Proposed SB 79 development in Santa Monica would do exactly the opposite of what the law’s backers promised

Coming to a neighborhood near you…

Yesterday, in a story so short you’d miss it if you blinked, the Santa Monica Mirror reported that the first development proposal under SB 79 has been submitted in Santa Monica. According to the article, if approved, a 1,051 square foot single family house at 2904 Delaware Avenue will be demolished and replaced by five town homes totaling nearly 10,000 square feet.

Call it “Supersize Me: Home Edition.”

SB 79 allows developers to build multifamily structures on single family parcels that are within a half mile of certain defined transit stops. The theory goes that California needs to goose the number of housing units — not “homes,” mind you, but cold, spreadsheet calculated “units” — near public transit as part of the effort to ease the housing crisis and end the state’s so-called car culture.

Never mind that what we have is not a housing crisis, full stop, but a housing affordability crisis. Never mind that projects like these, as we’ll see, actually make that crisis worse. Never mind that car culture was essential to the biggest, broadest and most sustained economic expansion in human history. Never mind that study after study after study confirms the obvious, that car ownership vastly increases individuals’ and families’ access to jobs, educational opportunities and the other fundamentals of prosperity, particularly for lower income people.

For a decade now, the so-called YIMBY (“yes in my back yard”) movement has tried to sell Californians on the notion that the only policy worth considering is to build millions of new housing units in multifamily developments, ideally near transit. However, Californians aren’t stupid. They’re not going to pay upward of $4,000 a month to live in souless shoe boxes with no outdoor space and a view of the shoe boxes across the street. Developers aren’t stupid, either. They’re not going to build buildings in which people don’t want to live, meaning said shoe boxes.

Likewise, surveys consistently show that off-street parking is a top priority for both renters and buyers. That’s why the proposed new town homes on Delaware Street come with dedicated off street parking spaces, because the developer isn’t stupid.

Ponder that: A law intended to reduce car dependence and incentivize transit use will add more cars to an existing neighborhood. Let’s assume the previous owners of the existing single family home had two cars, three if they had a teenage kid or two. If we add four more families to that same parcel, that could be as many as eight cars where now there are two or three. More if any of the new families also have teenage kids with cars. So much for “transit oriented” development.

In sum, a developer took advantage of a law that supposedly is intended to increase transit usage, then made sure future residents will have places to park their cars. Depending who you ask, this is either folly or the law working exactly as intended. It’s either “transit oriented” or another example of the war on single family neighborhoods.

Then there’s the question of affordability. This is where the story becomes either downright hilarious or positively pestiferous, depending on your point of view. According to Redfin, the home last sold in June 2025 for $1.6 million. This is consistent with the neighborhood, where thousand square foot homes routinely fetch between $1.5 and $2 million, and not infrequently more (welcome to Santa Monica!)

A typical $1.6 million home in Santa Monica. 2904 Delaware Avenue

Let’s be conservative and assume construction costs of $500 per square foot, for a total project cost of $6.6 million.

Developers of these kinds of projects generally expect to make at least 20% profit. That means each of the five new town homes will have to fetch … wait for it … $1.6 million (technically $1.58 million: $6.6 million project cost + $1.32 million profit / 5). This is affordability in YIMBY World, replacing a $1.6 million single family home with front and back yards and trees with five $1.6 million town houses that have none of those things.

Not only does it exacerbate the affordability crisis, it downgrades everyone’s quality of life. A town house with yards and trees is a fundamentally different place to live than a sleek, souless town house. Also, woe be unto the neighbors in the immediate vicinity, who will deal with years of demolition and construction resulting in a mini Death Star on their block.

It gets better for the developer: Rather than including one unit of affordable housing as required by SB 79, they have the option of paying an “in lieu” fee of $52.26 per square foot, for a total of $526,900. In Santa Monica, that amount of money will help subsidize about one half of one affordable unit. Incidentally, that’s about par for the course when public policy depends on for profit developers to build affordable housing, a 10:1 market rate/luxury to affordable ratio.

This is supply side economics in a carnival house mirror viewed through a kaleidoscope on LSD.

Predictably, the YIMBYs are fizzing their pants.

There’s also the question of who these “units” are being built for. The market isn’t working class families but young, upwardly mobile singles and couples purchasing their first or second home. Based on various renderings available online, the building resembles a 19th century U.S. Army fort somewhere out on the plains. We could call the project “Dances With YIMBYs.”

This is YIMBYism in action. Meanwhile, as I posted last week, Malibu and Pasadena caved to a lawsuit brought last year by YIMBY Law. Those cities previously had attempted to suspend another favorite YIMBY law, SB 9, in Palisades Fire and Eaton Fire burn zones. SB 9 requires cities to approve up to four (some argue as many as eight) new units on single family parcels. Because they, let’s shove a bunch more people into fire zones. What could possibly go wrong?

The YIMBY onslaught is in full effect. 

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