The Los Angeles City Council voted and approved new regulations for recreational cannabis businesses. Recreational marijuana will officially spread like wildfire on January 1, 2018, per California state law. This will be a boon for industrial real estate landlords as cannabis growers and cultivation operations typically pay premium industrial rental rates compared to regular warehouse and manufacturing users. Pot growers often pay in excess of 2X the market rate. Some key rules are below from the L.A. Times article. The mayor is expected to sign the ordinance soon.
12/20/2017 UPDATE: the Mayor signed the cannabis ordinance.
Under the new regulations, pot shops can open their doors only in specific commercial and industrial zones and must operate at least 700 feet from schools, public parks and libraries, child care centers, alcohol and drug treatment centers and other “sensitive” sites, as well as from other pot retailers.
Other kinds of marijuana businesses, including growers and manufacturers, would be confined to industrial zones and banned within 600 feet of schools. And marijuana manufacturers that use volatile solvents would also be prohibited within 200 feet of residential areas.
To prevent an “undue concentration” in neighborhoods, city leaders also decided to cap the number of pot shops, growers, manufacturers and marijuana “micro-businesses,” which do a combination of things, allowed in each community.
The City of Los Angeles developed The LA Business Portal, which provides all of the information you need to plan, start, manage, and grow your business. This is a good resource for business owners moving into the city limits. There is guidance on zoning, compliance, employees, registration, etc…
Interesting article in the LA Times and how the California and Los Angeles minimum wage increases will affect the Los Angeles garment manufacturing sector. Quote “In the last decade, local apparel manufacturing has already thinned significantly. Last year, Los Angeles County was home to 2,128 garment makers, down 33% from 2005, according to Bureau of Labor Statistics data. During that period, employment also plunged by a third, to 40,500 workers.”
On February 10, 2016, the Los Angeles City Council adopted the “HI” Hybrid Industrial Live/Work Zone Ordinance, which creates a new zone classification in the City of Los Angeles, the Hybrid Industrial (HI) Zone, with accompanying land use and development standards. The Ordinance becomes effective March 30, 2016. Generally, the purpose of this new zone classification is to permit the development of residential live/work units, hotels and other specified commercial uses on property within an existing current industrial zone and designated as Hybrid Industrial in the General Plan.
The newly adopted HI Zone is the first industrial zone of its kind in the City. In addition to permitting a mix of residential and commercial uses on industrial land, projects sited on land zoned as HI may exceed a Floor Area Ratio (FAR) of 1.5 up to a maximum of 6:1 with the provision of public benefits and other development commitments like below-ground parking as specified in the Ordinance. The Ordinance includes development incentives in exchange for affordable housing, additional non-residential floor area, public art and public open space, among other commitments. In addition, the HI Zone includes an FAR exemption for the reuse of existing structures. The new zone also includes stringent requirements regulating the size and layout of the permitted live/work units to promote productive work spaces compared to traditional residential developments.
The Ordinance was hotly contested among stakeholder groups regarding the density bonus program and other development incentives.
– See more at: http://www.natlawreview.com/article/new-livework-ordinance-adopted-la-city-council#sthash.3SLk3YeS.dpuf
December 2017 UPDATE: The city rescinded the ordinance because on March 23, 2016, the Petitioners Yuval Bar-Zemer, Mark Borman, Paul Solomon, Arts District Community Council LA, and Los Angeles River Artists and Business Association (Petitioners) served the City with a petition for writ of mandate claiming the City violated CEQA on the basis that an initial study and possibly an environmental impact report were necessary to adopt the Ordinance. The trial was held on April 11,2017.