RECA LDC Class Releases White Paper on UNO

July 2, 2018

RECA’s 2018 Leadership Development Class (LDC) was tasked with researching, preparing and presenting a whitepaper on University Neighborhood Overlays (UNO) and how it could potentially be utilized as a valuable resource four our community. The members of the 2018 LDC Class working on this paper consisted of fourteen members from a diverse range of professional fields with the real estate development community. We were fortunate to be able to utilize each members’ professional expertise in compiling the paper, and I’d like to share some of the highlights of our hard work on this topic.

The creation of the UNO was a demonstration of cooperation between area residents, stakeholders, and developers all working together towards a common goal. Within only three years, UNO was conceived, debated and approved by Austin’s City Council. Fourteen years after UNO’s adoption, development within the West Campus area surpassed $1 billion in private investments, resulting in a prolific expansion of new student housing units and transforming an underutilized central Austin neighborhood into a vibrant residential and restaurant district. This overlay allowed for significant benefits to the developers and residents within the area such as walkability, increased mix of land uses, and tax revenue. But its creation also resulted in some unintended consequences such as reduced legacy affordable housing and increasing demand on an inadequate infrastructure system.

UNO’s Positive & Negative Influence on Development

• Walkability: One of the guiding principles in the formation of UNO was to create an atmosphere that allowed students a lifestyle independent of automobiles. Many of the UNO design standards were written to foster a walkable environment. Two major themes helped achieve this goal: 1) a requirement that future developments have a mix of desirable destinations (i.e. retail, restaurants, groceries stores, etc.), and 2) that future development provide pedestrian friendly site design.
• Density Bonus Program: The density bonus program within UNO allows developers certain entitlements (increased building height, removing maximum FAR and maximum building coverage percentages) in exchange for providing community benefits (enhanced streetscape improvements, improved design and safety improvements, and affordable housing).
• Increased Tax Revenue: The passage of UNO has resulted in roughly 7,500 units located in the West Campus area today (compared to 4,800 units in 2000) with a corresponding estimated population growth of 77 percent, or more than an 8,000 person increase. The surge in student housing has generated a “24/7 living environment” with an expanded retail presence in restaurants, bars and grocery stores.
• Existing Affordable Housing Stock: Because underutilized parcels were among the first to be redeveloped, one of UNO’s potential drawbacks is the loss of legacy affordable housing. Recent examples of this trend include the Skyloft, 2100 Nueces, and Aspen West Campus developments. These new projects often cater to the luxury market and feature amenity packages such as concierge services, cyber cafes and cutting-edge fitness centers, which are often unaffordable for lower-income students.
• Public Infrastructure: Many of the water and wastewater lines within West Campus were installed in the 1940’s and 50’s. While this infrastructure is considered a significant component of development today, it seems to have been overlooked in the original regulating plan. While time was spent crafting a more walkable, livable and visually appealing community, the issues from having an inadequate infrastructure system were constantly kicked down the road.

Case Study

The purpose of our case study was to compare the development potential of a parcel under Austin’s current code, UNO, and CodeNEXT. The site chosen for the case study was near the Highland ACC Campus area and four scenarios were applied to it. The following summarizes the scenarios by achieved density:

• UNO 175’: 272 units (27 affordable), $2.65 / SF rent
• CodeNEXT: 143 units (8 affordable), $2.05 / SF rent
• UNO 90’: 140 units (14 affordable), $2.03 / SF rent
• Current Code: 89 units (9 affordable), $2.31 / SF rent

UNO is a great example on how effective planning and cooperation can create a solution to some of the city’s major issues. Part of its success came from identifying the need and allowing all stakeholders to actively participate in writing an ordinance that achieved the main principles from all parties. Another element of its success is the simplicity of its text. Compared to current city regulations, ordinances and the latest version of CodeNEXT, UNO was plainly written and easy to follow. Which entitlements a developer could be given, and their associated costs/tradeoffs were clearly defined and easily applied to potential sites.

Unfortunately, the area governed by UNO is unique due to the immediate population it serves. However, by understanding the similarities between this district and other identified urban centers and transportation hubs, the city could potentially implement similar standards to incentivize the necessary growth needed for compact density utilization. This unique pocket of Austin has flourished because of UNO and as a result West Campus continues to exemplify the pro density regulations that can reshape a neighborhood.

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