TC-C DISTRICT CO-LIVING UNITS - LAND DEVELOPMENT REGULATIONS

AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AMENDING THE CODE OF THE CITY OF MIAMI BEACH, SUBPART B, ENTITLED “LAND DEVELOPMENT REGULATIONS,” BY AMENDING CHAPTER 142, ENTITLED “ZONING DISTRICTS AND REGULATIONS,” ARTICLE II, ENTITLED “DISTRICT REGULATIONS,” DIVISION 21, ENTITLED “TOWN CENTER-CENTRAL CORE (TC-C) DISTRICT,” SECTION 142-741, ENTITLED “MAIN PERMITTED USES, ACCESSORY USES, CONDITIONAL USES, PROHIBITED USES, AND SUPPLEMENTAL USE REGULATIONS,” TO MODIFY THE MAXIMUM NUMBER OF CO-LIVING UNITS, MODIFY PROVISIONS RELATING TO THE RESERVATION OF CO-LIVING UNITS, AND CLARIFY EXISTING PROVISIONS; AND PROVIDING FOR CODIFICATION, REPEALER, SEVERABILITY, AND AN EFFECTIVE DATE.

On November 14, 2018, the City Commission adopted Ordinance No. 2018-4224, establishing the Town Center – Central Core (TC-C) zoning district. Pursuant to the recommendations of the North Beach Master Plan, the ordinance allowed for a housing type that is new to the City known as a co-living unit, which may also be known as a micro-unit. At the time of adoption, the ordinance established a cap of 312 co-living units within the TC-C district, which represents approximately ten percent (10%) of the total allowable units in the TC-C district.

Pursuant to the land development regulations (LDRs), a co-living unit is a residential unit that is between 375 SF and 550 SF in size. The LDRs require that buildings with co-living units have a minimum of 20 percent of the gross floor area for amenity space.

On July 31, 2019, the City Commission adopted Ordinance No. 2019-4287, which amended the way density is calculated for co-living units in the TC-C district. The City Commission also required that a review and update on implementation of this ordinance be provided within 6 months of adoption.

Pursuant to Ordinance No. 2019-4287, one (1) co-living unit now counts as one-half (1/2) of a conventional unit for the purposes of calculating the maximum allowable density and population impact. Due to the lower population impact and lower floor area utilization rates associated with co-living units, the Administration also proposed, at First Reading, an increase to the maximum number of co-living units within the TC-C district, from the current limit of 312 units. The Commission did not increase the current cap of 312 co-living units.

On February 12, 2020, the 6-month review required by Ordinance No. 2019-4287 was presented to the City Commission, along with a draft ordinance to amend the maximum number of co-living units and reservation requirements (item R9 H). The City Commission referred to the proposed ordinance to the Planning Board, with an amendment that the increase in co-living units be limited to accommodate an additional 140 units. The referral also included a request for an advisory opinion from the Planning Board as to the maximum number of co-living units in the TC-C district, as well as other locations in the City where co-living units should be permitted.

Commissioner Ricky Arriola is the sponsor of the subject ordinance amendment.

PLANNING BOARD REVIEW
The March 24, 2020 and April 21, 2020 Planning Board meetings were canceled, and the item was moved to the May 19, 2020 Planning Board agenda. On May 19, 2020, the Planning Board held a public hearing and transmitted the ordinance to the City Commission with a favorable recommendation by a vote of 7-0, with no changes.

Pertaining to the advisory opinions sought by the City Commission regarding co-living units, the Planning Board recommended the following:

1. Provide a recommendation to the City Commission regarding a maximum number of co-living units to be permitted in the North Beach TC-C district:

The Planning Board recommended an increase in the cap on co-living units, but that such an increase be offset by reductions in the caps of other types of units in the TC-C district, such as residential and hotel, in order to re-allocate these units, without increasing the overall quantity. The Planning Board also recommended that the City continue to evaluate the traffic impact of those units in the TC-C district where the occupants have private vehicles.

2. Provide a recommendation to the City Commission on whether to permit co-living units in other areas of the City:

The Planning Board recommended that co-living units be expanded to other areas of the City, after careful study and evaluation of which areas would be the most appropriate, and with cap limits.

PLANNING ANALYSIS
Co-living and micro units are becoming increasingly common throughout urban cities in the United Sates. Due to their smaller sizes, it is expected that co-living units will have more attainable rents, while still providing a significant number of amenities for residents that allow for high levels of social interaction. They are shown to attract young professionals that are not looking for the expense and responsibilities of home ownership, as well as retirees looking to downsize. Attracting such residents is desirable in order to encourage the economic development of the North Beach Town Center.

Due to the small size of co-living units, they will likely house fewer people than a conventional housing unit. For planning purposes, it is estimated that a conventional housing unit has 2.5 people per dwelling unit. A report from the Urban Land Institute (ULI) entitled The Macro View on Micro Units indicates that the ability to live alone is one of the primary reasons for people to move into a co-living unit. Because of the size of a co-living unit and the expectation of more attainable rent, it is more likely that they will be made up of single-person households. Because a co-living unit is roughly half the size of a conventional unit, it can be estimated that the planning impact of a co-living unit will be half (1/2) that of a conventional unit, or approximately 1.25 people per dwelling unit.

The following development applications have been approved by the Design Review Board (DRB) or have submitted a building permit application with co-living units:

1. 7145 Carlyle Avenue: 121 co-living units.

2. 6970 Collins Avenue: 20 co-living units.

3. 7114 Collins Avenue: 168 co-living units.

Total: 309 co-living units.

When Ordinance 2019-4287 was presented to the City Commission in July of 2019, the developer of the parcel located at 7140 Abbott Avenue expressed an intent to submit a development application to the DRB, before the end of the year, for a project containing co-living units. The proposed configuration of this project was contingent upon the approval by the City Commission of a requested alley vacation. Although the developer began the formal DRB application process as quickly as possible, 309 of the co-living units available within the pool of 312 units (for the TC-C district) were unexpectedly reserved, prior to the developer meeting the technical requirement in City Code Section 142-741 to reserve the units (i.e. before the developer was determined to have filed a completed DRB application). The developer of 7140 Abbott Avenue is now proposing to construct 141 co-living units. If the cap were increased by 141 units to accommodate this proposal, the total number of proposed co-living units within the TC-C district would increase from the current 312 units to 453 units.

Considering the general interest in, and forward movement of, applications including co-living units within the area, the Administration has consistently recommended an increase in the overall cap of co-living units within the TC-C district. The modification of the density calculation in July of 2019 has increased the feasibility of co-living developments. However, without an additional increase to the maximum number of co-living units in the district, the number of projects that can develop these units is limited. Greater flexibility relating to the number of co-living units would improve the likelihood of bringing a co-living development to fruition. As the City Commission has expressed some concerns with the possible proliferation of co-living units, the proposed ordinance provides for a modest increase from 312 units to 453 units.

In addition to the proposed increase in the cap for co-living units, the method of reserving co-living units within the cap is proposed to be modified for purposes of clarity and equity. Currently, a reservation for these units can be made on a first-come, first serve basis, by either making an application for a (i) land use board approval, (ii) building permit, (iii) certificate of occupancy, or (iv) business tax receipt. Since the allocation of co-living units is administered pursuant to the LDRs (i.e. by the Planning Department), the Administration recommends that the land use board application process be the sole method of reservation for co-living units. These proposed revisions are contained within the attached draft ordinance.

SUMMARY/UPDATE
As previously noted in the February 12, 2020 Commission Memo, the administration recommended that the cap on co-living units be increased to 550 units, in order to provide flexibility for current and future projects to move forward with a co-living component. The Planning Board, while not recommending a specific number, did recommend an increase in the cap on co-living units, provided such increase is offset by a reduction in the cap of other types of units in the TC-C district.

The City Commission approved the subject ordinance at first reading on June 24, 2020, subject to the co-living cap being increased from 312 units to 453 units. Additionally the Commission offset the 141 co-living unit increase by decreasing the cap on hotel units from 2000 to 1,859.  This modification has been incorporated into the attached ordinance for second reading.

As indicated in the June 24, 2020 Commission memo, the administration has evaluated the current caps on all types of allowable units within the TC-C district under Sec. 142-741(b)(2) of the TC-C regulations, including residential, hotel, affordable housing and workforce housing. In this regard, a reduction in the number of allowable hotel units from the current cap of 2000 units to 1,762 units, would offset an increase in the cap of co-living units from the current limit of 312 units to 550 units.

The administration continues to believe that such a re-allocation of units, as discussed by the Planning Board, would be a neutral offset of the increase in co-living units. Additionally, the re-allocation of units would come from allowable transient units. As such, it is recommended that the City Commission increase the allowable cap of co-living units in the TC-C district to 550 units.