City of Santa Monica - Adaptive Reuse Ordinance

In the fall of 2024, the City of Santa Monica adopted an Adaptive Reuse Ordinance to encourage housing production and incentivize the reuse of underutilized commercial buildings and sites. Omgivning has extensive experience crafting adaptive reuse policies for cities, and they worked with the City of Santa Monica to fine-tune this innovative policy and test it out with five redevelopment schemes.

While Santa Monica has large office buildings that could be converted or partially converted, there are many smaller commercial buildings that are underutilized as well. These buildings are often at risk of demolition, potentially being replaced with oversized developments that could drastically alter the city’s character and scale. Santa Monica has always been forward-thinking in its approach to policy and redevelopment and recognizes that discouraging demolition and promoting reuse are essential components for creating a sustainable and resilient city. In addition, this approach also helps to maintain the charm of the city while introducing more housing and helping to make reuse economically viable.

Santa Monica’s planning department has crafted a smart and thoughtful ordinance that offers financial incentives to property owners and developers to increase density and revenue potential, while also focusing on sustainability and preserving the character of the city’s streetscapes.

Bonus Floor Area

As long as you are reusing the existing building without significant demolition, the primary eligibility for using the new Adaptive Reuse Ordinance are sites that would create a minimum of two new residential units in the existing building. Or in some zones, this could be in the new allowable floor area. A significant portion of these incentives involves adding new construction on top of, behind, or beside existing buildings, referred to as “Bonus Floor Area.”

There are two ways to achieve this Bonus Floor Area:

1. Additional Stories--- Up to two stories within a max of 24 feet of new construction on top of the existing building

2. New Construction in Side/Rear--- Residential and Neighborhood Commercial Zoning Districts: New construction in the side/rear cannot exceed one story above the existing building.

--- All other Zoning Districts: New construction in the side/rear is limited to 100% of the existing building floor area and cannot exceed one story above the existing building

Bonus Story for Open Space

One additional story may be added for open space amenities

Streamlined Process and Cost Savings

The final set of incentives is directly tied to saving time and money. These projects are classified as “by-right” and will be processed administratively, potentially saving property owners years of navigating lengthy entitlement processes. Additionally, there are no affordable housing requirements and certain impact fees, such as those for transportation, cultural arts, and childcare linkage, have been exempted.

Redevelopment Examples

Let's go through a few of Omgivning's building examples with Adaptive Reuse Ordinance policy applied to see how it can impact a building and site.

Example 1: Montana AvenueThis small retail building with a rear surface parking lot is zoned to allow four residential units and 50% parcel coverage.

If the retail space has struggled with vacancies, the owner could convert part of it into two small residential units while reducing the commercial square footage. The Adaptive Reuse Ordinance would then allow two additional stories to be constructed on top of the retail building. In the rear, the parking lot could remain with a one-story addition erected above it, resulting in a total of 13 units on the site.

Example 2: Ocean Park BoulevardThis two-story commercial building with a rear surface parking lot off of an alley presents another opportunity.

The two second-floor offices could easily be converted into two residential units. If adding additional stories proves cost-prohibitive or the owner wishes to preserve the building’s charm, they could still build a three- or four-story residential structure on the parking lot, leveraging the ordinance’s incentives.

Example 3: Lincoln BoulevardThis large, 60,000-square-foot commercial building with ample on-site parking is a prime candidate for adaptive reuse. With an oversupply of office space in the region and demand for Class A or A+ office products, this well-maintained building could be challenging to lease. However, under this ordinance, the ground floor could remain commercial, while the upper floors are converted to residential units.

Two additional stories, plus a partial rooftop amenity, could be added, doubling the building’s leasable square footage and providing over 100 residential units with adequate parking for both commercial and residential uses.

Additional Development Standard Incentives

The following is a list of additional incentives which are modifications from the current Development Standards:

Seismic Considerations

Santa Monica’s mandatory seismic retrofit ordinances, particularly for non-ductile concrete or steel moment frame buildings, may seem onerous to some owners who have been given notice to upgrade their buildings. However, they could open up the viability of an upgrade with these conversion projects. Buildings that are already required to be structurally upgraded are often well-suited for additional stories. That said, each building is unique, and an assessment by a structural engineer would be essential to determine viability.

Partnering with Omgivning

Omgivning was thrilled to work with the city to model this policy on five different building types, helping refine the ordinance to maximize its impact. If you own a small or large underutilized commercial building in Santa Monica, reach out to us for a quick feasibility study. Our experienced teams, including structural engineers and contractors, can provide realistic, high-level analyses at a low cost.

See our page on Feasibility Assessments

We extend our gratitude to the Santa Monica Planning Department and other stakeholders for their expedient efforts in implementing this ordinance.

Code Reform, Adaptive Reuse