Measure ULA Opposition Rises as Apartment Construction Drops

As developers continue to blame Measure ULA for choking multifamily construction across Los Angeles, more players are signing on to a renewed opposition campaign to the transfer tax.

While developers are still confident in development in the region, the citywide tax has partially led many apartment developers to look outside L.A. city limits, coinciding with a dip in apartment construction overall, Bisnow reported. Now, a signature drive spearheaded by the Howard Jarvis Taxpayers Association to put a repeal measure on the November 2026 ballot is gaining momentum.

Developers are “very much bullish on L.A. County, but not so much on the City of L.A., and it’s a complex set of reasons,” Kamran Paydar, a CBRE broker and partner, told the publication. “ULA is a piece of it. Interest rates, which have risen, are also a big component, then add to that the different housing policies that are being supported by different municipalities.”

A University of California, Los Angeles, report this year found that approximately 1,900 units each year have gone unbuilt since the measure was adopted in 2023. Another study cited by Bisnow found that commercial transactions fell between 30 and 50 percent in the two years since Measure ULA’s adoption. In 2022, Los Angeles permitted a total of 23,422 residential units that count toward the state requirements for housing, or 5.1 percent of its state-mandated goal; by contrast, last year, the city permitted 17,195 residential units, or 3.8 percent of its state-ordered goal.

Simply put, “The math ain’t mathing” for developers, Chris Tourtellotte, managing director at LaTerra Development, previously told The Real Deal about developing new apartment buildings in the City of Los Angeles. Many multifamily investors have followed suit and shifted their interests outside of the city, thereby depriving many developers of crucial funding. In the third quarter alone, fewer than 19,000 apartments were under construction in Los Angeles, representing a 30 percent drop from three years ago, per CoStar data cited by the Los Angeles Times.

“Buyers and sellers are absolutely disgruntled over ULA, and it is not going away. It’s actually getting worse every day,” Aaron Kirman, CEO of Christie’s International Real Estate Southern California, said at The Real Deal’s Building Back L.A. roundtable in September. “It’s the crux of the issues today when we’re selling anything residential, even commercial. It comes up and it really has probably stopped 50 percent of the deals, maybe even more.”

Whether Howard Jarvis Taxpayers Association’s Measure ULA opposition referendum makes it to the ballot remains to be seen. For now, the organization is collecting signatures to put the issue before voters next fall.

— Chris Malone Méndez