Commercial Investment Real Estate September/October 2018 | Page 13

Local Collaboration
In December 2016, Tucson, Ariz., Mayor Jonathan Rothschild
and the Tucson City Council voted to implement a 24-month
pilot program to encourage adaptive reuse, modeled after simi-
lar programs used in Phoenix and Los Angeles. The program
incentivizes developers and business owners to repurpose existing
buildings within the city limits while maintaining and enhancing
the current structure.
AdRu projects typically involve controversial and costly ordi-
nance variances for items related to density, parking, and com-
pliance with any number of modern building codes unrelated
to life-safety. Communities like Tucson are addressing zoning
codes and other unique AdRu challenges to accelerate the reuti-
lization of empty buildings.
The Tucson program primarily focuses on buildings that are 50
years old or older or that have been vacant for 30 years or more,
but it also makes allowances for buildings that are at least 30 years
old. Projects also are required to provide community benefits
and ensure consistency with the plans of the surrounding area
and neighborhoods. The incentives for developers and investors
include relaxed parking, permit fee waivers, and flexible density
and zoning requirements.
“This program will make it easier to get new businesses into
old buildings … [It] will save developers time and money while
boosting the economy through job creation and a proliferation
of construction projects,” says Jonathan Mabry, Tucson’s historic
preservation officer. “Historic preservation is achieved by giving
new lives to our vintage and historic buildings, and sustainability
is created by recycling entire buildings.”
Tucson is a model for other cities looking to pave the way
for more AdRu activity to stimulate the local economy and put
empty buildings back to productive use. But until we see wide-
spread collaboration from local governments, law and ordinance
challenges will prevent AdRu from making a positive impact in
many markets.
K.C. Conway, MAI, CRE, is CCIM’s chief economist and
director of research and corporate engagement at the University
of Alabama’s Center for Real Estate.
Editor’s note: This article is an excerpt from the 3Q18
Commercial Real Estate Insights report from CCIM Institute
and the Alabama Center for Real Estate. To read the full report,
visit www.ccim.com/insights.
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