Governor Gavin Newsom of California has recently approved AB 98, a bill that enforces buffer zones and statewide design and construction standards for new warehouse developments. The response from the state’s real estate and business community was mostly negative.
NAIOP SoCal expressed concern about the measure, which will go into effect on January 1st, 2026. They believe it will have significant negative impacts on supply chains, job opportunities, and greenhouse gas emissions. However, a coalition including the California Chamber of Commerce sees this bill as a compromise that addresses community concerns while avoiding more stringent legislation with potential economic and environmental consequences.
Before signing AB 98 in early September before the end of legislative session , Fowler mayor Daniel Parra (also president of the California League of Cities) stated that it is an unfunded mandate that could harm local economies and communities if implemented. He also criticized its rushed passage through legislature without proper consideration for its impact on cities.
Timothy Jemal , CEO at NAIOP SoCal said they were disappointed with AB 98 because instead of offering practical solutions to address concerns around warehouse development,s it imposes statewide mandates that limit local control . This could hinder economic growth by pushing warehouses further away from ports or population centers – increasing emissions levelsand consumer costs .
Eric Paulsen , Board President at NAIOP SoCal addedthat hundreds members who are directly affected by this bill urged Governor Newsom to veto it due to its costly natureand burdensome requirements . Unfortunately their voices were not heard duringthe process,andthey plan to strengthen their representation in both Southern Californiaand Sacramento going forward.They hopefora resolutiontothis harmfulbillin next year’s legislative session.
