The Strange World of Politics — Episode 49: California Says Build More Housing. But Who Helps Small Property Owners Actually Build It?

My Experience Trying to Develop 11 to 20 Apartments Under SB 79 in Culver City

California has a housing shortage. Our state legislators know it. Our local elected officials know it. We hear constantly that we need more housing, greater density, more affordable units, and fewer obstacles to construction.

California passed Senate Bill 79 to allow more housing near qualifying public transportation stations and corridors.

On paper, this sounds like progress.

But what happens when an ordinary property owner like me actually tries to build that housing?

I am finding out firsthand.

And what I am discovering is that being legally permitted to build housing and being financially capable of building it are two entirely different things.

My Property: From a Small Residential Lot to Potentially 11–20 Apartments

I own property on Wesley Street in Culver City. Like many property owners, I began exploring whether my land could accommodate additional housing.

I initially explored building an accessory dwelling unit (ADU). That process introduced me to the complications of utility infrastructure, architectural requirements, professional fees, and lengthy coordination with Southern California Edison.

Then came SB 79.

According to information I received from Culver City's Planning Division, my property could potentially accommodate 11 housing units under SB 79.

With California's State Density Bonus Law, the theoretical number could be even higher, potentially reaching approximately 23 units if the project qualifies for additional density and meets applicable affordability requirements.

That is an extraordinary change in what the property might accommodate.

Imagine transforming one relatively small residential property into a building containing 11, 15, or perhaps 20 apartments.

Those apartments could provide homes for working families, teachers, healthcare workers, young professionals, and others struggling to find housing in Culver City.

But there is a problem.

The City can tell me how many units I might be allowed to build. It cannot tell me whether the project makes financial sense.

And that is where my experience becomes frustrating.

The First Obstacle: Spend Thousands Before You Know Whether the Project Is Possible

To determine whether I can build these apartments, I must hire professionals.

I need an architect to determine whether 11 to 20 units can physically fit on my relatively narrow property.

I may need a land-use consultant to interpret development standards and identify available incentives and waivers.

I may need civil and structural engineers, utility assessments, preliminary construction estimates, and financial feasibility analyses.

Then I must determine whether the anticipated rental income could support the construction costs, financing expenses, insurance, taxes, maintenance, and long-term operation of the building.

None of these services is free.

And I may spend substantial amounts of money only to discover that the project cannot obtain financing.

Think about that.

California wants me to create housing. Culver City recognizes that my property may qualify for additional housing density.

But before I know whether I can obtain a construction loan, I may have to spend thousands of dollars simply to determine whether the project is financially viable.

If the answer is no, that money is gone.

For a large developer with multiple projects and substantial capital, these expenses may be part of doing business.

For a small property owner, they represent a significant personal financial risk.

How Much Does It Cost Just to Find Out Whether I Can Build 11 to 20 Apartments?

Here is something I believe every property owner considering SB 79 should understand.

Before construction begins, before a bank approves financing, and before a single apartment is rented, a small developer may need to spend tens of thousands of dollars on professional services.

I am discovering that almost every question requires hiring another professional.

And each professional has a different responsibility.

Here are illustrative preliminary cost ranges for evaluating a small multifamily development in the Los Angeles area. These are planning estimates, not verified quotes from the professionals I have contacted.

The Potential Cost Before Construction

Adding those illustrative ranges produces the following picture:

• Lower-end combined estimate: $37,500

• Upper-end combined estimate: $136,000

These are not necessarily the amounts every owner must spend. Some services can be deferred, combined, or avoided, depending on the project. The figures also do not include every possible City fee, environmental study, financing expense, or detailed construction-document cost.

Nevertheless, they illustrate how expensive the preliminary development process can become.

And here is what makes this especially concerning:

I could spend $40,000, $60,000, or even $100,000 investigating a project, only to discover that no bank is willing to finance it.

I would have professional reports and architectural drawings, but no apartments.

Why Can't We Determine Financial Feasibility First?

This is what I find particularly difficult to understand.

Why must a small property owner spend so much money before knowing whether the proposed building has a realistic financial future?

Consider my property.

Culver City has indicated that I may be able to build 11 units under SB 79, potentially more using the State Density Bonus Law.

But I still need answers to basic questions:

1. How much would it cost to construct an 11-unit building compared with a 15- or 20-unit building?

2. How much rental income would each alternative generate?

3. How much cash equity would a lender require from me?

4. Would a bank finance the project if I contributed the land?

5. Would the property generate sufficient income to cover debt payments and operating expenses?

6. Would the affordable housing requirements make the project financially feasible or infeasible?

7. Could I partner with an experienced developer instead of undertaking the entire project myself?

These questions should be addressed early, before substantial expenditures on detailed architectural and engineering work.

A preliminary financial analysis will not guarantee financing. But it could help identify projects that are unlikely to work before property owners commit significant additional funds.

The Second Obstacle: Where Is the Financing?

This is perhaps the most important issue.

Suppose an architect confirms that 15 apartments can fit on my property.

Suppose the City confirms that the design meets applicable requirements.

Suppose construction costs total several million dollars.

Who is going to finance it?

Banks do not lend money simply because California passed a law allowing additional housing.

They examine the project's financial performance.

They want to know the projected construction costs, rental income, operating expenses, value of the completed building, the developer's experience, and the amount of personal equity available.

They may require substantial cash contributions, guarantees, and evidence that the completed building will generate sufficient income to repay the loan.

A small developer may own valuable land but lack the millions of dollars in liquidity needed to satisfy construction lenders.

That is my concern.

I may have land that can legally accommodate 11 to 20 apartments, yet still be unable to develop those apartments because I cannot obtain financing on reasonable terms.

SB 79 may create the legal opportunity to build housing, but it does not automatically create the financial opportunity to build it.

The Third Obstacle: My Lot Is Narrow, and Every Square Foot Matters

My property presents another challenge.

It is relatively narrow.

A developer cannot simply divide the available land by the number of apartments and assume the project will work.

The building needs stairways, elevators when required, hallways, utility connections, fire-safety systems, trash facilities, and other infrastructure.

These components consume space that cannot be rented.

The narrower the lot, the more difficult it may become to design an efficient building.

Parking and vehicle access can create additional challenges, even when state law reduces or eliminates minimum parking requirements.

A building that technically accommodates 15 units may still be financially impractical if the units are too small, the construction costs are too high, or too much space is devoted to circulation and building systems.

That is why I need professional architectural and financial studies.

And that brings me right back to the first problem: I must spend money before knowing whether the project can be financed.

The Fourth Obstacle: Where Is Culver City's Help for Small Developers?

This is the question I keep asking.

Where does a small property owner go in Culver City for practical assistance turning an SB 79 housing opportunity into an actual building?

I have communicated with City Planning staff and received information about zoning, density, and development regulations.

That information has been useful.

But zoning information is not the same as development assistance.

What I have not found is a City program that takes someone like me through the financial feasibility of a small multifamily project.

I have not been offered a City-supported preliminary feasibility analysis, a financing assessment, or a structured program connecting small property owners with construction lenders and qualified development partners.

Culver City's Housing Element discusses affordable housing development assistance, including potential financial and technical assistance. But I have not identified a practical program through which a property owner like me can obtain the preliminary feasibility and financing support needed for an 11–20-unit SB 79 project.

From my experience, Culver City provides information about what may be legally permitted, but offers no meaningful financial-development assistance for someone in my situation.

The practical message feels like this:

You may be allowed to build 11 to 20 apartments. Now hire the professionals, spend your own money, find a lender, take the financial risk, and hope the project works.

That is a tremendous burden to place on small property owners.

I am not asking Culver City to guarantee my investment or use taxpayer money to rescue a bad project.

I am asking why the City does not have a practical process to help determine whether small housing projects are financially feasible before owners spend thousands of dollars.

The Fifth Obstacle: Affordable Housing Requirements and Financial Reality

California's density bonus laws can allow additional apartments when developers provide qualifying affordable housing.

That creates an opportunity to build more homes, including income-restricted apartments.

But affordability requirements also affect the financial projections.

A unit rented below market rate produces less revenue than an otherwise comparable market-rate unit.

If construction costs remain high while rental income declines, financing can become more difficult.

Additional units may offset some of that loss, but not necessarily.

For a project with 150 apartments, the financial calculations may be quite different from those of a project with only 11 or 15 apartments.

Smaller buildings have fewer apartments over which to distribute fixed costs.

An elevator, fire-safety system, utility upgrade, or expensive foundation can materially change the economics of a small project.

We should encourage affordable housing.

But we also need to understand that a density bonus is not the same as a construction subsidy.

Giving a small developer permission to build additional units does not guarantee that those units will generate enough revenue to cover their costs.

The Difference Between a Large Developer and Someone Like Me

A large developer may have architects, engineers, financial analysts, lenders, and attorneys who work together regularly.

That developer may be able to evaluate dozens of properties and absorb the cost when some projects do not proceed.

I am not in that position.

I am a property owner trying to determine whether my land can help produce additional housing.

I do not have an in-house development team.

I do not have millions of dollars set aside for speculative architectural and engineering studies.

And I do not want to spend tens of thousands of dollars without first understanding whether the project has a reasonable chance of being financed.

California has made it possible for people like me to become small housing developers. But the financial and professional infrastructure needed to help us succeed has not necessarily followed.

That is the contradiction I want our local government to address.

We need more housing.

We have properties that may qualify for greater density.

We have owners willing to explore development.

But unless we create a practical pathway from zoning permission to financial feasibility, some of these opportunities may remain nothing more than drawings on paper.

What Could Culver City Actually Do?

I believe there are practical questions worth examining.

Why not establish a small housing development assistance program?

Such a program could offer an initial screening of eligible properties, identify potential density and affordability options, and provide standardized guidance on likely development expenses.

It could help property owners understand which studies are necessary before they spend money on detailed architectural plans.

It could connect owners with lenders, nonprofit housing organizations, architects, and experienced development partners.

It could also investigate whether state housing funds, revolving loans, or other financing tools could support qualified small housing projects without placing unreasonable risks on taxpayers.

Most importantly, the City could help owners understand early whether their proposed projects have a realistic chance of obtaining financing.

Imagine a program where a property owner pays a modest fee and receives:

• A preliminary assessment of the number of units that may be permitted.

• A basic analysis of whether those units could physically fit.

• An estimated range of construction costs.

• A preliminary rental income and operating expense projection.

• An estimate of the equity and construction financing required.

• Information about available lenders, development partners, and public financing programs.

Such a program would not guarantee project approval or financial success.

But it could prevent small property owners from spending thousands of dollars pursuing projects that were financially unrealistic from the beginning.

This would not require the City to approve every project or finance every development.

It would require recognizing that small developers face obstacles different from those faced by large institutional developers.

A property owner considering 11 apartments is not necessarily equipped like a company building 300 apartments.

Housing Legislation Is Only the Beginning

I support creating more housing opportunities.

I am personally trying to do exactly what California says property owners should do: explore whether existing land can accommodate more homes.

But my experience illustrates a gap in our housing policy.

The state changes the zoning laws.

The City explains the development rules.

The architect designs the building.

The engineer determines what can be constructed.

The lender decides whether the numbers work.

And the small property owner pays for much of the investigation before knowing whether the project can proceed.

At every step, the financial risk accumulates.

For some owners, that risk will be enough to stop the project before a single apartment is built.

My Final Question

If California and Culver City genuinely want small property owners to help address the housing shortage, why is there no clear, practical pathway to help them determine whether their projects are financially feasible?

I have a property that the City says may accommodate 11 units, with the theoretical potential for more under density bonus provisions.

I am willing to investigate building those apartments.

But I cannot responsibly spend unlimited amounts of money on architectural plans, engineering studies, and consultants without knowing whether financing is realistic.

That is not opposition to housing.

That is financial reality.

We have created laws that allow more housing. Now we need to examine whether our institutions are helping people turn those legal possibilities into actual homes.

Because a housing unit that exists only in a zoning calculation is not a home.

And until we address the financial obstacles facing small property owners, many of those potential homes may never be built.

The question is no longer simply, "How many apartments can I build?"

The question is, "How much money must I risk before anyone can tell me whether I can afford to build them?"

The Strange World of Politics — Episode 42

Dr. Franklin Carvajal

Culver City property owner and 2026 City Council candidate

Safe. Clean. Quiet. Beautiful. Accountable.