"As a company that takes great pride in being L.A. based, we no longer build within the city of Los Angeles because of the unpredictability, the cost of doing it [and] the multiple layers of bureaucracy you have to go through for approvals, Caruso said on stage. And I made that decision long before I ever ran for office [in 2022]."
"What people need to understand, what leadership needs to understand, is money is going to travel in directions that have the less friction to it, the less risk to it, Caruso said. And L.A. is redlined now, because of the fires, because of the homeless problem, because of the crime problem. Find a crane in L.A. In 10 years, the lowest amount of housing is now."
Caruso's company no longer builds within the city of Los Angeles due to unpredictability, high costs, and multiple layers of bureaucracy for approvals. The company attributes roughly 40 percent of housing costs to regulations, including permitting processes, parking requirements for multifamily projects, energy efficiency and seismic standards, and environmental impact reviews. Since 2023, Measure ULA imposes a city-specific tax on property transactions starting at $5.3 million, complicating eventual sales and profitability. Capital flows toward markets with less friction and lower perceived risk. Fires, homelessness, and crime are cited as factors reducing construction activity and housing supply.
Read at therealdeal.com
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