Photo: George and the G.C. Garcia, Inc. staff achieved the moniker, “Red Tape Sherpas” due to their ability to navigate the sometimes-treacherous terrains of government zoning, licensing, permitting, and real estate transactions.
MASTERING LAND ENTITLEMENTS
A strategic and knowledgeable approach to securing land entitlements streamlines the involved processes and augments returns-on-investment in commercial real estate development.
Land entitlements are the cornerstone of land development. Yet, a deep well of patience is necessary to unravel the bureaucratic complexities and multifarious requirements.
George Garcia, the Founder and President of real estate development and redevelopment services company G.C. Garcia, Inc. located in Las Vegas, guides real estate investors, site owners and developers as they navigate such enterprises. For this expertise, Garcia and his team have earned the moniker, “Red Tape Sherpas.”
“Cutting through the red tape involved in land development, zoning and entitlements is nothing short of a complex series of carefully managed activities,” says Garcia.
He knows this firsthand. Garcia has more than 26 years in government planning, land planning and real estate development. Prior to founding his company, he served as Planning Director for the City of Henderson, Nev., and Assistant Planning Director in Overland Park, Kan.
In Garcia’s leadership role at G.C. Garcia, Inc., he guides developers through the process of dealing with local governments, planning boards and other public entities. Before the first shovel breaks ground, he and his team strive to bring clarity to any land planning or zoning situation.
For land owners and those seeking new property for future building and development, detailed research is a fundamental precursor in evaluating a project’s potential. A vetting and planning process is essential.
From site evaluation to coordinating with government entities, leaving no stone unturned is paramount for real estate entrepreneurs. The procedures give a whole new meaning to doing one’s homework.
Garcia advises that a systematic approach to site exploration and procedural planning are prerequisites for real estate investments. “Government and neighborhood relations, entitlements, due diligence, development coordination, permitting, and business licensing are key elements,” he says.
Coordination will be needed with local and state governments, utility companies, neighbors, and engineers. In many cases, technical studies, redevelopment financial reviews and application submittals are necessary.
Common Land Entitlements
Formulating project parameters is the first step. You’ll want to understand the five common land entitlements, which are legal agreements between you and government municipalities that allow for land developments.
1. Amending. The highest level of entitlement requires amending the city’s comprehensive plan, which is the policy that guides city development. “Amending is the most legally and politically difficult of entitlements,” Garcia says. “It’s necessary if you want to change the current use-plans for a piece of land.”
For example, a developer might want to develop land for commercial, industrial or multi-family use, but the city’s plan has slated the property for residential-use at a certain developmental density. To achieve his goal, the developer would have to amend the city’s plan.
2. Rezoning. If the land is not zoned for your intended use, there is no escaping the rezoning process. “This can be complicated,” Garcia says. “Sometimes, rezoning is not possible, but it can be achieved in most cases with proper management and an action plan.”
Zoning or entitlement of land varies depending upon location. For example, a field on the edge of development is handled differently than an infill property with surrounding development.
3. Zoning variances. For projects that don’t fit the city’s requirements for size, scale, height, or mass of building, you will need a variance to deviate from the standards.
“There are techniques provided within zoning code, affording the ability to seek waivers and modifications to the standards,” Garcia says. “The most restrictive is a variance.”
A well-structured plan, under statues and codes, is the foundation for seeking to vary from the standard requirements.
4. Permits. A special-use permit needs a discretionary review and approval of the government staff and neighbors to evaluate characteristics of a project. Such factors might include traffic impact, the project’s functionality, or aesthetic implications.
A conditional-use permit is one that can be categorized, administratively, in a checkbox fashion. Whether a permit is special-use or conditional-use, can vary depending on the district.
5. Utility and road approvals. Utilities may not be at your site or be appropriate for your usage. Adequate roadways may not exist to connect your property.
For these challenges, you’ll have to attempt to amend the city’s plan to facilitate utilities or create roadways. If you obtain these changes, the higher intensity of zoning will allow you to proceed.
With an understanding of the types of entitlements that could be required, the next phase of land development or redevelopment involves due diligence to gain indispensable, preliminary insight that could make or break the ability to seek and secure any necessary entitlements.
G.C. Garcia, Inc.’s team executes the following five steps of due diligence before property is purchased. This helps prevent commencement of land deals that could go very wrong or sets the course for ones that have the qualities for positive fruition.
1. Entitlement potential. George Garcia and his team assess if a property is going to stand any chance of being rezoned or having entitlements granted. The goal is to save unnecessary expenditures and avoid problematic land deals.
If purchasing a property for a specific development is realistic, given zoning and building requirements, Garcia gives his clients a pre-purchase view of complexity and cost.
2. Infrastructure assessment. G.C. Garcia, Inc., works with a team of professionals to examine public and private infrastructure, including roads, drainage, water, sewer, power, gas, and others.
“This evaluation is part of due diligence to understand whether the project you want to build or refurbish can support additional infrastructure, or that the infrastructure exists,” Garcia explains.
3. Potential land-use. A developer should understand the special use or conditional use permits in the jurisdiction and its potential zoning or rezoning.
This review produces knowledge of all that a project will require of the land, including a master-planned development when applicable.
“We predict and translate a project’s end result into the regulatory world,” Garcia says. “Then, we can create a path to completion.”
4. Informal meetings. Before the project’s onset, a developer’s concept should be reviewed by the city’s staff and elected officials to gauge their initial thoughts.
“It’s wise to present the concept so regulators understand, whether in political or regulatory language, so they can assess the development’s goals,” Garcia says.
This affords a window into how the process may play out at the hands of those with approval authority. Garcia gains three points of view: “Our own perspective about the project; the owners’ goals; and the government and decision makers’ standpoints.”
5. Knowing neighbors. Often, there are neighbors to consider. Having due diligence meetings with members of a community is critical.
“If community relations are well-handled, and the project is supported by residents, it usually gets a green light,” says Garcia. “It is then time to craft a core strategy to secure entitlements.”
Working to obtain specific entitlements comes with its challenges. There is a process, and a profitable outcome is one that only results from adhering to a step-by-step strategy.
1. The informal meetings. Garcia recommends preliminary meetings with elected officials, neighbors and city staffs. “We call them the ‘major stakeholder groups,’” he says. “You can do this informally.”
Connecting early with these groups is a means to introduce project concepts and weigh early opinions and problems. The ‘major stakeholder groups’ affect the outcome in more ways than one, so we highly recommend giving them credence and of your time.
2. The submission of conceptual plan review or pre-submittal meeting. This is more formal than the first conversations with the major stakeholder groups. Once the conceptual plan is submitted, the city will issue a checklist of comments.
Your plans could be less than what’s required for a full submittal, but at least this yields upfront guidance to address. At this point, a project’s conceptual planning may need to be modified to fulfill and address the city staff’s checklist.
3. The official submittal. After revisions are made to the plan, it will be time for the official submittal to the jurisdiction. The city will conduct another, more formal, review of your documents. This can yield another round of comments, this time officially, about your application.
Addressing or amending the project again, this time, according to the city’s official recommendations, is a requirement to move forward.
4. A neighborhood hearing. Neighbors could regard your project unfavorably. Treading carefully is crucial. Part of gleaning entitlements is communicating to, and with, the residential and even other commercial business neighbors.
“We provide transparency and insight in a digestible form,” Garcia says. “We identify a convenient location and meet with the community. In some cases, the staff or a public official may attend.”
This yields an opportunity for open dialog about concerns and solutions. While proactive neighborhood and community relations may seem challenging, the related efforts and activities almost always prove beneficial later, when it comes to excavation, building, refurbishing, and opening a new property or business.
5. A staff recommendation of approval, or a review date. Sometimes, your plan is approved by city staff; sometimes by the planning commission; and sometimes through a city council hearing. At the hearing, elected officials listen to the applicant, neighbors and city staff, before rendering a final decision. They can accept your plan, modify it, or deny the application.
After city council concludes its decision, if not in your favor, the only recourse is filing an action in a district court to challenge it. To file or not to file comes with its set of pros and cons, and the need for thought-leadership and guidance. Consultation of a well-equipped support team is vital to the realization of a successful, completed project that benefits both developer and the community in which the finished project resides.
Contact our team at G.C. Garcia, Inc. and tell us about your commercial real estate project. We can help simplify and streamline the intricate aspects of planning, approvals, entitlements, permitting, zoning, communications, and guide the process to achieve success and return-on-investment.