Zoning Change That Would Allow Converting Commercial Spaces Into Housing Gets Green Light

The Pasadena City Council approved a proposed zoning code amendment allowing commercial buildings to be used for housing.

The adaptive reuse amendments are intended to encourage the conversion of underutilized commercial and office spaces into multifamily housing, addressing the growing demand for residential units in the city.

“We were talking about this when I was on the Planning Commission,” said Councilmember Jason Lyon. “I am thrilled to see it here.”

Lyon chaired the Planning Commission for three and a half years before he was elected to the City Council in 2022.

The City Council will also consider financial incentives.

The city currently has 13.9 million square feet of office space, with vacancy rates soaring from 11.8% in 2019 to a peak of 26.8% during the COVID-19 pandemic, before settling at 19.8% in 2024.

Pasadena’s vacancy rates remain higher than those in neighboring Burbank and lower than in Glendale, highlighting a regional trend of increased office space availability. Approximately 50% of Pasadena’s office buildings were constructed before 1980, a factor that complicates their potential conversion to new uses compared to Burbank and Glendale, where fewer older structures exist.

“This has been a long time coming,” said Mayor Victor Gordo.

The amendments remove maximum density limits for existing buildings, while retaining density restrictions for new construction, and mandating an average unit size of 450 square feet for projects with 10 or more units, with exemptions for fully affordable housing developments.

Parking requirements for projects that provide on-site vehicle sharing will be reduced, and open space requirements for properties near public parks will also be decreased.

The Planning Commission urged the City Council to explore allowing adaptive reuse in zones where housing is currently prohibited, such as Industrial General and Commercial General zones, and to consider financial incentives for adaptive reuse projects in the future during a public hearing on July 10, suggesting several changes to the original proposal.

The COVID-19 pandemic significantly impacted retail and office markets, leaving millions of square feet vacant across the nation. With the diminishing demand for nonresidential space, city officials are seeking ways to revitalize underutilized buildings while simultaneously addressing the housing crisis.

According to city documents, the addendum to the 2015 Pasadena General Plan Environmental Impact Report concluded that the proposed amendments would not result in significant environmental impacts not already assessed. The council is also expected to direct the City Attorney to prepare an ordinance based on the amendments within 90 days.

These zoning code changes align with the city’s 2021-2029 General Plan Housing Element, which emphasizes the importance of adaptive reuse as a strategy to enhance housing availability and promote historic preservation while supporting environmental sustainability and economic development.

Cities across California, including Los Angeles and San Francisco, have successfully implemented similar ordinances, resulting in thousands of new housing units. For instance, Los Angeles’s adaptive reuse ordinance, first adopted in 1999, has produced over 12,000 housing units in downtown alone.

While Pasadena has a history of adaptively reusing historic buildings, such as the Raymond Theatre and the Del Mar Station, the city lacks a formal ordinance to facilitate such conversions on a broader scale. The most recent project involved converting a seven-story office building on Cordova Street into residential units, revealing various challenges related to zoning standards and building codes.

In response to the rising need for housing and to reduce regulatory barriers, Pasadena has recently adopted several incentives. These include removing parking requirements for historic buildings and easing restrictions for structures built before 1970. Changes also simplify the process for converting hotels into affordable housing and provide variances for historic resources.

Staff members have engaged with local industry professionals and stakeholders to gather feedback on existing barriers to adaptive reuse. Recommendations from these discussions suggest implementing citywide updates to regulations, increasing flexibility in parking requirements, and considering by-right approvals for adaptive reuse projects to streamline development processes.

As the state legislature plans to form a working group to address building and fire safety challenges for adaptive reuse, Pasadena officials remain proactive in monitoring potential changes that could further support these initiatives.