Calculating Permitable Density Part 1 of 3 - Density Bonus Law & Units Per Acre
This episode launches a critical three-part series on how to correctly calculate the maximum permitable density of housing for any given parcel in California. This is among the most misunderstood aspects of California housing development—and getting it wrong (which happens at least 95% of the time) means leaving significant housing capacity on the table. Part 1 focuses on parcels where density is expressed in units per acre, walking through the full calculation from general plan designation through density bonus law and multifamily ADU provisions.
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Guest: Chris Hudon — Director of Development, Workbench (25 years of multifamily development experience in Colorado and Utah) Sibley specifically brought Chris on for Part 1 because Chris is an experienced multifamily developer—but not in California. His background in Colorado and Utah, where developers rely on local zoning, site constraints, and informal planning department consultations, makes him the perfect stand-in for what most developers do when entering the California market. Chris's fresh perspective highlights just how different—and counterintuitive—California's density calculation system is compared to the rest of the country.
Key Takeaways
Don't start with zoning. In California, looking up the zoning code and consulting local planning staff—the standard approach in most other states—gives you the wrong answer at least 95% of the time. State law supersedes local zoning for density calculations.
Start with the General Plan. State law says you get to use the larger density number between the general plan designation, zoning, and any overlay districts. Because of how environmental analysis works, the general plan almost always has the highest allowable density.
Use gross acreage, not net buildable. Local codes often reference "net buildable acres" excluding slopes, rights-of-way, etc. State law is clear: use the entire gross area of the parcel for your density calculation.
Always round up base density. California state law explicitly allows rounding up when calculating base density for density bonus law. Even 22.0001 units rounds to 23 as your base density.
Density Bonus Law is essential for multifamily development. Even if you don't need extra units, density bonus law provides waivers, concessions, and streamlined processes that make projects feasible. You qualify for these benefits even without building bonus units.
Two 50% density bonuses are available. By providing very low income affordable housing, you earn up to a 50% bonus. By also providing moderate income housing (calculated separately from the base density), you earn an additional 50% bonus. These are additive from the base, not compounding—each is 50% of the original base density.
Multifamily ADU law adds even more. After density bonus calculations, you can add up to 25% more units as ADUs within the building (no rounding up allowed), plus up to 2 additional detached lot-based ADUs on the parcel.
The math is dramatic. In the episode's running example: a parcel with a base density of 23 units grows to 35 (first bonus), then 47 (second bonus), then 58 (building ADUs), and potentially 60 (lot-based ADUs)—from what might be zoned for only 12 units under local code.
State law sets the floor, not the ceiling. Some jurisdictions (like Santa Cruz and San Diego) have adopted more generous local provisions—allowing rounding up on ADUs, permitting more lot-based ADUs, or enabling concurrent construction of conversion ADUs with the main building.
The "existing building" requirement creates a construction sequencing challenge. State law technically requires the multifamily building to exist before converting interior spaces to ADUs, adding time and cost. Some jurisdictions have adopted workarounds, and developers can use density bonus concessions to address this.
Infill Insiders Success Grades
Problem Severity: 1 out of 5 (the most critical possible) Sibley rates this as a top-tier problem. Decades of down-zoning across California meant that on most sites, it simply was not legal to build enough housing to make a project financially feasible. The state needed to restore zoned capacity for housing.
Chris Hudon's Grade: A Chris sees the framework as fundamentally sound—California has laid the groundwork to actually enable housing production. The concept and ambition earn top marks.
Sibley Simon's Grade: C / C- While the law technically legalizes the housing California needs, Sibley gives the execution a C to C-minus. His reasoning: the system is so complicated that hardly anyone understands it—including local planning staff who are developers' first point of contact. If the people who need to use the law don't know how it works, it isn't actually solving the problem. "It only solves the problem if the housing actually gets built."
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[00:03:31] Why the Standard Approach Fails in California
[00:04:09] General Plan vs. Zoning
[00:09:30] Calculating Base Density Step by Step
[00:12:48] Density Bonus Law: The First and Second
[00:20:05] The Multifamily ADU Play Most Developers Miss
[00:25:22] The Full Math
[00:30:19] Why This Happened
[00:33:54] Grades For Concept & Execution
Sibley Simon [00:00:15 – 00:01:10]
I'm really excited that we're kicking off three episodes where we're really gonna talk through all the nuances of how you calculate permitted density of housing for a given parcel, for a given site in California. This is often misunderstood, or there's a lot of gaps in knowledge out there. I meet folks all the time in the housing industry who don't know all of this, and so I'm hoping that these episodes in particular will really be impactful, because this is applicable to almost every housing development project, and in many cases, more housing could be created and work well on a site, but for a lack of this knowledge. So, really excited to get this all out here, and today, with us for part one, is Chris Hudon, who's Director of Development at Workbench, and I wanted Chris here for this first version of how we calculate. We're gonna do three different versions, and often more than one of these could be applicable to a given site, so you have to look at it different ways sometimes. But this first version, wanted to have you here, because you're an experienced developer, but not in California. Why don't you tell us a little bit about what you've done?
Chris Hudon [00:01:34 – 00:01:55]
So, my background has been for the last 25 years really focused in the state of Colorado and Utah, in multifamily development, and never have used state laws, have always used the local jurisdictions, gone through general plans and zoning and a lot of relationship type of development.
Sibley Simon [00:01:55 – 00:02:47]
What we're covering today is how you figure out what density of housing you can get permitted, that really if you're doing it right, a local jurisdiction in California is required to approve, without zoning change, general plan amendment, all that kind of stuff—it would be totally discretionary. So, staying within the box of what state law says needs to be approved. How do you calculate that when the basis for the calculation is in local code in terms of units per acre, or square feet per unit or something, but basically the area of land per a certain number of units. So, that's what we're gonna look at today. In Colorado, where you've worked before, if people wanted to figure this out, how much density under the laws, code, et cetera, that applies, how much density could I permit, what would you do to figure it out in a nutshell?
Chris Hudon [00:02:47 – 00:03:05]
Right, you look at the constraints of the site itself. You look at the land area, you look at the height limits, you look at the density allowed in that zone district, and then you'd look for what the setbacks are, and you basically squeeze into the piece of land that you can actually build on.
Sibley Simon [00:03:05 – 00:03:31]
So, basically zoning and site constraints is what you would look at. And if you didn't understand the zoning or something unclear about how to apply it—
Chris Hudon [00:03:14 – 00:03:31]
And typically what I would do is get a high-level concept together and get an informal meeting with the planning department, float that by them, see what—get a temperature taken on the idea and then go back and start to dig into it.
Sibley Simon [00:03:31 – 00:04:09]
So, that's great, great summary. And in my experience, talking to folks out there, if they're starting housing development in California, that's exactly what they do. And by doing those things, looking up the zoning, doing an initial consult with the local staff at local government, they get the wrong answer. At least 95% of the time. And there's not a dis on local staff who know the local rules, but that is all looking under the local rules. And that in general, zoning rules is not what governs the answer to this question. In California, it turns out, because we're weird, because when we did it that way, we didn't build any housing.
Sibley Simon [00:04:09 – 00:05:04]
So, all those rules are still in place, but we've added new rules that changed the game. So, what do you do here? I literally have just had multiple conversations with development projects that we're not involved in last week explaining this. The first thing you do is you look at the general plan. So, in California, we have a general plan, which has the environmental analysis for a planning document for a whole jurisdiction. And then once that's approved, then we write more specific zoning rules. So, in general, every place that you could develop in California, if residential use is allowed, that parcel by parcel will have a general plan designation. That's a broad category. So, an example might be single family home, it might be called something like residential low density.
Sibley Simon [00:05:04 – 00:06:06]
And the general plan might describe that—I'm thinking of one of our projects that's entitled in the city of Santa Cruz with P.C. United Church, for example. They had this six-acre parcel we were gonna build on 2.3 acres or so of it. That general plan designation said one to 10 units per acre. Okay. And the idea was it was a single-family home. So, you have a single-family home and you could have a parcel and you could have up to 10 parcels per acre. But if you only have one parcel, you put one house, right? But then, that was a general plan designation, but then it doesn't really say much else in the general plan. And then there's zones. And even within that general plan designation of, let's say, low density residential, then there might be R1-5 or R1-10 where they say, okay, it's one house residential, there's one house per lot. And of course you could do an ADU or something, but one main house per lot. And then you could do five of those per acre or 10 of those per acre in that zone.
Sibley Simon [00:06:06 – 00:06:31]
So, there might be a general plan map—there should be a general plan map in the general plan that has the whole city or county laid out by areas, these designations, low density residential, high density residential, commercial mixed use, whatever. But then in the zoning code, there might be more maps that are more detailed with more different zones, right? It's kind of a tree diagram.
Sibley Simon [00:06:31 – 00:07:28]
So, it turns out state law—we're talking about units per acre density, but that's a fraction, right? Units per acre. And so, we have to figure out how many units per acre do we get, and then we gotta figure out what our acreage is, right? So, in our "how many units per acre we get," what state law says in California is that if that number's not the same in zoning or the general plan, you get to take the larger number. But because of how environmental analysis works in this planning process, if one of them is bigger, it's almost always the general plan, 99% or whatever. And then zoning's more restrictive. You could have—and so you have to check—we have one site we're helping an owner with where, as I think you've heard, there's the general plan and there's the zoning, and then there's three overlay districts, and one of those overlay districts borrows or refers to conditions from another zone. And so, to do your homework, you check all of those and go with the largest number. But, you know, almost always it's the general plan. So, the quick thing is just look up the general plan.
Sibley Simon [00:07:36 – 00:08:04]
Now, my whole spiel here about how we calculate density is presuming that one would use density bonus law, okay? Which means you have to have a base density of five units. So, you gotta start with a site where you could, under this general plan density, where you could do at least five units. If your site's so small for that density, you can't even do five units, then you do have to use zoning.
Chris Hudon [00:08:04 – 00:08:09]
Okay, but could you rezone into something? You can always rezone. The density bonus—
Sibley Simon [00:08:09 – 00:08:50]
Yeah, yeah, yeah, you're right. You'd have to either rezone or make a general plan amendment. If the general plan amendment is a bigger deal with the EIR, because environmental analysis didn't necessarily contemplate more density around the concept. Go through all those hoops. And it's entirely discretionary. Yeah, to the—entirely. So you could spend hundreds of thousands of dollars on that, and everybody seems to like it, and at the last second, the city council could say, no, no, no, not gonna do that. It's totally within their right to do that. So, I would generally tell people, don't do a general plan amendment, unless you're some really big thing long term, and you've got 10 years, and it's gonna be world changing, and the community generally likes it. So, just don't do it.
Sibley Simon [00:08:50 – 00:09:43]
So, density bonus law is critical for multifamily development in California. Even if you're not gonna use extra density, which we're gonna assume today and talk about, but even if you're not, it brings with it the waivers and concessions and processes, things—and just, it's so critical for getting multifamily housing development approved in a way that's feasible. So, we presuppose we're gonna work on that. So, if you don't use density bonus law, and say you don't do any affordable housing in your project, then you do have to follow the zoning. Okay, so that's where I got off on this other track. So, to use density bonus law, where you get to do more housing, what we're talking about is figuring out our base density. So, that's where we look at that general plan, and we get to use the largest number in the zoning, or the general plan, or some overlay district, usually the general plan. So, in the example I was describing, the general plan designation, places in that would go up to allowing 10 units per acre, so that's what we got to use. 10 units per acre as our base density.
Sibley Simon [00:09:52 – 00:10:48]
And the other thing is, you get to round up your base density. So, if—and I think that was applicable in this case—I'm gonna make up the exact number, but let's say there was 2.23 acres in our lot. Okay, and 10 units per acre would give you 2.23 acres times 10, right? So, 22.3 homes, make sense? Yeah, yeah. And with many things, you just say, oh, 22—well, I can't build .3 of a house, so I build 22 houses, or 22 apartments, whatever. But explicitly in California state law is when you're calculating base density for density bonus law, you get to round up. No matter what the fraction is, if it's 22.0001 homes allowed, then I get to build 23 as my base density.
Chris Hudon [00:10:43]
Can't round up the acreage?
Sibley Simon [00:10:44 – 00:10:48]
No, you don't round up the acreage. I was just joking. That was a good one. Right, now you take the actual acreage.
Sibley Simon [00:10:48 – 00:11:28]
Now, a lot of times it is important—your county GIS or something, that acreage that's in there might not be quite right. That could be approximate. So, sometimes it can matter to get an exact survey of the property in this case. And you can imagine, if it does tip you into another unit, especially, and then that percolates through density bonus law, you might get multiple extra units, in theory, from one square foot but tip you over in the calculation. But also, you don't wanna go down the road to designing and then do an ALTA survey and find out, oh, I got 300 square feet fewer than I thought, and that actually reduces my number. So, it's good to know, really for sure, how many square feet do you have?
Sibley Simon [00:11:32 – 00:12:15]
The other thing on that is—I'm glad you brought that up—is that if you look in local codes, they will often say, well, our density in our general plan or in our zoning, that's a density of units per acre but that's net buildable acre. Or slope over 30% area doesn't count towards that. Or the public right-of-way area. But state law is clear in California, for this calculation, you use the entire gross area. Gross area. To your point about site constraints, you might have a steep area and a not steep area. You know you're gonna build down here, but you can still use the density for the entire area, if it makes sense and fits. What you wanna do, if you have that extra steep area, that does give you more acreage if it's planned that way, to provide more housing.
Sibley Simon [00:12:24 – 00:12:56]
So, we've got gross area, we've found our maximum locally allowed under the general plan number of units per acre. And that kind of makes sense because the general plan again, it had the environmental studies. So in theory, that area was allowed and then for some reason, they just restricted it further with zoning. So it's like, okay, you can't bump up past what was environmentally studied in terms of that, as base density.
Sibley Simon [00:12:56 – 00:13:04]
Then we get to density bonus law. And there's been a density bonus law in California for a long, long time, but it was rarely used for a long time.
Chris Hudon [00:13:00 – 00:13:04]
And it's used to capture more units for allowing affordable housing?
Sibley Simon [00:13:04 – 00:13:33]
That's right. So I think a lot of the law has been done also because so little housing was getting created and more certainty was put into the law with more streamlined process, all this stuff, but also like, we really need housing. So more housing often is a good thing in and of itself. But yes, the mechanics and trade-off of it is you figure out your base density.
Sibley Simon [00:13:33 – 00:14:51]
And then if you want to build more housing in that, you have a certain percentage of that number of units that is affordable at a certain income level and you have choices. And we're not going to go way into that today. We'll do another podcast on exactly how to use and qualify for density bonus law and what else it gets you besides density. Today we're just focused on the density. But yes, to get more density through it, you take some of those—we're saying 23 units of base density—and we might at a very minimum have 5% of those as very low income units, right? Or some larger percentage, 10% of them as low income units or whatever. So different income levels, different percentage. And the more of the bigger percentage you do at a certain income level, the more bonus density you get. And there's tables you look up on that. And what—small projects, the rounding can get weird. Sometimes you do more affordable housing and you don't get more units or whatever. But, and again, we'll get into it—a lot of developers use very low income rather than low income, different things. But the point is you do some affordable housing. So then, but what we're here today to talk about is how much housing can you do total—regardless of—because you might get funding that restricts the rent or you might do different things, right? But how much housing total?
Sibley Simon [00:15:00 – 00:15:56]
So, we've got our base density, we've calculated it from our area, we have this example with 23 units of base density. So now, the traditional density bonus in California is up to 50%. When I started it was up to 35%. And then it expanded to go up to 50%. So if you do enough affordable housing within your base density, you get 50% more units. So with 23 base density units—I like this example because it's every step in this calculation you actually get a round-up. So 23 base density units, half of 23 is 11 and a half. So you get 12. So you get 12 more units with this first base density. Okay, so we got 23 units plus 12, we're at 35 units if I did this right, right? Okay, 35 units now. So we've done some, let's say, very low income affordable units within the 23 as a percentage just of the 23. And now we get 12 more units. And so the idea is that those potentially market rate units pay for taking a loss on the project—
Sibley Simon [00:16:34 – 00:17:52]
You still look back at your base density. Also within it, you've already done some of your base density units as very low income affordable housing. Now you're gonna do some of those 23 units—a percentage of them—as moderate income housing. So now we've got two tranches of affordable housing and some market rate housing. The base density of 23 units, then additional 12 potentially market rate units. Now you get another 50%. You've done enough moderate income housing—again, it ratchets us up based on how much you've done. But let's say you max it out. Now that is 50% of the base density. So another 12. Another 12, you're right. Cause independent of the first one, you calculate it and round up. So it's actually—it's not—some people understandably, cause there's two 50% bonuses that are each—they're not compounding, they're each of the original base density. So a lot of people go out and say, there's a 100% bonus. But if your base density is odd, it's a bit more than 100%, right? So you get two 12-unit bonuses here. So we went from 23 to 35, now we're at 47.
Chris Hudon [00:17:54]
It's a very different project than what you would start with, right?
Sibley Simon [00:17:56 – 00:18:48]
Right, potentially if you use all this. Yes. So that is how we do it. Two tranches of affordable housing, two density bonuses. And again, this is assuming it makes sense on your site. One of the top reasons people don't—might not use this—is building height. If you have more than five stories, you're not wood frame. You're either mass timber or now, or concrete and steel, right? And that's more expensive. And so they might say, well, that's not worth it to do more of these, more units, even the market-rate units. Right, if the whole building has to change to a different construction type. Or other things, or it'd be like, look, we really wanna do for-sale townhouses. And to fit more in, you'd have to do stack flats and apartments, right? And that's not what our project is. And this is how many townhouses fit in, right? So there's a lot of reasons, different reasons, you might not use all the density, but this shows you what's allowable that you could do. However—
Chris Hudon [00:18:50]
Can I ask a question? On that, you don't have to use the maximum density. That's right. You can dial that back a little bit.
Sibley Simon [00:18:55 – 00:20:05]
And in fact, density bonus law gives many other benefits besides extra units, besides the density bonus. And so the density bonus law explicitly says, black and white right there, that you qualify for any of those benefits even if you're not building the bonus units. You don't have to do any extra units. And because you've done the affordable housing, you get waivers and concessions, which are extremely useful. And we'll get to a whole podcast about that.
Chris Hudon [00:19:22]
And those are separate from the units. So if you reduce density, you still get to use the waivers and concessions.
Sibley Simon [00:19:28 – 00:20:05]
Yes, that's right. And your first 23 units in the example I gave are all base density units. So you don't get to say, well, I'm only gonna do 10 base density units. I'm only gonna use part of the base density and then do bonus units. You can't do that. Until you've used the base density of your whole parcel, they're all base density units and your affordable housing, which could be an inclusionary ordinance or this density bonus law, is keyed off of however many base density units you're building in your project. So if you only wanted a 20-unit project in my example, they'd all be base density units. You do a percentage of those, perhaps, as affordable. But yeah, you get to use as much of the benefit as you want to. However, we're not done.
Chris Hudon [00:20:06]
There's more?
Sibley Simon [00:20:07 – 00:20:59]
There's more, but wait. One more thing. You know what ADUs are—accessory dwelling units. And famously they're backyard units. And they are the number one most successful thing that the state legislature has done to increase housing supply in the last decade. Because there's 20,000 units or so of ADUs being created every year in California now. And mostly backyard units. And that was probably under 50 before the state law. Because there were a few places like Santa Cruz that allowed ADUs in very specific circumstances through a tortured process. And so we'd get maybe 10 or 15 a year here in Santa Cruz. Been there a couple other places. But that was it. And now everywhere it's allowed ADUs. So lots of those, huge success. And it's a success partly because the state legislature did a good job. Okay, let's allow it. Oh, let's see what's not working. Let's fiddle with that. Now let's allow more of this and keep working.
Sibley Simon [00:20:59 – 00:22:05]
Along that process, the state legislators said, this is working so well. Let's allow ADUs in certain ways in multifamily buildings. And the two most intentional ways that was being used is—say, well, let's say you have an apartment building already. Existing apartment building. And you've got space in that building you're not using. Maybe people use less—
Chris Hudon [00:21:28]
Inside the building.
Sibley Simon [00:21:28 – 00:22:05]
Inside the building. Some part of the building that wasn't—that's underused. Well, you can convert some of that space into units. You could build out a unit. And let's say there's a storage space in the building. A conference room that no one uses. You could build that out, you know, within building code and many other requirements, everything else, right? You could build that out into a unit. And that is an ADU within your existing apartment building or condo building or something. Okay, so that's one way. Another way is you could have an apartment building on a lot and there's open space on the lot you're not using. And you could build a couple ADUs on the lot. Separate building that are detached from your apartment building, from your multifamily building. They could be attached to each other, but a couple of those.
Sibley Simon [00:22:20 – 00:23:04]
So, what this means is, there's many circumstances in which you can design a building with extra space in it. Especially because density bonus law in many cases allows you to build taller, allows you to build lesser setbacks or other things, right? If you need that. And so you can design and build a multifamily apartment building with space in the building that's not housing and not critical. It's not your electrical room or your trash room or whatever. And some extra amenity space undefined or storage space or whatever. And then you can convert that into more units. So you could plan to do that from the beginning.
Chris Hudon [00:23:04 – 00:23:16]
And so those would give you more units than your maximum density. Because I was gonna ask, why wouldn't you just put units in those spaces to begin with?
Sibley Simon [00:23:16 – 00:24:08]
Because we've maxed out, you know, because sometimes there's definitely places where it's a great place for a multifamily building, but the local density is pretty low, right? And if you're gonna go through all this to build the building and construction costs are extremely high, you really need to make—you know how hard it is to get things to pencil out here, right? So yes, you get a double effectively, or maybe round up a bit, whatever, but approximately double your number of units. So under this multifamily ADU law in California, you can do up to another 25% of your total units in your building. So now, we'll just keep on with it. Now we're in a fictitious world potentially, but 47—we had that 47-unit project. We were just talking about 23 units plus 12 plus 12. We got the 47 units. Now we can take that total number of approved units, if it's 47, and you can do up to 25% of that as additional ADUs within that building.
Sibley Simon [00:24:20 – 00:25:09]
Now, that you do not get a round-up. You can't round up to that. Because that's not a density bonus calculation. This is a separate law, and you cannot go above—you can't go one inch above 25%. So with 47, right, a quarter of 44 would be 11, and we don't go to 48 to get another. So you would need to round down, even though we're pretty close to getting to 12. In this case, we got to round all the way down to 11. So you could do up to 11 ADUs in a building like that. And separately from within the building, you can, on any multifamily parcel with existing housing, you can do up to two lot-based ADUs. Doesn't count toward that 25%, but has to be detached in a separate building.
Chris Hudon [00:25:09]
Wow, so you're up to—
Sibley Simon [00:25:09 – 00:25:41]
Oh, 47 plus 11. So you're up to 58. 58 plus two. If you have the space. If you're not just building out a whole super infill lot, if you have space, you could build two more. 23 to 60. To 60, that's true. A little bit of nuance. Now, when I'm saying this about all of this—about density bonus law, about these bonuses, and the ADU law—all of these things are in state law actually as the minimum that a local jurisdiction must allow.
Sibley Simon [00:25:41 – 00:26:07]
So it is rare, but there are cases where jurisdictions have implemented a more generous density bonus, or—I say more generous, but it might be do even more affordable housing and get an even bigger bonus kind of thing.
Chris Hudon [00:25:59]
Okay, project by project?
Sibley Simon [00:25:59 – 00:27:14]
No, in their code. Yeah, we're all trying to go for not discretionary here—just what do I know without any politics that in theory, legally, the jurisdiction has to provide. If all this checks out environmentally and everything else you have to do, and you get a fire truck and get around the building and all this stuff, right? But without the site constraint version, what could you know that you're gonna get approval of? And so, for example, in the city of Santa Cruz, they specifically allow you to round up that ADU within the building. Just what they put in their ordinance. And the state allows that. In these types of rules, the state law is a minimum. And I know there's jurisdictions—and I think San Diego, city or county—has allowed more lot-based ADUs. There's different things like that in different places. I don't have it all in my head, but lot-based ADUs is another one where sometimes the jurisdiction's a bit more generous. Usually not—usually they copy what's in the state law as the minimum required, paste it in the local code, go approve it, and then city council and supervisors get to say either, "We're solving the housing crisis, look at how much we just improved the local code," or they say, "Darn that state legislature, they're making us do this and we hate it." One of those two things, if not both.
Sibley Simon [00:27:14 – 00:28:10]
It is always worth looking and saying, oh, is there a little—you look up the local version of the density bonus calculation, and there might be a bigger bonus for even more affordable housing you might wanna consider. Or they round up on the number of ADUs, kind of thing. The one hitch on these ADUs that is still being looked at, worked out, decided, is that it does say in the state law, in the minimum ordinance required by the state, that it applies to "existing buildings," which means in theory, you might have to build the building first, build that space in it, and then get a building permit to convert those. And that's a ministerial building permit. Nothing's stopping you, it's not another hearing or anything. But that's a longer construction process, right? If you can't start some of your interior work or something like that to build that into a unit, if you have to make it empty rooms with—
Chris Hudon [00:28:10 – 00:28:15]
Pipes that come in, electrical outlets. And then—a retail space into an existing building. And then building it up.
Sibley Simon [00:28:15 – 00:29:08]
Exactly. So there's no question state law—okay, you're allowed to do that for sure. We keep pushing, being like, that waiting is helping nobody. Everybody agrees we could do that, but we're just gonna have longer, more expensive construction. It just causes housing to be more expensive, right? For example, the city of Santa Cruz passed an ordinance that said, yeah, you can include those conversion ADUs in your building permit for the whole building. So they agreed in their own local ordinance to move that step up. So you could just go build it all at the same time. We're looking to use a concession for that in another project in another jurisdiction, where we say, okay, you just have the state code copied and pasted and it says, existing housing—we can do this, so we all know we can build it. How about you use a density bonus concession to allow us to apply earlier for these and build it at the same time instead of building one and then the other.
Sibley Simon [00:29:08 – 00:29:47]
So there's some nuances there, but everybody agrees, you're allowed to build the space and then build those units. So that is how something that might be zoned for—make this up, but it may well be true—like this, on this example project I'm talking about, might be zoned for five units an acre, but because we had to use the general plan and round it up and then the bonus and bonus and then the ADUs, like you said, in theory one could get to 60 units, whereas the zoning might have been five units per acre, so a 12-unit project or something like that.
Sibley Simon [00:30:00 – 00:31:12]
You know, you might say—I saw you reacting a little bit—you might say it was like, whoa, we got to such a big number. Well, just to fill it in more philosophically, part of the reason that this happened—it's not just like, oh, how do we pay for some affordable housing? That's part of it. But all the land use incentives in California were to down-zone, down-zone, down-zone. So, you know, just as one example, Los Angeles, obviously biggest city in California. In the 1960s, it was zoned for millions more units of housing than it is now. You know, just every decade, we kept down-zoning. And so when we talk about the zone capacity, if every parcel is built to its own capacity, we actually wouldn't have that much more housing. We got to that point, right. And so this is part of the state legislature looking and saying, well, people—you know, there's a lot of folks in local government or just local folks seeing all this change happen and saying, oh, the state legislature is taking all this power away. But actually, I would say, local government still has 90% of the power. But that's the plan up front. And then once you plan for it, and have these bonuses and get some affordable housing out of that and that kind of stuff—but once you plan in that way, and then look how these laws could be used, then you can't say no to projects that follow all these rules, right?
Chris Hudon [00:31:12 – 00:31:25]
It reminds me of transit-oriented development, like those zone districts, those overlays all changed based on the nodes of the transit options, right? So it's similar.
Sibley Simon [00:31:25 – 00:32:18]
Exactly. And that's going to be mentioned in our third episode. So here in the broader context now, okay, we've just explained exactly how you do it when you find your units per acre allowed. And sometimes those units per acre, they can be sometimes expressed the opposite way, which is like how many square feet of ground do you need for each unit. But you know, it's the same thing. You do it that way. And actually we have seen—like, well, you need this many square feet of ground for a studio and this many square feet of ground on your parcel for a two bedroom. So you get a little complicated, but you figure that out. And then you do this calculation, and then these state laws allow more housing. And that's that. It just turns out that in a lot of, most places that allow housing, that's how you calculate it. So it is in that—it's really a minimum lot size. Might be another way the same thing's expressed. It might be, oh, a single family in a minimum lot size is X. Well, that really just tells you how many units per acre. And by the way, when you do this calculation, you no longer have to have them be single family. You can do it because the density bonus law also allows you to then do it as an apartment building or condos or whatever.
Sibley Simon [00:32:28 – 00:33:07]
Well, that's most common by area. The reality is mostly where we're doing apartment buildings is on bigger corridor streets or downtowns. And it's relatively common now in those areas that the general plan limit on density is not expressed in units per acre. Sometimes it is, but often increasingly in more and more places, it's form-based density. And so it just says an FAR, height limit, a setback limit. And so that is an advertisement for next episode, where if there is no units-per-acre limit, then you have to do a totally different calculation with a different process.
Sibley Simon [00:33:08 – 00:33:54]
And then episode three in this series, the third episode in the series is gonna be—yeah, either you do what we just did, units per acre calculation, great, or you do form-based density, which is our second episode, you do that. One of those two things applies, that's great. However, there are also other state laws that say, but if you're near transit or if you're in this kind of parcel or that kind of parcel or this situation or that situation, and that calculation doesn't come out dense enough, then forget all that, start over with this base density.
Chris Hudon [00:33:36]
Wow.
Sibley Simon [00:33:36 – 00:33:53]
And so—that's a lot to learn. And so episode three is really important. Even if you have units per acre, you're not done yet when you do what we just did. You need to go check a bunch of other things to see if a different density actually applies.
Chris Hudon [00:33:49 – 00:33:53]
Wow. So I don't leave you with that. I'm excited for the next two episodes.
Sibley Simon [00:33:54 – 00:34:45]
So when we're talking in this podcast about an actual housing bill that passes in California, then I like to rate it as like, how big of a problem is this solving? Like a one—super big problem—five, kind of symbolic. I actually think that we're not doing that here because we're not assessing one bill, but I do think—and then I like to grade it and how effectively is it doing that? This is a great example though, even though it's not a bill, where I think this is a one. As we were just talking about, we lost all our zone capacity. So there's no way to build housing. And on most sites, you couldn't build enough on that one site to make it work financially, right? So it was a huge—it was a number one way that housing that we needed was not legal to build. Huge problem.
Sibley Simon [00:34:34 – 00:34:48]
How—you know, if you were to give what you've heard so far in California, how are we doing? How does this whole scheme, how well does it solve that problem? A letter grade. There's no wrong answer. What would you say?
Chris Hudon [00:34:48 – 00:35:03]
Well, I think the idea absolutely is—it would be an A because we're pushing forward and we're laying out the groundwork to actually build this housing.
Sibley Simon [00:35:03 – 00:35:57]
Great, that's a great, that is I think one totally justifiable answer. I am going to give it a C, maybe even a C minus, because you're right. In terms of does it legalize the housing we need and solve that? Yes. Is this so complicated that hardly anyone knows it? And even—that's why I say, even with great respect, don't go talk to local jurisdiction staff first because they also don't know all of these things in all three of these podcasts and won't give you the right answer. And so if no one—hardly anyone—understands it and therefore is actually doing it, did it actually solve the problem, like the tree falling in the forest? At the end of the day, it only solves the problem if the housing actually gets built. And that's why I'm saying yes, it does legally zone the capacity we need. The housing we need is now legal in California to build. Awesome. Is it gonna happen because of this? It's so messy and complicated. That's where I get—I'm gonna C minus. The execution of it.
Sibley Simon [00:35:57 – 00:36:24]
So we'll leave it at that. We'll come back next time with form-based density, also extremely relevant to a lot of places folks would build multifamily. But I also just wanna put out there—relevant to our current discussion, there's always more nuance. Court cases are changing these things. So if you ever want help, we're here for that at Workbench, give us a call. Literally talk to folks about this all the time. And we'd love to even get involved and help you entitle your projects.
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Who Are The Infill Insiders?
The Infill Insiders break down the highly complex process of infill housing development in California. Host and principal developer, Sibley Simon, shares Workbench's experience to teach developers and land owners how to use the many state housing laws to successfully develop infill housing, while showing jurisdictions what makes the process more efficient, and encouraging elected officials and anyone interested to face the big challenges that still remain in housing creation. Join us and become more effective at creating infill housing.Hosted by
Sibley Simon
Principal & Impact Development Executive, WorkbenchSibley leads the Workbench development team's impact focused projects geared towards creating more affordable housing without public subsidy. With years of experience driving legislative progress, he’s forged strong alliances with leaders dedicated to tackling California’s housing equity challenges. Before joining Workbench, Sibley founded numerous companies and created an impact investment fund to spur new workforce and affordable housing development.
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California | State Housing Laws | Infill Development | Santa Cruz | Housing Santa Cruz County | California Affordable Housing | Affordable Housing Developer | Support Affordable Housing | Build Affordable Homes | California Living | Housing For All | Affordable Living | Housing Solutions | Community Development
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