203k - Raze, Reduce, Addition, or Seek Exemption?

[Monique Boyce]

I purchased a property over a year and a half ago through a 203k renovation loan. The property is down to the studs, so even though it's technically a renovation, it will be like a new build. The plan is to convert it to a 4 unit building since it's in a multi-use zone. The permitting process has been challenging, but after a year and a half we have approval from all but one division at the permitting agency to receive the building permits - Zoning.

For various reasons, according to Zoning, options for getting my current design approved include:

1- getting a Raze permit

2- applying for an exemption with the zoning board

3- make it a 3 level building with the three units in the front, and then add an additional structure in the back as the fourth unit to utilize the remaining lot occupancy space on the property

4 - going from a 4 unit design to a 3 unit design, expanding the the third unit height and creating a loft/ mezzanine to add more bd/ba

There are cons associated with each option:

1 - process is time consuming and costly.

2 - process is time consuming, costly, requires neighbor support, uncertain.

3 - adding the structure onto the back would require having each division re-review/approve the design plans again. Unsure if this would be seen as an amendment or entirely new reviews with new review costs.

4 - this might lower the value of the project, which would likely cause the lender to reappraisal the project and then possibly not approve the changes or redo the loan or call the loan. I'm uncertain what they would do.

We have been through so much and are at the last step. We just need Zoning approval to move forward. I would like to do the thing that is least time consuming and costly. What do you recommend?