximately three years after its adoption. Accordingly, staff anticipates bringing the medical use ordinance to the City Council in late 2025 or early 2026 to engage in a broader discussion on the ordinance and identify if any modifications are warranted.

FISCAL IMPACT
There is no fiscal impact to the City for this annual report beyond staff time required to research permits issued for the preceding year. Any medical conversion permit is subject to permitting fees as set forth in the City’s Comprehensive Schedule of Taxes, Fees, and Charges for Fiscal Year 2024-25.

RECOMMENDATION
This report is for information only; no further action is required.

Michael Forbes, AICP
Director of Community Development
Approved By
Attachment 1
to Attachment 1
BHMC Section 10-3-1620.1
10-3-1620.1: MEDICAL USES:

A. Registered Medical Buildings: Registered medical buildings are buildings that received a certificate of occupancy from the city prior to February 11, 2011, and have received a medical registration letter issued by the Director of Community Development. Registered medical buildings may be used for medical uses provided that the amount of floor area occupied by medical uses does not exceed the amount of floor area occupied by legally permitted medical uses on February 11, 2011, as noted in the medical registration letter, and provided that such medical uses comply with any applicable conditions and requirements, as outlined in the registration letter. In addition, notwithstanding section 10-3-4101 of this chapter, registered medical floor area may be relocated within the building provided that the total amount of floor area occupied by medical uses does not increase beyond the amount of floor area occupied by lawfully permitted medical uses on February 11, 2011.

1. In addition to subsection A above, registered medical buildings may add up to six thousand (6,000) square feet of medical floor area to the building by converting general office space to a medical use, even though the building is not located in a medical overlay zone, if all of the following conditions are met:
a. The building is located on property in one of the following commercial zones: C-3, C-3T-1, C-3T-2, C-3T-3, C-RPD, C-R, C-3A, C-3B, or E-O-PD. b. If the property is located in the pedestrian oriented area, as defined in section 10-3-1653 of this chapter, the community development director issues a minor accommodation pursuant to the provisions of article 36 of this chapter to authorize a medical use to occupy a space in a pedestrian oriented area provided that all other requirements of this section are met and the director makes all of the findings pursuant to subsection 10-3-1655A of this chapter. c. The building contains one or more legal medical uses prior to application for either a building permit or minor accommodation pursuant to this section.
d. No new medical uses are located on the ground floor within the pedestrian oriented area. For development located outside of the pedestrian oriented area, no new medical uses are located within the first forty feet (40') measured from the front building facade, on the ground floor of any building with a depth of one hundred feet (100') or greater. For buildings with a depth of less than one hundred feet (100') and that are located on irregularly shaped lots, medical uses may be permitted in all or part of the first forty feet (40') upon a finding by the director of community development that: a) all other provisions of this subsection B have been met and b) the proposed expansion of medical use does not adversely impact surrounding development. Facades facing a "side street", as defined in section 10-3-100 of this chapter, shall not be considered a front building facade for purposes of this section.
e. Parking for the new medical use is provided pursuant to the requirements of section 10-3-2730 of this chapter or pursuant to a restriping permit issued before December 16, 2005. f. No existing floor area may be removed, demolished or vacated to satisfy the parking requirements for a medical use.
g. The medical use complies with the restrictions of the zone or underlying zone. h. The additional space shall not be occupied by a "specialty clinic" as defined in section 10-3-1604.5 of this article. i. The building owner has submitted documentation in form and content satisfactory to the Director of Community Development that the proposed medical use meets the conditions of this subsection A1.

2. In order to implement the requirements of this section, no building owner shall utilize the provisions set forth in this section to relocate or expand medical uses unless the building owner has submitted documentation to the Director of Community Development, in form and content satisfactory to the Director, documenting the amount of floor area occupied by legally permitted medical uses on February 11, 2011. Such documentation shall be provided no later than August 11, 2011, or the provisions of this section shall not be available to the building owner. This date may be extended by the Director.

Additionally, if the submitted documentation includes any false statements or misrepresentations, then the building owner shall not be able to utilize the provisions of this section.

B. Medical Use Overlay Zone: Buildings that received a certificate of occupancy from the city prior to February 11, 2011, may be used for medical uses if the building is located in the Medical Use Overlay Zone and the medical uses are approved as part of a planned development.

C. Legally Nonconforming Medical Uses: Notwithstanding the provisions of section 10-3-4101 of this chapter, a legal nonconforming medical use located in a building that has been damaged by a disaster to the extent of more than fifty percent (50%) of its replacement value, may be reestablished without application of the Medical Use Overlay Zone, provided the reconstructed building complies with applicable zoning standards, including parking requirements, in place at the time a building permit is issued for the replacement building. In no event shall the amount of floor area occupied by nonconforming medical uses in the replacement building exceed the floor area that would have been permitted in the damaged building.

D. The City Council may, by resolution, establish fees for reviews and approvals required by this section.

E. Cosmetic Spas: Notwithstanding any other provision in this section, a cosmetic spa permitted pursuant to section 10- 3-1620.2 of this article is not subject to the regulations of this section.

F. Establishment Of New Medical Uses: Notwithstanding any other provision in this section, existing commercial spaces that have received certificates of occupancy from the city may be converted to a medical use, and new medical uses may be established in new commercial buildings, upon meeting the following conditions:

1. No new medical uses may be located on the ground floor of a building.

2. No 'specialty clinic' uses, as defined in section 10-3-1604.5 of this article shall be permitted. However, ambulatory surgical care uses, as defined in section 10-3-100, shall only be permitted within one operating room that has a maximum ten percent (10%) of the total floor area of the overall medical suite floor area, but shall not preclude an operating room of up to two hundred fifty (250) square feet.

G. Review By The City Council. The provisions contained in section F above shall be reviewed approximately three (3) years from their adoption with a report to City Council every year, in order to ensure that an increase in medical uses has not created unforeseen adverse impacts to commercial or residential properties and uses. (Ord. 11-O-2602, eff. 2-11-2011; amd.

Ord. 19-O-2786, eff. 8-16-2019; Ord. 20-O-2826, eff. 11-17-2020; Ord. 20-O-2831, eff. 12-8-2020; Ord. 21-O-2852, eff. 10- 26-2021; Ord. 22-O-2864, eff. 10-21-2022)
Attachment 2
to Attachment 1
Medical Conversions (January 1,
2024 through December 31, 2024)
Address Square Footage
8671 WILSHIRE BLVD 6,622
329 WETHERLY DR 840
99 LA CIENEGA BLVD N 1,846
8671 WILSHIRE BLVD 3,288
350 BEVERLY DR S 2,147
433 CAMDEN DR N 1,773
9720 WILSHIRE BLVD 8,866
400 BEVERLY DR S 1,632
150 RODEO DR S 1,609
9100 WILSHIRE BLVD 1,316
8665 WILSHIRE BLVD 2,198
8665 WILSHIRE BLVD 675
8500 WILSHIRE BLVD 2,508
TOTAL SQUARE FOOTAGE 35,320

MEDICAL CONVERSIONS
January 1, 2024 - December 31, 2024
Attachment 3
to Attachment 1
First Annual Medical Ordinance
Update Report (without attachments)

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Attachment 3
Fiscal Year (FY) 2025-26
Schedule of Taxes, Fees and
Charges
CityofBeverlyHills

FINANCE DEPARTMENT
FISCAL YEAR 2025-26

SCHEDULE OF TAXES, FEES AND

CHARGES

PREPARED BY

FINANCE DEPARTMENT
Jeff Muir, Director of Finance
Tatiana Szerwinski, Assistant Director of Finance
Emily Armstrong, Revenue Services Manager
July 2025
Business Taxes, Classification A, C, and I effective January 1, 2026 Vegetation Management and Fire Department Inspection Fees are effective January 1, 2026 All other fees are effective July 1, 2025 (unless otherwise stated) City of Beverly Hills
455 North Rexford Drive
Beverly Hills, California 90210
(310) 285-1000
i

SCHEDULE OF TAXES, FEES, AND CHARGES

TABLE OF CONTENTS

FEES AND CHARGES

TAB SECTION PAGE

1. CITYWIDE .......................................................................................................... 1

2. CITY CLERK ........................................................................................................ 3

3. COMMUNITY DEVELOPMENT ....................................................................... 4 TAXES

4. COMMUNITY SERVICES ................................................................................ 18

5. FINANCE........................................................................................................... 28

6. FIRE.................................................................................................................... 31

7. INFORMATION TECHNOLOGY.................................................................... 37

8. POLICE .............................................................................................................. 38

9. PUBLIC WORKS ............................................................................................... 45

10. ALL TAXES ....................................................................................................... 64 TAXES
Tax Name Reference
Tax Applies
To Current Tax Per Notes
Condominium Conversion Tax 3-1.602 All 10,021.00 Conversion Per conversion for buildings having two or more
dwelling units
Dwelling Unit Tax - Unit 3-1.502 All 1,468.00 Unit Includes tax per unit and per each bedroom.

Dwelling Unit Tax - Bedroom 3-1.502 All 292.00 Bedroom Includes tax per unit and per each bedroom.

Tax Name Reference
Tax Applies
To Current Tax Per Notes
Park and Recreation Construction Tax 3-1.702 All 8.65 Square foot of floor area Tax Name Reference
Tax Applies
To Current Tax Per Notes
Classification A - Business Services, Minimum Tax 3-1.201 BH Business 349.00 First 2,080 hours of
employee payroll Classification A, C, and I, effective January 1, 2026.

Classification A - Business Services, Additional tax 3-1.201 BH Business 0.07358 Each additional hour of
employee payroll Classification A, C, and I, effective January 1, 2026.

Classification B - Retail, Wholesale, and
Manufacturing, Minimum Tax 3-1.201 BH Business 75.00
First $60,000 of gross
receipts Minimum tax amount
Classification B - Retail, Wholesale, and
Manufacturing, Additional Tax 3-1.201 BH Business 0.00130 Every $1.00 of gross
receipts over $60,000
Classification C - Professionals, Minimum Tax 3-1.201 BH Business 1,950.00 First 2,080 hours of
professional/semiprofessional payroll or
billed hours Classification A, C, and I, effective January 1, 2026.

Classification C - Professionals, Additional tax 3-1.201 BH Business 0.93798 Each additional hour of
professional/semiprofessional payroll or
billed hours over 2,080
hours Classification A, C, and I, effective January 1, 2026.

Classification C - Non-professionals, additional tax 3-1.201 BH Business 0.18855 Each hour of nonprofessional employee
payroll Classification A, C, and I, effective January 1, 2026.

Classification D - Used Car Sales (not associated with
new car dealership), Minimum Tax 3-1.201 BH Business 255.00 First $85,000 of gross
receipts Minimum tax.

Classification D - Used Car Sales (not associated with
new car dealership), Additional Tax 3-1.201 BH Business 0.0030 Every $1.00 of gross
receipts over $85,000
Classification E - Residential Property Rental 3-1.201 BH Business 0.0120 Every $1.00 of gross
receipts
Classification F - Commercial Property Rental 3-1.201 BH Business 0.0235 Every $1.00 of gross
receipts
Classification G - Lenders, Brokers, Real Estate
Brokers/Offices, Minimum Tax 3-1.201 BH Business 175.00 First $50,000 of gross
receipts (first year only) Minimum Tax for the first year only Classification G - Lenders, Brokers, Real Estate
Brokers/Offices, Additional Tax 3-1.201 BH Business 0.0035 Every $1.00 of gross
receipts
This is the only tax for second year in business and
beyond.

Classification G1 - Real Estate Agents 3-1.201 BH Business 0.0010 Every $1.00 of gross
receipts
Classification I - Oil Well Tax, Outside City Minimum
tax 3-1.201 BH Business 2,869.00 First 10,000 barrels Classification A, C, and I, effective January 1, 2026.

Classification I - Oil Well Tax, Outside City Additional tax 3-1.201 BH Business 0.21208
Each additional barrel over
10,000 barrels Classification A, C, and I, effective January 1, 2026.

Classification I - Oil Well Tax, Inside City Minimum
tax 3-1.201 BH Business 5,763.00 First 10,000 barrels Classification A, C, and I, effective January 1, 2026.

Classification I - Oil Well Tax, Inside City Additional tax 3-1.201 BH Business 0.53034
Each additional barrel over
10,000 barrels Classification A, C, and I, effective January 1, 2026.

State SB 1186 Fee (Amended by AB 1379) SB1186, AB 1379 All 4.00 Application Fee imposed by State Transient Occupancy Tax 3-1.303 BH Business 14%
All rental receipts charged
by hotel operator for stays
up to 30 days (% of room
rate)
*For Taxes listed as All in the "Tax Applies To" column, there is no differentiation in the rate charged based on the following categories (Resident vs. Non-Resident, Inside City vs. Outside City, BH Business vs. Non-BH Business, etc.).

COMMUNITY SERVICES

COMMUNITY DEVELOPMENT

FINANCE
Effective: July 1, 2025 (unless otherwise stated) Page 64 Attachment 4
Public Correspondence
Peter L. Slavin, MD
President and CEO
8700 Beverly Blvd.

Los Angeles, CA 90048
310-423-5711
[email protected]
cedars-sinai.org
October 22, 2025
Honorable Mayor Nazarian and Members of the Beverly Hills City Council 455 North Rexford Drive
Beverly Hills, CA 90210
Re: City Council Study Session on the City’s Medical Use Ordinance Dear Mayor Nazarian and Councilmembers,
Cedars-Sinai appreciates the opportunity to share comments as the City reviews its medical use ordinance. We respectfully encourage the Council to consider a limited amendment that would allow Hospital-Affiliated Medical Uses on the ground floor outside the City’s designated pedestrianoriented areas.

This change would maintain Beverly Hills’ vibrant retail corridors while encouraging the reuse of vacant commercial space along Wilshire Boulevard and Burton Way. Allowing reputable, hospitalaffiliated healthcare providers to occupy these sites would help strengthen the local economy, expand access to care, and uphold the design and planning standards that define Beverly Hills.

Over time, the City’s non-pedestrian corridors, particularly along Wilshire Boulevard within the 90211 zip code, have experienced significant changes in tenancy. Banks, financial institutions, and corporate offices have consolidated or relocated, leaving deep ground-floor spaces unoccupied. The former Wells Fargo branch at 8501 Wilshire Boulevard remains closed, and other nearby properties have remained on the market for extended periods.

While Beverly Drive, Rodeo Drive, and Canon Drive continue to thrive under existing protections, these secondary corridors face persistent vacancy. Hospital-affiliated medical users could reactivate these areas with long-term, daytime tenants who invest in high-quality improvements and maintain their properties to the standards expected in Beverly Hills.

Cedars-Sinai currently serves about 20 percent of the local healthcare market and continues to experience growing patient demand. Primary-care appointments average a three-week wait, geriatrics often exceeds a month, and pediatric services operate beyond capacity. Twenty-five percent of Beverly Hills residents are 65 or older—well above the county average—and that Beverly Hills City Council Study Session on the City’s Medical Use Ordinance Page 2 of 3 population is expected to grow by more than 60 percent by 2040. Eighteen percent of residents are under 18, reflecting strong needs for both pediatric and senior care.

Many of these services require accessible, ground-floor facilities to accommodate patients with mobility challenges or complex clinical needs. Cedars-Sinai’s existing buildings at 8501 and 8750 Wilshire Boulevard already support key outpatient services, but the inability to expand at street level limits our ability to meet community demand within the City’s boundaries.

Ground-floor medical space provides direct, barrier-free access and allows for efficient use of equipment and patient transport systems. These facilities can maintain an attractive streetscape when designed to the City’s standards, with transparent windows, landscaping, and clear signage.

In corridors already dominated by office and service uses, limited medical space would not displace active retail but would instead help sustain well-maintained and active buildings.

Cedars-Sinai recommends that the Council consider creating a clearly defined land use category for Hospital-Affiliated Medical Use, described as:

A medical office, clinic, or diagnostic facility directly operated by, leased to, or formally affiliated with a hospital licensed by the California Department of Public Health. The use does not include specialty clinics as defined in Beverly Hills Municipal Code.

To guide implementation, several approaches could be explored:
• Limiting eligibility to Wilshire Boulevard between Robertson and La Cienega, or within ZIP Code 90211, to align with existing medical corridors.
• Allowing Hospital-Affiliated Medical Uses to occupy ground-floor frontage and preserve retail rhythm while ensuring sufficient space for viable healthcare uses. Caps that are too restrictive, however, could unintentionally limit the City’s ability to reactivate vacant spaces.
• Locating medical uses behind lobbies or transparent frontage segments to maintain an active street-facing appearance while supporting patient privacy and clinical functionality. • Applying design standards—such as street-facing entries, landscaping, and transparency requirements—while monitoring feasibility to ensure these criteria remain compatible with healthcare operations and design expectations.

Each of these approaches offers a balanced way to accommodate healthcare access while protecting the City’s design character and retail vitality.

Allowing Hospital-Affiliated Medical Uses outside pedestrian-oriented areas would activate longvacant properties, increase local employment, and generate steady daytime activity for nearby businesses. It would improve resident access to high-quality care while preserving the City’s pedestrian-oriented retail core. The policy would also reaffirm Beverly Hills’ reputation as a center of excellence in both commerce and healthcare.

Beverly Hills City Council Study Session on the City’s Medical Use Ordinance Page 3 of 3 Cedars-Sinai values its partnership with the City of Beverly Hills and supports thoughtful planning that balances economic resilience, design quality, and public health. A measured update allowing Hospital-Affiliated Medical Uses outside pedestrian-oriented areas would advance those goals while preserving the unique character of the City’s retail districts.

We appreciate the Council’s consideration and would welcome the opportunity to collaborate with staff on refined language and implementation standards that reflect the City’s priorities.

Sincerely,
Peter L. Slavin, MD

CONTENTS
Re: Beverly Hills City Council Study Session on the City’s Medical Use Ordinance 1 Letter from Cedars-Sinai to Beverly Hills City Council 2 Frequently Asked Questions on Cedars-Sinai Request
3 Letters of Support from Property Owners and Business Partners 4 Diagrams for Proposed Medical Use at 8501 and 8750 Wilshire Blvd.

Peter L. Slavin, MD
President and CEO
8700 Beverly Blvd.

In corridors already dominated by office and service uses, limited medical space would not displace active retail but would instead help sustain well-maintained and active buildings.

Cedars-Sinai recommends that the Council consider creating a clearly defined land use category for Hospital-Affiliated Medical Use, described as:

Each of these approaches offers a balanced way to accommodate healthcare access while protecting the City’s design character and retail vitality.

We appreciate the Council’s consideration and would welcome the opportunity to collaborate with staff on refined language and implementation standards that reflect the City’s priorities.

Sincerely,
Peter L. Slavin, MD
Cedars-Sinai FAQ: City of Beverly Hills Ground Floor Medical Q: Why is there a need for increased medical/clinical space? There is a growing and diverse demand for healthcare services in Beverly Hills and the surrounding area. Cedars-Sinai currently accounts for approximately 20 percent of the local healthcare market across all specialties, and demographic trends indicate continued growth in service needs. In Los Angeles County, residents aged 65 and older make up 15.7 percent of the population in 2025, with a projected 61 percent increase by 2040. Beverly Hills has an even more mature profile, with 21.2 percent of residents aged 65 or above, underscoring the need for expanded geriatric and specialty care. Beverly Hills also maintains a strong pediatric base, with children under 18 representing 16.1 percent of the population in 2024. Without additional clinical space, more residents will be forced to seek services outside the City, shifting both economic activity and healthcare access elsewhere. Expanding available space allows residents to receive needed care close to home and aligns with the City’s commitment to community-based healthcare.

Q: Why is there a need for ground-floor medical use?
Ground-floor medical/clinical space provides barrier-free access and is especially advantageous for geriatric patients, orthopedic patients, and others with mobility limitations. By offering services in a single, easily accessible location, we can streamline patient flow and reduce the physical burden on patients who require multiple appointments. Centralizing these services on one floor or within one building enhances efficiency, improves care coordination, and creates a more seamless experience for patients and caregivers. Ground-floor medical access is also consistent with the City’s Age-Friendly Initiative and its commitment to supporting aging-inplace. For seniors, patients recovering from surgery, and individuals with mobility challenges, avoiding elevators and multi-level navigation removes real barriers and directly supports the City’s public health goals.

Q: How could allowing ground floor medical benefit the City? Allowing ground floor medical/clinical uses outside pedestrian-priority areas would activate long-vacant properties, boost daytime foot traffic, support nearby businesses, and expand local healthcare access for seniors, families, and residents. Converting long-term vacancies into active medical/clinical space reduces blight, increases safety, and creates consistent activity along storefronts that have remained inactive for years. Activated uses strengthen surrounding commercial areas by increasing the local daytime population and helping stabilize corridors that have struggled since the pandemic.

Q: Why is this change needed now?
Demand for care is already outpacing capacity. Cedars-Sinai serves roughly 20 percent of the Beverly Hills healthcare market, and current appointment availability illustrates the strain on the system. Primary care visits have an average wait time of three weeks, geriatric appointments often exceed one month, and pediatric services are operating at full capacity. These delays reflect system-wide capacity limitations rather than scheduling inefficiencies. Without additional space, access issues and delays in care will worsen and may affect health outcomes for Beverly Hills residents.

Q: If the expansion to ground floor medical spaces is allowed in this area, could it harm retail?
These secondary corridors have not demonstrated strong demand for traditional retail and have experienced difficulty attracting long-term tenants. Maintaining a retail-only requirement in these areas has contributed to multi-year vacancies. A long-term, high-quality tenant such as Cedars-Sinai would invest in significant improvements, operate during daytime hours when nearby businesses are open, and bring consistent foot traffic to the area. This can strengthen surrounding commercial environments rather than replace or compete with them.

Q: Why only outside pedestrian-oriented areas?
Cedars-Sinai recognizes the importance of preserving the vibrancy of the City’s core retail districts. Our suggested modification would intentionally limit the change to allow for ground floor medical uses to those areas dominated by office and service uses, where retail demand has historically been weaker. This approach mirrors the City’s planning principles of placing appropriate uses in appropriate locations. It protects the central retail identity while offering a practical tool to address persistent vacancies in secondary corridors.

Q: How many additional jobs could be created by allowing expansion into ground floor spaces?
There are currently 943 physicians and staff in the 90211 zip code. After the completion of already-approved development, employment is expected to increase to 1,170 employees. If one uses the buildings at 8750 Wilshire Boulevard and 8501 Wilshire Boulevard as an example of likely conversion, the ground floor spaces could add nearly 80 additional employees, bringing the total to approximately 1,249 employees. These are stable, daytime positions that contribute to the vitality of surrounding businesses and provide a reliable economic foundation that is less vulnerable to fluctuations in the retail sector.

Q: What is the current state of vacancies in ground floor properties in the City? An analysis of 26 ground-floor properties with existing vacancies shows that available spaces range from 1,030 square feet to 16,888 square feet, with most falling between 4,000 and 9,000 square feet. Most of these spaces have been vacant and active on the market for between two to five years. The longest current listing is five years and seven months. These long-term vacancies indicate structural challenges rather than temporary leasing cycles. Allowing medical uses gives the City a targeted tool to activate these spaces without affecting the retail-protected core, and Cedars-Sinai can occupy and improve these properties immediately where traditional retail has not succeeded.

Q: What change is Cedars-Sinai requesting?
Cedars-Sinai is requesting an amendment to the Medical Use Ordinance to allow HospitalAffiliated Medical Uses on the ground floor, outside of the City’s designated pedestrian-oriented areas. This request does not affect the retail-protected corridors (Beverly, Rodeo, and Canon Drives) and maintains the integrity of the City’s core retail identity. It is proposed to apply only to areas already characterized by office and service uses, such as Wilshire Boulevard and Burton Way, where retail demand is significantly weaker. The request preserves all existing protections within the Golden Triangle’s primary retail streets.

Q. How could the City implement this?
At present, the Medical Use Overlay prevents the City from evaluating the viability of ground floor medical uses outside of the prescribed area. To address the need for this type of use, ongoing vacancy issues along certain corridors, and the potential job-growth benefits described above, the City could consider establishing a discretionary review pathway that allows staff and decision-makers to assess proposed ground floor medical uses on a case-by-case basis. This type of review would give the City the ability to validate a prospective user’s data and determine, with appropriate findings, whether the medical use would not undermine efforts to foster a pedestrian-friendly environment, would contribute to and enhance the surrounding area’s activity, and would support a balanced mix of services and amenities that meet neighborhood, Citywide, and regional needs. Beverly Hills Municipal Code Section 10-3-1620.2 provides an example of a similar evaluative process for cosmetic spas, which the City could use as a framework when considering an adapted approach for medical uses. 1 November 7, 2025
Honorable Mayor Sharona Nazarian and Beverly Hills City Council City of Beverly Hills
455 North Rexford Drive
Beverly Hills, CA 90210
Dear Mayor Nazarian and Members of the Beverly Hills City Council:

We understand that the City’s medical use ordinance, which was last updated in 2022, is coming up for a three year review before this Council. The Chamber encourages the City to open up the review process for this ordinance to potential changes, including considering allowing ground floor medical use in certain non-pedestrian oriented portions of the City.

As you know, the City in 2022 relaxed many of the rules governing medical office use, including allowing conversion of commercial spaces to medical office space in certain zoned areas of Beverly Hills. The City recognized the challenge of filling certain commercial spaces and the opportunity and economic impact of medical spaces to support our economy.

Given that this ordinance is now coming up for review, the Chamber believes it appropriate to at the least re-open the discussion to consider what is beneficial and appropriate for the City, including filling vacant spaces. In this respect, the Chamber is unaware of any other industry subject to a categorical ground floor exclusion such as the one in question. 2 Based on the above, the Chamber asks the City to open up the review process to evaluate potential updates to the ordinance to support a vibrant and growing business climate.

Sincerely,
Todd Johnson
President and CEO
Beverly Hills Chamber of Commerce

December 9, 2025
Honorable Mayor and Members of the City Council
City of Beverly Hills
455 North Rexford Drive
Beverly Hills, CA 90210
Dear Mayor and Councilmembers,
I am the owner of the properties located at 200 and 250 N. Robertson Blvd., 8767 and 8536 Wilshire Blvd., and 99 N. La Cienega Blvd., and I am writing to express my strong support for amending the City’s medical use ordinance to allow limited ground-floor medical uses on the east side of Beverly Hills.

While Beverly Hills continues to enjoy a vibrant commercial environment in its central shopping district, the same cannot be said for many properties along Wilshire. A number of large groundfloor spaces have remained vacant for extended periods, creating visible gaps in the corridor and diminishing both walkability and public safety. These vacancies are challenging for property owners and detract from the overall vitality of our city’s key gateways.

Allowing reputable, service-oriented tenants such as hospital-affiliated medical uses to occupy these spaces would help activate the street, generate daytime activity, and improve safety through greater pedestrian presence. It would also respond to an important community need for accessible, high-quality medical care—particularly as Beverly Hills continues to grow and as Metro service begins in the area.

We respectfully urge the City Council to consider this measured change to the ordinance to encourage responsible ground-floor activation, address persistent vacancies, and enhance the long-term health of the Wilshire corridor.

Thank you for your time and thoughtful consideration.

Sincerely,
Kathy Javor

PALTVI PACIFIC PROPERTIES, LLC
92OI W. OLVUPIC BOULEVARD, SUITE 2OO
BEVERLY HILLS, CALIFORNIA 902I2
TELEPHONE (3 t0) 248-3200
TELECOPIER (3 l0) 248-3201
November 13,2025
Honorable Mayor and Members of the City Council
City of Beverly Hills
455 North Rexford Drive
Beverly Hills, CA 90210
Dear Mayor and Councilmembers,
As the owner of 920I W. Olympic Boulevard, I am writing to respectfully urge your consideration of a thoughtful amendment to the City's medical use ordinance that would permit limited ground-floor medical uses along the east side of Beverly Hills. This recommendation is driven by both property owner experience and a clear community need.

While the central shopping district of Beverly Hills remains dynamic and prosperous' ground-floor vacancies persist in key gateway corridors such as Olympic and Wilshire Boulevards. Prolonged vacancies create gaps in the streetscape, impacting walkability, safety, and the vibrancy of our city's entrances. For property owners and community members alike, these conditions weaken the economic and social vitality we seek to preserve and enhance' Allowing carefully screened, reputable medical tenants-such as hospital-affiliated practices-to occupy these spaces would enliven the street, increase daytime pedestrian activity, and further public safety through natural surveillance. Critically, it would also advance Beverly Hills' reputation for accessible, high-quality healthcare, especially as the city grows and prepares for the arrival of Metro service.

This targeted ordinance change offers a responsible solution that balances activation of the ground floor with maintaining a healthy retail environment. It is a practical step to address persistent vacancies, support community health, and secure the long-term prosperity of the Olympic and Wilshire corridor.

Thank you for your time and consideration of this important matter. I look forward to your leadership in promoting both the economic and social well-being of Beverly Hills.

Sincerely,
Palm Pacific Properties, LLC
fi9'"47.W*
David A. Lapin t

November 24, 2025
Honorable Mayor and Members of the City Council
City of Beverly Hills
455 North Rexford Drive
Beverly Hills, CA 90210
Dear Mayor and Councilmembers,
I am the owner of the property located at 8447 Wilshire Boulevard, and I am writing to express my strong support for amending the City’s medical use ordinance to allow limited ground-floor medical uses on the east side of Beverly Hills.

Thank you for your time and thoughtful consideration.

Sincerely,
Jessica Dabney
Manager
8447 Wilshire Boulevard Associates II, LLC
R. Todd Doney
Vice Chairman
Lic. #: 00852254
CBRE, Inc.
400 S. Hope Street
25th floor
Los Angeles, CA 90071
Broker Lic. 00409987
213 613-3330 Tel
213 613-3005 Fax
November 12, 2025
Honorable Mayor and Members of the City Council
City of Beverly Hills
455 North Rexford Drive
Beverly Hills, CA 90210
Dear Mayor and Councilmembers,
I am a Vice Chairman with CBRE and along with a number of my colleagues, have represented many of the city’s most significant landlords and tenants. I am writing to express my strong support for amending the City’s medical use ordinance to allow limited ground-floor medical uses on the east side of Beverly Hills.

While Beverly Hills continues to thrive in its central shopping district, the east side—particularly along Wilshire Boulevard—faces a different reality. Large pockets of ground-floor spaces have remained vacant for extended periods, creating visible gaps that diminish walkability, reduce street-level vibrancy, and raise public safety concerns. These prolonged vacancies challenge property owners and detract from the overall vitality of one of our city’s key gateways.

Allowing reputable, service-oriented tenants—such as hospital-affiliated medical practices—to occupy these spaces presents a practical and forward-thinking solution. These uses would:
• Activate the corridor by generating consistent daytime activity and increasing pedestrian presence, which enhances safety and fosters a sense of community. • Address a critical need for accessible, high-quality medical care, especially as Beverly Hills grows and prepares for the arrival of Metro service. • Support economic stability by reducing vacancy rates and strengthening property values, benefiting both owners and the city’s tax base.

This approach aligns with Beverly Hills’ commitment to maintaining a vibrant, safe, and inclusive environment while adapting to evolving community needs. By embracing these tenants, we can transform underutilized spaces into assets that serve residents, visitors, and businesses alike.

Thank you for considering this perspective. I would welcome the opportunity to discuss how we can work together to ensure Wilshire remains a dynamic and welcoming gateway to Beverly Hills.

Sincerely,
R. Todd Doney
STORAGE BIO EXAM 9 EXAM 10 EXAM 11 EXAM 8EXAM 7 EXAM 6 EXAM 5 EXAM 4 EXAM 3 EXAM 2 EXAM 1 MEDS CO-LOCATION PRINT / STOR. TOILET TOILET LAB/UTILITY STAFF BREAK OFFICE (2) OFFICE (2) OFFICE (2) MAN. OFFICE TELEDATA WH RECEPTION WELL WAITING SICK WAITING STAFF BREAK OFFICE (2) CO-LOCATION OFFICE (2) STORAGE BIO EXAM 9 EXAM 10 EXAM 11 EXAM 8EXAM 7 EXAM 6 EXAM 5 EXAM 4 EXAM 3 EXAM 2 EXAM 1 MEDS PRINT / STOR. TOILET TOILET LAB/UTILITY PRINT / STOR. OFFICE (2) MAN. OFFICE OFFICE (2) OFFICE (2) BUILDING SUPPORT WELL WAITING O OFFICE (2) MULTI-USE STAFF BREAK

EXISTING BANK 5,011 SQ.FT. EXISTING OFFICE 1,094 SQ.FT. EXISTING MEDICAL OFFICE 11,965 SQ.FT. EXISTING BISTRO 1,645 SQ.FT.

STORAGE BIO EXAM 9 EXAM 10 EXAM 11 EXAM 8EXAM 7 EXAM 6 EXAM 5 EXAM 4 EXAM 3 EXAM 2 EXAM 1 MEDS CO-LOCATION PRINT / STOR. TOILET TOILET LAB/UTILITY STAFF BREAK OFFICE (2) OFFICE (2) OFFICE (2) MAN. OFFICE TELEDATA WH RECEPTION WELL WAITING SICK WAITING CO-LOCATION STORAGE BIO EXAM 9 EXAM 10 EXAM 11 EXAM 8EXAM 7 EXAM 6 EXAM 5 EXAM 4 EXAM 3 EXAM 2 EXAM 1 MEDS PRINT / STOR. TOILET TOILET LAB/UTILITY PRINT / STOR. OFFICE (2) MAN. OFFICE OFFICE (2) OFFICE (2) BUILDING SUPPORT WELL WAITING O OFFICE (2) MULTI-USE STAFF BREAK RECEPTION WELL WAITING SICK WAITING WELL WAITING STAFF BREAK MULTI-USE 8750
EXISTING MEDICAL OFFICE 01 EXISTING MEDICAL OFFICE 01 EXISTING BANK TOTAL PROPOSED FOR NEW MEDICAL OFFICE EXISTING BANK 8,190 SQ.FT. EXISTING MEDICAL OFFICE 01 11,928 SQ.FT. EXISTING MEDICAL OFFICE 02 4,747 SQ.FT.

Beverly Hills City CouncilDecember 9, 2025

Beverly Hills City Council
December 9, 2025