In real estate, as in business generally, a good strategy for making money is to buy low and sell high.
Because the value of land in urban areas is typically tied to the amount of stuff – residences, offices, etc. – you can build on it, one way to profit is to buy land zoned for low density (i.e., land on which you are only allowed to build a few dwellings) and persuade the local government authorities to rezone it for higher density (i.e., to allow you to build a much larger number of dwellings).
While rezoning for higher density is profitable for landowners, it imposes costs on our community by accelerating growth – costs for expanded schools and government services, increased traffic congestion and flooding, and erosion of our celebrated small-town character. It may even cause longer wait times to borrow popular books from the library.
We expect that when elected officials rezone town land for higher density they ensure that a fair share of the newly created value accrues to the broader community to help mitigate growth-related costs.
For example, they can require the developer to provide, in exchange for the lucrative rezoning, new units of affordable housing, land for new public parks or schools, improvements to town infrastructure, or direct payments to the town that we can then use to procure some of the above benefits. In years past, Chapel Hill elected officials have been pretty skillful at obtaining community benefits in exchange for allowing growth through rezoning, which is why, despite steady growth over several decades, our town remains an appealing place to live, as evidenced by the consistent appreciation in the value of our homes.
But last spring, current Town Council members really dropped the ball when, in exchange for dramatically increasing the value and allowable density of almost 200 acres of land in the Ephesus-Fordham district, they got ... nothing.
No land for parks or public recreation, no new buses, no meaningful increase in connectivity within the district to support biking and walking, no infrastructure improvements to reduce flooding risk, and no new units of affordable housing.
What did the town get from the Ephesus-Fordham rezoning? So far, it appears we are going to get a 90-foot tall, 263-unit apartment building looming over South Elliot Road. The form-based code adopted for the district was supposed to help ensure that redevelopment produced attractive new buildings and good urban design, but the most favorable thing any council member has been able to say about this new apartment building so far is that it’s better than a vacant lot.
On Monday, Jan. 26, the Town Council will hear a progress report on the Ephesus-Fordham District and will have the opportunity to consider how well the zoning and development guidelines they adopted for the district align with the community goals that new development is intended to achieve.
They should use this opportunity to improve the code so that redevelopment delivers public benefits, such as park land and affordable housing, and more appropriately scaled buildings. One way to proceed would be for them to review the many good ideas town residents offered last spring for how to improve the code (see bit.ly/1IIBzwp). If town staff advise against requiring those made rich by rezoning to provide community benefits for fear that doing so would “discourage redevelopment,” the council should ask to see the evidence on which this fear is based.
For better or worse, the massive Village Plaza Apartments will stand as Mayor Mark Kleinschmidt’s legacy to the town. But it is still possible to ensure that the rest of Ephesus-Fordham develops into something we can all be proud of.
David Schwartz lives in Chapel Hill.