Race to the City Planner’s Office: Is the Threat of a Zoning Overhaul Causing Miami’s Residential Construction Boom?

Introduction

There is little consensus over whether a housing bubble exists or whether there is just housing “froth,” as Fed Chairman Alan Greenspan suggests. [1]   If a bubble does exist, it is less clear whether the bubble is national in scope or a series of smaller local and regional bubbles. [2]   With all of the confusion over the housing bubble, it is easy to attribute Miami’s tremendous high-rise residential construction boom to an immediate need for housing in a desirable climate like that of the Miami area. In fact, it comes as no surprise that the greatest beneficiaries from the housing boom (and the areas still experiencing the most favorable conditions for growth) lie on the coasts. However, there is no shortage of skepticism over a coming bust in the condominium market. [3]   The City of Miami Planning Department reports that there are currently 104 large-scale development projects either recently completed, under construction, or in the planning stages which will result in an additional 20,068 residential units, 1.28 million square feet of office space, and 2.18 million square feet of retail space at a construction cost of $7.75 billion. [4]   While it is possible that a condominium bubble is driving this construction, there is another reason why developers might be rushing to get large-scale development plans approved in the city of Miami—a massive overhaul of the Miami zoning code known as “Miami 21.”

  Photo courtesy of http://asoft12.securesites.net/secure/miami21/graphics/newmiami21.jpg

Background of Miami 21

Miami 21 is a city initiative intended to introduce form-based zoning in lieu of the current zoning restrictions which govern use and density. Spearheaded by New Urbanist Elizabeth Plater-Zyberk and a team of economic development, transportation, and green space experts, Miami 21 seeks to address Miami’s recent and projected population growth, which may experience a 30 percent increase by the end of the decade. [5]   The initial stages of Miami 21 involve economic development studies, the development of a form-based code, and attention to historic preservation, green space, and public transportation. Form-based codes focus on building height and the relation of buildings to the street while allowing for mixed uses. This results in the ability to zone for compact and walkable mixed-use areas. Furthermore, the form-based code is intended to make the development approval process more efficient and as a result to serve as an incentive for increased investment in the city of Miami. [6]  

Are Developers Trying to Beat the New Zoning Ordinanace?

Any uncertainty in future rezoning is likely to drive developers to “dig a hole” in order to protect their preexisting use once the new ordinance goes into effect. Therefore, it is certainly plausible that developers are trying to beat Miami 21 by either starting construction or submitting plans for new developments that would not be launched in the absence of the rezoning effort. As one Miami Herald article put it, “[t]he pace of development is so furious that it has overtaken the city's planning efforts.” [7]   Another article elaborates on the rush to build as a means to get “grandfathered” in for a preexisting use: Some developers have submitted plans that aren’t fully fleshed out in the apparent hope of getting “grandfathered in” before the commission votes on zoning changes for the city’s northeast quadrant, which is expected to happen around January, said Assistant City Manager Otto Boudet-Murias, who oversees planning and zoning. “ 'I’m sure some of them are submitting faster because of Miami 21 and anxiety over possible changes,' Boudet-Murias said. 'My direction to staff is that if they see drawings that are not complete, to reject them and let developers and property owners know they need to provide more detail.' The administration will also ask the city commission for an ordinance explicitly barring new projects from getting grandfathered in under the old rules unless applications are submitted in complete form, including traffic and economic impact studies, before the commission vote. 'Submitting schematic drawings will not grandfather you in,' Boudet-Murias said." [8]   With many of the 104 new large-scale buildings advancing through the stages of development, it seems that developers are taking Boudet-Murias’ warning seriously and are presenting more than simple preliminary plans for their proposed construction projects.

Conclusion

While at first glance one might attribute Miami’s robust condominium market to a housing boom—and certainly there is evidence of investment in Miami condominium real estate by Latin American second-home buyers to support such a belief—the Miami 21 proposal may be contributing to the onslaught of new developments littering the Miami skyline. A height restriction, as much as a use or density restriction, is perceived as a threat to the grandiose plans that many developers seem to have for Downtown Miami. The irony is that the threat of a coming economic development plan, in the guise of Miami 21, has spurred one of the greatest periods of economic development which Miami has ever seen—providing $7.75 billion of construction cost impact.

Links

1) Miami 21, http://www.miami21.org/
2) City of Miami Planning Department, http://ci.miami.fl.us/Planning/
3) Duany Plater-Zyberk & Company, http://www.dpz.com/
4) SmartCode (an example of a form-based code), http://www.dpz.com/pdf/SmartCodeV7.0-6-06-05.pdf
5) The Miami Herald Interactive Graphic on Current and Proposed Construction, http://www.miami.com/multimedia/miami/business/archive/skyline/index.html