HAPPY NEW YEAR!

The California legislature reviewed scores of new real estate laws in 2024, including approving 60 on housing alone. And voters weighed in on ballot measures related to rent control, housing bonds and warming climate adaptation.

Here, we have highlighted several new laws we believe might most impact Selna Partners’ clients, including property owners and developers. The laws kicked in on Jan. 1, 2025, and include new requirements on commercial landlords, mid-sized housing production support, and ADU amnesty programs.

We also included an article about Rob Selna’s non-profit Sidewalk Trees & Gardens, which is expanding its efforts in 2025.​

Please contact Selna Partners Law with questions about the information below.

“Qualified Commercial Tenants” Treated Much Like Residential Tenants

The Commercial Tenant Protection Act (SB 1103) provides protections for a new class of commercial tenants on issues that historically have been negotiated with landlords. The new class, Qualified Commercial Tenants (or QCTs), are sole proprietorships, partnerships, and companies with five or fewer employees that lack access to capital, restaurants with fewer than10 employees, and non-profits with fewer than 20 employees. The new landlord requirements are as follows:

1. For rent increases on a month-to-month lease, or where the lease term is not specific, landlords must deliver a notice at least 30 days’ prior to an increase of 10 percent or less takes effect. If the increase is more than 10 percent, notice is 90 days.

2. Month-to-month leases automatically renew unless the landlord delivers notice at least 60 days before termination where a QTC has rented for at least one year, or 30 days if a QTC has rented for less than one year.

3. Lease agreements with QTCs negotiated in Spanish, Chinese, Vietnamese, Tagalog or Korean must be translated in writing into the negotiation language and delivered to the QTC.

4. A Landlord may collect building operating costs from QTCs only if the landlord 1) allocates the costs proportionally to each tenant; and2) provides the tenants with detailed and itemized documentation of the allocations. A QTC may use the landlord’s violation of 1 & 2 as an affirmative defense against a landlord claim for failure to pay.

New Pro-Housing Laws: more streamlining and easier ADUs

Reflecting an ongoing housing affordability crisis, the 2024 legislative session saw a renewed focus on housing development streamlining, in many cases clarifying and simplifying existing streamlining laws. Examples were as follows:

AB2243 made it easier to build housing at shopping centers.

AB1893 modified the Builders Remedy, including restricting density increases.

SB1123 extended eligibility for ministerial housing and subdivision approvals of up to 10 units to sites with single-family zoning if a proposed site is vacant.

SB1211 required cities to approve accessory dwelling units (“ADUs”) that consist of not more than eight detached ADUs on a lot with an existing multifamily dwelling.

City of Berkeley Illegal ADU Amnesty Program

By some estimates there are 4,000 illegal ADUs in Berkeley, many of which are sitting empty due to property owner concerns about building permit violations and fines. In response, the city devised a four-year pilot program in which property owners can confidentially — and without penalty —request a city inspection and come into compliance.

As reported in the San Francisco Chronicle, legalization could take one of two paths: a certificate of occupancy or a housing certificate of compliance. The certificate of occupancy requires a standard permit application process, including plan submittals. The certificate of compliance requires that an ADU comply with federal Housing and Urban Development standards. If not, permits and plans are required.

Many California jurisdictions face similar issues with unpermitted ADUs and we may see more amnesty programs come online.

2024 Real Estate Ballot Measures: 2 of 3 Fail

The Nov. 2024 California ballot included 10 propositions. Before the election, Selna Partners Law reported on three state measures that implicated real estate and land use matters across California. Here are the results:

Proposition 4 — $10 Billion Bond for Better Adaptation to Global Warming: Allows state government to sell bonds to raise $10 billion, one of the largest bonds on any ballot in the nation last year. $3.8 billion would be spent on water projects intended to improve drinking water safety, protect from floods and droughts, and restore rivers and lakes. $1.5 billion is earmarked for wildfire prevention and supporting forest health. Sea level rise mitigation and coastal improvements are expected to use $1.2 billion. Result:  APPROVED.

Proposition 33 — Repealing State Limits on Local Rent Control Laws: Cities could have imposed rent control on any type of housing and restricted the amount landlords could charge new tenants. Result:  REJECTED.

Proposition 5 — Lowering Required Voter Support for Affordable Housing Bonds and Infrastructure: local bonds generally require the support of at least two-thirds of those who vote in an election. Proposition 5 would have amended the State Constitution to lower the threshold to 55% for bonds funding affordable housing, down payment assistance programs, and many public infrastructure projects. Result: REJECTED.

Oakland Stopped Planting and Pruning Trees in 2008. We are Here to Help.

Just before the holidays, Oaklandside published an article about an organization Rob Selna founded in 2014 to replace illegal dumping with public gardens and to plant trees. The group is raising money to expand in 2025 because the need is so great. See the website and donate here: https://www.treesngardens.org/.

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