By Trey Dove, Senior Associate, Office Tenant Representation
A few weeks ago, Midtown Alliance and the City of Atlanta Office of Zoning and Development passed a series of new zoning policies aimed to shape a pedestrian-friendly, walkable community in the future. “The updates…are meant to ensure high-quality, high-value development in Midtown for the next decade,” according to Midtown Alliance.
The efforts are the result of years of work and gathering extensive community input from organizations like the Midtown Neighbors Association and the Ansley Park Civic Association. The zoning updates set several long-term goals that will improve the market for the better for the people that live and work in Midtown. Below are a few of the changes that will impact the commercial real estate market:
- Parking ratios for new buildings will be reduce from 2.5 to 2.0 spaces per 1000 square feet. Currently, most companies in Midtown have 2.5 to 3 spaces per 1000 square feet. Because parking in Midtown is already tight, this will require companies to evaluate how their employees are getting to work, and to push for an increasing number of people to take public transportation. We expect more companies to offer to pay for at least a portion of public transportation costs to help persuade employees to seek alternative transportation. Furthermore, developers now have to reduce the visibility of parking structures by blending into buildings with architecturally compatible materials and adding active street-level retail.
- Floor area ratio (FAR) density incentives are available by adding more affordable housing, public art, and public park space. FAR is the ratio used to cap the amount of developable square footage a developer can build on a particular piece of land. The higher a developer can get the FAR, the larger and more significant the building can become. Developers also can receive density bonuses for creating new streets, pedestrian paths or alleyways, and for creating curb cuts and loading zones away from bike lanes. All of the density bonuses designed by Midtown Alliance are meant to contribute to a more walkable and pedestrian-friendly district. A full list of FAR incentives is available on Midtown Alliance’s website.
- Streets are now dedicated a designation of A1, A2, B1, B2 or C, and the permitted, active uses are dictated by the type of street designation. The higher the street designation, the more restrictive uses available for the land. Additionally, higher-designated streets require more street-level window space. For example, A1 streets, the highest designation, require 75 percent window space for street level facades. This promotes ground-floor retail on main thoroughfares. Additionally, ground-floor retail windows must offer 10 feet of visibility into the space.
The changes to the zoning policy will make Midtown even more desirable from a tenant perspective, but are likely to increase rental rates as development will require more in construction costs to receive as many FAR incentives as possible. Developers and landlords will adhere to these requirements because as the FAR incentives increase, so does the value of the land, and when the value of the land increases, the value of the building increases. These new zoning policies will be implemented immediately, and any new development going forward will be held to these guidelines. In just a few short years, Midtown could look very different – for the better.