New Orleans Commercial Real Estate Zoning For Dummies

logo trademarkedIn this article we examine the permitted uses in various zoning districts for New Orleans commercial real estate including Orleans and Jefferson Parishes. Zoning uses and density can determine feasibility, so gathering this information is imperative before you make an offer.

New Orleans commercial real estate development  is not a feat undertaken by the weak. The entrepreneurs making things happen today are a special breed. They not only have a vision but an instinct of where opportunities exist, and they put their money where their mouth is-risking millions on just an idea. There is no guarantee that building an $25 million dollar apartment complex to solve the housing problem will produce the rents needed to break even; there is no guarantee that spending $6 million to make a shopping center look better will result in higher rental income, and it is really a long shot to rebuild an office building since tenants can find Class A space at $15/sf. Even with all the risks, developers are coming to New Orleans anyway and trying to make things happen.

Zoning Map

Many developers find our zoning and planning rules to be convoluted, but they are no more restrictive than in Atlanta or Memphis or Birmingham. Zoning is more lax in Covington and Mandeville than in New Orleans, but then you don’t have the demographics to support a large project once you get away from New Orleans. In fact, our zoning and planning rules make sense, and it helps to know how they apply to what you are building before you make any offers to buy. Let’s examine building an apartment building in either Orleans or Jefferson Parish; ideally you would want an RM-4 zoning for the highest density, and you would need four to six acres. The first problem you’ll face is finding four acres of land. It doesn’t exist. The next problem is finding land zoned RM-4. Maybe you’ll find a duplex or two.  One solution in Jefferson Parish is to use C-1 or C-2 zoning, which allows multi-family use. Recently however, Jefferson Parish requires 50% non-residential uses on the ground floor of a multifamily structure over 30 units. Residential uses include parking, lobby, management office, mail or laundry room, and health club.  Another solution is to purchase industrial zoned land and change the zoning, as multi-family is not allows in light or heavy industrial zoning.

Zoning Designation vs. Land Use Designation

Land Use Map

The future land use map illustrates the preferred location of development over the next twenty years, and is comprised of eighteen future land use categories and provides for an adequate mix of land use types in appropriate locations. Residential categories range from low-density residential development to high-density residential development. The future land use map also provides a variety of commercial, office and retail, industrial, mixed-use, public, and recreation lands. In developing the plan, each of these uses are located to protect existing neighborhoods, provide shopping and recreational uses in close proximity to residents, and to make the most efficient use of infrastructure.

Residential Zoning

In Orleans Parish, a C-2 zoning allows the same uses as RM-4, which, for multi-family exceeding 41 units, has density of 1,000sf lot area per dwelling unit, with a minimum 400sf lot area for a residential planned community.

In addition to the zoning, you might have a specific land use, or an overlay district. The Urban Corridor Overlay is common in B-1 zoning in Jefferson Parish. This means the project must undergo a complete review by the City Planning Department, which usually takes two months. Zoning B-1 allows uses approved by RM-1, which has a minimum density of 1.800sf minimum lot area for a three family or more development.

In Orleans Parish, the zoning categories for Multi-Family are:

RM-1: low-medium density residential, garden style apartments and single family. Density 1,800sf minimum lot area per dwelling for multi-family. Maximum height 40 feet.

RM-2: 1,000sf minimum lot area per dwelling. Maximum height 75 feet.

RM-2A: 1,000sf minimum lot area per dwelling. Maximum height 40 feet, or 60 feet if fronting a street.

RM-3: 1,000sf minimum lot area per dwelling. Maximum height 75 feet.

RM-4: 1,000sf minimum lot area per dwelling, or 400sf minimum for a planned residential community.  No limit to height.

Commercial Zoning

In Orleans Parish, commercial zoning categories are:

MS: allows RM-2 uses plus medical, parking garages, adult day care.

RO: allows RM-2 plus office, motels, clinics.

RO-1: retail, hospitals, clinics.

B-1: allows RM-1 uses plus retail, hospitals, clinics.

B-1A: allows RM-2, hospitals and retail, but not boarding houses.

B-2: allows RM-2, hospitals and retail, but not timeshares.

C-1: allows RM-4, B-1 and B-2, apartment hotels, boarding houses, retail.

C-1A: allows RM-2, except for timeshares, RM-4 and retail.

C-2: allows B-1 or B-2, RM-4, and retail.

Some areas allow multi-family as a conditional use,  such as zoning B-1,  which means the Executive Director of the Planning Department must recommend the City Planning Commission conduct a public hearing, and the City Council is the final decision-maker. City Council members Stacy Head and Shelley Midura have been instrumental in developments in their districts. New Orleans City Council members Cynthia Willard-Lewis, Jon Johnson and Cynthia Hedge-Morrell were not willing to meet with developers to learn about proposed developments, and you can still see today the results of their actions in a lack of growth in businesses in their districts. In Jefferson Parish, Council member Byron Lee did not welcome new apartment construction and Council member Chris Roberts was against new multi-family developments, with the strange line of thinking that they would prefer to increase the renovation of existing multi-family instead of new construction because it will reduce crime.

 Land Use Classes

(1)   Low density residential (LDR).  The low-density residential land use category includes single-family, detached-unit residential development at a maximum net density of up to four dwelling units per acre.

(2)   Low-medium density residential (LMR).  The low-medium density residential land use category includes single-family detached-unit residential development at a maximum net density of nine (9) dwelling units per acre.

(3)   Medium density residential (MDR).  The medium density residential land use category includes single-family detached, two-family, three-family, and four-family dwellings, townhouses, and condominiums at a maximum net density of twenty-five dwelling units per acre.

(4)   High density residential (HDR).  The high density residential land use category includes townhouses, condominiums, and multi-family apartments up to a maximum net density of sixty-five dwelling units per acre.

Developers Dilemma: Meet With Neighborhood Groups Vs. Not

The truth is you’ll need a simple letter backing the project from the City Council member in the District where your development is, but no City Council member will back a project that the neighborhood associations are against. A short meeting, one-on-one, with the President of the neighborhood associations (there may be more than one) will go a long way towards building a team. Floor plans and architectural drawings help explain to anyone the details of your project. Neighborhoods love businesses who are responsible and create value which increases property values. Little things like  rebuilding playgrounds go a long way to making a neighborhood thrive.

How Do You Change Zoning?

File the paperwork, meet with neighborhood leaders and the City Council Representative, present at a public hearing, then wait for the City Council vote. Total time: two to six months.

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