August 19, 2025 Breaking News, Latest News, and Videos

Six Big Lies Keeping the Real Estate Bubble Inflated (Part 1)

Every so often SMart invites a guest columnist to write an article about local planning issues. This week and next we have invited Dick Platkin, a former planner for the City of Los Angeles, who is writing about the lies that the building and financial industries perpetuate in their quest for profits using the wedge of new State of California laws gutting local development controls. Since this year the State has been feverishly passing laws unleashing over development, (the City of Santa Monica is now supposed to build 5000 new units in the next 10 years) we felt this article was relevant to expose the lies used to sell this overdevelopment. While Dick’s article was written about Los Angeles identical issues apply in Santa Monica. Just substitute Santa Monica every time he mentions Los Angeles. This article first appeared in City Watch LA a few weeks ago. 

Planning Los Angeles.  If you follow the news regarding housing-related legislation bubbling up in Sacramento and at LA’s City Hall, you have been subjected to a series of big lies.  They all claim that quickly-permitted, larger, taller, denser apartment buildings will finally solve the housing crises ravaging Los Angeles and the rest of California.  For good measure, the lies sometimes fold in other alleged benefits, such as less traffic congestion, reduced Green House Gas emissions, and increased transit ridership.

Even though many CityWatchLA writers have exposed these lies, like zombies, they repeatedly rise from the grave, intent on keeping the current real estate bubble alive.  For this reason they need continuous debunking, as well as identifying who benefits from them. 

Big Lie # 1.  California needs 3.2 million more homes, and up-zoning the entire state will end the housing shortage and, therefore, the state’s housing ‘crisis’.   As carefully refuted in CityWatchLA by Casey Maddren and myself, this is a lie for two reasons.  First, the 3.2 million figure comes from a McKinsey Global Institute consultant study that relied on New York and New Jersey housing data to draw conclusions about California.  Other studies show a smaller housing shortage, and if you look at such obvious measures as homelessness, out-migration, over-crowding, and rent-gouging, the figure is even lower.  

Second, if up-zoning has any effect on housing production and costs, it will only produce expensive housing funded by private investors.  These investors do not plunk billions in under-performing capital into profitless low-income housing ventures. As for HUD programs to directly build and operate low-income housing, the Nixon, Reagan, and Clinton administrations eliminated them decades ago. The one remaining public housing option, California redevelopment agencies financial support for low income housing projects, ended in 2011.  This is when the State Legislature and Governor Jerry Brown dissolved California’s local redevelopment agencies.

Big Lie # 2.  Los Angeles does not have enough remaining zoning capacity to meet its housing needs.  The solution, therefore, is to up-zone the city’s residential neighborhoods, through State laws, like SB 330, and local ordinances, like “Transit Neighborhood Plans.”  Anyone who believes this tall-tale only needs to drive, walk, bike, or take the bus down any of LA’s endless, low-rise, mostly-treeless commercial corridors, like Van Nuys Boulevard in the San Fernando Valley, Pico Boulevard on the west side, Vermont Avenue south of DTLA, and Whittier Boulevard on the east side.  You will see miles of one and occasional two story buildings. These long, woefully under-utilized transit corridors could be redeveloped with three story, by-right apartment buildings. Through density bonuses, these corridors could be re-built with mixed-use or apartment-only buildings six or more stories tall.

This is why the most accurate study on LA’s unused zoning capacity, Chapter 7 of the General Plan Framework’s Draft Environmental Impact Report, reveals that LA’s zoning build-out population would be 7 million people, far above the capacity of the city’s infrastructure and public services.  Subsequent density bonus laws lift this zoning build-out figure to 9 million people, or more than double the city’s population. Despite LA’s current building boom, most of this unused zoning capacity remains untouched, far exceeding the latest population forecasts.

Big Lie # 3. Transit ridership will increase if the density of nearby housing is raised through zone changes.   This fix could work if the current housing boom were restricted to low-priced housing rented to transit-dependent low income tenants.  But, this is not the case. In Los Angeles new “transit oriented development” (TOD) decreases transit ridership because it is based on private real estate investment.  Since investors are strictly guided by profit maximization, and since the most profitable apartment houses are for the well-off, TOD is really car-oriented, transit-adjacent housing.  These well off tenants rarely ride a bus or subway, even when it is close by. They own cars and stick with them for most trips, the main reason LA’s bus and subway ridership continues to plummet.

As you can see from this first half of the article, these are familiar themes that apply directly to Santa Monica. Santa Monica does not need more housing, just more affordable housing that cannot be produced by private profit seeking developers. When these developers do build their high end apartments in our City they give us a code required fig leaf (of about 8%) of affordable units which only makes their pricier units even more expensive. 

Our City already has plenty of capacity, like Los Angeles, in its existing zoning, particularly along the boulevards, to meet all its foreseeable future population housing demand. It does not need up zoning.  And finally,  transit oriented development has no impact on traffic congestion or increasing public transit ridership as the new development around transit stations is only for rich tenants who will always drive cars. 

In short, up zoning entire Cities is bad public policy with no net benefit to the Cities forced by the State to endure its burdens. To be continued next week. 

For Santa Monica Architects for a Responsible Tomorrow

Sam Tolkin, Architect; Dan Jansenson Building and Safety Commissioner, Architect; Mario Fonda-Bonardi, AIA, Planning Commissioner; Ron Goldman, FAIA;  Thane Roberts ,Architect; Bob. Taylor, AIA; Phil Brock, Arts Commissioner. 

<>Related Posts

‘Ketamine Queen’ Pleads Guilty and Admits Role in Matthew Perry’s Death

August 19, 2025

August 19, 2025

Prosecutors Say She Supplied Ketamine Through Perry’s Assistant Facing five federal counts tied to Matthew Perry’s 2023 overdose, North Hollywood...

State Bill Aims to Protect Palisades Bowl Mobile Home Park Residents

August 18, 2025

August 18, 2025

PPCC President Sue Kohl emphasized the bill’s importance in safeguarding affordable housing and preventing displacement in Palisades The Pacific Palisades...

Pedestrian Killed in Downtown Santa Monica Car Crash

August 18, 2025

August 18, 2025

Police Say Driver Stayed at Scene; Investigation Ongoing The Santa Monica Police Department says a man died Friday, August 15,...

HelloFresh to Pay $7.5M in Subscription Renewal Case Filed by CART Prosecutors

August 18, 2025

August 18, 2025

Meal-Kit Giant Settles Lawsuit Over Automatic Plan Payments Without Proper Consent HelloFresh has agreed to pay roughly $7.5 million to...

HelloFresh to Pay $7.5M in Settlement Involving Santa Monica Attorney’s Office

August 18, 2025

August 18, 2025

The lawsuit, filed by the California Automatic Renewal Task Force, claimed HelloFresh failed to clearly disclose subscription terms, obtain proper...

Marquez Knolls Home Unaffected by Fires Lists for $10M

August 18, 2025

August 18, 2025

The outdoor spaces include an al fresco dining area with a fireplace, a pool and spa, and a covered lounge...

Santa Monica Approves First-Ever Equity Plan. Here’s What It Means For the City

August 18, 2025

August 18, 2025

The plan, developed by the city’s DEI team over the past year, acknowledges generational and institutional racism’s lasting impacts and...

23-Story Tower, Affordable Housing Project Proposed in Downtown Santa Monica

August 18, 2025

August 18, 2025

Hankey Capital Unveils Plans for Two 7th Street Developments Plans for two residential projects in Downtown Santa Monica, including a...

Louis Naidorf, Architect of the Santa Monica Civic, Capitol Records Building, Dies at 96

August 17, 2025

August 17, 2025

Designer Also Shaped Landmarks From the Beverly Center to the California State Capitol Louis Naidorf, the architect who designed Hollywood’s...

Workers’ Compensation Defense Law Firm Opens Santa Monica Office

August 16, 2025

August 16, 2025

The Santa Monica office is part of Gilson Daub’s national expansion, which includes eight new offices opened across the U.S....

$25 Million Campaign Launched to Restore and Expand Palisades-Malibu YMCA

August 16, 2025

August 16, 2025

Community Leaders Launch $25 Million Campaign With $10M County Pledge Officials and community leaders gathered Thursday to break ground on...

LAPD Seeks Additional Victims in Venice, Santa Monica Sexual Assault Case

August 16, 2025

August 16, 2025

Detectives have identified three victims but believe others may exist Detectives from the Los Angeles Police Department’s Operations West Bureau,...

Jeni’s Splendid Ice Cream Debuts  All-Black Ice Cream in Collaboration With Artist Cj Hendry

August 15, 2025

August 15, 2025

Limited-Edition Flavor Opaque and All Black Cones Launch on Aug. 14 Jeni’s Splendid Ice Creams is stripping away the usual...

County Jail System Achieves Compliance Milestone in Inmate Processing

August 15, 2025

August 15, 2025

Key improvements include a new Shared Intake Management System using wristband scanner technology to track and expedite inmate processing Los...

Santa Monica Pier to Honor Local Legends at Inaugural PIERfect Benefit Fundraiser

August 15, 2025

August 15, 2025

The event marks the debut of the Santa Monica Pier Awards, and will recognize an original Pier Corporation board member...