Newport Beach Cuts Affordable Requirement 50% Near Airport

Newport Beach has cut its requirement for affordable homes near John Wayne Airport by half, hoping to attract developers.

The City Council voted to slash the affordable requirement to 15 percent, from 30 percent, in a 145-acre swath of industrial and office properties near the airport in nearby Santa Ana, the Voice of OC and Orange County Register reported.

The area, known as Newport Place, is bounded by Jamboree Road, Bristol Street North and Birch Street. The city voted to limit development to a minimum of 30 units per acre and a maximum of 50 units per acre.

City officials say the change could help it meet a state housing requirement for more lower-priced homes. Newport Beach must plan for more than 4,800 homes, of which nearly half must be affordable for low- and very low-income households, by 2029.

“Now there are more projects with significant interest,” Assistant City Manager Seimone Jurjis said.

They include three proposed apartment projects near Bristol Street and Jamboree Road, with developers expressing interest because of the lowered affordable housing bar, he said.

In 2006, the city decided that if a developer wanted to build homes in the office and industrial area near the airport, a 30 percent affordable requirement made sense. But a recent analysis found that the requirement wouldn’t pencil out for builders.

Last year, a study by Keyser Marston Associates concluded that requiring affordable housing higher than 15 percent would likely make most residential projects financially unfeasible.

Apart from the airport zone, the rest of Newport Beach has no affordable housing requirement.

At least one council member said that, given the high cost of real estate, the upscale coastal city would never meet its state “housing element” goal.

“It’s maddening to be given such a mandate to build so many units when clearly, for this town, it’s extremely challenging,” Councilmember Brad Avery said. “It’s extremely challenging, given our price of real estate.

“We’re on time with our plan; we’re trying to build more, but it’s just not going to happen,” he said. “There just isn’t the land or market to do it.”

The council has spoken out and challenged past state housing mandates, claiming the city can’t create thousands of affordable housing units in a city like Newport Beach, where much of the land is regulated by county, state or federal agencies, according to the Voice of OC.

— Dana Bartholomew