City of El Segundo
All You Need to Know About Building on Properties in El Segundo Under SB-9
Applying SB-9 for real estate projects in El Segundo City is an effective method for homeowners to significantly reduce their mortgage debt. With additional funds, you can construct extra units to generate rental income or provide space for family members while continuing to live in your primary residence. To ensure the success of an SB-9 project, begin by confirming your property's eligibility, familiarizing yourself with the regulations, and selecting the SB-9 option that provides the most financial advantage for your El Segundo City property.
What is SB-9 and how does it apply to the properties in El Segundo City?
What is SB-9?
Senate Bill 9 (SB-9) aims to make it easier to approve certain housing projects in California. It requires local governments to speed up approvals by bypassing extensive environmental reviews (CEQA), Conditional Use Permits, or other approvals from bodies like the Planning Commission or Historic Preservation Commission. Participating in SB-9 is optional for property owners, but they need to meet specific requirements.
How does SB-9 apply to properties in El Segundo?
SB-9 allows El Segundo homeowners to add more housing units through two-unit developments or urban lot splits into single-family lots. This can increase property value, provide rental income or sales opportunities, and offer a streamlined permit process. It also helps address local housing shortages while preserving neighborhood character.
What can homeowners build under SB-9 or El Segundo’s HOME Act?
Urban Lot Split under SB-9
This process allows homeowners to divide one lot into two separate lots in areas designated for single-family homes.
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 Residential Development under SB-9
Two-unit residential development under SB-9 refers to a housing project that includes two homes or adding a second home to a lot zoned for single-family use.
Under this option, you could have the following unit configurations:
How large can each new unit be, and how many can you have per lot?
In El Segundo, each residential unit needs a minimum area of 800 square feet.
For lots wider than 25 feet, the total building area cannot be larger than a floor area ratio (FAR) of 0.60, and each unit’s total floor area cannot go beyond 1,050 square feet. For lots 25 feet wide or smaller, the maximum floor area for a unit is limited to 850 square feet.
However, California State SB-9 allows for units of any size to be constructed.
After an urban lot split, each new lot can have up to two residential units, including primary homes, ADUs, and JADUs.
What are the setbacks?
For lots wider than 25 feet, the front yard setback should be at least 22 feet or the existing front yard setback, whichever is smaller. Side yard setbacks require a minimum of 4 feet on each side, and rear yard setbacks are also 4 feet for both the first and second floors.
For lots 25 feet wide or less, the same front yard setback applies, but side yard setbacks need to be at least 3 feet each, while rear yard setbacks remain 4 feet. Existing structures or new ones built to the same size do not need a setback.
What is the parking requirement under SB-9?
Each new dwelling unit should have at least one off-street parking space. However, if the property is within a half-mile of a High-quality Transit Corridor or major transit stop, or if there’s a car-sharing vehicle within a block, no parking is required.
What are the lot constraints under SB-9?
SB-9 limits lot splits to creating two new lots of roughly equal size, with one being no smaller than 40% of the original parcel's area. Both new lots should be at least 1,200 square feet in total 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?
Properties eligible for SB-9 are located in single-family residential zoning districts, specifically the R-1 zone.
Is it allowed to demolish an affordable unit?
No, demolishing an affordable unit is not allowed under El Segundo's SB-9 regulations. Each two-unit residential development or any lot created through an Urban Lot Split needs to include at least 1 unit designated as affordable for moderate, low, or very low-income households.
What are the limitations after completing a project using SB-9?
Does the homeowner need to reside on the property?
Yes, the homeowner needs to live on the property. The applicant for an urban lot split signs an affidavit approved by the City Attorney, stating their intention to live in one of the new housing units as their main residence for at least 3 years from the approval date. This requirement does not apply to community land trusts or qualified nonprofit corporations.
What are the rental regulations?
Rentals are required to be for at least 31 consecutive days.
What is the difference between SB-9 and SB-684?
SB-684, a newer law, streamlines the development of up to 10 units on urban lots smaller than 5 acres. While SB-9 is limited to single-family properties, SB-684 covers multi-family zoning areas and vacant lots within single-family neighborhoods. One key benefit of SB-684 is that it does not impose ownership restrictions after construction, unlike 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 may qualify for ministerial approval, which streamlines the development process by offering straightforward guidelines. This allows for quicker permit approval without the need for lengthy CEQA evaluations or public hearings. However, completing a lot split can still take as long as a year and a half.
What are objective standards?
“Objective zoning standards”, “subdivision standards”, and “design review standards” aim to remove personal judgments from government officials. These criteria are based on clear, external measures that developers and officials can use before submissions. This ensures consistency in project evaluations and gives homeowners clear expectations for their proposals.
What types of objective standards qualify for a waiver under SB-9?
Under SB-9, the following objective standards may be waived:
- Rules that would prevent the construction of two units, each with a minimum size of 800 square feet.
- Setback requirements for existing buildings that would hinder the development of two units.
- Setback regulations greater than 4 feet from side and rear lot lines, which could restrict building two units.
What are the steps to get the permits?
To obtain permits for a two-unit residential development or an Urban Lot Split, follow these steps:
1. Prepare Application: Gather all necessary documents and fill out the required application forms.
2. Submit Application: Hand in the application for a building permit to the local authority in charge of permits and zoning.
3. Review Process: The application will be reviewed to ensure it meets all relevant regulations, including those in SB-9.
4. Approval: If everything checks out, the permit will be approved. This process is typically administrative, with no subjective decision-making involved.
5. Fees and Assessments: After approval, the property owner pays all applicable fees, including development impact fees.
6. Permit Issuance: Once fees are paid, the building permit will be issued, allowing construction to begin on the two-unit residential development or Urban Lot Split.
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?
This analysis will examine two scenarios to evaluate expected expenses, property valuations, and potential profits for real estate projects.
Scenario 1
New 4,000 sq. ft 3-Story Duplex + 1,000 sq. ft ADU
In this scenario, we suggest 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 estimated total cost, including construction, permits, and professional services (excluding land acquisition), is $2,162,551. The projected market value of the finished property in El Segundo is approximately $4,750,000, resulting in a return on investment (ROI) of [($4,750,000 - $2,162,551) / $2,162,551] * 100 = 120%.
Scenario 2
Lot Split with 2 new 4,000 sq. ft 3-story Duplexes
In this scenario, we propose splitting the lot to build two separate three-story duplexes, each covering 4,000 square feet. The total estimated cost, excluding land acquisition, is $3,462,249. The expected market value for these duplexes in El Segundo is $7,600,000, resulting in an ROI of 120%.
Conclusion:
SB-9 projects in El Segundo offer substantial returns on investment, making the city a highly attractive location for real estate development.
See how much it will cost you to improve your property per SB-9
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