CCA White Paper on Expanding Adaptive Reuse to Support Housing & Economic Recovery

"As the primary champion for the City’s first adaptive reuse law passed in 1999, CCA knows the power that this policy has to help under-utilized and vacant buildings assume new uses that meet communities’ needs and enliven neighborhoods. Adaptive reuse is one tool that can help cities like Los Angeles respond to the future while tackling our many pressing challenges. We look forward to collaborating with the City to implement our recommendations. Together, we can help Los Angeles recover into a more resilient and livable city."

—Jessica Lall, President & CEO, CCA

The Adaptive Reuse Policy Landscape in Los Angeles
The ARO has been a major catalyst for the transformation of Downtown LA since its adoption in 1999. Its success led to the adoption of the Adaptive Reuse Incentive Areas Specific Plan in 2003 that expanded adaptive reuse provisions to other areas of the city to include Chinatown, Lincoln Heights, the Hollywood Community Redevelopment Project Area and portions of the Wilshire Center/Koreatown Community Redevelopment Project Area. 

The primary success factors for the existing ordinances are that they:

1. allow buildings to change uses by-right and not incur Site Plan Review or trigger CEQA requirements
2. do not require buildings to provide any net new parking
3. allow new, one-story rooftop additions by-right
4. are accompanied by a new building code chapter to clarify building code requirements.

These features are instrumental to removing key barriers by reducing costs, time and risk involved in converting buildings and support project feasibility. 

Despite the success of these ordinances, there are several limitations that constrain adaptive reuse’s prevalence in Los Angeles: 

• The ARO applies to only a fraction of areas in the city.
• Buildings constructed after 1974 must undergo a more onerous, discretionary approval process for conversion that triggers CEQA requirements.
• Buildings in areas that are currently zoned for manufacturing (“M” zones) must also undergo a more onerous approval process for conversion that triggers CEQA requirements.
• New residential units resulting from conversion must be an average of 750 square feet for an entire building. Each individual unit must be a minimum of 450 square feet, which presents challenges for financial feasibility and accommodating a broader mix of housing sizes, especially affordable, permanent supportive and micro-unit typologies.

The Department of City Planning is currently revising rules for adaptive reuse projects within Downtown under the DTLA 2040 Community Plan Update, which is the land use and zoning plan that will guide development in Downtown for the next two decades. This is being done in tandem with the broader reorganization and rewriting of the citywide zoning code known as “re:code LA”. 

DTLA 2040 would build on the ARO and include important updates that would further support the feasibility of adaptive reuse projects. These updates include:

• allowing basements and rooftop features to be utilized and not count toward a building’s floor area
• removing minimum and average unit size requirements
• providing for a greater range of uses like enabling parking structures to convert to any new uses permitted by the new zoning code, such as housing, office or retail.

While DTLA 2040 would generally expand opportunities for adaptive reuse, the new provisions would necessarily be limited to only Downtown, and there are still several constraints: 

• Buildings constructed after 1974 would still be subject to a more cumbersome review process with CEQA requirements.
• It only provides additional incentives for historic projects as part of a unified adaptive reuse project, which are primarily only large sites, or through a newly-created Transfer of Development Rights (TDR) system which applies to a small portion of the Arts District.
•  It maintains the current ARO FAR exemption for mezzanines and loft areas in residential uses but does not allow this exemption for other uses.
•  Residential and lot amenity space requirements for unified adaptive reuse projects are based on the residential floor area and lot square footage of the full site, rather than just new floor area.

• Loading docks would be required features in industrial areas as a design element regardless of whether the use necessitates a loading docks.

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Recommendations

To maximize impact, the City’s efforts to update adaptive reuse provisions should be coordinated and unified under a comprehensive proposal. We believe the most effective adaptive reuse proposal would include the following principles: 

• Apply citywide
• Apply to a broad range of buildings of different land uses and ages
• Maximize flexibility for residential unit sizes, types, design and densities and programming of commercial spaces
• Make it easy to provide amenity spaces throughout buildings, including in rooftops and basements
• Incentivize development and rehabilitation by allowing new floor area to be added in tandem with preserving existing buildings
• Ensure projects are allowed by-right
•  Do not require any new parking and provide opportunities to convert existing parking to more active uses

To achieve this holistic approach to adaptive reuse in the City of Los Angeles, we recommend the following: 

Recommendation #1

The proposed DTLA 2040 and re:code LA adaptive reuse regulations are the farthest along in development and offer the 

most promise for a cohesive and flexible approach. As such, the City Council’s efforts should be consolidated and aligned with City Planning’s current work to reexamine and update adaptive reuse most expeditiously, without necessarily tying its implementation to updates to individual community plans.

Recommendation #2

While DTLA 2040 and the new citywide zoning code make many positive changes to the existing ARO, additional refinements can 

make it more usable and inclusive. These proposals should be amended to align with the final version of the DTLA 2040 Adaptive Reuse incentives by: 

• Allowing buildings built more recently than 1974 to utilize the ARO provisions by-right rather than requiring them to be approved via discretionary review and subject to CEQA requirements.
• Expanding citywide applicability provisions to include light industrially zoned areas where industrial uses are no longer active or appropriate for their contexts.
• Allowing adaptive reuse projects with any use, not just residential, to have new intermediate floors and mezzanines that do not count towards floor area.
• Calculating amenity space based on the new development floor area only, instead of the floor area for the full site.
• Removing requirements to maintain loading dock areas, which limits opportunities for redesign and reuse, particularly for industrial areas with large loading bays.

Recommendation #3

The updated adaptive reuse provisions that apply to Downtown will be enacted when the DTLA 2040 Community Plan is adopted by City Council, which is expected to occur in 2021. However, updated citywide adaptive reuse rules will be adopted over a much longer timeframe as they will be dependent on the adoption of each new Community Plan Update. By the time DTLA 2040 is likely adopted, the entire process will have taken seven years. While some Community Plans are in the process of being updated, others have not yet even begun. The need for more flexible and expansive adaptive reuse regulations across the city is far too urgent to wait until all new Community Plans have been updated and adopted. The City Council should advance citywide adaptive reuse provisions envisioned under re:code LA, with the recommended changes outlined in Recommendation #2, in the short term via a citywide ordinance and amendments to existing AROs. 

Recommendation #4

Here again, more flexible and broadly applicable ARO provisions are an urgent and time-sensitive need to support the city’s economic and fiscal recovery from COVID-19, but the City should seek every efficiency to expand adaptive reuse. Notably, the City’s zoning code already allows residential development in certain commercial zones (i.e., the C2 zone allows R4 uses), which suggests that existing structures should be allowed to more flexibly change uses by-right in these zones as well. Changing uses from commercial to residential is also a decrease in the intensity of uses. The reduced intensity of use coupled with the ARO’s application to already existing structures suggests that adaptive reuse projects would not result in significant environmental impacts (to the contrary, they have net positive sustainability impacts as detailed previously). 

Additionally, the Senate Bill (SB) 6 and Assembly Bill (AB) 115 currently under consideration by the State legislature would allow for more residential uses in commercial zones by-right statewide. To better foster adaptive reuse projects, these bills should not require projects to have any net new parking and not be subjected to cities’ maximum density or minimum unit size requirements. Given the emergency nature of such a policy response to the pandemic and the housing crisis, the City should work to find opportunities to expand adaptive reuse expeditiously under the existing zoning code while advocating that the State legislature improve bills like SB 6 and AB 115 to facilitate adaptive reuse projects across California.