Can I Convert a multi-use building to a triplex???

Question

Here's a question I have. I found a mult-use building in a smaller town (10,000 people) that I'm very familiar with. Its actually right near the downtown area. Its a really nice town that I have not been able to get a rental in because the prices are just too high to make sense.

However, this multi-use building just popped up. Its got 5,600 sq ft of space with a 2bdrm apt on the upstairs taking up 1,800 sq ft. The bottom 3,800 sq ft is office and storage in an "open floor plan".

My question, without having seen it yet or talking with the village. Has anyone ever considered converted the office space to residential rental space entirely? Its actually right next to residential so it wouldn't be a notable fish out of water.

Does anybody know when if a property thats zoned multi use has to have a certain percentage of the square footage used for commercial?

I'm just thinking if I could actually get the approval to turn it into a 3 plex, there's some really good rents to be had and a lot of space. I figured I could possibly convert the upstairs 2 bdrm into a 3bdrm (1800 sq ft should allow for 3 bdrms), and the downstairs into a couple of 1,500 sq ft 3 bdrm units - provided the layout works.

Im just wondering if anybody knows more about multi-use zoning rules and/or what my chances might be to pull something like this off. The numbers would look pretty good if I could turn it into a 3 plex. I don't think the office thing interests me enough to want to pick it up and deal with the commercial side of it

Mike H. · Answer

re: multi-use I'm just using the terminology of the listing - they called the building multi-use. I looked at it last night. Its a nice building in terms of the bones. But the inside would be a complete gut and build out. Right now they have it listed at 130k but I saw that the building was foreclosed on by the bank for 80k. It had been owned for some time and I think the loan was down to about 65k based on some other info I got. So I'm going to keep an eye on it and will try following up with the village on the zoning. The interesting thing is that this is near mostly residential and it looks like the two buildings next to it were both two flats as well so I'm thinking it might already be allowed with the zoning. But now its the rehab costs that have me a little spooked. :-) It would be a fun project to do though with the high ceilings on both floors. Create loft-like units in that area I think would be a huge seller.

Mala S. · Answer

Mike H. Well, at the very least you should try and get the specific zoning info for the lot from the Building/ Planning department. There is no risk in that. Where did you get the term "multi-use" from? If I understood you correctly you are just describing the property that is currently on the lot - this does not mean that the lot was zoned strictly for multi-use.

Karen Margrave · Answer

Mike H. That's something you definitely will have to make a trip to the Planning Department for and talk to someone in person. Every area has their policies on this type of stuff. Though residential is a lower impact use, it may be that the City wants commercial due to higher fees and taxes they can generate from sales revenue or ? Does the area have a long term general plan? If so, look at see what the long term use of the property is planned to be.

Mike H. · Answer

Thanks for the feedback. Yea. That sounds a bit risky. I don't think I'd want to buy it unless I was sure I could convert it to all residential. I was just wondering if the term multi-use required me to have any commercial or not. Or if that just means that some of it can be used for commercial.

Mala S. · Answer

Hi Mike, Zoning regulations are typically very specific to location, and can change from even one block to another. However, if you have the address of the property you can look up this information online. If the info is not available online you can get the specific zoning rules for the property at the building department for free (or maybe a small photocopying fee). If it so happens that the property is zoned for mixed-use and you want to convert it to 100% residential you can file for a variance. If a large portion of the neighboring properties are 100% residential, this will work in your favor. You will likely need an architect to create some plans and elevations and/or renderings to show your proposed building will fit in with the neighborhood. An local architect is a good person to ask to see how likely it is that the variance will go through. Also, when applying for a variance you have to publicly announce it (in the paper or with a sign on the property) so any neighbors who may object have the opportunity to do so. If you don't think neighbors will have a cause to object to your proposal that is also something that will work in your favor. I hope that helps! Mala