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Will CodeNEXT Spur Redevelopment in Austin?

Today’s blog post is Will CodeNext Spur Redevelopment in Austin guest post is by Leigh Budlong, founder of Zonability. You can connect with her on LinkedIn or email her at [email protected]

Austin continues to be one of the leading US real estate markets, as evidenced by its Top 5 ranking in the PWC Emerging Trends in Real Estate 2018 report.  New mid-rise buildings are popping up where there was just a small building, roads are under construction throughout the city and the downtown skyline is on the rise.

Proposed “CodeNEXT” changes, the name the city has given its re-writing of the zoning for the City, are in a hot debate with the second draft currently in review. Given Austin’s popularity with new companies, residents, and real estate development, is CodeNEXT going to be the catalyst for even more change? This piece strives to put the proposed CodeNEXT in context by analyzing an area I dubbed “The Triangle” (for its shape).

Real estate investment and development basics pertaining to this analysis:

  • Real estate and real property reflect the existing structures, land, and contracts associated with the parcel. While real estate is “immovable” is it “re-doable.”
  • A parcel is an identifiable piece of land – with or without improvements – that can be bought and sold with title assurances. The assurance part of the equation is essential to understand when thinking about investing and developing.
  • Restrictions can be public or private and are “invisible” except on paper. Private restrictions include deed restrictions. A prime example of a public restriction is city zoning.
  • Zoning is an ordinance set by a specific city. The general intention behind zoning is to create rules that enhance public safety, quality of life, and property values.
  • A district is an area defined by either a government agency or quasi-government agency that grants them authority. The reason this is key for real estate investment and development is a property can be subject to multiple districts.
  • A zoning district can be expressed as having “base” or “primary” controls and also be subject to “overlay” or “secondary” zoning controls. In Austin, the average parcel has 3.5 layers of zoning districts. CodeNEXT is attempting to reduce the number but there will still be some overlay zoning.
  • Property rights are given to the parcel – the dirt – through zoning whether that is public, private or both. There are instances where an existing structure is less valuable than the dirt; this is an economic concept about what contributes to value.

The Triangle: A Use Case

This interesting shaped block has frontage on Burnet Road, an area with plenty of marketed “redevelopment opportunities.” The question is will CodeNEXT make it a truly “hot” area to focus on for development like when the City of Austin rezoned Rainey Street from residential to central business district (CBD) zoning?

 

 

 

 

 

 

Here are some images, courtesy of Google Street.

I also added notes on a zonability map which uses “blue” to show commercial zoning.

The Triangle and CodeNEXT

Under the proposed September draft (of CodeNEXT), all of the parcels in the Triangle would have a single district called Main Street 3A, or MS3A for short. Zoning is known for its vibrant use of letter/numbers! The glaring differences between current and proposed zoning:

More height allowed under the new plan – 3 stories now vs. 5 stories
Larger buildings allowed under the new plan – greater land coverage ratios

By my rough estimate, the current structures are less than 20% of the size compared to what could be there under CodeNEXT.

So will the boost in potential be the catalyst to spur redevelopment? While “up zoning” may create the economies of scale needed for a mid-rise to pencil out, there are still other considerations in the game of real estate. This is a short list (certainly not exhaustive) of such aspects to consider:

  • For starters, how do the existing rents compare to rents for new construction?
  • Is it better to “add-on” or “tear down?”
  • What are current and projected construction costs?
  • How great is demand for new construction in the immediate area?
  • What is the supply of new construction coming on line in the immediate area?
  • Would there be a premium to buy out any existing leases?

The Triangle location is a mix of Community and Neighborhood Centers given the high volume of traffic on Burnett Road relative to Hancock Drive.

Austin, TX 2017 Retail Annual Report

Element Community Retail Neighborhood Retail
Rents $ 24.80 $ 21.00
Vacancy 5% 6%
Expenses Triple Net Triple Net
Going in Cap Rate 6.5% 6.5%
Direction – Year Over Year
Asking rent Up Up
Going in Cap Rates Down Down

“Despite a relatively tight market, developers are being very selective about new and speculative construction, and we expect this market to remain strong.”

– Integra Realty Resources – Austin

In Summary, the Triangle Analysis Reflects

  • CodeNEXT may create new opportunities for real estate development but whether or not it is a catalyst to spurn redevelopment is only one piece of the puzzle.
  • Individual considerations will impact the timing for when owners decide to sell or transform their properties.
  • Even if a property doesn’t get redeveloped, owners seeing redevelopment and thinking about their property’s position may spring for upgrades to their buildings out of concern of “not keeping up” or just to make their properties look better.

The upward direction of commercial rents and downward vacancy rates combined with Austin’s low unemployment and increased population have spurred new construction – without CodeNEXT. Once this major subject is finally settled, I suspect the decision to develop or not will be influenced by the real estate and business cycle. We may have to wait to see just how influential CodeNEXT is – or isn’t – on what gets built and where.

 

The post Will CodeNEXT Spur Redevelopment in Austin? appeared first on CRE Blog | CommercialSearch.

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Smarten Up Your Showings With Smart Home Technology

By Christy Matte, guest contributor

StyledStagedSold_imageSmart homes with security and automation features are becoming a hot trend, and they can be an exciting way to dazzle prospective home buyers (and up your staging efforts to a high-tech level at the same time). But if buyers have never experienced an automated home environment, rattling off a list of features could be meaningless at best, and confusing at worst. Here are some fun ways to show a home with smart features, so the buyers will be wowed and you can clinch the sale.

Know What It Is and How It Works

It should go without saying, but make sure you can control the features like a security system, smart locks, or smart lighting, before trying to introduce them to buyers. Ask the homeowner for tips, test them out, and be ready for the big show.

Get the Apps

Ask the seller for access to the associated apps for the various systems. Even better, convince the sellers to tie all smart home technology into one convenient smart hub. It’s an easy task with the help of their Internet service provider. Install one app on one device so prospective buyers can try them out.

Educate Buyers on the Benefits

Make a one-page list of the features, specifically showing how they can save time and money, while also providing increased security.

Go Beyond the Basics

Most people have a basic understanding of a traditional home security system. Show them how this particular system can go even further. Can it send them a text message for smoke detection or a water leak? Can you open the smart lock with your own designated code? Show buyers how much flexibility is available. Security systems aren’t just for protecting against theft anymore.

Have Fun!

Use motion detectors to trigger mood lighting and automated music as buyers move through the home. Let them set off the sprinkler system (after touring the yard, of course) with a swipe of the app. Teach them voice commands to trigger the home’s other functions.

With the right planning, you can turn your everyday showing into something truly special and extremely smart.

Christy Matte HeadshotABOUT THE AUTHOR: Christy Matte is a Boston-based writer who covers home security for XFINITY Home. She is also a die-hard techie who blogs at QuirkyFusion.com. 

 

 


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Story Idea: Clever Cures for the Worst of Winter

Cold weather can keep homeowners cooped up inside for months, so why not use that time to take on some quick and easy DIY home repairs!

For homeowners who are not that handy, they can take on projects as simple as replacing the batteries in their carbon monoxide and smoke detectors or silencing squeaky door hinges by spraying a puff of powdered graphite on the hinge pins. Homeowners who have a bit more skill with a hammer can work on fixing creaky floorboards with specially designed screws or replace any brittle, cracked or damaged plugs and electrical cords.

Serviceman doing his job well

Story Springboard:

Check out HouseLogic’s December spotlight “Clever Cures for the Worst of Winter” for more information on home improvement projects to take on during the winter months. Speak with homeowners about projects they have completed and any information they wish they had known beforehand. Talk with a REALTOR® about what advice he or she would give a new homeowner interested in taking on DIY projects.

You can view all of NAR’s Real Estate Story Ideas here or follow the RSS feed here.

Each month, NAR produces a few story ideas for the media, presenting timely topics accompanied with background information and facts related to the real estate market. These housing and real estate story ideas are designed to help media generate content for news stories, hopefully serving as a helpful resource to those in the media looking for stories or new angles.


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Instant Reaction: Lawrence Yun on Today’s FOMC Statement

The following statement is NAR Chief Economist Lawrence Yun’s reaction to the Federal Reserve’s decision today to raise short-term interest rates, as well as what it means for the economy and housing in 2018:

“There will be juice added to the economy in the months ahead as a result of the expected passage of a massive tax cut. It remains to be seen whether the effects are long-lasting or just for a short period of time. 

However, with the unemployment rate already at a low of around 4 percent, there is not much room to go further down. That means inflationary pressure will slowly develop. That is why the Federal Reserve today raised the short-term interest rates and will likely do so three more times in 2018. The longer-term interest rates, like the 30-year fixed mortgages rate, will therefore be nudged higher in 2018. Economic stimulus will help with job creation and housing demand, but higher interest rates threaten to cut into housing affordability next year.”   


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New Florida Gators Coach Dan Mullen Selling Starkville Mansion

Dan Mullen

Rob Foldy/Getty Images

Dan Mullen is headed back to Florida as the new University of Florida Gators head football coach, and he’s placed his Starkville, MS, home on the market for $ 1,350,000.

Mullen had served as head coach for Mississippi State for nine seasons before making his way back to Gainesville, and now the new Gators boss has no need for a luxury home in the middle of Mississippi.

Custom-built in 2008, the 9,400-square-foot house has five bedrooms, five baths, and three half-baths. The layout includes a grand entry, formal living room, dining room, and chef’s kitchen with pantry, island, and breakfast area—all with views of the backyard.

Dan Mullen's home for sale
Dan Mullen’s home for sale

realtor.com

Living room
Living room

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Kitchen
Kitchen

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Family room
Family room

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Pool
Pool

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There are two living areas, each with a fireplace and high ceiling; front and rear staircases; and an elevator. All the bedrooms are en suite.

The home comes with some great hangout areas, including a game room, media room, gym, and second kitchen. Outdoors there’s a lounge area and a pool. Jay Murphy holds the listing.

The 45-year-old Mullen leaves Mississippi State as the second-winningest coach in the history of the program, which he led from 2009-17. His wife, Megan Mullen, is a sports journalist who has covered the NFL and college football. Mullen served as offensive coordinator for the Gators from 2005-08.

“Megan and I are very excited to get back to Gainesville and the University of Florida,” Mullen said in a statement to USA Today. “I have such great memories of the championships we won during our time here and have a love for Florida. We are happy to be coming back to such a supportive administration, staff, student body and fan base, which is the premier football program in the country.”

The post New Florida Gators Coach Dan Mullen Selling Starkville Mansion appeared first on Real Estate News & Insights | realtor.com®.

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Instant Reaction: November Jobs Report

The following is NAR Chief Economist Lawrence Yun’s reaction to this morning’s U.S. Bureau of Labor Statistics report on employment conditions in November:

“November marked another impressive month for the labor market, adding up to now over 2 million net new jobs over the past 12 months.  From the deep recession in 2010, 17 million new jobs have been created. In fact, current employment levels are way above the pre-recession levels by nearly 10 million.

That means an abundance of new potential homebuyers in the near future. Yet, the construction employment is still slow in coming. Even the though the latest month’s job growth rate in the construction sector of 2.7% is twice as fast as the overall growth rate, total construction jobs are still well below the pre-recession levels by roughly 20%. Without more skilled construction workers and more hiring in the sector, the housing shortage will continue well into 2018.”


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Tips on Christmas Decor Home Staging

By Merri Cvetan, guest contributor

StyledStagedSold_Image1If you’re staging your home during this time of the year, adding a bit of holiday cheer to your decor can make a big impression on potential buyers. Use these tips to create a simple, polished look that puts your home in its best light this holiday season.

Choose the Right Christmas Tree

When showing your home, include holiday decor that allows potential buyers to picture themselves in the space. For example, choose a tree that allows other aspects of your home to shine. Your living room or entryway will look bigger if you opt for a small artificial tree over a 6-foot live pine. An artificial tree is also less messy than a real one, meaning your home will always be neat and tidy and ready for the next showing.

Light It Up

StyledStagedSold_Image2

The Christmas light possibilities are endless, but when you’re staging a home for sale, think simple and low-key and stick to one style. An over-the-top display might not reflect the tastes of your potential buyers, and too many decorations can take away from the room itself.

Take advantage of the many styles of Christmas tree lights available to give your home an understated yet inviting holiday look. Opt for something different, like an artificial white tree decorated with white LED lights. Finally, choose ornaments and trim that coordinate with the lights. Add a few silver and red ornaments for extra sparkle and color. It’s just enough Christmas for your family to enjoy without overpowering the room.

Decorate Your Mantel

Traditional Christmas Fireplace

The fireplace is an important focal point. Keep it simple and elegant to help potential buyers imagine opening their own Christmas gifts around a roaring fire.

Don’t completely cover the mantel. Pack away any personal family photos or the kids’ school crafts. Drape a garland across the mantel, allowing the branches to hang over the edge. A string of simple white LED lights adds just enough illumination to highlight the fireplace.

Add a few candles and a simple vase to reflect the light. A rustic wreath on the wall above the mantel completes the scene without distracting from the main event. This style is classic enough to appeal to a variety of buyers while still capturing the holiday spirit.

Don’t Forget the Exterior

Christmas Door

Increase your curb appeal and make a good impression from the get-go by decorating the outside of your home. Consider your neighborhood, too–if all of your neighbors have lights and outdoor decorations, you don’t want to be the only home without them.

Keep things simple and easy with a festive wreath on the door to greet potential buyers. Wrap a garland or string of lights around your front porch (or hang them around your entryway), then finish the look with lanterns or a potted evergreen. Finally, make sure your walkway is clear of snow or ice.

Welcome Buyers With the Spirit of the Holidays

During an open house, create the feel of a festive holiday party by offering seasonal snacks like gingerbread cookies, candy canes, hot chocolate, and apple cider. Keeping mulled hot apple cider simmering on the stove will also make the whole house smell good. Light a fire in your fireplace to make the home feel cozy and warm, helping visitors envision living there. When it comes to impressing potential buyers, these small touches can make all the difference.

MerriABOUT THE AUTHOR: Merri Cvetan is an interior designer who writes about home decor topics for The Home Depot. See more Christmas lights and decorating ideas for the holidays.

 


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This UES mansion could become the most expensive townhouse ever sold in NYC

An Upper East Side townhouse owned by President Trump’s first nominee for Secretary of the U.S. Army is in contract to sell for $ 80 million — a price tag that would make it the most expensive townhouse in city history. Vincent Viola, CEO of Virtu Financial and owner of the Florida Panthers, bought the property on 12 East 69th Street with his wife Teresa Viola in 2005 for $ 20 million, according to the Wall Street […]


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NAR Applauds FHA’s “Smart Step” on Energy Efficient Loans

The Department of Housing and Urban Development announced earlier this week that the Federal Housing Administration will no longer insure properties with Property Assessed Clean Energy assessments, winning praise from the National Association of Realtors®.

“FHA’s PACE announcement is a smart step that will protect taxpayers and strengthen the overall program for homebuyers,” said NAR President Elizabeth Mendenhall.

PACE programs allow local governments to provide homeowners with the financial resources to make energy improvements to their home. Homeowners then pay back the money through an assessment on their property tax bill. While NAR generally supports voluntary efforts to drive energy efficiency, NAR raised a series of concerns throughout the year and pushed for HUD’s shifting policy on PACE loans.

In a letter to HUD, NAR said that PACE loans typically aren’t accompanied by the same disclosures and protections as home mortgages. As a result, real estate professionals said this new financial obligation could potentially lead to a higher risk of borrower delinquency. Ultimately, NAR said that made it possible that FHA would incur higher mortgage defaults, putting systemic risk on the program.

The announcement this week marks an important policy shift at FHA, echoing many of NAR’s overarching concerns.

“FHA can no longer tolerate putting taxpayers at risk by allowing obligations like these to be placed ahead of the mortgage itself in the event of a default,” said HUD Secretary Ben Carson. “Assessments such as these are potentially dangerous for our Mutual Mortgage Insurance Fund and may have serious consequences on a consumer’s ability to repay, or when they attempt to refinance their mortgage or sell their home.”

Mendenhall agreed, adding that while Realtors® support the goals of efficiency efforts, FHA’s announcement is needed.

“NAR supports voluntary, incentive-based programs that encourage homeowners to make their property more energy efficient, but not at the expense of FHA or the strength of its portfolio,” said Mendenhall. “NAR pushed for this change and we applaud FHA’s attention to the issue.”


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Hot Home Trend: Bamboo Everything!

By Melissa Dittmann Tracey, REALTOR® Magazine

Bamboo is making its way into more home interiors. From flooring, window treatments to wall accents, furnishings and more, this sustainable material is popping up everywhere.

Some designers are making bamboo their go-to material, which RISMedia recently highlighted in the article “4 Reasons Why Bamboo Is Taking Home Décor by Storm.”

Bamboo is widely available and more affordable than many other wood products. Bamboo is traditionally considered a type of wood flooring, but it’s actually not a wood at all, but a grass. And at growth rates of three to five feet per year, bamboo is one of the fastest growing plants on Earth, which means it’s widely available for spicing up interiors.

Here are a few trending ways we’re seeing bamboo enter more household decor.

Gold bamboo is particularly hot for home accents (Check out the coffee table in the picture below).

 

Bamboo-textured walls can add a focal point to a space.

 

Bamboo is popular in landscapes and for adding privacy.

 

Bamboo flooring is an alternative to wood flooring and comes in many different color variations.

 

Bamboo can be used for an artistic privacy screen.


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