The rebuilding of Pacific Palisades in the wake of the devastating January wildfires has ignited a heated debate between pro-housing advocates and affluent residents who are resistant to change. At the center of the controversy is a proposal to replace a burned-down gas station with an eight-story apartment complex that would include affordable housing units.
A New Vision for Pacific Palisades
Local businessman Justin Kohanoff, the owner of a former Shell gas station at 15401 West Sunset Boulevard, has put forward an ambitious plan to transform the site into a Cape Cod-style apartment building featuring white brick facades, awnings, and a metal roof. The development would house up to 100 units, with a portion reserved for low-income residents.
“It’s gonna be beautiful,” Kohanoff stated, expressing his enthusiasm for the project’s potential to reshape the community.
However, while housing advocates praise the initiative as a much-needed step toward inclusivity, some residents of Pacific Palisades—one of Los Angeles’ most exclusive neighborhoods—are pushing back hard against the idea.
A Wealthy Community’s Resistance to Change
Before the wildfire disaster, Pacific Palisades had a median home price of $3.5 million, with households earning an average of $325,000 per year. The neighborhood had only two designated affordable housing units, highlighting a long-standing lack of economic diversity.
Some residents hope to maintain—if not heighten—the area’s exclusivity during reconstruction. In a local community text message chain, one individual even suggested using drones to monitor unfamiliar vehicles, reflecting a growing sentiment of resistance against outsiders.
Local homeowners and community leaders have voiced opposition to integrating affordable housing into the rebuilding plans. Billionaire developer Rick Caruso, who founded a nonprofit dedicated to wildfire recovery, claims that the push for affordable housing is coming from “external interests” that could hinder reconstruction efforts.
“Now is not the time for outside groups with no ties to the area to slow down the ability of people to rebuild their homes by trying to impose their agenda,” said Caruso, who previously ran against Mayor Karen Bass in 2022.
Tech investor Joe Lonsdale, a board member of Caruso’s wildfire foundation Steadfast LA, took an even more aggressive stance, mocking the proposal on social media platform X. He posted a screenshot of a headline about mandatory affordable housing and sarcastically wrote:
“Sorry guys, no rebuilding your fancy houses that burned down by the ocean in LA until there’s a new crack den installed right in the middle of the neighborhood.”
Challenges in Rebuilding Multifamily Housing
The January 7 firestorm, fueled by 80 mph winds, destroyed more than 6,800 structures across 36.5 square miles of the Santa Monica Mountains. Among the losses were 1,300 multifamily units and mobile homes, including 770 in rent-controlled buildings. Rebuilding these properties presents a significant challenge due to bureaucratic hurdles and uncertainties over potential rent restrictions.
Landlords must navigate a maze of red tape to reconstruct rental units while facing possible new regulations that could impact their ability to charge market rates. These factors have contributed to hesitation among property owners, further complicating efforts to restore lost housing.
A Battle Over the Future of the Palisades
While resistance from affluent homeowners remains strong, not all community leaders share their views. Developer Steve Soboroff, who was appointed by Mayor Bass as the city’s recovery czar, supports the addition of affordable housing. He dismissed the opposition as a continuation of historical elitism in the area.
“In the deeds, it used to be, ‘No Jews and No Blacks,’” Soboroff remarked. “What are they going to put in the deeds now, ‘No Affordable Housing?’ That stuff doesn’t hold muster.”
As the battle over rebuilding unfolds, the future of Pacific Palisades remains uncertain. Will it become an even more exclusive enclave catering only to the ultra-wealthy, or will it embrace a more diverse and inclusive approach to housing? With deep divisions between community leaders, developers, and long-time residents, the resolution of this debate will shape the neighborhood for generations to come.