C-02 Staff VMU Presentation.pdf — original pdf

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CO2-2021-006: Amending Title 25- 2(E) 4.3 Vertical Mixed-Use Buildings March 8, 2022 Sam Tedford Principal Planner, Inclusive Planning City of Austin, Housing and Planning Department Overview  VMU-Related Direction  Process Clarification  VMU Basics  Staff Recommendation  Staff Research 2 VMU-Related Direction  Planning Commission, July 2021 – C02-20210727 – Directed changes to the affordability requirements for Vertical Mixed-Use Buildings  City Council, November 2021 – Resolution No. 20211118-052 – Directed an expansion of the VMU program through the creation of new tier with a height bonus 3 Process Clarifications  Acknowledgement of confusion and lack of transparency – Prior public notices and renotices, multiple postponements – VMU working group  Planning Commission, March 22 – Public hearing and potential action – Renotification required to explicitly state remote participation option  City Council, April – date pending – Public hearing and potential action – Multiple postponements 4 Vertical Mixed-Use (VMU) Basics VMU is a voluntarydensity bonus program designed to achieve community benefits through the use of development incentives.  Adopted in 2010 – Included a one-time opt-in/opt-out process for neighborhood associations or neighborhood planning teams  Bonus Entitlements – Residential uses allowed on Commercial and Office-zoned sites – Unlimited FAR – Site dimensional waivers – 60% reduction of minimum parking requirement – 30ft height (VMU tier 2 only)  Community Benefits – Active ground floor use – Mix of land uses near transit – Heightened design standards – Regulated Affordability Development Incentive Community Benefit Bonus Height (tier 2 only) Regulated Affordability Reduced Parking Minimum Heightened design standards Unlimited FAR Mix of land uses Residential Uses Active ground floor use 5 Staff Recommendation: Set-Aside Percentages and Affordability Levels Bonus Entitlements Affordability Requirements VMU Tier 1 Residential uses Unlimited FAR • • • Waiver of site dimensional requirements 60% reduction in parking minimum VMU Tier 2 All of the above 30ft bonus height • • • Rental Developments 40-year affordability period For-Sale Developments 99-year affordability period 10% set-aside affordable to 60% Median Family Income 10% set-aside affordable to 50% Median Family Income OR 12% set-aside affordable to 60% Median Family Income 10% set-aside affordable to 80% Median Family Income OR Fee equivalent to 10% of total units 12% set-aside affordable to 80% Median Family Income OR Fee equivalent to 12% of total units A summary of the staff recommendation for affordability requirements in the Vertical Mixed-Use program is shown in the table above. Amendments to the current code provisions are shown in blue. 6 Staff Recommendation: Fee in-lieu for condominium developments  Recommended for ownership developments only – Direct these fees back towards long-term affordable homeownership projects such as Community Land Trusts – Rental developments must provide affordable units onsite  Proposed due to barriers to securing long-term affordability and stability for low-income homeowners in predominantly market-rate condominium developments – Homeowners’ association fees – Property tax assessments Example of proposed fees in-lieu of onsite income-restricted affordable units from the draft LDC Revision citywide Affordable Housing Bonus Program Unit Size Studio 1-Bedroom 2-Bedroom 3-Bedroom Fee-in-Lieu $135,000 $180,000 $335,000 $440,000  If approved, the Housing and Planning Department would bring forward a recommendation for this fee in-lieu for the Vertical Mixed-Use program in the City budget process within the department’s fee schedule. 7 Staff Recommendation: Addition of General Requirements to Affirmatively Further Fair Housing  Applicable to all developments that Provision Name Description voluntarily participate in VMU – In the long-term, staff recommends that these requirements apply uniformly in all voluntary density bonus programs within the LDC  Affirmatively furthers Fair Housing and helps to create more inclusive, equitable outcomes for our community Source of Income Discrimination Protection Ensures that a prospective tenant in a VMU development would not be denied housing based solely on their source of income, including housing vouchers. Dispersion of and equal access to affordable units Comparable design standards Proportional bedroom count Floating rental units • • • • • • • Disperses income-restricted units through the development to avoid clustering Ensures access to income-restricted units through the same routes as market-rate units Guarantees access to all on-site amenities for income-restricted units that are available to market-rate units, including parking facilities Requires functionally equivalent finishes, features, and appliances within income-restricted units and market-rate units Requires that all interior components in income-restricted units are durable, good quality, and consistent with federal, state, and local standards Requires that the income-restricted units within a development match the mix of the number of bedrooms in the market-rate units Allows for two one-bedroom or efficiency units to be exchanged for one two-bedroom units or three one-bedroom or efficiency units to be exchanged for one three-bedroom unit Allows for the location of the income-restricted units in a rental development to change over time so long as the property maintains the required total number of affordable units for the duration of the affordability period Simultaneous availability Ensures that income-restricted affordable units are made available concurrently with market-rate units, or requires plans for sequencing construction in multi-phase developments Affirmative marketing Requires the development to prepare and utilize an affirmative marketing and outreach plan that affirmatively furthers Fair Housing 8 Staff Recommendation: Additional Direction to Set Non-Residential Bonus Area Fee  Bonus area fee for upper-level non-residential space within VMU buildings never set by Council  Staff will wait for additional direction to bring forward a recommendation for this non-residential bonus area fee for the Vertical Mixed-Use program 9 Staff Research  VMU Developments  Completed  In the Pipeline  Tenure  By Council District  Dispersion of VMU Zoning  Number of sites  Total Acreage  By Council District  Displacement Risk Areas  High Opportunity Areas  Other Policies Impacting VMU-Zoned Properties  Conditional Overlays  Compatibility Standards 10 Vertical Mixed-Use Developments VMU Developments Completed In the Pipeline 9 under construction 18 in planning 2,037 under construction 3,992 in planning 496 under construction 404 in planning Notes Buildings under construction have been issued a building permit but have not receive a Certificate of Occupancy (CO). Buildings in planning have received a certification letter to utilize VMU but may be in early stages of planning and development ranging from site plan under review to building plan under review. These totals reflect all housing units within VMU buildings including both market-rate and income-restricted housing units. These totals reflect income-restricted affordable units within VMU buildings ranging from below 60% MFI to 100% MFI. Two projects in the pipeline are developing with higher numbers of income-restricted affordable units than required under VMU, which brings the percentage of total units that are income-restricted to over 10%. VMU Buildings 29 VMU Housing Units 5,379 Income-Restricted Affordable VMU Housing Units 540 VMU Housing Units by Tenure 98% rental 2% ownership 99% rental 1% ownership 11 Vertical Mixed-Use Developments VMU Developments By Council District 16 14 12 10 8 6 4 2 0 District 1 District 2 District 3 District 4 District 5 District 6 District 7 District 8 District 9 Projects In Development Projects Completed 6 2 0 0 5 10 7 6 3 5 0 0 4 5 0 0 1 1 District 10 1 0 12 Vertical Mixed-Use Developments VMU Housing Units by Council District 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 District 1 District 2 District 3 District 4 District 5 District 6 District 7 District 8 District 9 units in development units completed 888 63 0 0 1,161 1,371 1,995 1,382 838 1,572 0 0 774 968 0 0 113 23 District 10 260 0 13 Dispersion of VMU Zoning VMU Zoning Total Sites with -V Total Acres with -V ~ 818 ~ 1,900 14 Dispersion of VMU Zoning VMU Zoning by Council District 700 600 500 400 300 200 100 0 District 1 127 238 District 2 6 20 District 3 102 262 District 4 118 604 District 5 94 167 District 6 0 0 District 7 66 240 District 8 0 0 sites acres District 9 District 10 247 272 58 96 15 Dispersion of VMU Zoning Displacement Risk Areas  55% of VMU-Zoned Sites are within Displacement Risk Areas VMU-Zoned Sites within Displacement Risk Areas 60% 50% 40% 30% 20% 10% 0% Chronic Displacement Risk Area 27% Active Displacement Risk Area 15% Vulnerable Displacement Risk Area 13% 16 Dispersion of VMU Zoning High Opportunity Areas  33% of VMU-Zoned Sites are within High Opportunity Areas High Opportunity Areas are defined by Enterprise Community Partners Opportunity360 Index. 17 Other Policies Impacting VMU-Zoned Sites Conditional Overlays (CO’s)  Conditional Overlay Combining Districts, or CO’s, are used to modify use and site development regulations on a site- by-site basis. CO’s are always more restrictive than the restrictions otherwise applicable to the property. CO’s can regulate many site development regulations, including lowering the maximum allowable building height on a site.  67% of VMU-zoned sites have a Conditional Overlay. Staff did not research specific CO’s on VMU-zoned sites; however, it is possible that many of these sites with CO’s have additional height restrictions that may limit the ability to utilize the 30-foot height bonus outlined in the new tier of the VMU program. 18 Compatibility Standards  Compatibility standards apply to sites that are within 540 feet of the property line of an urban family residence (SF-5) or more restrictive zoningdistrict. – For the purposes of the new VMU height bonus, the distance that could affect a VMU building’s maximum height is 420 feet.  Compatibility standards also apply when a site is adjacent to a lot on which a usepermitted in an SF-5 or more restrictive zoning district is located.  Compatibility Standards require: − Height and Setback Limitations − Scale and Clustering Requirements − Screening Requirements − Design Regulations Other Policies Impacting VMU-Zoned Sites Compatibility height and setback limitations applicable to VMU are summarized in the diagram above. 19 Other Policies Impacting VMU-Zoned Sites Compatibility Standards  41% of VMU-zoned sites could build to their baseheight after compatibility standards are applied. − The remaining 59% of VMU-zoned sites are prohibited from building to the maximum height allowed by their base zoning due to compatibility standards.  34% of VMU-zoned sites would be able to build to the bonusheight under the new tier of the VMU program after compatibility standards are applied. − The remaining 66% of VMU-zoned sites would be prohibited from building to the maximum height allowed with the 30-foot height bonus. *For purposes of this analysis, a site was considered buildable if the maximum height could be achieved for at least 10,000 square feet. VMU-Zoned Sites Allowable Heights with Compatibility Standards 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Achievable 41% Unachievable 59% Achievable 34% Unachievable 66% Base Height Bonus Height 20 Compatibility + VMU Web Map  Interactive Map  View where VMU-Zoned Sites are Located – Including layers for Displacement Risk Areas, High Opportunity Areas, and the Transit Priority Network  View allowable heights with the new bonus on VMU-Zoned sites after Compatibility Standards  View VMU-Developed and Developing Buildings https://austin.maps.arcgis.com/apps/webappviewer/index.html?id=bff1cf81f6534a0bb2f8a23988d499c2 The web map can be accessed here: 21 Extras 23 VMU-Developed Buildings: AMLI 5350 Developer: Ardent Residential Total Units: 174 Affordable Units: 17 Tenure: Rental Year Built: 2010 Council District: 7 Corridor: North Burnet 24 VMU-Developed Buildings: Camden Lamar Heights Developer: Camden Property Trust Total Units: 314 Affordable Units: 31 Tenure: Rental Year Built: 2015 Council District: 7 Corridor: North Lamar 25 VMU-Developed Buildings: Texan North Campus fka Uptown Lofts Developer: Uptown Lofts LLC Total Units: 23 Affordable Units: 2 Tenure: Rental Year Built: 2011 Council District: 9 Corridor: North Lamar 26 VMU-Developed Buildings: Aura on Lamar Developer: TRG North Lamar L.P Total Units: 279 Affordable Units: 28 Tenure: Rental Year Built: 2021 Council District: 4 Corridor: North Lamar 27 VMU-Developed Buildings: West Koenig Flats Developer: Stillwater Hyde Park Total Units: 210 Affordable Units: 21 Tenure: Rental Year Built: 2018 Council District: 4 Corridor: North Lamar 28 VMU-Developed Buildings: Lamar Union Apartments Developer: Greystar Real Estate Partners Total Units: 441 Affordable Units: 44 Tenure: Rental Year Built: 2015 Council District: 5 Corridor: South Lamar 29 VMU-Developed Buildings: The 704 Developer: Residences at the Spoke LLC Total Units: 378 Affordable Units: 38 Tenure: Rental Year Built: 2014 Council District: 5 Corridor: South Lamar 30 VMU-Developed Buildings: Nexus East Developer: Spicewood Investments, Ltd and ABP Interests, Ltd Total Units: 49 Affordable Units: 5 Tenure: Rental Year Built: 2021 Council District: 3 Corridor: Airport Blvd 31 VMU-Developed Buildings: Lenox 7th Developer: OH Gonzales GP, LLC Total Units: 279 Affordable Units: 28 Tenure: Rental Year Built: 2020 Council District: 3 Corridor: East 7th 32 VMU-Developed Buildings: Axiom East Developer: Pearlstone Partners Total Units: 60 Affordable Units: 6 Tenure: Ownership Year Built: 2020 Council District: 1 Corridor: East 7th 33 VMU-Developed Buildings: 7East Developer: SL Chicon, LP Total Units: 177 Affordable Units: 18 Tenure: Rental Year Built: 2015 Council District: 3 Corridor: East 7th 34 VMU-Developed Buildings: Alexan East 6th Street Developer: AE6 Apartments LLC Total Units: 208 Affordable Units: 21 Tenure: Rental Year Built: 2015 Council District: 3 Corridor: East 6th 35 What is the Median Family Income? 36 What does median income look like disaggregated by race? Austin Median Household Income Difference from the Austin Median Household Income by Race / Ethnicity (2019) $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $- $25,000 $20,000 $15,000 $10,000 $5,000 $- $(5,000) $(10,000) $(15,000) $(20,000) $(25,000) White $15,237 Asian $19,875 Latino $(19,790) Black $(25,242) 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 White Non-Hispanic Black / African American Latino / Hispanic Asian Data Source: American Community Survey 1-Year Estimates for Austin city, Texas; Table S1903 37 What are affordable rents?  Market-rate rent in VMU developments is on average $1,832  Affordable rent limits at 50% of MFI is about $898 on average*  Affordable rent limits at 60% of MFI is about $1,077 on average*  Affordable rent limits at 50% of MFI is about $1,436 on average* *averages are weighted and account for differences by number of bedrooms 38