Form-Based Zoning Can Bring Municipalities and Developers Together on the Walkable Communities Buyers Want
Photo by North Charleston. Published here under a Creative Commons license.
The National Association of Realtors (NAR) recently released the results of a nationwide poll showing millennials increasingly prefer walkable communities over the spread-out developments in many present-day suburbs. Other studies have confirmed similar preferences for walkable neighborhoods and mixed-use development; however, traditional zoning approaches, which emphasize low-density development and a separation of land uses, makes it difficult for residential developers to obtain approval for these communities. This article explores the rise in popularity of the walkable community and discusses how residential developers and municipal planners can use form-based zoning to create a community that meets the needs of everyone.
The Case for Walkable Communities
In 2013, NAR’s Community Preference Survey found that 60% of respondents preferred a neighborhood that mixes housing with stores and businesses within walking distance, and 55% would give up a home with a bigger yard in order to get one within walking distance of schools, stores and restaurants.
Additionally, a study by Gary Pivo at the University of Arizona’s Urban Planning Program and Jeffrey Fisher at Indiana University’s Kelly School of Business found that – other factors being equal – enhanced walkability increased the value of both residential and commercial properties. Using data from the National Council of Real Estate Investment Fiduciaries and Walk Score, they compared more than 4,000 office, apartment, retail and industrial properties and determined that a 10% increase in walkability increased property value by up to 9% for all but the industrial properties. (There was no discernible impact on industrial properties with a higher walkability score.)
This is in line with other studies of traditional neighborhood developments (TND) published in Real Estate Economics and the Journal of Urban Economics, which found that buyers were willing to pay between 12-15% more for pedestrian-friendly homes in the studied neighborhoods, compared to similar homes in neighboring low-density communities.
Increased property values benefit the developer selling the home, but they also benefit the local municipality as they increase property tax revenues. In addition, high density, walkable communities reduce the amount of infrastructure (such as roadways, traffic signals, water and sewer line extensions) needed to connect spread-out developments, which can save the municipality money that would’ve been needed to maintain that infrastructure.
The most important reason for municipalities to consider making their zoning friendlier to walkable communities, however, might be their desire to stay competitive as a place people want to live.
Millennials represent a demographic of 80 million people, and they are the generation that will be buying homes and putting down roots in the years to come. Michael Myers, a managing director at The Rockefeller Foundation, is quoted in an article on The Atlantic’s CityLab website, saying, “As we move from a car-centric model of mobility to a nation that embraces more sustainable transportation options, millennials are leading the way…Cities that don’t invest in [these options] stand to lose out in the long run.”
Bridging the Municipal-Developer Gap with Form-Based Zoning
If municipalities and developers agree that walkable communities can be beneficial, why aren’t more of them being built?
Over the past few years, these communities have become more and more popular with both developers and municipalities, but acceptance still is not widespread. Traditional zoning ordinances could be one of the reasons why.
Traditional zoning ordinances separate land uses into distinct zones: Commercial is separate from residential. Single family homes are separate from apartments and townhomes, etc. This prevents the construction of developments that combine commercial and residential uses of different types in one space like modern walkable communities do. In addition, traditional zoning has emphasized a low-density approach because communities associate higher density with a loss of open space and community character and fear higher density developments will drain community resources. However, developers require a higher density approach in order to make the many amenities (such as recreational facilities and civic and commercial spaces) affordable in a typical walkable community plan.
But form-based zoning could be the bridge that closes the gap between a community’s concerns and a developer’s needs.
Rather than fixating on density values and strict land use definitions, municipalities using a form-based zoning approach create a vision for the type of community they’d like to have and set standards to realize that vision. If they want a community that encourages walking and social interaction in public spaces, they can set standards that will promote these activities. For example, Public Space standards can specify the types of pedestrian amenities, greenspaces and recreation requirements that make a place feel safe, comfortable and walkable. They can also set the size of a standard block and govern how roadways and pedestrian amenities interconnect. (Keeping the size of blocks small will make them more manageable for walkers, and interconnecting streets will provide shorter routes and more evenly distribute car traffic throughout the roadway network. This will, in turn, have the added benefit of reducing congestion that comes from concentrating cars on just a few heavily travelled corridors, as is common in many traditionally zoned communities today.)
By using a form-based approach, municipalities can focus more on the form and feel of a community, instead of limiting development to strictly separated zones with a one-size-fits-all regulation of lot sizes.
In turn, residents enjoy the quality of life they seek, and municipalities can continue to attract growth, maintain a healthy tax base, and reduce the expenses associated with sprawling infrastructure. Meanwhile developers are able to meet a market demand profitably without navigating an unnecessarily lengthy entitlements process.
This type of approach allows communities to remain relevant and competitive in the decades to come as millennials age, take their resources and preferences to market, have kids and nurture the next generation. Municipalities and developers that dismiss these trends as merely a fad may be taking a big risk. Is it worth it? We will know in 20 years.
HRG excels at bringing developers and municipalities together to meet the needs of a community in a way that benefits all parties. To discuss how walkable communities could benefit you, please contact us.
Investing time on the front end offers real savings in time and money on the back end
This article appeared in the September 17, 2008 issue of the Mid-Atlantic Real Estate Journal and is published here with their permission.
You have invested significantly in a site and you spent several months in the design phase. You are anxious to get your property built so you can maximize the profit it earns you. Unfortunately, you find yourself tangled in a web of entitlements and regulatory constraints that could drag on for several more months.
How can you avoid a costly and frustrating scenario like this? The answer is by obtaining a thorough due diligence investigation. We all know time is money in the development game, so it can be very tempting to speed through preliminary investigations in order to get to construction faster. Unfortunately, this can delay your project significantly when unexpected issues arise during the approval phase.
A more reliable strategy would be to hire a qualified professional engineer who is experienced in real estate due diligence to conduct an investigation and develop a time-saving strategy that comprehensively addresses the risks and variables you are likely to face. If possible, this investigation should be conducted during the initial site selection activities and should look at a wide variety of issues related to taxes and financing, parcel size and configuration, topographic and environmental constraints, zoning and land use requirements, infrastructure (e.g. utilities and transportation), and the local political climate.
As the project progresses, the engineer will further define the details related to land title issues, floodplain restrictions, geologic conditions, wetlands presence, on- and off-site infrastructure improvements, and permitting procedures. This will lead to the development of a concept plan to maximize the yield of the site and provide an estimate of probable development and construction costs (as well as a realistic project timeline).
One of the benefits of hiring experienced professionals to perform this investigation is their experience with the local political landscape and regulatory climate of the governing bodies that have jurisdiction over the site. One of the most significant factors determining the timeline of your project is the length of the entitlement phase. Someone who knows the decision-makers who will ultimately approve your project can devise a strategy to minimize review time and gain support. An experienced professional can also bring the key stakeholders together to foster a dialogue that will make the process proceed more efficiently.
As a result, in spite of the time involved in conducting the due diligence investigation, you can often obtain required approvals and begin construction in less time than if you rushed this step. In an industry where every day of delay could potentially cost thousands of dollars, a thorough due diligence investigation could be the best investment you make in your development.
Contact Chris Dellinger, P.E., with your questions about land development.
Project Fast-Tracking: Developing in the Left Lane
This article appeared in the December 27, 2007 issue of the Mid-Atlantic Real Estate Journal and is published here with their permission.
How fast do you drive down the expressway? Do you cruise the speed limit in the right lane, or do you accelerate past the speed limit in the left lane?
In today’s fast-paced real estate market, driving the speed limit is no longer an option. You must accelerate your project through the design and approval phases quickly or risk rising costs (and lower profits). Many changing factors pressure your projects. Tenant requirements, practical financing and regulatory burdens are just a few. Drive too slowly and you risk losing a tenant, acquiring a higher finance rate, or facing more stringent regulatory requirements. Put the right team behind the wheel, and you can drive your project to success, rather than end up as an accident on the 6:00 news.
In years past, developers and owners fast-tracked a project to meet the requirements of others (such as a potential tenant), but today fast-tracking is initiated by the developers and owners themselves in order to maximize their profits. Putting your project on the fast track can be done in many ways: It could mean awarding the contract as a design-build or adding provisions to the contract that impose a penalty if the consultant doesn’t complete the project by a given deadline. Whatever approach you take, planning and foresight are necessary to avoid potential obstacles and ensure different disciplines coordinate their work to reduce delay. This is why having a strong team on your side is the best way to meet your goals.
By working closely from the earliest stages of project development, your team can simultaneously work on the project components to complete your project most efficiently. Some companies work well as one member of the team, while others do well as the entire team. If you already work with the best site entitlement company and architect, you obviously want them to work together in your best interest. This can be very effective by utilizing different discipline experts. Another great option is companies that provide a wide range of services under one roof. This makes the coordination effort of each component much smoother. Just as you get a flat tire, projects often develop issues that are unexpected. Companies with multiple services are able to react to changing conditions quickly. Find wetlands on a project: have the environmental group delineate and mitigate; acquire the adjoining parcel: have the survey group add it to the plan; realize a bridge is better then a culvert: have the structures group design it. This flexibility decreases the coordination effort of identifying and contracting with separate consultants for each project component.
Before starting a project, sit down with your consultant and expect them to answer your questions honestly. Can you get that permit by spring? Will there be issues like zoning you can avoid by taking a different route? Be sure to develop a relationship of trust with your consultant, and expect the same in return.
By working cohesively as a team and developing a realistic schedule that addresses all issues, you will reach your destination in the quickest timeframe. Find a consultant that will slow down to address those issues that may truly stall your project but be aggressive in moving your project through the approval process. In the end, your project will be up and running like a well-oiled machine.
Andrew Kenworthy, P.E., has extensive expertise in the areas of site planning, layout and design, zoning and regulatory requirements, permitting, stormwater management, erosion control, roadway and utility design, and bidding and construction administration. He can be reached by phone at (717) 564-1121 or by email at akenworthy@hrg-inc.com