Choosing an entitlement pathway: units, time and risk

Most multifamily sites have more than one pathway: the base zone, a local bonus program, the state density bonus and, where they apply, state laws that add administrative routes. The pathway with the most units is not always the one that earns the most, and the comparison is made on all four terms.

The four terms

• Units: drawn on a test fit, not read from a table.
• Time: plan check only, an administrative review, or a hearing with an appeal period.
• Discretion: whether a decision maker can say no, and on what findings.
• Set-aside and returns: the restricted units a program asks, their rents, and the yield on cost.

What moves a project between routes

A request for relief beyond a program's menu, a waiver of a development standard, a subdivision, an overlay or a historic resource can each turn an administrative route into a discretionary one. The requests are planned with the route, so the building does not drift into a hearing.

Questions

Is the pathway with the most units always the best?

No. A pathway with fewer units can earn more if it takes less time, asks a smaller set-aside or avoids a hearing; the comparison is made on units, time, discretion and returns.

Sources