As San Diego cracked down on sprawling ADU projects, a few sneaked in just under the wire

Developers didn’t make a mad rush to take advantage of the city’s controversial backyard apartment incentive before it expired Aug. 22 — but they did get a handful of large projects OK’d just under the wire.

And some of those projects appear to be classic examples of what the incentive’s critics call “ugly,” “egregious” and an “exploitation” of a city policy that aimed to help solve the local housing crisis.

One project will put 73 backyard apartments — formally called accessory dwelling units, or ADUs — on one single-family lot. Another project calls for 19 ADUs on a single-family lot, and another proposes 15.

The two largest projects are both being developed by Christian Spicer, an investor and developer who has faced the most criticism for his use of the city’s ADU bonus incentive.

The projects are also located in neighborhoods where the ADU incentive has been particularly controversial. The 19-unit project is in Pacific Beach, and the 73-unit project is in Encanto, where a firestorm of backlash against the rule was sparked last January.

That backlash eventually led the City Council to significantly roll back the incentive in a 5-4 vote on June 16, but the rollback didn’t take effect until more than nine weeks later on Aug. 22.

That’s because such policy changes require a second vote by the council, which took place July 22. The mayor signed the policy the same day, but state law still requires 30 more days before the policy can take effect.

Critics of the incentive, including some council members, worried during the five-hour June 16 hearing on the rollback whether developers would take advantage of the delay.

“When we trigger these kinds of changes, it sends a red flag up and developers just say ‘I’ve got a window to do something under the old rules,’” Council President Joe LaCava said. “It’s just an unfortunate part of the transition.”

Councilmember Kent Lee said such concerns were one reason council members demanded last winter that the Planning Department come back with a proposed rollback of the incentive within three months.

“The reason we pressed so hard for this 90-day window is because every single day there is a lack of any action means another day that additional permits will be submitted,” said Lee, singling out Spicer’s company, SDRE. “SDRE will probably take the opportunity to rush every possible permit in at this juncture.”

Spicer did not respond last week to requests for comment.

Neighbors for a Better San Diego, a group that led the charge against the incentive, said last week that some developers might have pushed through some projects even before the June 16 council vote because there had already been indications the incentive would be rolled back.

The group’s chair Geoff Hueter said an initial look at city data appears to indicate that.

“We can say that 2025 projects were running ahead of 2024 at least through August, both in terms of number of bonus projects and number of bonus units,” he said. “This suggests that developers might have submitted their projects earlier in anticipation of the changes.”

But Hueter said it will become much clearer how many bonus ADUs were approved this spring once the city finalizes some data and issues its annual housing report in a few months.

He also noted that the projects approved between June 16 and Aug. 22 mostly didn’t meet the city’s goal of having the incentive primarily get used in high-resource areas. The 73-unit project is in Encanto, a moderate-resource area.

Some residents in that neighborhood in southeastern San Diego have harshly criticized the incentive for allowing large projects in an area that lacks sufficient infrastructure and quality jobs to support them.

The initial backlash from the council against the incentive came from Councilmember Henry Foster, whose district includes Encanto.

The neighborhood has many oddly-shaped, sloping lots that were ripe for large ADU developments under the city’s old incentive, which had been among the most aggressive in California.

The original incentive, approved in late 2020, went beyond what state law allows by letting property owners build a potentially unlimited number of ADUs if a property is near transit and in an area with good resources.

For every ADU a property owner is willing to build that is deed-restricted for low- or middle-income tenants, they can build one bonus ADU and charge market-rate rent for it.

While in most cases this led to property owners building between one and three ADUs, in some unusual cases property owners used the program to build more than a dozen on a single lot.

The council considered several versions of how to roll the incentive back, eventually selecting a proposal from Foster to set a hard cap on the number of ADUs per property.

The amended policy sets a maximum of four ADUs on lots smaller than 8,000 square feet, five ADUs on lots of 8,001 to 10,000 square feet and six ADUs on lots of 10,001 square feet and larger.

Other elements of the rollback include forcing developers to pay infrastructure fees, mandating parking spots for ADUs that aren’t near transit and requiring ADUs to be farther away from property lines.

Other changes include limiting ADUs to two stories, prohibiting them on cul-de-sacs in areas with high wildfire risk, setting a maximum size of 1,200 square feet and allowing the homes to be sold, not just rented.

The rollback hasn’t taken effect in the city’s coastal zone, which is mostly land west of Interstate 5, because the California Coastal Commission hasn’t yet approved it. City planning officials say they have prioritized getting commission approval, including with a letter asking for expedited approval in early October.

They also said the rollback was approved by the city relatively quickly.

“Responding to an initial motion in March 2025, the suggested reforms were reviewed by both the Planning Commission and the Land Use and Housing Committee in May before going to City Council in June – an extraordinarily quick turnaround for a zoning ordinance,” the department said in a prepared statement.

A list of projects that got approved between June 16 and Aug. 22 was created for The San Diego Union-Tribune by Neighbors For a Better San Diego, which has been closely tracking them.

City officials declined a request for a list of their own. But the Development Services Department, which reviews development applications, agreed to evaluate the list from Neighbors for a Better San Diego.

DSD officials, however, said Friday that they were still reviewing some projects and couldn’t confirm the accuracy of the list.

“The number of projects identified by the Neighbors for a Better San Diego group appears reasonable based on our initial estimates,” DSD said in a prepared statement. “However, we are not able to fully validate their list at this stage. Many of the referenced projects are still early in the review process. Staff are actively reviewing these applications to verify regulatory compliance and to ensure that all submitted materials meet the required standards.”

City officials said they had particular concerns that a 12-ADU project identified by Neighbors for a Better San Diego at 1811 E. Westinghouse St. in Linda Vista may not fit the description of using the ADU bonus between June 16 and Aug. 22.

The others on the list include a 9-ADU project in the College Area at 5152 69th St., a 15-ADU project in North Park at 2847 Nutmeg St., a 19-ADU project in Pacific Beach at 4844 Pacifica Ave. and the 73-ADU project in Encanto at 698 Leghorn Ave.