Santa Monica is offering up more than eight acres of city-owned land to developers, launching a formal search for long-term lessees to help meet the city’s state-mandated housing goals and deliver hundreds of affordable apartments on publicly controlled sites.
A legal notice issued June 30 outlines plans to lease three major properties under California’s Surplus Land Act, which requires cities to give priority to affordable housing projects when disposing of public land. While private developers are invited to submit proposals, priority will be given to projects that commit at least 25 percent of units to lower-income households.
The largest of the three sites is the Bergamot Station Arts Center at 2525 Michigan Avenue, a 5.6-acre property currently home to about 30 businesses including galleries, a theater company and a comedy club. The city’s stated goal for the property is to build at least 707 affordable apartments, serving households earning up to 80 percent of the area median income. Proposals with fewer units will be considered only if developers explain why that threshold cannot be met and offer alternative options that still prioritize affordability.
City planning documents show Bergamot as a key site identified under Santa Monica’s 6th Cycle Housing Element, the state-required plan that spells out how the city will accommodate nearly 9,000 new housing units between 2021 and 2029. That housing target includes 1,880 affordable units to be built on public land, with Bergamot expected to carry a significant portion of the load.
While there is no requirement to provide parking at Bergamot, proposals must align with the city’s transit-oriented goals, given the property’s proximity to the Metro E Line’s 26th Street/Bergamot Station. Developers are also expected to factor in community engagement, with at least four public meetings required and to consider preserving elements of the existing arts-focused uses either through on-site retention or a formal relocation plan.
The city has also expressed interest in setting aside at least 15 percent of the proposed units as artist-affordable housing and may offer 40 project-based vouchers through the Santa Monica Housing Authority to support permanent supportive housing units, pending federal regulations.
The second site, spanning 2.57 acres across nine parcels bounded by 4th Street, 5th Street and Arizona Avenue, is currently occupied by Chase and Bank of America branches as well as surface parking. The city wants to see at least 362 affordable apartments built there, although, as with Bergamot, that target is flexible if accompanied by a viable explanation. Both banks have leases extending into 2026 and 2028, but have reportedly expressed interest in returning to the site after redevelopment if commercial space is made available.
While housing is the core focus, the city is also open to mixed-use proposals that could include hotel space, market-rate apartments or community amenities like a public park or seasonal ice rink, which has traditionally been hosted at the site.
The Downtown parcels, along with Parking Structure 1 at 1234 4th Street, could also be bundled in a joint proposal. That final site, measuring 0.75 acres, is a concrete parking structure with 327 spaces that would require seismic retrofitting by 2027 to remain operational. Unlike the other two properties, the city is not limiting this parcel to affordable housing use and will consider a range of proposals, including adaptive reuse, full redevelopment or integration with the Arizona Avenue site.
Any future redevelopment of Parking Structure 1 must include a large shared waste receptacle for nearby businesses and the ongoing maintenance of that feature would fall to the future leaseholder. The site lies within the California Coastal Zone, so any changes would require Coastal Commission approval.
In all three cases, the city is offering 55-year ground leases, with the option to extend for two additional 22-year terms. Interested developers must submit a formal letter of interest within 60 days of the notice date. If multiple eligible proposals are received, the city will give preference to those that offer the highest number of affordable units deemed financially viable, with further consideration given to projects with lower average affordability thresholds and alignment with the city’s stated community engagement goals.
While these properties represent some of the most valuable remaining land under public control, the city has faced legal pressure in recent years to comply with regional housing mandates and prioritize affordable housing production. The notice explicitly references Santa Monica’s commitment to Program 2.E of its Housing Element, which centers on leveraging city-owned sites to build below-market-rate units.
At a time when Santa Monica continues to navigate the tensions between state housing laws, local land use authority and the preservation of its cultural and commercial identity, the outcome of this land offering could reshape significant pieces of the city’s landscape for decades to come.