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Alleviating California’s Housing Shortage Through Shopping Malls

California officials have taken small but important steps to curb the state’s extraordinarily high housing prices and remove barriers to construction. While legislation banning single-family zoning has grabbed the headlines, its importance may be more symbolic than practical. A more obscure change could have a bigger impact on housing in the Golden State: enabling the conversion of malls and business parks into new large-scale developments that could combine new homes with the streets and stores that create new communities.

It’s no surprise that ending the default single-family zoning for residential land in California is getting a lot of attention. The single-family or split-level ranch home is the epitome of postwar California. San José, for example, the tenth largest city in the country, is actually a giant suburb; 94 percent of its real estate has been zoned single-family. Historically, it has seen more commuters leaving the city each morning than entering it. Thus, the modest measure of allowing owners of single-family homes with sufficient land to build up to two duplex homes reflects the understanding that high state housing prices are inextricably linked with limited supply and that many households need rental housing as a stepping stone to home ownership.

The bill’s sponsor, State Senator Toni Adkins, who represents a neighborhood in San Diego that includes the Tony La Jolla neighborhood, said he would “give Californians the chance to pursue their version of the American Dream.” . Adkins observed that a duplex structure could provide “a new source of income” for first-time homebuyers, an important recognition that the state needs a full range of housing types to thrive.

As symbolically important as the bill is, it is unlikely to lead to a major new building. Although house lots can be subdivided to make room for a duplex, new lots must still be at least 1,240 square feet and each housing unit must be at least 800 square feet. It’s even bigger than the 750-square-foot homes of the original Levittown, the quintessential post-war suburb. And while new construction is not subject to California’s famously Draconian Environmental Quality Act (CEQA), it will be banned if it has a “negative impact on health and safety or the environment.” physical”.

Jennifer Hernandez, one of California’s top housing development attorneys, believes the condition will prompt legislation in upscale suburbs, as well as litigation over issues such as tree felling. She expects the legislation to result in the subdivision of “long, skinny lots” in areas with lower land costs, including historically black ones in Compton and Inglewood, near Los Angeles. She is worried about gentrification, although this could just as easily be seen as a collateral benefit.

But another bill could do more to break the regulatory barrier holding back California housing construction. Richard Bloom, a member of the Santa Monica State Assembly, sponsored a law that has mainly captured attention because it allows developers to remove old racial pacts and restrictions on deeds from real estate titles. At first glance, this seems like a symbolic gesture, as Supreme Court rulings and the Fair Housing Act of 1968 have long replaced these restrictions. But the law went further, potentially affecting malls, shopping centers and business parks. These properties often have their own “community terms and restrictions” meant to ensure that all subdivisions have been used for a similar purpose, in other words, no Airbnb rentals in an industrial park.

Bloom’s Law opens up a big exception, allowing these commercial properties to be converted to residential use, as long as the housing is “affordable.” This is an unfortunate condition, forcing state taxpayers to provide the necessary subsidies only because regulations have so increased the cost of construction. Still, the change he facilitates might be more than a few duplexes here and there. Making it easy to remove these restrictions on acts could lead to a wave of business conversions.

The Covid-19 pandemic, which ushered in the work-from-home revolution, may also have brought shopping malls and business parks to the end of their usefulness. In a 2020 report, “Residential redevelopment of commercially zoned land in California,” the Turner Center for Housing Innovation at UC Berkeley notes the magnitude of the opportunities involved: “The four largest subways in California — Los Angeles, San Francisco Bay Area, San Diego, and Sacramento— have an abundance of land zoned for commercial use, and allowing residential development in these areas could introduce new housing to virtually any neighborhood.

For the imaginative developer and town planner, the large-scale conversion of commercial real estate suggests the possibility of not only affordable apartment buildings, but also homes, shops and businesses – pedestrian communities of the type that buyers are now looking. Not just new housing, but new neighborhoods; not a few houses, but several thousand. Add to that vision an uberized transportation system in which fewer Californians will need to own a car to get to work, if they have to leave their homes to work. Indeed, state officials are already taking note of the decrease in the need to own a car; the duplex bill only requires new limited parking space.

This move from mall to housing won’t happen overnight, and restrictions like “100% affordability” don’t help make it happen either. Even if the law allows for the rescission of deed restrictions, local communities will still need to change zoning from commercial to residential or mixed-use. But resistance is less likely for new developments that are next to no one.

Economist Herbert Stein has pointed out that if something cannot last forever, it will stop. Time will tell if this truism applies to California’s housing shortage.

Photo by Justin Sullivan / Getty Images


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