Developers Often Feel Constrained by Land-Use Regulations

Developers Often Feel Constrained by Land-Use Regulations
C.J. Gabbe
Housing Policy Debate
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Developers, urban planners, and other parties constantly debate the best strategies to improve a city’s equity and advance its economic and environmental goals. How do developers feel about land-use regulations, particularly in deliberations over development density and transit-oriented development? This study seeks to understand this question by comparing characteristics of new housing with baseline land-use regulations in two rail station areas in Los Angeles, California, a city attempting to grow around transit to decrease driving, increase ridership, and create more affordable housing. The author focuses on the Vermont/Western plan area, which was Los Angeles’s first modern transit-oriented development plan, and compares it with Koreatown, an area with rail transit but no plan. In addition to analysis of new multifamily and mixed-use residential developments, the author conducted nine interviews with experts to find out more about how zoning requirements shape residential development outcomes, the development approval process, and developers’ strategies for diverging from baseline zoning. Based on his findings, the author recommends that cities take an evidence-based approach when reforming and implementing regulations and says that these findings from Los Angeles are most applicable to other growing cities with strong housing markets.

Key findings

  • The average development in the Vermont/Western area had 112 percent of the maximum permitted residential density and 94 percent of the minimum required parking, while the average Koreatown development had 99 percent of the maximum density and 88 percent of the required parking.
  • Land-use regulations, particularly density restrictions and parking requirements, matter for urban development, and developers would often build more urban infill housing if regulations were adjusted.
  • Regulatory implementation can be as important as written regulations, and developers pointed out that though decisionmakers often employ discretion throughout the process, developers value proven pathways to approval.
  • The author recommends that both city and state governments play a role in scrutinizing regulations. State-mandated density bonus incentives are an example of how state law can influence local development. Municipalities also have considerable power to create incentives to build affordable housing near transit.