Weekly Update

July 17, 2025

Legislature Nears Recess Before Final Sprint

The Legislature is set to adjourn tomorrow for its month-long summer recess, ahead of the final five weeks of the 2025 legislative session. Lawmakers will return on August 18, with a September 12 deadline to pass bills out of each house. Governor Newsom will then have until October 12 to sign or veto any legislation sent to his desk.

Assembly Bill 380 (Gonzalez; D–Los Angeles), which would impose commercial rent control during states of emergency, remains our top concern. We continue to engage with the author on potential amendments. The bill is scheduled to be heard in the Senate Appropriations Committee after the recess.

In Case You Missed It: Major CEQA Reforms Passed

The recently enacted California State Budget delivers some of the most significant land use and permitting reform our industry has seen in modern times. With the passage of AB 130 and SB 131, commercial real estate developers now have access to new tools that streamline housing and mixed-use development on eligible sites.

These reforms cut through red tape, reduce delays, and bring greater predictability to the entitlement process. It’s a major step forward for commercial real estate and infill development across the state.

The 2025–26 State Budget also delivers a long-overdue pause on constant building code updates. Residential projects now benefit from a six-year freeze, and commercial projects return to a predictable three-year cycle. This change cuts costs, reduces delays, and brings much-needed certainty to project planning and approvals across the state.

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New VMT Rules Could Halt Development Without Fixes

While the 2025–26 State Budget includes some major victories, a policy shift could significantly increase development costs—and even stop projects in their tracks. Under Assembly Bill 130, California now allows developers to offset transportation impacts under CEQA by paying into a statewide VMT mitigation fund.

While this is intended to streamline mitigation for infill and mixed-use projects, the potential fees are high, and the rules are still under development. Some early estimates suggest the new fee could add $100,000 or more per door to project costs—posing a serious threat to feasibility, especially for projects in location-efficient but lower-margin areas.

CBPA and industry partners are pushing for clear, consistent, and cost-effective implementation of the new VMT policy, including predictable fee structures and limits on local add-ons—to ensure this doesn’t become another CEQA hurdle. If done right, the framework could support smarter growth; if not, it risks pricing out new housing and commercial projects across the state.

Stay tuned for more information and resources on these recently signed laws.

Major League Baseball @ CCRES!

Registration is now open for commercial real estate’s premier advocacy event! The California Commercial Real Estate Summit returns to Sacramento on August 26–27.

New for 2025: Connect with special guest legislators and industry leaders while enjoying first-class hospitality from a private suite at Sutter Health Park, the exciting new home of the Athletics, as they take on the Detroit Tigers.

Don't miss this one of a kind opportunity to make memories while advocating for our industry!

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CBPA Pushes for Fixes to AB 98 Cleanup Legislation

CBPA remains actively involved in efforts to clean up and clarify last year’s AB 98 (Reyes; D-San Bernardino), the law that placed new restrictions on warehouse development. AB 735 (Carrillo; D-Palmdale) and its Senate companion, SB 415 (Reyes; D-San Bernardino), are intended to address technical and practical issues raised by the original legislation, and we continue to work closely with the authors to resolve our remaining concerns.

While we’ve secured key clarifications—including fixes to buffer area language, internal circulation standards, and definitions related to project size and entitlement timing—several important issues remain.

These include allowing modernization of existing logistics facilities without triggering full compliance, protecting the use of cross-dock loading bay designs critical to goods movement, and ensuring projects submitted before September 30, 2024, are not retroactively covered.

CBPA and the coalition maintain a “No Position” on the bills at this time, but momentum is building, and outreach to the authors and key legislators is ramping up. Now is the time to stay engaged and ensure these critical changes are made.

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