City of Arcadia
All You Need to Know About Building on Properties in Arcadia Under SB-9
Using SB-9 for property development in Arcadia is an effective method for homeowners to secure funds to significantly reduce their mortgage. If additional capital is available, you can also construct extra units to generate rental income or accommodate extended family members while maintaining your primary residence. To achieve success with SB-9, first, determine if your property qualifies, understand the regulatory implications, and select the SB-9 option that offers the greatest financial advantage for properties in Arcadia.
What is SB-9 and how does it apply to the properties in Arcadia City?
What is SB-9?
Senate Bill 9 (SB-9) streamlines the approval process for certain residential projects in California. It instructs local governments to expedite these projects by bypassing lengthy environmental reviews (CEQA), conditional use permits, or similar approvals from bodies like the Planning Commission or Historic Preservation Commission. Participation is optional and requires meeting specific eligibility criteria.
How does SB-9 apply to properties in Arcadia?
In Arcadia, SB-9 allows homeowners to streamline the addition of residential units to their properties. With SB-9, property owners can potentially split single-family lots into two separate lots and build up to two residential units on each lot, bypassing extensive environmental reviews and discretionary approvals. Homeowners should check local zoning regulations and consult with relevant authorities to ensure they meet all specific criteria and procedures.
What can homeowners build under SB-9 or Arcadia’s HOME Act?
Urban Lot Split under SB-9
SB-9 allows for the creation of two new lots from a single lot in urban areas, provided the property is zoned for single-family housing.
Under this option, you could have the following unit configurations:
Not sure if your property is located in a Single-family zoned area?
Two-Unit Projects under SB-9
A two-unit project refers to two separate dwelling units built on a single-family lot, whether as a new construction or an addition to an existing home.
You could have the following unit configuration:
How large can each new unit be, and how many can you have per lot?
In Arcadia, SB-9 requires each new residential unit to be between 500 and 800 square feet. However, according to California's SB-9 regulations, there are no size limits, meaning units can be larger than 800 square feet.
You can construct two units, such as ADUs or JADUs, on a lot that has been divided through an urban lot split.
What are the setbacks?
New construction requires a minimum 4-foot setback from side and rear lot lines while front setbacks follow zoning or HOA rules. However, existing structures or those built in the same spot are exempt from setback requirements.
What is the parking requirement under SB-9?
Each new primary dwelling unit should have at least one off-street parking space. This space is accessible via a driveway. An enclosed garage is allowed but only limited to two parking spaces, each measuring at least 10 feet by 20 feet. The size of the garage does not count towards the total unit size.
What are the lot constraints under SB-9?
Under SB-9, the lot to be subdivided is required to be at least 2,400 square feet. Each new lot created from the lot split should be at least 1,200 square feet and fall within 40% to 60% of the original lot's area.
Development Analysis calculates the max size under SB-9 for the highest return.
Who and which properties are eligible for SB-9 or the HOME Act?
Which zoning designations are eligible for SB-9?
SB-9 applies to properties in single-family residential zoning districts, such as R-M, R-0, and R-1.
Can you disregard the environmental restrictions on the lot?
No. SB-9 does not allow development on lots in environmentally sensitive areas. These include wetlands, hazardous waste sites, floodways, conservation areas, and habitats for protected species. This ensures that sensitive environments are protected from development impacts.
Can you bypass the Historical Preservation limitations?
No. In Arcadia, if a property is historic or located in a historic district listed on the State Historic Resources Inventory or is part of a city landmark or local historic district, SB-9 will not override these preservation rules.
Is it allowed to demolish an affordable unit?
No, demolishing affordable housing units—those designated for moderate, low, or very low-income households—is not allowed under SB-9.
Is it allowed to build on a property in Coastal Zones?
Arcadia's SB-9 does not specifically address buildings in coastal zones. It’s best to check with the planning department, as coastal areas often have stricter building regulations than urban zones.
Is it allowed to build in High-Risk Areas?
Maybe. Building in high-risk areas is possible, but strict safety measures are required. For properties in high fire hazard zones, an inspection confirming compliance with fire safety regulations is needed. For properties in earthquake fault zones, compliance with the seismic building codes is required.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, the homeowner should sign an affidavit stating they will live in one of the dwelling units on the new lot as their main residence for at least 3 years after the urban lot split is approved.
What are the rental regulations?
Rental regulations under SB-9 do not allow short-term rentals. This means that no unit on the property can be rented for less than 30 days.
Are existing tenants’ rights protected?
Yes, existing tenants' rights are protected under certain conditions. This includes housing under rent or price control by a public agency and properties previously occupied by housing withdrawn from rental or lease under the Ellis Act within the last 15 years. Additionally, any housing rented by a tenant within the last 3 years is also protected.
Can condominiums be proposed as part of my Urban Lot Split application?
No, you cannot propose dividing the property into condominiums or other common interest developments as part of an urban lot split. Creating separate airspace for condominiums or similar projects is not allowed under this process.
What is the difference between SB-9 and SB-684?
SB-684, a newer law than SB-9, streamlines the development of up to 10 housing units on urban lots smaller than 5 acres. Unlike SB-9, SB-684 applies to properties in multi-family zoning areas or on vacant lots in single-family zones. Additionally, SB-684 doesn't have the same ownership restrictions as SB-9.
Below we compared SB-9 and SB-684 for you to understand the development framework outlined by each bill.
How to get permits under SB-9 or the HOME Act?
Does SB-9 projects qualify for a ministerial approval process and what does it mean?
Yes, SB-9 projects are eligible for ministerial approval, which simplifies the development process by adhering to clear, objective standards. Unlike discretionary approvals, it eliminates subjective judgments, reducing delays. This allows permits to be issued without the need for extensive CEQA reviews or public hearings. However, even with this streamlined process, approval for a lot split may still take up to 1.5 years.
What are objective standards?
"Objective zoning standards," "objective subdivision standards," and "objective design review standards" are set rules used to evaluate projects. These standards are based on fixed, measurable criteria rather than personal opinions from officials. They ensure consistency and predictability in project reviews, so developers and homeowners know what to expect when submitting their plans.
What types of objective standards qualify for a waiver under SB 9?
Under SB-9, objective standards can be waived if they obstruct the construction of two units or result in either unit being less than 500 square feet. If a regulation would cause a unit to fall below this size, it can be adjusted or waived to allow the unit to meet the 500-square-foot minimum.
What are the steps to get the permits?
To get permits for SB-9 developments, property owners should follow these steps:
1. Review Arcadia's SB-9 Ordinance: Familiarize yourself with the specific requirements in Arcadia's SB-9 Ordinance. You can find this information on the city's website or by contacting the Arcadia Planning Department.
2. Gather Application Documents: Collect all required documents for your SB-9 project application, such as site plans and floor plans.
3. Ensure Compliance: Make sure your project meets all the objective standards specified in Arcadia's SB-9 ordinance, including lot size, dimensions, and building specifications.
4. Submit Application: Submit your completed application and all required materials to the Arcadia Planning Department, along with any applicable fees.
5. Undergo Ministerial Review: Your application will be reviewed based on compliance with the objective standards. The review process will not involve subjective judgment.
6. Address Concerns Promptly: If any issues come up during the review, promptly work with the Arcadia Planning Department to address and resolve them.
How fast can you complete a project per SB-9?
This information outlines the different phases of the project along with their respective durations.
Feasibility Study with deciding the final scope of the project:
- Maximum of 3 days using CityStructure Analysis
Secure Financing: 2 to 3 weeks
Hiring the Team: 2 weeks
Design Process:
- Schematic Design: 1-2 months
- Permit Set / Design Development Drawing Set: 2-3 months
- Construction Drawing Set: 2-3 months
Entitlements and Building Permits: 6 to 9 months with the possibility of extending further due to departmental backlogs
Construction:
- Lot Split only: 1 year
- Single Family House/Duplex: 1 year
- Accessory Dwelling Unit (ADU): 3 to 6 months
How much does an SB-9 project cost?
In this analysis, we will take a look at two scenarios to evaluate expected expenses, property assessments, and potential profits for real estate projects.
Scenario 1
New 4,000 sq.ft 3-Story Duplex + 1,000 sq.ft ADU
In this first scenario, we propose constructing a three-story duplex with a total area of 4,000 square feet and a 1,000-square-foot Accessory Dwelling Unit (ADU). The projected total cost, including construction, permits, and professional fees (excluding the cost of land), is $2,159,951. The expected market value of this finished property in Arcadia is about $2,750,000, leading to an ROI of [($2,750,000 - $2,159,951)/$2,159,951]*100 = 27%
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
For the second scenario, we plan to split a lot and build two separate duplexes, each measuring 4,000 square feet and three stories high. The estimated total cost for this project, excluding land acquisition, is $3,466,261. The projected market value for these duplexes in Arcadia is $4,400,000, which results in an ROI of 27%.
Conclusion:
Pursuing SB-9 projects in Arcadia might result in returns below 50%. To improve the potential returns, consider adopting additional financial strategies or negotiating a better price for the land.
See how much it will cost you to improve your property per SB-9
Related Articles
ADU Solutions for Aging in Place in Arcadia
Everything You Need to Know About SB-684 Development in Arcadia
How to get your permits fast or the benefits of using SB-423 in Arcadia
How to Make My ADU a Profitable Investment in Arcadia?
What are the requirements to build ADU in Arcadia?
More articles ...