What’s Trending in Infill Development?
Infill development is currently experiencing a renaissance in the Valley and in metropolitan areas across the U.S. There is no single cause for this. Instead, it is a confluence of economic factors, lifestyle trends, and significant changes in transportation technology and infrastructure. Since the Great Recession in 2008, the trend toward suburban sprawl and new development on the fringes of the Valley has dramatically reversed.
Over the last decade, Phoenix and surrounding municipalities have exploded with infill growth and development. Congestion on Valley freeways and the availability of convenient public transit like the Valley Metro light rail have incentivized residents to move closer to urban cores and reduce their commutes. More recently, ridesharing, bike sharing, and other technology-based services have dramatically increased the convenience of transportation within urban corridors.
Mixed Use and Evolving Zoning
As residents began to move back into urban centers, development trends toward urban infill projects intensified. Demand for new housing, retail, and food and beverage opportunities in urban areas drove development toward city centers. Mixed-use developments, in particular, have proven successful in Central Phoenix, such as The Osborn Marketplace at the southwest corner of Seventh Avenue and Osborn, and The Colony at Seventh Street and Missouri.
One of the most common challenges with infill development is zoning. More often than not, infill sites are vacant or underutilized because the existing zoning is no longer compatible or consistent with the surrounding area. In some instances, the uses permitted by the current zoning are no longer desirable or economically viable. In others, the limitations imposed by the zoning district's development standards (setbacks, height, lot coverage, etc.) do not offer sufficient scale or intensity to justify redevelopment.
Land planning trends have evolved to meet these needs. Municipalities have adopted zoning codes and ordinances geared towards encouraging and facilitating infill development, offering flexibility in development standards and incentivizing greater commercial intensity and residential density. The City of Phoenix, for example, has adopted the Walkable Urban Code for the Central Avenue corridor, following the light rail along its path from Downtown Phoenix, through Midtown, and into Uptown.
The Walkable Urban Code is designed to facilitate and encourage growth and redevelopment along the Central Corridor by offering additional density, height, lot coverage, and reduced parking requirements. The developmental flexibility and opportunities for additional density and intensity are tailored toward large-scale, mixed-use developments that activate the street frontages and offer a more walkable environment.
The Tax Cuts and Jobs Act of 2017 established a tax incentive program to encourage and incentivize development in economically-distressed communities designated as Opportunity Zones. The Opportunity Zone program allows individuals to reduce, and under certain circumstances avoid, their tax liability on capital gains from other investments by investing those funds in Opportunity Zone development.
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This article originally appeared in the Arizona Contractor & Community magazine, May/June 2019 issue, Vol. 8, No.3. The Arizona Contractor & Community magazine is a bi-monthly publication.