How to address issues when rezoning properties for a different use

Columbus has had a few different hot spots for urban redevelopment near the city’s downtown in recent years, including the Short North and, more recently, Franklinton.

Businesses looking to locate in these areas need to realize that the process isn’t the same as when building on undeveloped land or in a suburban development, says Nick Cavalaris, a director at Kegler, Hill, Brown + Ritter.

“There are other things to consider when taking a warehouse building that’s zoned for manufacturing and rezoning it for residential use,” Cavalaris says.

Smart Business spoke to Cavalaris about the best way to approach urban redevelopment and unique situations that may arise.

What are some unique things that can happen regarding urban redevelopment?

One interesting case involved The Ohio State University’s implementation of what’s called Second-Year Transformational Experience Program (STEP), which requires sophomores to live on campus. Starting next year, sophomores will have the opportunity to participate in STEP and be eligible to receive a cash fellowship of up to $2,000 to use toward an experience they might not otherwise be able to do. This has created a problem for fraternities and sororities, which rely on sophomores living in Greek housing due to attrition.

The Greek institutions and the university came to an agreement that sophomores can live in the fraternity and sorority houses as long as they are upgraded to include assembly areas for instruction and dedicated study spaces like those in dorms.

Kappa Kappa Gamma sought legal help regarding an addition to meet the standards. That was challenging because the university area is like downtown or German Village in that those districts all have their own overlay to the city zoning code — standards that apply specifically to that district. The university has its own architectural board of review that signed off on the project.

What do companies need to consider when redeveloping urban properties for different uses?

You have to be sensitive to surrounding land uses. Many times, what you’re doing is basically downzoning when the use is changed from manufacturing to residential. A vacant plant is zoned for manufacturing and a new manufacturer could go in there, but times have changed and it doesn’t make sense for the area any longer.

That’s happening in Franklinton with the B&T Metals factory and the Eickholt Glass building. The city is looking at Franklinton in a similar fashion as the Short North 10 years ago. B&T was rezoned to a mixed use of residential, office and retail.

With projects like that you have to be aware that you have neighbors and you’re going to increase traffic. You’re going from a vacant space with no activity in some cases to a 24-hour, mixed-use development. There will be residents and members of area commissions who like the fact that the property is a dormant site — and now you’re introducing 100 residential units to the neighborhood.

A good way to handle these situations is to come in with a plan, show it, and be as open and honest as possible with people who live in the area. Let stakeholders have a voice in how it changes the neighborhood.

That way they’ll feel good if they received a concession and input into the new plan. It makes it a win for everyone as opposed to not letting them participate — a route that often leads to litigation.

Most times companies will negotiate six-month options on properties, with the sale contingent on zoning approval. That way they don’t have to buy the property if they run into opposition. But there are times when someone has already bought the building. That raises the stakes in the zoning process.

There will always be people who don’t want change. They have the right to their point of view, just as developers do. The public might think that there is indiscriminate development happening, but developers actually have to go through a lot of hoops.

Even if rezoning is approved, adjacent property owners will have standing to file an appeal in court. That’s why it’s best to be honest with them at the beginning and find a solution that works for everyone.

Insights Legal Affairs is brought to you by Kegler Brown Hill + Ritter