A developer will be able to build the six micro-apartment buildings that the city of Santa Monica moved to block earlier this year.

WS Communities, a spinoff of developer NMS Properties, threatened to sue the city after City Council temporarily banned micro-apartments in response to the developer applying to construct 363 units between 219 and 373 square feet. City Attorney Lane Dilg announced Tuesday that the city and WS have reached a settlement that allows the developer to build the six projects on an expedited schedule under certain conditions.

The buildings will rise at 1323, 1338 1415 and 1437 5th St., 1437 6th St. and 1557 7th Street, which are all in a four-block radius downtown.

The settlement stipulates, however, that WS will not be able to build any more micro-apartments in Santa Monica. The condition addresses the reason why city staff recommended against banning them in the first place — that the six buildings would spur other developers to build micro-apartments instead of other sizes of apartments, resulting in not enough new housing for families.

In response to the council’s fears that the apartments would be rented as corporate housing, the settlement requires them to be rented to individuals who intend the apartments to be their primary home. They must comply with any future local laws meant to combat corporate housing, such as minimum lease requirements.

The settlement also substantially increases the proportion of affordable apartments in the buildings. When the projects came before the council in March, councilmembers expressed concern that WS had abandoned plans to build two 100% affordable housing projects and three buildings with a mix of apartment sizes on the sites it selected for market-rate micro-apartments.

WS originally planned to restrict 5% of the micro-apartments to extremely low-income occupants, but the settlement requires 15% of the micro-apartments be rented to tenants making 80% of the area median income. 20% of the multi-room apartments must be affordable at different affordability levels.

“The city of Santa Monica is committed to producing and preserving housing, particularly affordable housing,” city spokesperson Constance Farrell said in a statement. “The City Council has consistently acted to ensure that new housing serve the needs of a wide range of incomes and household sizes.”

In addition to regulations regarding tenants, the settlement says the apartments be at least 220 square feet, not including closets and bathrooms, and include common areas for residents on each floor. Half of the apartments may be furnished.

The projects and two other WS projects at 1425 5th St. and 1543 7th St. must collectively meet Downtown Community Plan maximum parking requirements. Those two projects will also be entitled to expedited processing.

Neill Brower, an attorney for WS, said the developer threatened to sue because the council passed an emergency ordinance to ban micro-apartments without showing that they demonstrated an immediate threat to health, safety or welfare, which is required by state law.

The compromise reached with the city is acceptable to WS, he said.

“It addresses some concerns the city has about (micro-apartments),” he said. “It’s not the project we brought in, but it’s a compromise.”

The new applications WS submits to the city will still be subject to full review by the Planning Board and the Architectural Review Board.


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