1 of 19
City Council Meeting: July 26, 2022 Santa Monica, California ORDINANCE NUMBER __________ (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA APPROVING THE DEVELOPMENT AGREEMENT
BETWEEN THE CITY OF SANTA MONICA, A MUNICIPAL CORPORATION,
AND BELLE VUE PLAZA, A CALIFORNIA LIMITED PARTNERSHIP, AND OCEAN
AVENUE PARTNERS, LLC, A DELAWARE LIMITED LIABILITY COMPANY (COLLECTIVELY, “THE DEVELOPER”)
WHEREAS, California Government Code Section 65450 et seq. permits each city to adopt a specific plan for the systematic implementation of the general plan for individual areas covered by the general plan; and
WHEREAS, pursuant to California Government Code Section 65864 et seq. and Chapter 9.60 of the Santa Monica Municipal Code (collectively, the “Development Agreement Statutes”), the City is authorized to enter into binding development agreements with persons or entities having a legal or equitable interest in real property for the development of such real property; and
WHEREAS, Developer is the owner of approximately 82,570 square feet of land located in the City of Santa Monica, State of California, commonly known as 101 Santa Monica Boulevard, 1337 Ocean Avenue, 1333 Ocean Avenue, 1327 Ocean Avenue and 129 Santa Monica Boulevard (collectively, the “Project Site”); and WHEREAS, the Project Site consists of:
2 of 19
(1) approximately 52,570 square feet of land located in the City of Santa Monica, State of California, commonly known as 101 Santa Monica Boulevard, 1337 Ocean Avenue, 1333 Ocean Avenue, 1327 Ocean Avenue (collectively the “Ocean Avenue Parcel”) which consists of:
(i) the land located in the City of Santa Monica, State of California, commonly known as 101 Santa Monica Boulevard (and also commonly known as 103 Santa Monica Boulevard, 105 Santa Monica Boulevard, 107 Santa Monica Boulevard, 109 Santa Monica Boulevard, 111 Santa Monica Boulevard, 113 Santa Monica Boulevard, 115 Santa Monica Boulevard, 1355 Ocean Avenue and 1357 Ocean Avenue) that is currently improved with a two-story mixed-use commercial/residential structure with a rooftop penthouse apartment (the “101 Santa Monica Boulevard Building”) and surface parking,
(ii) the land located in the City of Santa Monica, State of California, commonly known as 1337 Ocean Avenue that is currently improved with (i) a two-story building that was originally built in 1926, is a City-designated Landmark (LC04-LM-005) and is in commercial use (the “Spanish Colonial Revival Landmark”), a detached one-story rear structure that is in commercial use (the “1337 Ocean Avenue Rear Structure”), and surface parking,
(iii) the land located in the City of Santa Monica, State of California, commonly known as 1333 Ocean Avenue that is currently improved with a two-story building that was originally built in 1906, is a City-designated Landmark (LC01LM-001) and is in commercial use (the “Queen Anne Landmark”), a separate two- 3 of 19
story rear structure that is in commercial use and is connected to the 1333 Ocean Avenue Landmark by an unenclosed catwalk and staircase (the “1333 Ocean Avenue Rear Structure”), and surface parking and
(iv) the land located in the City of Santa Monica, State of California, commonly known as 1327 Ocean Avenue that is currently improved with a two-story building that is in commercial use (the “1327 Ocean Avenue Building”) and surface parking; and
(2) approximately 30,000 square feet of land located in the City of Santa Monica, State of California, commonly known as 129 Santa Monica Boulevard (the “Second Street Parcel”) that is currently improved with surface parking; and WHEREAS, the City has included the Project Site within the Downtown Core land use designation under the City’s 2010 Land Use and Circulation Element of its General Plan (the “LUCE”). LUCE Policy D1.5 designates the Project Site as one of seven sites in the Downtown District to focus new investment given its accessibility to transit and ability to accommodate mixed-use development, contribute to the pedestrian-oriented environment, and support substantial community benefits. The LUCE did not establish maximum building height limits, floor area ratios (“FAR”), or other specific development standards (e.g., setbacks and step backs) for new buildings within the Downtown Core designation; instead, the LUCE deferred such standards to a future Downtown specific plan; and
WHEREAS, on February 28, 2013, Developer filed an application for a Development Agreement (13DEV-004), pursuant to Santa Monica Municipal Code 4 of 19
(“SMMC”) Section 9.60.020 (the “Development Application”). The Development Application proposes a mixed-use project with a hotel, residences, a cultural uses campus, ground floor pedestrian-oriented restaurant and retail uses and subterranean parking. The originally-filed plans (the “2013 Plans”) proposed, among other things, 125 hotel rooms, 22 residential condominium units, 19 replacement rental apartments, 5 affordable rental apartments, a cultural uses campus including the preservation and adaptive re-use of the Spanish Colonial Revival Landmark and Queen Anne Landmark, ground floor restaurants and retail, an observation deck, a maximum height of 244 feet and a 4.0 FAR. As further described below, the Development Application has been revised and refined since the initial filing but has always included hotel, residential, cultural uses, pedestrian-oriented retail/restaurant uses, and subterranean parking, as is more fully described in the Development Agreement; and
WHEREAS, on August 5, 2013, the Architectural Review Board held a public hearing to preliminarily review and provide feedback on the 2013 Plans; and WHEREAS, in August 2017, the City adopted the Downtown Community Plan (“DCP”), a specific plan governing the Downtown including the Project Site. Consistent with the LUCE, the Project Site is located within the Established Large Site (“ELS”) Overlay designation with the Ocean Avenue Parcel also having the Ocean Transition designation and the Second Street Parcel also having the Bayside Conservation designation. The ELS Overlay is provided for three sites in the Downtown that the DCP indicated have the potential to accommodate significant new development and provide significant community benefits. The ELS Overlay designation allows any project on the Project Site to request approval for development up to 130 feet in height and a 4.0 FAR 5 of 19
subject to the project being processed through a development agreement, as well as compliance with other specified requirements. Table 2A.4 of the DCP lists three “preferred” community benefits for a project on the Project Site: affordable housing, cultural institution, and historic preservation, all of which are included in the Project; and WHEREAS, after adoption of the DCP, the 2013 Plans were revised to conform with the DCP. In comparison to the 2013 Plans, revised plans filed in 2018 (the “2018 Plans”), included, among other things, elimination of the residential condominiums and replacement with 100% rental apartments (including more affordable housing), reduced density (2.95 FAR), a reduced hotel program, and reduced height (maximum height of 130 feet); and
WHEREAS, on February 20, 2018, the Architectural Review Board held a public hearing to preliminarily review and provide feedback on the 2018 Plans; and WHEREAS, on March 12, 2018, the Landmarks Commission held a public hearing to preliminarily review and provide feedback on the 2018 Plans; and WHEREAS, on May 2, 2018, the Planning Commission held a public hearing to consider, review and provide preliminary comments on the revised design concept, and to identify potential community benefits for consideration (commonly referred to as a “float up” discussion). The Planning Commission was generally supportive of the overall design concept, including the relationship between building height and open space, the emphasis on the pedestrian experience, and the proposed cultural uses campus as a community benefit. The Planning Commission recommended that the City Council proceed with development agreement discussions; and
6 of 19
WHEREAS, on June 12, 2018, the City Council held a “float-up” public hearing to preliminarily review and provide feedback on the 2018 Plans. The City Council concurred with the Planning Commission’s May 2, 2018 recommendation and directed City staff to initiate the development agreement negotiations and review process for the Project; and
WHEREAS, the project (the “Project”) is more specifically described in the Development Agreement and now includes, among other things, the following components:
(1) a full-service hotel building located in the central area of the Ocean Avenue Parcel (the “Hotel Building”),
(2) a cultural uses campus that is located north of the Hotel Building on the Ocean Avenue Parcel and is comprised of a new building (the “Cultural Uses Building”) and the relocated Spanish Colonial Revival Landmark and Queen Anne Landmark, which would be rehabilitated for adaptive reuse as part of the cultural uses campus, and open space (the “Cultural Uses Campus”),
(3) a building with restaurant/retail uses that is located near the corner of Ocean Avenue and Santa Monica Boulevard on the Ocean Avenue Parcel (the “Corner Building”),
(4) a mixed-use residential apartment building with ground floor retail/restaurant space located on the Ocean Avenue Parcel near the corner of Santa Monica Boulevard and First Court Alley (the “Santa Monica Boulevard Building”), 7 of 19
(5) a mixed-use building(s) with retail/restaurant space located on the ground floor/podium level and residential apartments located within three separate forms/structures situated above the podium level on the Second Street Parcel (the “Second Street Building(s)”),
(6) a publicly-accessible observation deck at the top of the Hotel Building,
(7) substantial open space, including publicly-accessible open space, (8) subterranean space, including for vehicle and bicycle parking, and (9) substantial other project features and community benefits as set forth in Section 2.7 and Section 2.8, of the Development Agreement; and WHEREAS, the Project Site is also located in the California Coastal Zone. In October 2018, the City adopted a Local Coastal Program Update, Land Use Plan, Final Draft (“2018 Draft LUP”). The 2018 Draft LUP reflects the LUCE and DCP with respect to the Project Site’s development standards. The Project Site is located within Subarea 5, Downtown District of the 2018 Draft LUP; and
WHEREAS, on December 15, 2020, Developer filed an application seeking an amendment to the 1992 LUP (“1992 LUP Amendment”) to be consistent with the LUCE, DCP and 2018 Draft LUP policies. The 1992 LUP Amendment, as it has been modified, would add a new policy to the 1992 LUP as follows:
8 of 19
If the properties located on the north side of Santa Monica Boulevard between Ocean Avenue and Second Street commonly referred to as 129 Santa Monica Boulevard, 101 Santa Monica Boulevard, 1327 Ocean Avenue, 1333 Ocean Avenue, 1337 Ocean Avenue (the “Established Large Site”) are redeveloped as a comprehensive project pursuant to a development agreement, then the development standards in Policies 67 and 71 and the corresponding development intensities shown on Map 15 shall not apply to such new project on the Established Large Site, and the project shall instead not exceed 130 feet, with no limitation on the number of stories, and a cumulative maximum 2.95 FAR across the Established Large Site; and
WHEREAS, to aid in the redevelopment of the Property, the City and Developer desire to allow Developer to demolish the existing improvements except for the Queen Anne Landmark and Spanish Colonial Revival Landmark and construct a new mixeduse hotel, residential, and cultural uses project with ground floor retail and subterranean parking; and
WHEREAS, the City prepared and circulated on May 18, 2020 for public review and comment a Draft Environmental Impact Report (the “DEIR”) pursuant to the California Environmental Quality Act (“CEQA”) and designated SCH No. 2018121060 to evaluate the Project’s potential environmental impacts. Following the close of a 90-day comment period on August 17, 2020, the City prepared a Final Environmental Impact Report pursuant to CEQA (the “EIR”); and
9 of 19
WHEREAS, Developer has paid all necessary costs and fees associated with the City’s processing of the Development Application and the Development Agreement, including the full cost of the City’s preparation of the DEIR and the EIR; and WHEREAS, the primary purpose of the Project is to redevelop the Project Site with a new mixed-use project that includes a full-service hotel, residential apartments including replacement rent-control apartments, market rate and deed-restricted affordable apartments, a new Cultural Uses Campus which includes the rehabilitation and adaptive reuse of the Queen Anne Landmark and Spanish Colonial Revival Landmark with cultural uses, pedestrian-friendly ground floor retail/restaurant uses, subterranean parking, significant open space including a publicly-accessible observation deck and other community benefits consistent with the LUCE, DCP, 1992 LUP as amended, and the 2018 Draft LUP; and
WHEREAS, the City Council has determined that a development agreement is appropriate for the proposed development of the Project on the Project Site. The Development Agreement will (1) eliminate uncertainty in planning for the Project and result in the orderly development of the Project, (2) assure installation of necessary improvements on the Project Site, (3) provide for public infrastructure and services appropriate to development of the Project, (4) preserve substantial City discretion in reviewing the Project’s design in accordance with Article 6 of the Development Agreement, (5) secure for the City improvements that benefit the public, (6) ensure the provision of community benefits as envisioned in the LUCE and DCP and (7) otherwise achieve the goals and purposes for which the Development Agreement Statutes were enacted; and
10 of 19
WHEREAS, the Development Agreement is consistent with the public health, safety, and welfare needs of the residents of the City and the surrounding region. The City has specifically considered and approved the impacts and benefits of the development of the Project on the Project Site in accordance with the Development Agreement. Consistent with the LUCE and DCP, the Project will provide a number of significant project features and community benefits as set forth in Sections 2.7 and 2.8 of the Development Agreement; and
WHEREAS, the City Council has found that the provisions of the Development Agreement are consistent with the relevant provisions of the City’s General Plan, including the LUCE; the DCP; the 1992 LUP as amended by the 1992 LUP Amendment; and the 2018 Draft LUP; and
WHEREAS, on March 23, 2018, Developer filed a demolition permit application for the 101 Santa Monica Boulevard Building (18BLD-5360). On October 1, 2018, Developer filed demolition permit applications for the 1327 Ocean Avenue Building (18BLD-7899), the 1333 Ocean Avenue Rear Structure (18BLD-7918), and the 1337 Ocean Avenue Rear Structure (18BLD-7917). Pursuant to SMMC Section 9.25.040(E), members of the public had a 75-day period from the filing of each demolition permit application to file an application to designate the applicable existing building as a landmark or structure of merit. No applications to designate any of these existing buildings were filed during the applicable 75-day period; and WHEREAS, on May 18, 2022, the City's Planning Commission held a duly noticed public hearing on the updated Development Application, the EIR, the 1992 LUP 11 of 19
Amendment, and the Development Agreement, and at such hearing, the Planning Commission recommended that the City Council certify the EIR, approve the 1992 LUP Amendment, and approve the Project including the Development Agreement; and WHEREAS, on May 24, 2022, the City Council adopted Resolution No. 11420 stating its intention to establish a pedestrian mall on a portion of First Court alley adjacent to the Project site pursuant to the Pedestrian Mall Law of 1960, California Streets & Highways Code Sections 11000 et seq., and setting a public hearing date of September 27, 2022 for the City Council to make a determination on the establishment of the Pedestrian Mall; and
WHEREAS, on July 14, 2022, the City Council held a duly noticed public hearing on the updated Development Application, the EIR, the 1992 LUP Amendment, and the Development Agreement, and at such hearing the City certified the EIR and adopted a Statement of Overriding Considerations and Mitigation Monitoring Plan, and adopted a resolution approving the 1992 LUP Amendment; and
WHEREAS, the proposed Development Agreement, which is attached hereto as Exhibit A to this ordinance, conforms to the requirements of Government Code sections 65450 et seq. as well as the requirement of Chapter 9.60 of the Santa Monica Municipal Code (Development Agreements); and
WHEREAS, the City Council, after consideration of all oral and written testimony presented at the duly noticed meeting of the City Council on July 14 2022, made the following findings (collectively, “the Findings”):
12 of 19
Development Agreement Findings
1. The proposed Development Agreement is consistent with the objectives, policies, general land uses and programs specified in the general plan and any applicable specific plan. The 2010 Land Use and Circulation Element (LUCE) and 2017 Downtown Community Plan (DCP) are the City’s applicable general and specific plans. The Ocean Avenue Project site is located in the 2010 LUCE’s Downtown District and has a Downtown Core General Plan Land Use Designation. Policies in this District are geared primarily toward reinforcing the Downtown as the focus of the City, encouraging a broad mix of uses and new investment in the District that creates dynamic daytime and evening activity, and reinforces the Downtown as the place with the greatest concentration of activity in the City. As outlined in the LUCE, this broad mix of uses in the Downtown includes retail, hotels, office, high-density residential, and entertainment and cultural uses (Goal D.7, Policy D.7.1). With respect to Downtown residential development, units with a diversity of types, forms, sizes, tenure, and affordability for all income levels are encouraged (Policy D7.7). Policy D1.4 also states that new and expanded hotels and other visitor-serving uses are also to be encouraged. General LUCE discussion about the Downtown District recognizes that the Downtown is considered a true urban place where streets are important pedestrian activity spaces, buildings are generally the tallest in the City, and the intensity of development is higher than in the rest of the City (page 1.3.8). The LUCE’s Downtown District also specifically identifies the subject property as one of seven sites in the Downtown District to 13 of 19
focus new investment given its accessibility to transit and ability to accommodate mixed-use development, contribute to the pedestrian-oriented environment, and support substantial community benefits; (Goal D1.5). DCP Goal LU1 supports the Downtown Community Plan area as a high quality, mixed-use district offering opportunities for housing for people across the income spectrum, jobs, arts and culture, local-serving retail and community/visitor gathering places. The proposed project is consistent with these LUCE and DCP goals and policies based on the project’s mix of uses comprised of a new full-service hotel, provision of 64 marketrate housing units, 25 deed-restricted affordable housing units, and 19 rentcontrolled housing units, retail and dining, and a full range of community benefits.
These community benefits include the commitment to construct and operate a Cultural Uses Campus open to the public; protection of two designated historic Landmark Buildings; provision of publicly-accessible open space; and a development plan that includes buildings with a range of building heights from 53’ to a maximum height of 130’ while still providing substantial ground level open space on the parcel.
2. The proposed Development Agreement is compatible with the uses authorized in the district in which the real property is located, in that the subject property is located in the Downtown District that allows multi-family residential uses and a wide range of commercial and community-serving uses. The proposed Development Agreement is consistent with LUCE Goal D7, Policy D7.1, and DCP Goal LU1.2 which all seek to create a balanced mix of uses in the Downtown that 14 of 19
reinforces the area’s role as having the greatest concentration of activity in the City. DCP Policy LU1.2 supports accommodating the development of uses that support a 17 hours a day/7 days a week environment that meets the needs of businesses and residents; such uses include retail goods and services, food stores, restaurants and cafés, hotels, health clubs, entertainment and comparable uses. The project proposes a full-service hotel, other commercial retail and restaurant uses as part of the project, and a Cultural Uses Campus that will provide opportunities for residents and visitors alike to experience a world-class cultural use venue. Further, the project proposes 100 residential units, of which 25 units will be deed-restricted affordable housing units for households of varying income levels within the Downtown, consistent with LUCE Policy D7.7
3. The proposed Development Agreement is in conformity with the public necessity, public convenience, general welfare, and good land use practices, in that it allows for the redevelopment of an underutilized property that would benefit from reinvestment to increase employment, create new transit occupancy taxes paid to the City, and to create a mixed-use project consisting of a full-service hotel, new housing units in the Downtown, and a new Cultural Uses Campus available to the public that is consistent with the 2010 Land and Use Circulation Element’s vision for the area. The proposed project would also preserve and adaptively reuse two designated City Landmark Buildings as part of the Cultural Uses Campus.
Moreover, the project will provide community benefits including affordable housing, publicly-accessible open space on the parcel, and provide monetary fees that 15 of 19
would support mobility, construction of affordable housing, parks and recreation, early childhood initiatives, and recycled water infrastructure expansion in the City.
Further, the project seeks to be consistent with the City’s sustainability goals by committing to LEED® Platinum certification with a project designed to achieve 15% less energy than required by California Energy Code, using recycled, non-potable water sources for landscape irrigation and other County-approved uses.
4. The proposed Development Agreement will not be detrimental to the health, safety and general welfare, in that the Development Agreement would allow for the redevelopment of an existing, underutilized property that is consistent with the 2010 LUCE and 2017 DCP vision for the area. The proposed project will be located in an urbanized area and is consistent with other similar improvements in the area and does not have the potential to disrupt the urban environment or cause health or safety problems. The proposed project provides 100 new residential units, of which 25 units will be deed-restricted affordable units. The project will feature commercial uses on the ground floor, a variety open spaces on the property, including an approximately 5,000 SF publicly-accessible rooftop viewing deck. The project will also provide community benefits including the aforementioned deedrestricted affordable housing as well as payment of fees that would support the City’s affordable housing development fund, mobility/transportation, early childhood initiatives, recreation and parks, and community economic equity/opportunity initiatives.
16 of 19
5. The proposed Development Agreement will not adversely affect the orderly development of the property, in that the Development Agreement is contingent upon the review and approval of a specific site plan consistent with recognized urban design principles that reflect the goals and policies of the City of Santa Monica which were established through a long range planning process and are reflected in the 2010 Land Use and Circulation Element of the City’s General Plan and the 2017 Downtown Community Plan. Further, the project will be subject to a construction mitigation plan that will be reviewed and approved prior issuance of a building permit for the project.
6. It is estimated that the proposed Development Agreement’s net fiscal impact to the City’s General Fund is estimated at $6.2M ($3.44M net new) during the first year of stabilized operations. This net fiscal impact associated with the project would be a result of the project generating substantial new Transit Occupancy Tax for the City and commercial uses would generate City business license taxes and sales tax. The project would also provide an estimated total of $6,065,000 in monetary contributions that would support the City’s affordable housing development fund, mobility/transportation projects, early childhood initiatives, parks and recreation, and community economic equity/opportunity initiatives.
17 of 19
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. The above recitals are true and correct, and incorporated herein by this reference.
SECTION 2. The City Council hereby adopts the Findings, and recommends approval of the Development Agreement, attached hereto as Exhibit A and incorporated herein by this reference.
SECTION 3. Based upon Findings 1-6, the Development Agreement is hereby approved.
SECTION 4. Each and every term and condition of the Development Agreement shall be and is made a part of the Santa Monica Municipal Code and any appendices thereto. The City Council of the City of Santa Monica finds that public necessity, public convenience, and general welfare require that any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of the Development Agreement, to the extent of such inconsistencies and no further, be repealed or modified to that extent necessary to make fully effective the provisions of the Development Agreement.
SECTION 5. Any provision of the Santa Monica Municipal Code or appendices thereto, inconsistent with the provisions of this Ordinance, to the extent of such 18 of 19
inconsistencies and no further, are hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.
SECTION 6. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of any competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional.
SECTION 7. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall be effective 30 days from its adoption.
APPROVED AS TO FORM:
______________________________
DOUGLAS SLOAN
City Attorney
19 of 19
EXHIBIT A
DEVELOPMENT AGREEMENT
[behind this page]