Land donations provide creative and mutually beneficial ways for market-rate and affordable housing developer to collaborate on creating more housing in the city. By law, any developer in California seeking zoning density bonuses through the State Density Bonus Law (known as the 2005-enacted SB 1818) has the option to donate a qualified parcel of nearby land to an affordable housing developer, in lieu of building affordable units on-site. Density bonuses (up to 35% above zoning limitations) are granted when the qualified land is donated to an affordable housing development or earmarked for future deed-restricted affordable housing.
While the land donation option has been an option for developers since 2005, a land donation deal has yet to be completed due to ambiguous language in the state law, which can open developers up to liability.
If a land donation deal was executed, the market-rate developer would receive approval for up 35% density increase for a 100% market-rate project and an affordable housing developer would receive a sizable developable site (of at least 40 units) within a quarter mile of the market-rate project, helping create more truly mixed income communities in the places most impacted by new development. If the process could be further defined and outlined by cities to protect developers, the land donation option could be an attractive option for both the market-rate developers and the affordable community.
Fun Fact: Although a different kind of land donation, Welsh immigrant Griffith J. Griffith donated some 3,000 acres of his Rancho Los Feliz property to the City of Los Angeles in 1896 for use as a public park. That land became Griffith Park – now the tenth-largest municipally owned park in the United States. Griffith Observatory , pictured above, was also funded by Mr. Griffith’s donations to the City of LA.