Rainy Days, Mondays and Recessions
Mark Twain was fond of saying that everyone complains about the weather, but no one does anything about it. The same could be true of recessions, particularly in the real estate world. Since I make my living in the world of real estate transactions, litigation and land use, I try to keep informed about the economy generally and the commercial real estate industry specifically. That is, I like to stay ahead of the curve. We all know that recessions are like malaria; they return every so often no matter what you do. Yet despite this irrefutable fact, it seems that there is little pre-planning in key areas. I’ll describe just one such area.
Many zoning codes (and we have tons of them in the Philadelphia area) are inflexible, static and often behind-the-times resulting from no pre-planning for economic changes. Many ordinances continue to prohibit industrial-to-residential conversions, mixed uses, Airbnb, VRBO, student and workforce housing and conversion of non-conforming uses, just to name a few. I recognize that a zoning ordinance is a key component of good comprehensive planning, although Houston seems to get along fine without a zoning ordinance.
SPOILER ALERT. A recession is inevitable and will be here sooner rather than later. Now is the time for local government and zoning to get ahead of the curve. Here are some changes that need to be made to every ordinance:
- Allow Mixed Uses by Right. Classify mixed uses as permitted and create flexible dimensional standards.
- Update Dimensional Standards. The one house per acre formula became obsolete around the turn of the century. Zero lot line housing, small lot singles and vertical expansion are necessities for young families and empty-nesters.
- Expand Public-Private Partnerships. Private development and public bodies must create partnerships to create and improve the infrastructure needs for continued economic development.
- Streamlined Approval Process. Do I really need to explain this one?
- Update Definitions. Many zoning codes continue to have ancient or obsolete definitions of certain land uses that have been around for a long time. A Wawa is neither a gas station nor a convenience store.
- Local government must educate its residents. There is not enough focus and consideration on the economic impact (jobs and property tax) of a commercial project. I am still amazed at how local government waits until a room is packed with angry residents, before it explains what is and is not permitted by law. Pre-hearing seminars and publications for residents help avoid public disputes.
- We must look carefully at all segments of the population, but particularly those of ages 18-35, and lower-income minority groups. These groups need more compact, walkable mixed-use communities with convenient access to public transit. In the absence of flexible design standards, they are more likely to be transient and to delay home buying. This is how recessions begin.
- Recessions mean job loss, less opportunity for existing businesses and declining government revenues that sometimes result in tax increases. This cycle results in pain for everyone. Municipalities must move away from conventional zoning approaches that segregate and separate land uses. The time is now to think about and adopt design mechanisms that create a greater sense of place and community through opportunities to live, work and play within closer proximity to each other.
If you would like additional information, please feel free to contact Neil A. Stein, Esquire (610) 941-2469 or firstname.lastname@example.org.