Resolution 6527 - Laserfiche WebLink

I. INTRODUCTION AND SUMMARY INTRODUCTION BACKGROUND The City of Everett is designated a metropolitan city and regional growth center. As such, it is expected to accommodate a significant growth in population and employment. A Transfer of Development Rights (TDR) program is a tool to guide growth to urban areas, while preserving scarce rural resources. A TDR program is a market-based approach to meeting these twin objectives. TDR programs are feasible where there is demand for additional higher density multifamily development; where TDR provides an option for increased density beyond a base; and the price of a TDR credit is less than the cost of obtaining development rights through other options (e.g. purchasing additional site area or providing bonus amenities). Two recent studies considered the applicability and feasibility of a TDR program in Snohomish County and the Puget Sound region. Each addressed the potential for such a program in Downtown Everett. The studies reached similar conclusions. The first study Receiving Area Strategy for TDR Program in Snohomish County was prepared for Snohomish County in 2007. The conclusions of the study included the following: • Developers are currently not building up to the maximum density allowed in downtown zones (B3 and R5). Rents are not high enough to support the higher cost of concrete and steel construction necessary for buildings over seven stories. • Developers indicated that a TDR program might be feasible in R3/R4 zones. They might pay approximately 50% of the market value for a TDR credit. The second study Market Analysis for Regional Transfer of Development of Rights in Central Puget Sound was prepared for the Washington State Department of Trade Commerce and Economic Development in 2008. The analysis evaluated prototypical developments in several specific geographic areas to determine the value developers would place on additional density available through TDR. If the price of TDR credits can be set at an amount equal to or less than their value, a TDR program would be feasible. The analysis considered a mixed use prototype in Downtown Everett with five floors of apartments over a two floor base. The analysis concluded that "...based on existing market conditions,the project is currently not economically feasible. Rents would have to go up 40% to 50% to create sufficient revenues that would be the foundation of a TDR model." EVERETT TRANSFER OF DEVELOPMENT RIGHTS STUDY FINAL REPORT PROPERTY COUNSELORS PAGE 1