Office Development Annual Limitation Program
The Annual Limit Program governs the approval of all development projects that contain more than 25,000 gross square feet of office space. Such projects require an “office space allocation” from the Planning Commission.
The Office Development Annual Limit Program became effective in 1985 with the adoption of the Downtown Plan and associated amendments to the Planning Code. It was subsequently amended by 1986’s Proposition M, 1987’s Proposition C, 2020’s Proposition E, and 2024’s Proposition C.
The central provision of the Annual Limit Program is a “metering limit” designed to restrict the amount of office space authorized in a given year. In doing so, the Annual Limit Program aims to ensure a manageable rate of new development and to guard against typical “boom and bust” cycles, among other goals. Additional background on the program, not including changes made in 2020 and 2024, can be found here.
The amount of office development potential that becomes available for allocation in each approval period, which begins on October 17, is tied to annual housing production. Office development space currently available for allocation can be found here. Of the total new available space, 75,000 gsf is reserved for Small Allocation projects (25,000–49,999 gsf of office space), while the remainder is available for Large Allocation projects (at least 50,000 gsf of office space). Under Proposition E, the amount available for Large Allocation projects can be reduced each year when the City does not build enough affordable housing. Office space not allocated in a given year is carried over to subsequent years.
Background
Proposition C was passed by the voters in March 2024 to do the following:
- Exempt Non-residential to Residential conversions from the Real Estate Transfer Tax;
- Allow existing office space that is demolished for new office projects to be credited towards any required office allocation; and
- Create an office conversion and demolition credit program, wherein conversions and demolition of General Office Space of 10,000 square feet or more occurring on or after January 1, 1986, may be added back to the program.
A presentation on implementing Prop C into the Office Development Program was given at the Planning Commission on June 20, 2024.
Conversion/Demolition Inventory
The proposition requires the Zoning Administrator to publish a draft inventory of qualifying office conversions and demolitions, and provide a meaningful opportunity for public review and comment. The Zoning Administrator then must publish a final inventory no later than September 1, 2024.
Final Inventory
On August 30, 2024, the Zoning Administrator published the final inventory.
The Draft Inventory was published on July 18, 2024, for public review and comment.
The public comment period expired on August 19th and is now closed.