Beverly Hills officials prohibited fractional ownership properties due to concerns they could be turned into vacation rentals. (photo by Joey Waldinger)

The Beverly Hills City Council adopted a prohibition on fractional ownership of residential and commercial properties at its June 6 meeting. The city had previously introduced the ordinance for a first reading during the May 16 City Council meeting.

Similar to a vacation time share, fractional ownership is a trend in which shares of ownership rights to a property are sold to multiple buyers, thus allowing each buyer to use the property for a certain period of time, according to a May 16 staff report.

City officials first began discussing fractional ownership in June 2021 in response to a proposed development. Council members adopted an interim prohibition ordinance on July 15, 2021, as they were concerned that fractional ownership properties could be turned into vacation rental properties and have adverse impacts on residents’ health and safety. The interim ordinance was extended repeatedly, and was set to expire on July 14.

On June 6, the permanent ordinance was adopted without discussion by the council, and only one resident submitted public comment.

“It’s becoming ridiculous that Beverly Hills is the epicenter, along with West Hollywood and Santa Monica, when it comes to [the] short term rental hostile takeover,” Jamie Francis Wendell said. “I hope that you can address this problem.”