Shopping Center Adaptive Reuse ZoningHack-a-House 2020, Policy and Regulatory Reform

David Huaman (Virginia Tech, MURP)Austin Taylor (University of Utah, MRED)

“Having a building sit empty does nothing for the neighborhood, but redeveloping the building and giving life...brings a community hub back to life, ready to retell stories of the past while also creating new stories”

1. COVID-19 and Its Impact

COVID-19 Impact: a shift in habits

More people are shopping online than

ever before since COVID-19 hit the

US.

36% of Americans say they now shop

online weekly--up from 28% before

the virus. This is leading to a decline in

in-person retail revenue and declining

demand for retail leases.

Declining Shopping Centers

Malls are closing down as online shopping

wins market share. Three hundred malls are

expected to close in the next for years.

Hundreds of others will suffer.

Locked doors and shuttered windows send

negative signals to local communities and

become a source of blight.

They become targets for squatters, vandalism,

arson, and other illegal activity.

COVID-19 Impact: housing challenges

Over 26 million Americans are still on

unemployment benefits as of

September 12 (US Dept of Labor),

meaning millions of renters are behind

on rent.

One-third of Americans missed rent

payments in April (National

Multifamily Housing Council)

Latinx and black residents have been

hit the hardest--making up 18% and

12% of the country's population and

accounting for 28% and 18%,

respectively, of the tenant population

in the United States.

2. Opportunity in Underutilized Shopping Centers

A Blank Canvas

Shopping centers are ripe for

redevelopment.

Their spacious parking lots present

opportunities for simple and

inexpensive infill housing. Small

storefronts can be converted into

office or restaurant use. Large

department store and big-box spaces

can be converted for office, medical,

recreation, or warehousing use.

Our Site and Location

Provo Towne Centre Mall, Provo Utah

● Built in 1998● Declining conditions and loss of anchors ● Located in an Opportunity Zone census tract● Residents in this tract have a median household

income of $38,900 or less● Neighboring community is significantly Hispanic● Direct access to bus rapid transit line● ½ mile from commuter rail

Market Challenges & Demographic Considerations

● A contributor to the increasing

housing costs is the availability of land

near employment, shopping, and

transportation centers.

● City is “landlocked”

● The Census tract has strong

transportation accessibility and low

housing and transportation costs

(41% H&T costs)

● City is primarily made up of renters

(61% renter occupied units)

● Rents have increased 35% from 2014

to 2020

Limited Land, High Minority Population, Rising Rents

Adaptive Reuse Regulatory Barriers

● Zoning Code

● Development standards

● Building codes

● Review & Permitting

Processes

● Inflexible Parking

Requirements

3. A Zoning Code that Cuts Costs

Shopping Center Adaptive Reuse Zoning Code

Due to the many regulatory barriers in city zoning codes preventing reuse and redevelopment of these

dying shopping center sites, we have created a model zoning code that cities can use to facilitate the

redevelopment of these sites.

This code gives the developer an incredible amount of flexibility and creativity but includes the following

requirements for housing:

1. That a minimum of 20% of the housing be held at 30% of the monthly income of a resident at 50%

of AMI for 30 years--guaranteeing a certain amount of affordability for rental units (LIHTC)

2. That a minimum of 25% of the housing be sold individually to give people in low-income areas (esp.

racial minorities) opportunities to own their home and build wealth

Cutting Costs and Guaranteeing Affordability

This zoning code cuts costs and guarantees affordability in a variety of ways:

1. Smaller setbacks and greater lot

coverage allowances mean more

buildable area--less money spent on

land that doesn’t go to housing

2. Greater density maximums and no

height limit means less land cost per

housing unit

3. Drastically reduced parking

requirements mean less money spent

on parking and more land available for

housing

4. 20% of units held accessible at the

50% AMI level for 30 years

guarantees deep affordability for

those units (LIHTC)

Affordable Rents and Market Rates in Provo, UT

Affordability Levels

Extremely Low (30% AMI) - $655/month

Very Low (50% AMI) - $1,005/month

Low (80% AMI) - $1,607/month

Moderate (100% AMI) - $2,010/month

Market Rents (2019)

Studio -$654

1-bedroom - $751

2-bedroom - $862

3-bedroom - $1,264

Inside

Small commercial

storefronts can be

reused as restaurant,

office, medical, and arts

and cultural space

Large big-box and

department store

buildings can be reused

as arts and cultural

centers, medical

facilities, office buildings,

or recreational facilities.

Outside

Large, empty parking lots make for easy residential infill development

The Shopping Center Adaptive Reuse zoning code drastically cuts existing parking requirements

4. Appendix/Supporting Documents

Financing Opportunities in Provo Utah

● Permit fee waivers for affordable housing projects

● Provides Tax Increment Financing (TIFS) for redevelopment projects

● State Resources (Olene Walker Housing Loan Fund, OZ tax benefits)

● Federal Resources (CDBG, National Housing Trust Fund, LIHTC)

Supporting Maps

AMI Breakdown

AMI Rental Unit AffordabilityAMI Group Median Income (for

household of 4 persons)Affordable Rent Level

Extremely Low (30% AMI) $26,200 $655

Very Low (50% AMI) $40,200 $1,005

Low (80% AMI) $64,300 $1,607.50

Moderate (100% AMI) $80,400 $2,010

This includes cost of utilities and so are not necessarily the asking rent. Affordable rent level is calculated by determining is 30% of gross monthly income.

Adaptive Reuse 101

•Adaptive reuse projects can convert

underutilized buildings to more

productive uses.

According to NAIOP,

1.Successfully repositioning or

redeveloping a mall often requires that

developers introduce new uses to the

property.

2.A mall’s location and layout can make it

a good candidate for redevelopment.

3.A successful mall redevelopment project

often provides a community with

significant economic and social benefits.

Existing Adaptive Reuse Policies

● Los Angeles Adaptive Reuse

Ordinance (ARO)○ Banks, Warehouses, Factories

● Transform Baltimore ○ small commercial spaces, rowhouse

● Historic Preservation

Philadelphia○ industrial warehouses, churches

● Adaptive Reuse Program

Arizona ○ churches, restaurants and small

buildings

What are existing policies addressing?

Shopping Center Adaptive Reuse Special District Zone 1. Intent The purpose of The Shopping Center Adaptive Reuse Special District Zone is to facilitate the redevelopment of shopping centers which have experienced a dramatic decline in activity into mixed-use communities with a large component of housing that is affordable to residents at or below the Area Median Income. This special district shall be applied by the city council in collaboration with the owner and redeveloper of the shopping center. The Shopping Center Adaptive Reuse zone shall be characterized by a diverse mix of land uses (though primarily housing), dense and compact development, frequent but small public parks and plazas, public art, and an internal network of narrow, low-speed streets. 2. Permitted Uses a. REGULATION OF USES Residential Single Family Residence (attached) P Ancillary Unit P Two Family Residence P Multi Family Housing P Home Office P Live - Work P Lodging Bed & Breakfast Inn P Hotel P Office Office P Commercial Auto Related Entertainment Establishment P Entertainment Establishment - Adult C Food Service Establishment P Alcohol Service Establishment P General Commercial P Marine Related Open Air Retail P Place of Assembly P Recreational Establishment P Civic Community Facility P Recreational Facility P

Religious Facility P Civil Support Community Support Facility P Infrastructure & Utilities P Marina C Public Parking P Rescue Mission P Transit Facilities P Educational Childcare P College / University P Elementary School P Middle / High School C Pre-School P Research Facility P Special Training / Vocational P

*P=permitted, C=conditional 3. Building Disposition

a. Lot Occupation

Lot Area n/a Lot Width n/a Lot Coverage 50% min., 80% max. Floor Lot Ratio (FLR) 1:1 min. Frontage at front setback 70% min. Green space Requirements 10% lot area min. Density 65 du/acre max.

b. Building Setback Principal Front 0 ft. min., 6 ft. min. for residential Accessory Front 10 ft. min. Side 0 ft. Rear 0 ft. min. On lot lines that abut properties in R1 zones 10 ft. min. c. Building Height Minimum Height 10 ft. min.

Maximum Height n/a; 30 ft. min. on buildings that abut property with R1 zoning

4. Parking a. Minimum Parking Requirements Automobile Bicycle

Residential Single Family Residence (attached) 2 per unit n/a with private garage, .5 LT per

bedroom without

Ancillary Unit 1 per unit n/a with private garage, .5 LT per bedroom without

Two Family Residence 1.5 per unit n/a with private garage, .5 LT per bedroom without

Multi Family Housing 1 per bedroom; max. 2 per unit .5 LT per bedroom, .05 ST per bedroom

Home Office n/a n/a Live - Work 1 per bedroom; max. 2 per unit .5 LT per bedroom, 1 ST per unit Lodging Bed & Breakfast Not permitted Not permitted Inn Not permitted Not permitted Hotel .75 per room .5 per room Office

Office 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 20,000 square feet

Commercial Auto Related Not permitted Not permitted

Entertainment Establishment 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Entertainment Establishment - Adult Not permitted 1 LT per 10,000 square feet, 1 ST

per 2,000 square feet

Food Service Establishment 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Alcohol Service Establishment 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

General Commercial 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Marine Related Not permitted Not permitted

Open Air Retail 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet (includes outdoor retail space)

Place of Assembly 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Recreational Establishment 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Civic

Community Facility 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Recreational Facility 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Religious Facility 3 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Civil Support

Community Support Facility 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 20,000 square feet

Infrastructure & Utilities n/a n/a Marina 1 per dock n/a Public Parking n/a 1 LT per 20 auto spaces

Rescue Mission 2 per 1000 square feet 1 LT per 5,000 square feet, 1 ST per 10,000 square feet

Transit Facilities 25% of expected daily ridership LT spaces for 10% of expected daily ridership

Educational

Childcare 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 20,000 square feet

College / University 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Elementary School 2 per classroom 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Middle / High School 2 per classroom / 5 per classroom

1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Pre-School 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 20,000 square feet

Research Facility 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

Special Training / Vocational 2 per 1000 square feet 1 LT per 10,000 square feet, 1 ST per 2,000 square feet

*LT = Long-term, ST = Short-term

b. Transit-oriented Parking Reduction When a building in the Shopping Center Adaptive Reuse Special District Zone is sited within ½ mile of an active passenger rail or fixed bus stop with public transit service every 15 minutes or less during peak hour, minimum automobile parking requirements shall be automatically reduced by 25% and may be reduced by up to 50% with approval from the City Council. c. Automobile Parking Design Guidelines

a. Automobile parking shall not be sited between a public street and the front of a building. b. Structured parking garages be screened as to hide the automobiles inside of the garage or be

wrapped with actively used space with a minimum depth of twenty feet. c. All automobile parking shall be designed to the dimensions and specifications as described in the

city code

5. Residential Standards In an effort to fulfill the community’s needs for affordable housing, the following standards shall apply to residential developments within the Shopping Center Adaptive Reuse Special District Zone. The following shall be required at the full project scale and not within each residential building. The principal developer shall present their full site plan that complies with these standards before building permits are issued:

a. A minimum of twenty (20) percent of the housing units shall be rented at a rate not to exceed thirty (30) percent of the monthly income of a household at 50% the Area Median Income as defined by the US Department of Housing and Urban Development and be held at such a rate for thirty (30) years.

b. A minimum of twenty-five (25) percent of housing units shall be sold as individual units on the open market.

c. A minimum of fifty (50) percent of the building floor area within the Shopping Center Adaptive Reuse Special District Zone shall be used for residential purposes.

6. Principal Developer During the redevelopment process of a property within the Shopping Center Adaptive Reuse Special District Zone, there shall be one (1) principal developer who serves as the project manager and liaison with the city. The city shall hold the principal developer responsible for meeting all requirements as described in the Shopping Center Adaptive Reuse Special District Zone. 7. Zoning Application This zone shall be applied only to a full shopping center site such as a regional mall or strip mall and not small sections of it. The city shall not apply this zoning to smaller sections of a shopping center. 8. Public-Private Partnerships The city, through its redevelopment agency, reserves the right to contribute toward the redevelopment of a project area within the Shopping Center Adaptive Reuse Special District Zone and shall have the right to negotiate public benefits commensurate with its contributions. Public benefits shall include, but not be limited to: deeply affordable housing, parks and plazas which are open to the public, business incubator spaces, arts and cultural centers, public art, and deliberate inclusion of minority populations in the development review process as well as marketing, leasing, and sale of the housing units.