How to Overcome Build to Rent Entitlement Challenges

Build to rent communities (BTR) are examples of critically needed missing middle housing and are growing in popularity. Increased job mobility and remote working, coupled with rising housing prices and higher mortgage rates, make rental homes with no one living above and below an attractive option for a variety of demographic profiles. Many BTR communities also feature sought-after amenities that are typical to master-planned communities that appeal to renters’ lifestyle needs.

Unfortunately, BTR projects are often delayed and even derailed during the land entitlement process. To be fair, BTR is a newer type of development, and many municipalities are unaware of BTR differences compared to single-family detached and multifamily projects. Fortunately, there are ways to make the BTR project approval process a little more streamlined (depending on the jurisdiction). We’re taking a closer look at some build to rent approval challenges during entitlements and what you can do to solve them.

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Why BTR Projects Stall or Fail During Entitlements

BTR site map confusion

Local planning and building departments know what a single-family detached or multifamily site plan looks like, less so with a proposed BTR development plan, says KGA Partner and Director of Design John Guilliams. “It’s a fairly new concept to municipalities, and they aren’t sure how to handle the different aspects of it.”

Sometimes BTR plot maps feature a single lot, unlike a typical subdivision with individual lots for each home. This is often misconstrued as a condo project by city planners or the development agency. Or a building department may review a horizontal apartment or cottage home type of project and assume it’s made up of individual units, says Diana Rael, principal of Norris Design. “Which is not the case, it’s managed on one property unsubdivided, so there’s confusion with respect to that and leads to questions about how to service those units from a utility standpoint.”

Lack of understanding of build to rent development

In addition to plot map misconceptions, other aspects of BTR development are new to municipalities and cause confusion and delay. Questions and obstacles arise around fire and critical services, utility hookups, water and sewer access, and trash collection. “There are many different departments that have a say in what’s going on in BTR projects, and sometimes they conflict with one another,” says Guilliams.

This leads to several friction points between the local agency and developer — lots of back-and-forth, reviews, and sometimes plan revision and redesign requests, adding delays and costs to a project. Some developers can stick it out, some can’t or choose not to.

Connectivity concerns

Like a townhome or multi-family community, build to rent projects often include a network of private roads that feed in and out of public streets. Naturally, municipalities want to understand how traffic flows and patterns will be affected by the new development’s ingress and egress points and locations. A plan for sidewalks and bike lanes is also a sticking point for many cities and towns as they consider how the proposed BTR plan blends into the existing transportation network and its effects on traffic patterns.

Rael says many BTR projects in other states are gated, a community feature that’s uncommon to Colorado. “Jurisdictions in Colorado don’t like gated communities. The network is really strong here and is a real focus versus a gated community that feels disconnected.”

Parking issues

When is parking ever easy? Spoiler: Rarely. Given planning and building departments’ inexperience reviewing them, parking in BTR projects tend to undergo more scrutiny than other developments.

Horizontal apartments or cottage homes do not typically include attached garages, for example, which can raise questions and concerns. Parking minimums are different from single-family detached to multi-family, and it’s unclear to some municipalities where or how to plan for parking in a BTR project. Some jurisdictions are revamping their parking requirements or eliminating them altogether to make way for more housing to be built. Parking reviews may also have a downstream impact on community circulation and connectivity.

How to Overcome Build to Rent Entitlement Problems

Outreach and educate municipalities

Understanding municipalities’ common BTR concerns can help you fast-track your next project approval. A best practice is to anticipate these concerns and plan accordingly. Meet with the departments that voice the most issues – utilities and fire – to answer questions, address misconceptions, and have solutions ready before submittal, if possible.

Emerson Olde Town Build to Rent Townhomes
This 24 unit build to rent townhome project is currently under construction in Arvada, Colorado.

Circle in local housing authorities

Local housing authorities can be resources and sources of support in local jurisdictions when building support for BTR projects. Governed by the Department of Housing and Urban Development, these independent agencies serve their local communities by supporting quality and affordable living environments for residents.

For some local housing authorities, local governments provide oversight through board appointments. Educating these organizations on how BTR can serve as a path to homeownership may fuel community acceptance and interest. Residents can rent and work in the same city or town, then purchase a home in the community when personal finances and interest rates are more favorable.

Start small

For out-of-town developers and for developers who are new to BTR, it helps to start small. An infill location of 10 to 20 units takes some of the issues and costs out of the connectivity equation. A modest project also minimizes soil testing expenses and impact fees.

Colorado is a home-rule state, and each jurisdiction is unique with different zoning codes and building codes. Region-specific codes and regulations are great for Coloradans but can be confusing to developers unfamiliar with the nuances of each municipality.

Include the community

There’s an unfortunate stigma surrounding rental housing which often results in NIMBYism and negative community feedback and pressure on city councils. Community pushback commonly includes concerns about vagrancy, maintenance and aesthetics, crime, and property values.

Reaching out proactively to community leaders about build to rent, its advantages, and its demographic profile can help dispel myths and misconceptions. Chief among them is the concern about upkeep. Communities want assurances that lawns are mowed and structures are maintained. Earn community buy-in by communicating that BTR developments are different from individual rental homes scattered throughout a community. BTR developers aim to keep their maintenance costs down by selecting quality, durable materials with longer lifespans. Property management companies perform needed repairs to interiors, exteriors, landscaping, and amenities to maintain curb appeal.

It’s also important to educate communities about typical BTR rent profiles. BTR households are often teachers, nurses, and first responders who may be priced out of a home purchase but desire to live near where they work. BTR neighborhoods provide missing middle housing many cities and towns desperately need to address the country’s housing shortages and affordability challenges. 

According to a recent John Burn Research & Consulting survey, 55% percent of BTR renters live in a rental for two to three years, and 34% plan to stay four years or longer. What’s more, BTR communities are made up of higher-earning households on average and command market rate rents, sometimes even more than the average mortgage payment in an area.

Create a framework of design specifications

A baseline plan matrix can educate and inform local agencies. This type of design playbook can include sample build to rent projects, square footages, room counts, and plan features. The matrix may also include a sample materials list with an emphasis on quality materials to improve neighborhood aesthetics and reduce maintenance.

Share success stories

Social proof is powerful! BTR is still a relatively new housing product and there is a lack of understanding at the local level. Planning and building department personnel would probably welcome recent use-case scenarios to understand how other municipalities have moved forward with BTR communities.

Include examples of BTR projects when meeting with local agencies and in project applications if possible. Educate and inform using case studies in nearby or similar jurisdictions to demonstrate connectivity solutions, provide examples of good BTR design, and highlight community benefits.

Your Partner in BTR Planning and Architectural Design

Build to rent development has unique planning and development requirements that are often misunderstood by local agencies and jurisdictions. An architectural firm with BTR design experience can help you anticipate challenges that may come up during entitlement and have jurisdiction-specific solutions. To learn more about KGA’s BTR design experience and to get your project questions answered, please contact us for a consultation.

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