Governor's Order Limits Lawsuits on $2B Mixed-Use Project in L.A.

In another step aimed at preventing California’s stringent environmental assessments from preventing the development of new housing, Gov. Gavin Newsom has narrowed the window for legal challenges to a $2B mixed-use project in Downtown Los Angeles.

The massive 7.6-acre project known as Fourth & Central plans to build 1,500 residential units, 410K SF of offices and a 69-room hotel at the intersection of Fourth Street and Central Avenue in L.A.’s Skid Row next to the Arts District.

The project, which was initiated by Denver-based Continuum in 2021, already is undergoing a California Environmental Quality Act review as a prelude to a vote by the City Council later this year.

Newsom’s order doesn’t negate the requirement for the CEQA review, but it would shorten the amount of time for a judicial decision in any lawsuit filed to challenge the CEQA impact assessment, according to a report in the Los Angeles Times.

“For decades, we’ve let red tape stand in the way of these kinds of critical housing projects-and the consequences are in plain view all around us,” Newsom said, in a statement. “Now we’re using California’s infrastructure law to build more housing, faster.”

According to the report, Newsom’s action aims to have litigation involving a legal challenge based on CEQA—which can take up to five years to resolve—within nine months.

The Fourth & Central development plans to demolish a century-old cold storage warehouse to make way for 10 buildings encompassing 2.3M SF. The centerpiece of the project will be a 44-story residential high-rise.

The housing element the project will include 572 condos and 949 apartments, with a minimum of 214 units designated as affordable housing for low-income households.

A state legislator who represents San Francisco last month proposed a bill that would allow most projects in the downtown to bypass CEQA reviews for up to a decade.

Sen. Scott Weiner wants to clear the way for the demolition of downtown buildings, including dozens of empty office buildings in a city with a 35% office vacancy rate, for adaptive reuse projects that will build new housing and a wide variety of “reimagined” uses for downtown property, including college campuses.

CEQA is California’s signature environmental law, enacted in 1970 a few months after the first Earth Day. Initially intended as a tool for residents to oppose freeway expansions, the California Supreme Court broadened the law in 1972 to apply it to almost every building project in the state.

Weiner, who authored 2017 legislation that accelerated construction of affordable housing in cities that were not meeting state-mandated targets for new housing, wants to exempt about 150 blocks of downtown San Francisco from CEQA reviews.