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We Love Property Management Headaches!

1900 Pico Boulevard
Santa Monica, CA 90405
(310) 434-4000

By Jorge Casuso

January 13, 2022 -- Two days after the City Council took a major step to build affordable housing on the site of Public Parking Structure 3 Downtown, a judge temporarily halted its immanent demolition.

LA County Superior Court Judge Mitchell L Beckloff on Thursday granted the Santa Monica Bayside Owners Association's (SMBOA) request for a preliminary injunction but did not order the City to continue to operate the parking structure.

The petition was opposed by the California Coastal Commission and the City, which plans to tear down the 337-space, six story structure and replace it with a supportive housing development.

"Based on a balance of the likelihood of success on the merits of the parties' competing harms," Beckloff wrote, "the court finds Petitioner has demonstrated entitlement to a preliminary injunction during the pendency of the litigation."

As a condition for the injunction, the Bayside Owners Association must post a $150,000 bond by 5 p.m. January 24.

Four days later, the court will hear from the parties on the amount and possible adjustments to the bond and "set trial on the petition on an expedited basis," Beckloff wrote.

City officials noted that if the bond is not posted, the preliminary injunction relief will be dissolved.

"A final ruling is not likely on the merits until April, depending upon the final briefing schedule, which will be determined by the Court on January 28," said City spokesperson Constance Farrell.

The ruling comes shortly after the City Council on Tuesday voted to enter into an exclusive negotiation agreement with EAH, Inc. (EAH) to build housing targeted for homeless individuals on the City owned parcel.

The developer was selected based "on the team’s depth of experience in the areas of permanent supportive housing, larger developments, supportive services, and property management," City officials said.

“Our region suffers from a dearth of affordable housing," Mayor Sue Himmelrich said after the vote, "and we in Santa Monica are committed to improving the crisis and getting people into housing that can be the foundation for stability.”

“We aren’t waiting for private development to lead the way," Himmelrich said. "We are leading by making available a precious resource that makes it possible –- land.

"This is a project that addresses the biggest needs of the day, including homelessness, affordability, and equity, and reflects our community’s values.”

In its lawsuit, the SMBOA contends that the Downtown area cannot afford to lose the 337 spaces in the garage, which City officials note were replaced when Parking Structure 6 was rebuilt.

The plaintiff seeks to stop the City's plans, claiming that the Coastal Commission "erred in granting the permit because the legal requirement wasn't met," according to the group's attorney.

In his ruling Thursday Beckloff wrote that "the dispute before the court as presented by the Petitioner is somewhat confused."

He noted that while it attacks the Commission's decision to grant a demolition permit, the petition fails to "specifically address any alleged legal error or abuse of discretion" by the Commission.

Beckloff, however, said the Petitioner "has sufficiently demonstrated the City considered (as an environmental matter) the demolition of PS 3 only in the context of rebuilding" and not demolishing it "without its reconstruction."

Demolition of the structure was potentially set to begin on January 3 under a $2.5 million contract approved by the Council last summer, but Beckloff issued a temporary restraining order last month halting its demolition ("Judge Temporarily Halts Parking Structure Demolition," December 22, 2021)..

The demolition of the structure -- which was built in 1966 and needs extensive retrofitting -- has been long in coming. The City decided in 2009 to tear it down and replace it with a commercial use, starting negotiations with two cinema operators that failed to pan out.

Two years later, the City approved the Downtown Community Plan (DCP), which allows approximately 120,000 square feet of affordable housing and approves the reduction of 600 public parking spaces on 2nd and 4th streets by 2027.

In October, the Council approved a Housing Element Update that earmarks Parking Structure 3 as one of the potential City-owned properties needed to build the 6,168 affordable units mandated by the State ("Council Cautiously Approves Housing Plan," October 13, 2021).

Under the winning proposal recommended by EAH, the developer would build and manage the property and "all residents would be supported with services to ensure housing retention and good-neighbor actions," City officials said.

"The unique needs of the households occupying the supportive housing component of the development would be addressed by intensive case management services," officials said.

"As the development concept is further refined, supportive services will be designed to align with the needs of the residents."

On Tuesday, the Council also directed staff and the development team "to work collaboratively on ways to move the affordable housing forward as quickly as possible."