How California’s CEQA Imperils Infill Development
Litigation drastically delays or kills these apartment projects. But that could be changing.
For the experienced California multifamily developer, agency-level compliance with the California Environmental Quality Act follows relatively predictable timelines and carries fairly knowable costs that developers can estimate and budget for at a project’s outset. The real risk lies in CEQA litigation, which forces a developer to defend a project’s environmental review against opponents in court rather than before the approving agency. Once litigation begins, costs can balloon and entitlement timelines can stretch, sometimes fatally, forcing developers to abandon the project altogether.
CEQA litigation hands anyone who wants to stop or delay a project a relatively cheap, reliable hammer. For decades, housing has served as the nail of choice, particularly apartment and mixed-use buildings on infill sites in California’s wealthier neighborhoods. Because development depends on capital, and capital depends on predictability, every swing of the CEQA litigation hammer undermines the ability to build housing in California.
The data bears this out. A new study from Holland & Knight’s land use team reviewed the entire body of CEQA appellate decisions issued from 2013 through 2023—498 rulings in total. An appellate decision reflects a higher court’s review of a trial court’s judgment. Appellate cases offer a telling measure of CEQA litigation delay because an appeal typically adds years to a lawsuit, and in the meantime, most projects cannot secure construction or grant funding. The study revealed that of the 13 different project types subject to CEQA litigation, housing ranked as the top CEQA-litigation target, drawing 26 percent of appellate challenges. That seemingly modest figure, however, masks the broader CEQA-based attack on housing. Public service facilities and infrastructure projects, often targeted because they make new housing possible, drew another 16 percent of published challenges. “Regulatory” challenges, which often target the planning and zoning changes or rules incidentally limiting residential development (e.g., wildfire fuel management rules) drew another 16 percent. Together, these three categories account for nearly 60 percent of CEQA appeals.
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However, CEQA appeals involving residential projects do not treat all housing types equally. Multifamily and mixed-use apartment projects drew more appeals than any other residential project type. That finding stands out because many regard dense infill apartments as among the greenest forms of housing; a previous UC Berkeley study found urban-core families have about half the carbon footprint of suburban ones.
The irony is hard to miss. The legislature enacted CEQA in 1970 with the stated goal of environmental protection, yet 77 percent of all projects challenged on appeal (and 88 percent of challenged housing projects) sit on infill land (located on previously developed or vacant parcels inside city boundaries or in unincorporated communities already surrounded by development)—precisely the compact, transit-oriented, urban-core development that California’s own climate and environmental policies aim to encourage. The 2026 study calls CEQA “the litigation tool of choice for neighborhood land use disputes and settlements to block or downsize infill housing.”
Who really files—and where
Neither chance nor environmental concern drives this pattern.
A Southern California regional study evaluating CEQA lawsuits filed against housing projects between 2013 and 2015 showed that less costly housing units, such as rental apartments, drew by far the most CEQA lawsuits. Fully 98 percent of the targeted housing units sat in existing neighborhoods (“infill” development), and challengers filed far more lawsuits in the region’s wealthier neighborhoods than in its disadvantaged communities (often with larger percentages of Latino or Black residents). And for multifamily developers, that means the same projects that would open high-opportunity neighborhoods to new residents face the steepest litigation risk.
Cheap swings make an effective hammer
According to the Holland & Knight study, challengers file roughly 200 CEQA lawsuits statewide each year. Filing costs remain nominal. Anyone can file—even anonymously and for any reason, including to leverage a monetary settlement—and the law imposes no penalties for meritless or serial suits, even from repeat opponents who file a dozen or more against a single project. The hammer costs little and can pay off. Project opponents prevail in about 25 percent of appeals, a higher success rate than opponents achieve in lawsuits under other administrative laws. That rate has actually fallen since Holland & Knight’s 2015 study, when opponents won 44 percent of published appellate decisions. However, this decrease more likely reflects an increase in frivolous CEQA lawsuits than stricter legal requirements.
In fact, NIMBY “success” often depends not on legal victory but on project delay. The 2026 Holland & Knight study confirmed that even a meritless lawsuit can cause multiyear project delays, which impair a project’s ability to secure financing. A trial court ruling—the initial litigation stage—typically takes 18 to 36 months, and appeals add 2 to 3 more years. Opponents have sued some projects more than 20 times, with delays measured in decades. Thus, for the multifamily industry, the underwriting risk lies not in whether a challenge will succeed, but in whether one will exist at all.
Why Proposition 45 helps mitigate CEQA litigation risk
Proposition 45, on the November 2026 ballot, targets the structural features that make CEQA such a potent litigation delay weapon against housing. Among many other changes, Prop 45 expedites CEQA litigation timelines for housing projects. Challengers must file any suit challenging an “essential project”—a term that expressly covers an “essential housing project,” including mixed-use development—within 30 days—and courts must resolve the suit within 270 days, “inclusive of original and appellate court proceedings.” A court may, on its own, add up to 90 days, for an outer limit of 360 days. Any further extension requires the written consent of the challenger, the agency and the applicant. Prop 45 limits any judicial remedy “only to prohibiting commencement of the noncomplying part, phase, or activity until the noncompliance is corrected” and bars courts from ordering an agency to “rescind its approval.”
In practice, if a court finds a flaw in, say, the traffic analysis for one phase, the agency fixes that analysis while the rest of the project keeps its approval and keeps moving—no restart of the entire entitlement process. Once the court accepts the fix, no further CEQA suit may challenge the project’s construction. For multifamily developers, Prop 45 offers the type of defined timelines and limited outcomes that CEQA litigation has long denied them.
Jennifer Hernandez is co-chair of Holland & Knight’s National Environmental Team. Jackson McNeill is a senior counsel in Holland & Knight’s Newport Beach office and a member of the West Coast Land Use and Environmental Group. Noah DeWitt is an attorney in Holland & Knight’s Newport Beach office and a member of the West Coast Land Use and Environmental Group.
