February 21, 2020  
 
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Zoning Considerations – Commercial

Written by Brent Pace for Gaebler Ventures

If you are considering a development project, you should be aware of the many types of zoning categories that exist. This article highlights a few of the most commonly used commercial zoning ordinances.

Zoning is an activity undertaken by a city or county to direct the land use in their jurisdiction.
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Often times the zoning map goes with some sort of master plan to help direct development. For commercial uses, zoning is especially important because it will help control and create your urban skyline.

Zoning conventions and common designations

Unlike residential which has a very basic three part convention, commercial zoning designations are all across the board. Here are a few of the designations and the ideas behind each of them:

RMF – 30 – is a residential multi-family designation, with the second part of the title indicated that you are allowed a maximum of 30 units per acre. Likewise RMF-45, RMF 75, etc are also common. Cities will use this zoning to help place their highest density uses where they are wanted.

TC-75 – is another multi-family type designation. The TC refers to "transit corridor." In other words, this designation is to increase density along major transit lines (bus, light rail, commuter rail, etc).

D-1 – is a designation indicating a downtown type of zoning. Larger cities may designate from D-1 up to D-10 or any number they choose. This helps them designate certain parts of their central business district as being in certain distinct neighborhoods. This allows the city to help certain neighborhoods keep their distinct feel and add to the ambience and functionality of an urban core. For instance, D-1 could be the portion of the city where high-rise office buildings are allowed. D-2 might be a district that has theatre uses and more restaurants, while D-3 could be a part of downtown with community functions and convention centers.

MU – another common designation is MU for "mixed use." Mixed use development has become a buzzword lately, and it is not uncommon to see a city designate a mixed use zone to try and encourage that type of development, especially in an urban area.

Zoning fine print in the zoning ordinance

Commercial zoning designations will have an inordinate amount of fine print accompanying them. Be sure to refer to the specific requirements associated with each zoning designation. As with residential zones, this information should be available on your city's web site.

For commercial uses there are often very specific restrictions you will want to be aware of. One of the biggest has to do with height. Although a zone may be designated RMF-75, meaning you could have 75 units per acre, it may not be possible to reasonably do so given other restrictions. For instance, the zoning ordinance may restrict you to a 75 foot height. It may be difficult to get up to 75 units per acre if you can only go up 75 feet. So be sure to check all the details before purchasing your property.

Obtaining a variance

It is definitely possible to build something that isn't specifically allowed in the zoning ordinance. To do this you will need to obtain what is called a variance. The city's web site should give you details on the process you will need to go through in order to obtain a variance. In many instances as long as your new project is in keeping with the intent of the zoning code you will be able to obtain the variance. But don't bank on it, do your research during the due diligence period to make sure you don't purchase a property that you can't develop as you'd like to.

Brent Pace is currently an MBA candidate at University of California at Berkeley. Originally from Salt Lake City, Brent's experience is in commercial real estate development and management. Brent will have tips for small business owners as they negotiate their real estate needs.

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Want to learn more about this topic? If so, you will enjoy these articles:

Why to Hold Your Real Estate in an LLC
Due Diligence for Real Estate Purchases Part 1


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