Commercial Property – The Importance of Zoning
Zoning in an area is often overlooked by both the buyer and the agent when looking at commercial property. Most people assume that just because a property is currently being used, say as an office building, that that is the proper and permitted use in that area. However, a closer look may reveal that the property has been granted a conditional use permit allowing an office building in a zone that is zoned for apartments. Depending on the wording of the conditional use permit you may or may not be allowed to expand or alter the use and still comply. Even though the property looks to be in a commercial area an owner may not be allowed to add an upper level of living space or office. An investor may be looking at a property to redevelop with a similar type of use. The current use may have been grandfathered and can continue to operate but new development even with the same use might be denied.
Parking is always an issue. Parking ratios in most areas will differ with the type of use. Office space will require a different amount of spaces per square foot than a retail business and or a hotel. Setbacks and building height requirements are also important to know and understand. Dealing with raw development land requires an even closer and more in-depth study into zoning requirements. Issues like densities, road width, and utilities are important in addition to the above items.
Every city and county will have their own zoning regulation. Most agencies will have this information posted on their website. It is important to read and understand these documents to better serve your client. The new and smaller investor, is more likely to neglect and miss zoning issues. The new investor will want to rely on you, the real estate agent, to provide and advise regarding this type of information.