REDEVELOPMENT OF EXISTING SITES AND BUILDINGS MARK ELLIOT & DAVID KIRK
This is an appealing course; land basis is fixed, so more density brings the same revenue opportunity for the
owner as with the rest of the asset, with a very large component of the cost (land cost) excluded. However,
this opportunity comes with other considerations and, if they are not properly addressed, traps, that must be
addressed at the front end of any densification. If not, an owner can risk substantial impairment of the asset.
The risks and issues for an owner to consider when it
densifies, fall into 3 categories. Those categories
are: what impact does zoning and land use have;
what impact do the current leases in the asset have;
and what impact do project wide, private covenants,
conditions and restrictions have. Each of these must
be addressed by an owner which desires to densify
office assets. There are both practical and legal
concerns to densification plans.
Zoning and Land Use Restrictions
Zoning and land use restrictions must be fully understood before embarking on a redevelopment project, as
they could prevent or limit the scope of what may be done with the property, absent a timeconsuming and
costly effort to change such restrictions.
Current Zoning
The zoning classification under which the property was originally developed, assuming it is still in place, must
first be considered. Often, the property’s original zoning classification of limit the type and intensity of uses.
This is typical of suburban office parks developed under a zoning classification appropriate at the time of
development. For example, the original zoning of suburban office parks may limit uses to office and some
accessory retail or restaurant space but prohibit residential development, standalone retail, or fullservice
restaurant uses. In addition, parking requirements may be excessive in light of current conditions or the ability
to share parking between newly contemplated uses. Furthermore, the maximum floor area ratio or other
development standards may reflect a past era's approach and not allow for the contemplated density typical of
today's mixeduse developments, particularly in areas that may be served by transit. Accordingly, the mixed
use redevelopment plan may not be achievable under the current zoning. Rezoning the property to an
appropriate classification may be the only path forward for the proposed redevelopment project. Such an effort
typically takes several months; requires substantial resources for professional design, engineering, and legal
assistance; involves extensive public involvement; and carries inherent risks.