RPVCCA_SR_2011_06_21_06_Code_Amendment_Golden_CoveTO:
.FROM:
DATE:
CrrvOF
HONORABLE MAYOR &CITY COUNCIL MEMBERS
JOEL ROJAS,AICP,COMMUNITY DEVELOPMENT DIRECTP~fr~Y
JUNE 21,2011 l!$A
SUBJECT:CODE AMENDMENT INITIATION REQUEST TO ALLOW ANCILLARY
RESIDENTIAL USE WITHIN COMMERCIAL ZONING DISTRICTS (CASE
NO.ZON2011-00089);APPLICANT:PARIS ZARRABIAN (GOLDEN
COVE CENTER);PROPERTY ADDRESSES:CITYWIDE
REVIEWED:CAROLYN LEHR,CITY MANAGER <02.-.
Project Manager:Leza Mikhail,Associate Planne@
RECOMMENDATION
Staff recommends that the City Council initiate the proposed Code Amendment Request by
directing Staff and the Planning Commission to draft an ordinance that would allow ancillary
residential uses within commercially zoned properties through the discretionary review and
approval of a Conditional Use Permit (CUP),and create the necessary Ancillary Residential
Development Standards within Title 17 (Zoning)of the RPV Municipal Code.
EXECUTIVE SUMMARY
This item is before the City Council because Staff is seeking Council direction on whether to
initiate a Code Amendment to allow ancillary residential uses/housing at the Golden Cove
Shopping Center and within other commercially zoned properties throughout the City.If the City
Council is not supportive of the Code Amendment,the current code,which does not allow
residential uses within properties zoned for commercial use,will not be changed.If the City
Council is supportive of the proposed Code Amendment,Staff and the Planning Commission will
amend the commercial zone regulations of the Development Code to allow a specified
percentage of commercial space to be used for ancillary residential use through a discretionary
review and approval process.In addition,Staff and the Planning Commission would conduct the
necessary research to establish development standards to allow said ancillary residential uses
within commercial zoning districts throughout the City.
BACKGROUND
In early March 2011,the property owner of Golden Cove Center,Paris Zarrabian,approached
Staff with a request to convert two existing,vacant commercial tenant spaces within Building "A"
of the Golden Cove Center (the 2-story building)to residential apartments.After reviewing the
uses allowed in the underlying zoning district (Commercial Neighborhood -CN),Staff informed
the property owner that permanent residential uses are not permitted within the Commercial
Neighborhood Zoning District,or any other commercially zoned property in the City.The6-1
property owner requested that the City consider allowing ancillary residential uses within the
Golden Cove Center due to the vacancy rate of the Center (currently 7.8%).Staff informed the
property owner that he would have to initiate a code amendment to be considered by the City
Council in order to amend Title 17 (Zoning Code)of the RPVMC to allow ancillary residential
uses within commercial zones.
On April 12,2011,the property owner of Golden Cove Center submitted a Code Amendment
Initiation Request to allow ancillary residential uses within the Golden Cove Center.Specifically,
the applicant is requesting a code amendment to allow two,2-bedroom,residential apartments
in the vacant,commercial tenant spaces of the Golden Cove Center.
DISCUSSION
Pursuant to Development Code Section 17.68.030.C,"Any person having an interest in land
may file an application withthe City Council for ...an amendment to this title [Title 17 -Zoning]
upon submission to the director of an initiation application and payment of a filing fee,
established by the City Council ...The City Council shall review an accepted initiation application
to determine if the requested amendment...is necessary or desirable.If the initiation request is
approved by the City Council by a majority ofaffirmative votes,the proposed...code amendment
shall be reviewed in accordance with Section 17.68.040 of this chapter [17.68 -Code
Amendments]."
As noted in the Background section of this report,the property owner of Golden Cove Center
approached the City with a request to allow two,2-bedroom apartments on the second floor of
Building "A",facing the adjacent Villa Capri Condominiums.The applicant stressed their concern
with not being able to commercially lease the spaces along the back side of Building "A"due to
the fact that these tenant spaces cannot be seen from the public right-of-way or the Golden
Cove parking lot.As such,the property owner noted that these tenant spaces are not desirable
to prospective commercial tenants,and therefore have not been leased for an extended period
of time.The property owner further explained that they would like to offer housing to some of the
people who work throughout the Golden Cove Center in an effort to reduce their daily commute
from locates off the Palos Verdes ,Peninsula.Additionally,by improving the vacant spaces for
residential use and allowing Golden Cove tenants to live within the vacant tenant spaces,the
current 7.8%vacancy rate at Golden Cove Center will be reduced.
In reviewing the property owner's request to allow residential uses within the commercially
zoned Golden Cove Center,Staff believes that the proposal has merit in that the property owner
will be able to make up for lost revenue,and provide housing to the Center's tenants to minimize
commutes.In addition,if affordable housing restrictions are placed on the allowed housing,the
new housing units could help the City meet the goals and policies of the City's Housing Element.
However,at the same time,Staff believes that if some residential use is allowed at the Center,it
should clearly be ancillary to the commercial use so that the commercial center is not converted
to a residential use,thereby affecting the City's tax base.Furthermore,Staff believes that if the
City Council agrees with the concept of allowing some ancillary residential use at the Golden
Cove Shopping Center,that the opportunity should be extended to other commercial zoning
districts throughout the City.Lastly,Staff believes that if the Council is inclined to approve the
concept of allowing ancillary residential use in commercial districts citywide,that the allowance
be implemented via a code amendment to the City's commercial zoning district regulations,
rather than a zone change.Staff addresses all of these issues below.
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Allowing Residential Uses that are strictly ancillary to a Commercially Zoned Property
The City's commercially zoned properties offer convenient retail and restaurant uses that serve
residents of the surrounding area and visitors throughout the City.In addition,commercially
developed properties offer office space for residents and other businesses located on the
Peninsula.Furthermore,many of the retail and service businesses within these commercial
districts provide sales tax revenue to the City's General Fund.Staff believes that if a residential
use were permitted as a "primary use"at the Golden Cove Center,or at any other commercially
zoned property,property owners may be more inclined to redevelop their properties to offer all
or a larger percentage of residential square footage compared to commercial square footage.
Without restricting the quantity of area dedicated to residential use within a commercially zoned
property,the City could potentially lose retail,restaurant and office spaces that are conveniently
located throughout the City for local residents and visitors.The City's could also potentially lose
a substantial percentage of commercial tax revenues.
However,Staff believes that allowing residential uses that are strictly "ancillary"to commercial
uses could provide benefits to the City,neighboring residents,workers and commercial property
owners.The property owner of Golden Cove Center noted that the Center currently has a 7.8%
vacancy rate due to the undesirable location of some of the tenant spaces at the rear of the
property,facing Villa Capri,a residential development.The property owner is of the opinion that
these spaces would be more appropriately used as residential apartments due to the fact that
they are not really visible from public areas.Mr.Zarrabian believes that allowing the spaces at
the rear of Building "A"to be residential would be a more compatible use to the neighboring
residential property,and allow the unused space to be leased out.In addition,targeting the
apartments for people who work at the Center would allow additional housing on the Peninsula
while reducing the long commutes on and off the Peninsula.
Staff agrees that the property owner's request has merit provided the residential use is clearly
ancillary to the commercial use and the residences are occupied by employees of the Center.If
the City Council agrees,Staff is recommending that the City Council initiate a code amendment
to allow ancillary residential uses within the Commercial Neighborhood Zoning District (Golden
Cove Center Zoning)through the.review and approval of a Conditional Use Permit.
Expand the Request to allow Ancillary Residential Uses Citywide to all Commercial Districts
Since Staff believes that allowing ancillary residential uses in commercial developments could
offer some benefits to the City and property owners,if the City Council agrees to initiate the
Golden Cove Center property owner's request,Staff would recommend that the concept be
applied to other commercial districts Citywide.This would allow the benefits of ancillary
residential uses within all commercially zoned properties throughout the City.Furthermore,Staff
would recommend that "ancillary residential uses"be specifically defined as a percentage of
total commercial leasable square footage within a development.
In an effort to understand the current vacancy rates that are found in local commercial
developments,Staff contacted the property managers offive (5)major retail/commercial centers
on the Palos Verdes Peninsula.Staff requested the total square footage of commercial space
within each development and the current vacancy rate.Table 1 below indicates the development
name,leasable square footage and current vacancy rate.
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Table 1:Palos Verdes Peninsula Vacancy Rates by %of Leasable Area
As noted in Table 1 above,the vacancy rate for the five (5)retail/commercial shopping centers
listed above ranges from 7.8%to 12%with an average rate of 10.14%.Based on this
information,Staff is of the opinion that limiting ancillary uses to 10%of a commercial center's
leasable area will ensurethat residential uses remain ancillary,will avoid impacting the City's tax
base and would benefit the commercial property owner(s)by subsidizing lost income.In
addition,the opportunity to provide on-site housing would benefit tenant employees who at
commercially zoned properties by reducing long commutes on and off the peninsula.
Therefore,if the City Council agrees that the concept of allowing ancillary residential uses
should be applied to all commercial districts Citywide,Staff recommends that the City Council
direct Staff to create specific development standards for "ancillary residential uses within
commercial zoning districts."
Compatibility with Affordable Housing Goals
Staff believes that allowing ancillary residential uses in commercial districts and requiring all
ancillary residential units to function as worker housing (Le.affordable housing),would increase
the supply of available residential units for people who work within the City limits and earn a less
than moderate income.According to the Housing Element (adopted December 2009),allowing
ancillary residential uses within commercial zoning districts would meet Preservation Goal4(a)
which states that the City should "remove existing governmental constraints to
the ...improvement and development ofhousing"."Additionally,Housing Element Preservation
Policy No.1 states that the City should "Continue to implement land use regUlations that
facilitate meeting affordable housing needs."It is important to note that the City is required by
State Law to provide an Annual Report on the Implementation of the RPV Housing Element.
This report discusses measures that the City has taken each calendar year to implement the
goals and polices set forth in the adopted and certified Housing Element.The following table
illustrates the various goals and policies that ancillary residential uses (units)within
commercially zoned properties could potentially implement.
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Table 2:Implementation of RPV Housing Element Goals and Policies by allowing Ancillary
Residential Uses within Commercially Zoned Properties.
In addition to implementing the Goals and Policies of the City's Housing Element,by allowing
ancillary residential uses within commercially zoned properties,the City and property owner will
be making a concerted effort to reduce Greenhouse Gas Emissions (GHG)throughout the City.
More specifically,SB 375 became law in 2009,and prompts California regions to work together
to reduce GHG's from cars and light trucks.The new law requires an integration of planning
processes for transportation,land use and housing.The City is currently working with the South
Bay Cities Council of Government (SBCCOG)to create a plan that helps reduce GHG's by 2020
and 2035.By allowing 10%of commercial square footage to be used for ancillary residential
uses,with specific development standards,the City will be making an effort in achieving
emission reduction target rates that are soon to be required for the Southern California Region
while also meeting affordable housing requirements.
Code Amendment vs.Zone Change
Currently,residential uses are not permitted within any commercially designated zoning district
throughout the City.In order to allow the applicant's request to allow some residential uses in
commercially zoned properties,the City has two options.One option is to re-zone the
commercial properties to have a dual commercial/residential or "mixed use"zoning designation.
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The other option is to amend the existing commercial district regulations to allow limited
residential uses through a discretionary CUP review process and to create review criteria for
said uses.Staff is recommending that the latter approach be pursued to allow residential uses
that are "ancillary"to existing commercial developments.Staff believes that the better process to
allow this is through a Code Amendment that allows "ancillary residential uses"through review
and approval of a Conditional Use Permit,along with associated "Ancillary Residential
Development Standards."If the City Council agrees with the concept of allowing "ancillary
residential uses",Staff would recommend moving forward with a Code Amendment to allow said
uses through review and approval of a Conditional Use Permit.
ADDITIONAL INFORMATION
Public Notice:
A Code Amendment Initiation Request does not require a public notice.If the City Council
initiates the Code Amendment,Staff will send a pubic notice to all property owners of
commercially zoned properties throughout the City as well as residents within a 500 foot radius
of each affected commercially zoned property.
Planning Commission Review
If the City Council initiates the Code Amendment,as recommended by Staff,the formal Code
Amendment will be presented to the Planning Commission for review and consideration at a
noticed public hearing.The Planning Commission's recommendation will then be forwarded to
the City council for a final decision.
FISCAL IMPACT
Due to the number of benefits that this Code Amendment would grant to the City and persons
who work within the City limits,should the City Council approve the initiation request,Staff would
process the request as a Citywide application.The Staff time associated with the processing of
this proposed Code Amendment is estimated to be approximately 40 hours.This process would
be considered an Advanced Planning Project and is accounted for in the Community
Development Department's budget.As such,no budget adjustment would be required.
ALTERNATIVE
The following alternatives are available for the City Council's consideration:
1.Deny the CAIR,and direct Staff to take no further action on the matter.If this alternative is
chosen,private property owners of lots zoned for commercial use(s)will continue to be
prohibited from allowing permanent residential uses within a commercially zoned property.
2.Direct Staff to initiate a Zone Change that would create a dual zone or "mixed use"zoning
district to allow the proposed request.
Attachments:
•Letter from Golden Cove Property Owner,Paris Zarrabian
•Golden Cove Center Plan (preliminary proposal for ancillary residential units)
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31244 Palos Verdes Drive West Suite 243 Rancho Palos Verdes,CA 90275
Tel:310.750.6707 Fax:310.750.6048
Management@Zarrabian.com
April 12,2011
City of Rancho Palos Verdes
Planning Department
30940 Hawthorne Blvd
Rancho Palos Verdes,CA 90275
Subject:Golden Cove Center -New Live!Work Units
Dear Planning Department,
The owner of Golden Cove center would like to request an initiation of a determination
from the Rancho Palos Verdes City Council to approve the implementation of (2)two
live-work units on the southerly side of Bldg "A"on the second floor,these units would
accommodate employees that have an extreme commute to the center every day,and
management that work late.The units will be occupied by employees of the center,and
or management only;they are "not"open to the public in any way.The Units have
complete access and fully han<;iicap compliant.Total square footage encompassing this
space is approximately 2,414 sq.ft.Owner of the Golden Cove is committed in
continuing the progress and renovation to the Center to accommodate and benefit of the
surrounding neighborhood.
Respectfully,
Golden Cove,LLC
fl/.-ekA~~
Property Manager
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