Santa Monica Locals Deride Supportive Housing Plan

A pre-Thanksgiving move-in led by Pacific Coast Healthcare at a vacant building on Ocean Avenue in Santa Monica has reignited tensions between Santa Monica officials, affluent neighbors and prominent Los Angeles developer Leo Pustilnikov.

Unbeknownst to Pustilnikov, in November, roughly 50 clients of an unpermitted sober living operation arrived in vans late at night and began occupying an empty Ocean Avenue property, the Los Angeles Times reported. The exact address of the building was not disclosed. Ocean Avenue residents spoke out against the neighbors moving in, and city officials imposed fines against Pustilnikov, who leases the buildings. By the following week, the property was cleared out.

The empty low-rise buildings at 413 Ocean Avenue, spanning 11,212 square feet, and 825 Ocean Avenue, at 11,256 square feet, have been zoned for use as supportive housing for years, though they are surrounded by upscale condominiums that have sold for as much as $7 million. The buildings were purchased by the Bourne Financial Group in early 2023 for $13 million and are leased by Pustilnikov, who said he aims to earn rental income from them while he seeks change of use permits from the city of Santa Monica.

The November dustup was the second time in a span of a few months that Pustilnikov failed to fill the building, as a plan to house county behavioral health patients at the site last year was also scrapped. Pustilnikov, Bourne Financial Group and St. Joseph Center had approached county mental health officials about using the building, ultimately earning $3.5 million in bridge housing funds to renovate and house homeless residents. The community backlash was swift, and the $3.5 million in funding was canceled. “I didn’t realize you’re not allowed to help people that are struggling in affluent communities,” Pustilnikov told the Times.

After that, Pustilnikov said he was “done” trying to fill the building until Pacific Coast Healthcare approached him about operating a sober living facility at the site. “I said, ‘Sure, why not?’ It sounded fine. They seem like reputable people,” he told the Times. He leased the property to the company not knowing that the operators hadn’t obtained a business license or move-in approval from the city and were already bussing in residents.

Pustilnikov is now in discussions with the Los Angeles County Department of Mental Health to explore other sites in Santa Monica for housing residents in need of mental healthcare that are closer to existing service providers, county supervisor Lindsey Horvath’s office confirmed to the Times.

— Chris Malone Méndez