New DTC bonus height plan

[smeagolsfree]

Taylor alerted me yesterday about this. It went live on D Tracker this morning.

 

https://maps.nashville.gov/MPC/2023Z-003TX-001_plan.pdf

 

 

Application Submittal	5/2/2023
MPC Agenda Date	6/8/2023
Administrative Approval
Case #	2023Z-003TX-001
Ordinance #
Previous Ordinance #'s
Associated Case #
Associated Bond #
Reviewer	Jared Islas
Application Name	DTC BONUS HEIGHT
Application Type	Text Amendment
Application Scope	A request to amend Section 17.37 of the Metropolitan Code of Laws to update the Downtown Code’s Bonus Height Program, all of which is described herein.
Scanned Application	View Scanned Application
Scanned Plans	View Scanned Plan
Property Address / Location
Applicant	Metro Planning Department Jared Islas [email protected]

 

 

[Bos2Nash]

This appears to be a great revision to the overall Downtown Code. This is a complete overhaul of the Bonus Height program that I believe will bring better developments to the city. There are three elements that I really enjoy. 

1. The introduction of prerequisites that would've otherwise given bonus height are now required to be complied to even be considered for bonus height. Baseline Sustainability, Utility Lines, Stormwater, EV Vehicles and Underground Parking all need to be incorporated prior to even being considered for bonus height. This alone will improve the overall urban landscape tremendously!
2. We have FINALLY removed the subsidy for parking and have actually gone the complete opposite direction and will now subsidize NOT providing parking. 
3. The inclusion of diverse residential units will greatly enhance not only the downtown environment, but what kind of businesses want to be downtown. Having those kinds of residents actually living downtown could begin to shift the city to a more balanced population of tourist vs resident on a day-to-day basis.

Here is the summary sheet from Metro's website:

[andywildman]

Well-said, Craig Bos2Nash.

89% of past Bonus Height has been earned by via parking (underground, lined garages, and public access).

As I noted on twitter, the prerequisite of "entirely underground parking" has a real shot to dramatically change the way developers build in Nashville... Lot of podiums under construction today. 

We could see future use of the bonus height program drop in the future with these changes, especially the "no above ground parking" making office towers (which are generally more-heavily parked) less likely to use the program... makes it increasingly important that the bonuses are lucrative.

(As an example, the new 35-story Pinnacle tower uses 5 stories of bonus height in the current program, including 8 stories of fully-lined above-ground parking in addition to the Nashville Yards' 5 stories underground.)

 

[Bos2Nash]

I LOVE the fact that if a developer wants to provide parking at their building, they MUST go underground to even contemplate bonus height usage. Furthermore, what we have been seeing alot in the city is Overall Height Modifications to go above the bonus height caps in the DTC. A major qualifying condition of OHMs is the developer must prove an EXAHUSTIVE effort to utilize the bonus height program. What that means to me, is if a developer wants an OHM and provide parking, it will be completely underground.

There are obviously certain drawbacks to this - ie cost - but this is a cost of a big boy city. 

[nashvylle]

@Bos2Nash you're going to have to help me out here. When you have a 15' stepback requirement in place above floors ~4-7, what is the point of having underground parking if the developer was going to do some underground, and any above ground parking would have liner units? I look forward to the discussion, but I am afraid this great intent is going to leave a lot surface parking lots... just that, and much fewer developments built in the core, leading to more sprawl, more gentrification, and not a lot of diversity downtown. It's extremely expensive to build in Nashville anywhere, and Nashville needs 30K units, not 2K units built with 100% u/g parking. 

Cities that realize supply is the most effective way to combat affordability don't have an affordability crisis (Atlanta, Dallas, Houston, Los Angeles). 

I am not advocating for Haven above ground parking lots, but what's the difference if you have liner units? 

Edited May 4, 2023 by nashvylle

[CandyAisles]

No above ground parking as a prerequisite is really really really short sighted. So long future infrastructure for affordable housing.

[downtownresident]

Here is the main page for the proposed updates, and it includes a survey link where feedback can be provided: https://www.nashville.gov/departments/planning/long-range-planning/local-planning-studies/downtown-code-bonus-height-program

[andywildman]

18 hours ago, CandyAisles said:

No above ground parking as a prerequisite is really really really short sighted. So long future infrastructure for affordable housing.

It's a prerequisite for bonus height only, not a prerequisite to build in Nashville. If Nashville sees land values fall and/or developers stop using the bonus height program, I'm confident Planning would pivot.

Edited May 5, 2023 by andywildman

[smeagolsfree]

The problem for a pivot is that it takes 10 years.

[CandyAisles]

On 5/5/2023 at 1:00 PM, andywildman said:

It's a prerequisite for bonus height only, not a prerequisite to build in Nashville. If Nashville sees land values fall and/or developers stop using the bonus height program, I'm confident Planning would pivot.

Height in the DTC is measured in stories. Above grade parking counts against your entitlements but the reason developers do it is because below grade parking in today’s climate is terrible and they can make it up by doing other pieces of the BHP.  What would be better would be to have no above grade open garages. All garages must be mechanically ventilated or have a liner usage.

6 hours ago, smeagolsfree said:

The problem for a pivot is that it takes 10 years.

And it’ll land them in legal trouble in the mean time.

[smeagolsfree]

That is what the new code will address is to take the incentive away for above grade parking in the core. Right now there is no parking requirement as we all know and this would just take any parking incentive away.

I think Bos2Nash said this morning at the meet the cost would be around 15 k extra per parking space for underground space. There are other new incentives added as well. Lets talk about those as well.

 

The legal trouble I think you are referring to will be the diverse housing. That will be something we think state may take a long hard look at as far as legality.

[CandyAisles]

5 hours ago, smeagolsfree said:

That is what the new code will address is to take the incentive away for above grade parking in the core. Right now there is no parking requirement as we all know and this would just take any parking incentive away.

I think Bos2Nash said this morning at the meet the cost would be around 15 k extra per parking space for underground space. There are other new incentives added as well. Lets talk about those as well.

 

The legal trouble I think you are referring to will be the diverse housing. That will be something we think state may take a long hard look at as far as legality.

Legal trouble is this:

I buy a piece of property that allows for 8 stories…but I could go to 12 if I abide by the Bonus Height Program.  I have run the numbers and decide the purchase is worthwhile based on an assumption…I might do two floors of above grade parking and 10 floors of building to total 12 to get to my maximum height. This is as of right.

But the new regulations say I can’t do that unless I bury the parking now. That’s a significant cost add to my potential project.

[smeagolsfree]

I don't see that as a legal situation as you are already constrained with height restrictions under current zoning laws and there are other ways to get your height other than parking. As a developer or owner, you would not really have a leg to stand on once the law is changed and passed by Metro IMO. Also, you are not required to have parking under Metro codes. This would be one to have a lawyer look at, but I would be there is no slippery slope.

My guess is that Metro legal has already taken a look at it. Now the diverse housing is the slippery slope and Metro is pushing the envelope with the state.

[CandyAisles]

2 hours ago, smeagolsfree said:

I don't see that as a legal situation as you are already constrained with height restrictions under current zoning laws and there are other ways to get your height other than parking. As a developer or owner, you would not really have a leg to stand on once the law is changed and passed by Metro IMO. Also, you are not required to have parking under Metro codes. This would be one to have a lawyer look at, but I would be there is no slippery slope.

My guess is that Metro legal has already taken a look at it. Now the diverse housing is the slippery slope and Metro is pushing the envelope with the state.

Height restrictions has nothing to do with it. Land was purchased with the understanding that you could do one thing, and now you can’t. Bonus Height Program is an as-of-right measure not to be confused with an Overall Height Modification.

[Luvemtall]

Will those that have/ or recently purchased property, be grandfathered in under the zoning in place now . Many of which probably have already gone though design and cost analysis. 

[CandyAisles]

1 hour ago, Luvemtall said:

Will those that have/ or recently purchased property, be grandfathered in under the zoning in place now . Many of which probably have already gone though design and cost analysis. 

This is exactly what I’m talking about. I do not think there will be any grandfathering.

[smeagolsfree]

I think there will be a race to get all projects in under the old bonus height program in that case. If you have paper worked filed, then you are OK. If you have owned the property for 50 years and expect to be included under the old program, you are absolutely crazy. It would be just like any other zoning that takes effect.

[CandyAisles]

4 hours ago, smeagolsfree said:

I think there will be a race to get all projects in under the old bonus height program in that case. If you have paper worked filed, then you are OK. If you have owned the property for 50 years and expect to be included under the old program, you are absolutely crazy. It would be just like any other zoning that takes effect.

Getting Bonus Height Certification before January 1, 2024 means you'll need to submit something pretty quickly.

[smeagolsfree]

This has to be approved by planning and then work its way through Metro Council. Granted, it may be a done deal by then, but it is what it is. It was like the old water sewer rates. The rush was on to file the paperwork before the old rates expired. Same difference. If you will remember there was a rush of permits that were filed in order to take advantage of the old rates that would save millions of dollars for landowners and developers. Same thing with the new fire code regulations that were implemented by surprise. How much did that cost. These are laws that go into effect like any other law. It is the cost of doing business. You build it into the cost of your new project.

I am not trying to be difficult here. I do not really want the parking bonus to go away either, but they are going to do it either way. The problem is that Metro always does things ass backwards. In this case they do things before we ever have any type of mass transit or even a plan on the boards or in the mind or a prospective mayoral candidate. If we had a mass transit system, this would make a lot more sense.

[CandyAisles]

I actually DO want the parking bonuses to go away.  I just want the density increased.

[Bos2Nash]

On 5/4/2023 at 12:03 PM, nashvylle said:

@Bos2Nash you're going to have to help me out here. When you have a 15' stepback requirement in place above floors ~4-7, what is the point of having underground parking if the developer was going to do some underground, and any above ground parking would have liner units? I look forward to the discussion, but I am afraid this great intent is going to leave a lot surface parking lots... just that, and much fewer developments built in the core, leading to more sprawl, more gentrification, and not a lot of diversity downtown. It's extremely expensive to build in Nashville anywhere, and Nashville needs 30K units, not 2K units built with 100% u/g parking. 

Cities that realize supply is the most effective way to combat affordability don't have an affordability crisis (Atlanta, Dallas, Houston, Los Angeles). 

I am not advocating for Haven above ground parking lots, but what's the difference if you have liner units? 

Been trying to think of a concise way to respond to your thoughts. I want to clarify, this is only for the downtown core, not Midtown, not East Bank, not Metrocenter. It is a relatively small area and should be quite walkable. Should be.

I don't have a problem per say with liner units, but what I have a problem with is how much actual parking is built. People love to say that finding parking downtown is difficult, but what really they are saying is finding FREE parking downtown is difficult. Between Broadwest and Nashville Yards alone, those two developments will build 10,000 (!!!) parking spaces. The Nashville Yards project is looking at an estimated $320 million on parking alone. When we begin to look at the 1200 Broadway (Endeavor), One22One (GBT), 1222 Demonbruen (Endeavor), Bridgestone, Pinnacle, and Music City Center and all the other parking garages within the Downtown Core we are approaching an obscene amount of parking. 

I mentioned this at the meetup, but to me the intent of this change is not to have developers not build parking, but rather build LESS parking and to detach parking from occupied space in the sense that every lease doesn't necessarily come with parking. It is a step in the direction of other cities in which you lease both your occupied space and your parking for such a space.

Coming back to the liner units. They are the most inefficient units when it comes to designing units. If there is ample parking around the downtown core why are we continuing to build very expensive parking in a very expensive market and building very inefficient (and as a  result very expensive) liner units? If the plan is to build two levels of underground and three levels of above ground (because the DTC says the parking must be balanced above/below grade), why not just build three levels below grade and lease those spots separately from the occupied space above grade? This would leave much more space above grade for people rather than cars. Space that could be used for amenities, or public space or space in which people can get to know their neighbors outside of elevated amenity decks.

I can't speak to Atlanta or the TX cities, but I know Los Angeles has a massive affordability problem and that is in a state that allows and also mandates developers including affordable housing in developments. I'll use this analogy;

A business owner is wanting to open a business that consists of a bodega type convenience store in the front and a pasta factory in the back. They cannot find any affordable commercial space within Nashville and is frustrated. This isn't a Nashville problem (to a certain extent), but rather a business model problem. The numbers of that business do not pencil to match the area. So what is this potential business owner to do? They can either move their business idea to places with cheaper rents - and ultimately less traffic - or they change their business model. 

To me, developers are in the same predicament. They can build parking outside of the core or they can build less parking (or ultimately no parking) within the core. We are seeing developments already willing to do these things. Look at Congress Group and Centrum as examples that they are willing to make the investment in completely below grade parking and providing great public space at grade. 

On 5/6/2023 at 10:17 PM, CandyAisles said:

Legal trouble is this:

I buy a piece of property that allows for 8 stories…but I could go to 12 if I abide by the Bonus Height Program.  I have run the numbers and decide the purchase is worthwhile based on an assumption…I might do two floors of above grade parking and 10 floors of building to total 12 to get to my maximum height. This is as of right.

But the new regulations say I can’t do that unless I bury the parking now. That’s a significant cost add to my potential project.

Personally, I do not see Bonus Height as a "by-right" zoning. Bonus Height currently still needs to be applied for, approved and certified (same this draft is saying) with the biggest difference in this revision is saying developers need to commit to some basic urbanism prior to gaining added benefits. If a development costs more money, than maybe the development cuts down on that parking to make the numbers pencil. Bonus Height is just that, a Bonus. If the developer is willing to contribute to the greater urban environment, then they qualify for such a bonus. Parking is one of the single largest detriments to the urban environment, so why should be it be easy and cheap to build? If we are looking at 25K to 35K per above grade and 40 to 50K per below grade spot, we are not seeing a significant increase (in the grand scheme of things) and if parking is separated from occupiable space and subsequently leased separately, it is just another layer of revenue for developers to work through. 

 

Lastly, I am sure we will hear a lot about other public infrastructure within the City. Sidewalks (or other walkability), bike infrastructure and Transit will be the big ones. Well developers will have the ability to step up and improve on those items to gain even more Bonus Height. Rather than just paying into the general fund (like the sidewalk "in-lieu" fund) developers can gain additional density by planning/designing, paying for and building public infrastructure away from their site. The caveat to that bonus is it cannot be an improvement within that project's Traffic Impact Study. The point of the bonus is to improve the city outside of where their development is impacting the infrastructure. We are living/designing/developing in a very business friendly place where the state has purposefully put businesses in front of people. This is the city's way of trying to claw back improvements for people to have a place people want to live and actually CAN live.

[CandyAisles]

8 minutes ago, Bos2Nash said:

Personally, I do not see Bonus Height as a "by-right" zoning. Bonus Height currently still needs to be applied for, approved and certified (same this draft is saying) with the biggest difference in this revision is saying developers need to commit to some basic urbanism prior to gaining added benefits. If a development costs more money, than maybe the development cuts down on that parking to make the numbers pencil. Bonus Height is just that, a Bonus. If the developer is willing to contribute to the greater urban environment, then they qualify for such a bonus. Parking is one of the single largest detriments to the urban environment, so why should be it be easy and cheap to build? If we are looking at 25K to 35K per above grade and 40 to 50K per below grade spot, we are not seeing a significant increase (in the grand scheme of things) and if parking is separated from occupiable space and subsequently leased separately, it is just another layer of revenue for developers to work through. 

Bonus Height absolutely is an as-of-right deal.  Everything must be applied for and approved through permitting...even if you aren't going for additional development rights...but the Bonus Height Program is prescriptive in its current form.

[Bos2Nash]

2 minutes ago, CandyAisles said:

Bonus Height absolutely is an as-of-right deal.  Everything must be applied for and approved through permitting...even if you aren't going for additional development rights...but the Bonus Height Program is prescriptive in its current form.

Ok, it is. But developers are still committing to items in order to achieve those bonuses, ie they are paying to play in the bonus pool. This revision just puts stipulations on that "pay to play" model to ensure the best urban environment for its city.

[nashvylle]

Can anyone point to a city (with zero mass transit like Nashville) that incorporated these extensive design and punitive parking requirements and was successful / did not stifle development? No one wants to build a parking garage or have them visible from the street, but 100% buried in this financing environment when construction costs (before Fed rate increases) were at an all time high? I'm concerned nothing will get built that hasn't started construction already. 

[CandyAisles]

14 hours ago, nashvylle said:

Can anyone point to a city (with zero mass transit like Nashville) that incorporated these extensive design and punitive parking requirements and was successful / did not stifle development? No one wants to build a parking garage or have them visible from the street, but 100% buried in this financing environment when construction costs (before Fed rate increases) were at an all time high? I'm concerned nothing will get built that hasn't started construction already. 

Won’t stop development completely but it will to a great extent. Hotel can be built with this…but no residences or office will be developed until the land values reset and the current owners take an extensive bath.