Seattle’s response to Washington State House Bill 1110 has now moved from interim compliance to adopted code. Through the One Seattle Plan and permanent legislation approved under Ordinance Nos. 127375 and 127376 late last year, the City has established a new Middle Housing framework intended to expand residential capacity in zones that historically allowed predominantly detached homes.

For Seattle and Pacific Northwest multi-family residential developers, the significance of these changes is not simply regulatory; the practical implications are architectural, financial, and site-specific. Revised standards for density, FAR, lot coverage, setbacks, height, amenity area, parking, stacked units, ADUs, low-income housing, and limited ground-floor commercial uses all influence what can be designed, entitled, financed, and built on a given parcel.

To help developers and project teams understand these changes, AXIS Architecture + Design has prepared a concise technical summary of Seattle’s updated Middle Housing standards. The summary includes code highlights and yield studies illustrating how the new framework may affect typical Neighborhood Residential lots, including detached, attached, semi-detached, and stacked-unit configurations.

As Seattle’s housing policy continues to evolve, early technical analysis will be essential to identifying development opportunities and minimizing planning risk. As an experienced Seattle-based multi-family residential architectural design firm, AXIS’ summary is intended as a practical starting point for owners, developers, and project teams evaluating sites under the City’s adopted HB 1110 implementation framework.

Download AXIS Architecture + Design’s Seattle Middle Housing white paper below.

CONNECT WITH AXIS ARCHITECTURE + DESIGN

Have a multi-family residential project proposed in Seattle, Washington State, or along the West Coast?  Connect with AXIS Architecture + Design’s Multi-Family Residential design practice to see how we can help.  As an award-winning architecture firm with extensive experience designing multi-family residential housing, workforce housing, affordable housing, and mixed-use projects across the Pacific Northwest and along the West Coast, AXIS Architecture + Design has the planning, design, and feasibility expertise to help ensure your project’s success.

Connect with AXIS.

The post Seattle Middle Housing: A Technical Guide to the Adopted HB 1110 Middle Housing Code Changes appeared first on AXIS Architecture.

As such, AXIS is proud to activate the adaptive reuse experts on our team to help local and state legislators maximize the potential of their planning efforts. Late last week, we submitted our recommendations to the City of Los Angeles for improving the draft Citywide Adaptive Reuse Ordinance (ARO). This ordinance is key in addressing the city’s housing crisis and revitalizing underused buildings.

Key Highlights of Our Recommendations:

• Expand Rooftop Additions: Allow both residential units and amenities to maximize housing production.
• Affordable Housing Incentives: Clarify and extend affordable housing incentives, offering developers more flexibility.
• Unified Adaptive Reuse Projects: Increase development opportunities by expanding the radius for project sites and removing restrictive design requirements.
• Seismically Vulnerable Buildings: Streamline approval processes for adaptive reuse in M-zones to expedite retrofits and conversions.
• Include Office-to-Hotel Conversions: Encourage office-to-hotel conversions to better utilize underperforming properties and increase housing options.

Our goal is to help Los Angeles meet its housing needs while preserving its architectural heritage. We believe these changes will help unlock the full potential of adaptive reuse projects across the city.

Download the full letter here: AXIS Architecture and Design – City of LA Citywide Adaptive Reuse Ordinance Recommendations – CPC-2023-5986-CA

The post AXIS’ recommendations to the Los Angeles City Planning Commission for improving the draft Citywide Adaptive Reuse Ordinance (ARO) appeared first on AXIS Architecture.

For our Los Angeles-based multi-family residential and affordable housing clients and industry partners, particularly those practiced with adaptive reuse developments, ICYMI, earlier this month the City of Los Angeles released the second draft of their Citywide Housing Adaptive Reuse Ordinance, with the goal of improving access to affordable housing by way of streamlining the conversion of commercial and office spaces into housing stock.

Proudly, AXIS’ own Roberto Vazquez, Associate Principal and in-house adaptive reuse architectural design expert, participated in the AIA Los Angeles Roundtable that in-part advised the City on the creation of these new ordinances.

Starting next week, the city will be welcoming public feedback on the proposed new ordinances. We encourage you to visit the Los Angeles City Planning Housing Element Rezoning Program site to see the proposed new ordinances, and to learn more: https://planning.lacity.gov/plans-policies/housing-element-rezoning-program .

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Earlier this month, AXIS Founding Principal and Seattle Studio Director Radim Blazej attend the 2024 Urban Land Institute’s Housing Opportunity Conference. An annual event hosted by ULI and the Terwilliger Center for Housing, the conference examines factors contributing to the housing affordability crisis, and explores best practices in residential development and public policy to support the construction of affordable housing across America.

This year, one factor dominated the discussion: interest rates. With rates continuing to hover around 6%, both buyers and developers are facing affordability challenges of their own. For homebuyers, higher rates make overall ownership more expensive, which indirectly places pressure on rental demand, ultimately increasing housing costs for everyone. For developers, rates contribute to the prohibitive cost of borrowing and building – a situation that further limits new home stock, and ultimately increases prices with decreasing inventory.

So, what can a multi-family residential architect do to assist in this situation? Radim offers these insights informed by his participation in this year’s conference.

AXIS Founding Principal Architect Radim Blazej at the 2024 ULI Housing Opportunity Conference.

“Increase density.”

“Simply put, more housing stock is needed.  Denser multi-family communities are the fastest and most cost efficient way to bring more stock online.  For buyers, increased density means reduced price pressure; for developers, denser developments are more cost efficient to build, and ultimately more tempting to undertake.  As architects, finding opportunities to increase unit-count in our multi-family projects means bringing more housing to market, and increased potential for developers.”

“Design homes for the changing demographics.”

“Millennials will soon become the largest segment of homebuyers in the market.  They’re also the most likely to live with over 3.0 people per residence, yet are the most likely to purchase homes with 2 bedrooms or fewer on account of affordability.  As architects, our challenge is to embrace designing homes that can affordably flex and accommodate Millennials’ changing needs and budgets.”

“Embrace transit proximity and walkable neighborhoods.”

“It’s a proven approach: focusing dense housing in the proximity of mass transit or the downtown core, and supporting it with zoning code adjustments, is a recipe for creating affordable urban housing.  The City of Austin’s success applying this approach to mitigate their recent population boom is a perfect example.  Reducing the dependability on cars and creating quality public spaces allows developers to reduce their cost-per-unit, and at the same time creates more commercial base and amenities for the city.”

“Simplify the permit process and reduce required mandates.”

“As a West Coast architect, I could only look enviously how much shorter the permitting and development approval process is in Austin.  Encouragingly, both Washington and California legislatures are pushing local jurisdictions to simplify and expedite the permitting process – a step in the right direction. Not only do permitting delays result in increased time costs, consultant fees, and carrying costs, but there is also an opportunity cost and increased development risk – this directly decreases the affordability of future housing.”

“Design homes with construction affordability in mind.”

“Ultimately, the more cost-efficiently multi-family residences can be constructed, the more affordable they will be to purchase, and the more willing developers will be to build them.  Affordability starts with the architectural design – but this doesn’t mean designing uninspiring buildings and specifying budget materials.  It means finding ways to maximize the potential of every aspect of every community we design – from optimal usage of space, choosing energy efficient mechanical, down to assisting developers access tax credits and bylaw variances for increased density.  Our challenge is to make every dollar count.”

This article appeared in the January/February 2024 edition of The Praxis newsletter.

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Team:

GMD Development – Owner
Emily Thompson
Alex Hutchinson

AXIS – Architect
Principal in Charge: Radim Blazej
Lead Designer: Aaron Blaha
Job Captain: Andrew Korik
Project Manager: Andrew Kluess

Sierra Construction – General Contractor
Kory Knudson

The 1020 Northgate site was originally conceived as a market-rate mixed-use multifamily development with a previous Caron Architecture client. The site was acquired by GMD Development in 2022. Emily Thompson from GMD Development highlighted the strategic opportunity this project presented, saying, “The investment in affordable housing in Northgate has lagged the significant public investment in transit with the opening of the light rail station, in part due to the lack of sites available for purchase. When presented with the off-market opportunity to acquire this site in Northgate, we immediately knew it was a fantastic location to build needed affordable housing, and are grateful to the City of Seattle’s Office of Housing for their early and strong commitment to this project.”

In response to an acute housing shortage, the City of Seattle declared a housing emergency allowing 100% affordable housing projects to bypass Design Review and proceed directly with a Construction Permit application. While bypassing Design review saves substantial time and cost, after reviewing the apartment yield available within a 55′ height limit, GMD and their non-profit development partner decided to take the project through Administrative Design Review. Obtaining design departures and proceeding with a Contract Rezone added an additional story (ten feet) of height – yielding 32 more 100% affordable units than the 55’ proposal.

Given nearby developments with a taller height limit and this site’s previous consideration for an upzone to a 65′ height limit, the team felt the prudent approach was to proceed with a rezone in order to increase the affordable housing capacity of the site. This approach aligns with regional trends, as illustrated by surrounding developments.

Aerial Rendering of Victory Northgate Affordable Housing Project

With support from city staff, this contract rezone was passed with a 7-0 vote by the full Seattle City Council on November 7th, 2023. Being a 100% affordable housing project, it receives priority review from Seattle Department of Construction and Inspections, saving substantial time during the Construction permit comment and response period. With a construction permit application filed in June 2023, the project is already on track to start construction in early 2024.

With extensive experience working together on previous ground-up affordable housing projects, GMD Development and Sierra Construction were able to provide real-time feedback on design alternatives, cost, and constructability issues which allowed the team significant efficiencies during design. Their close engagement with the design team allowed AXIS to maintain the visual appeal and sophisticated materiality prioritized early in design, even while balancing challenges with complex structural and waterproofing requirements due to site conditions. AXIS’ proven expertise with the mixed-use multi-family typology in the region, in conjunction with the knowledge of GMD and Sierra, allowed for the streamlined realization of this project.

The post Whitepaper: Maximizing Affordable Housing Through Strategic Rezoning – The1020 Northgate Case Study appeared first on AXIS Architecture.

Tailored for hotel owners and operators looking for guidance on how to best optimize their property to increase its viability during the pandemic, the roundtable discusses approachable optimization and renovation opportunities that will also increase a hotel’s marketability in a post-pandemic environment.

To watch the on-demand replay of the panel, simply visit the session’s registration page and complete the form.

Download the handout

Attendees of the live event were also provided a hand-out to help illustrate some of the opportunities discussed by the panelists. Download the handout and explore examples of real property optimizations AXIS has helped hotel developers, owners and operators achieve.

And as always, if you’re interested in exploring how to best optimize a hotel property to increase its viability, we welcome you to contact Athena to see how AXIS can help.

Athena Christodoulatos
Associate Principal and Director of Business Development
415.519.6778
athenac@axisgfa.com

The post IN CASE YOU MISSED IT – WATCH OUR HOTEL MANAGEMENT VIRTUAL PANEL <em>UNMASKING HOTEL VIABILITY</em> ON DEMAND appeared first on AXIS Architecture.

Join us for our upcoming virtual roundtable: Unmasking hotel viability – Practical optimizations with long-term value.

Tailored for hotel owners and operators looking to optimize their property to increase its viability during the pandemic, the roundtable will discuss approachable optimization and renovation opportunities that will also increase a hotel’s marketability in a post-pandemic environment.

Moderated by AXIS Principal Architect Cory Creath and including AXIS’ hotel renovation expert Rory Carroll, the virtual roundtable will include perspectives from EDG Design (interior design), SCEG (MEP), Comren (construction) and KHP Capital Partners (investment).

Benefits for hotel owners and operators

• What property enhancements can increase my hotel’s viability during the pandemic?
• How will hotel design change in the future in response to the “new normal?”
• What optimizations can I make to my property that will deliver value for years to come?
• If I’m considering a short-term or permanent repurposing of my property, what do I need to consider?
• What changes to my event and F&B spaces will be the most profitable in the coming years?

A chance to win personalized feasibility consulting

Hotel owner or operator attendees will be entered to win 20 hours of personalized feasibility consulting to explore the optimization opportunities at their property.

When, where, how

• Wednesday, March 10, 11:00 am Pacific / 2:00 pm Eastern
• Registration is complementary
• Attend virtually; register in advance through the link below

Join us and unmask your hotel’s increased viability; register at Hotel Management Magazine today: https://pages.questexnetwork.com/AXISGFA-Registration-031021.html

The post UNMASK YOUR HOTEL’S VIABILITY – JOIN AXIS’ VIRTUAL PANEL appeared first on AXIS Architecture.

Late last month, members of the AXIS leadership team once again made the trip to Phoenix for the 2017 installment of The Lodging Conference. Recognized as one of the most important events on the hotel industry’s calendar, the 2017 event saw a number of changes to the event’s format, most notable of which was the hosting of the conference later in the year – a change which provided the benefit of additional clarity for keynote analysis and breakout discussion. Amidst that analysis and discussion two questions stood out: Could the hospitality industry finally be post-cyclical? What impact might the proliferating number of hotel brands have on hotel development?

Contemplating a post-cyclical industry

Regular readers of The Praxis will no doubt recall a common theme in our post-Lodging Conference reports in recent years has been the industry’s ongoing inability to identify when the current growth cycle would end. In our October 2016 blog post, “The end of the cycle is near…but this time we think we mean it.”, we capture how attendees of last year’s Lodging Conference went out of their way to rationalize the imminent end of the current cycle – something they had done in the previous two years as well. With the opening of the 2017 Lodging Conference, it was clear analysts had grown weary of predicting the end of a cycle that stubbornly refuses to capitulate, and instead had started to consider that new fundamentals might be at play. While average daily rates may have peaked in many key markets as indicated by Ali Hoyt, Senior Director of Consulting and Analytics at STR in her Day One keynote address, demand continues to outpace supply, while RevPAR in those markets is anticipated to continue to grow through 2019. The result is either a very soft landing to the cycles in those indicator markets, or, as Stonebridge Companies President and CEO Navin Dimond captured it, the market is starting to operate under new fundamentals where down-cycles are seemingly very similar to growth cycles – and potentially equally profitable. In either case, developers are likely to continue to find success in minor markets through 2019 as guest demand and consumer-side fundamentals continue to keep the industry moving in a positive direction.

Opportunity with increasing brand segmentation

As developers look to increase supply to satisfy that curiously ever-growing demand, hotel companies like Marriott and Hilton are compelled to consider new approaches. Mature brands – like Courtyard by Marriott and Hampton by Hilton – are starting to become saturated in many major markets. Unlike Starbucks however, having two of the same hotel down the street from one another is not a viable option. The solution? Brand segmentation and spin-off soft brands. A perfect example of this approach is Wyndham Hotel Group, which issued a release to coincide with the 2017 Lodging Conference announcing the addition of another six hotels to its soft brand collection, bringing the total number of hotels in their soft brand portfolio to 61.

For 2018 and into 2019, underdeveloped minor markets can expect to see an increase in the number of select and limited service spin-off and soft brand projects. For hotel architects, designers, and builders, a de-emphasis of brand prototypes is expected – even for limited service properties – as developers look to provide a unique stay experience to differentiate their property from the hotel being built across the street.

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Uncertainty is the new normal

For much of last year a handful of issues carried the blame when it came to explaining the “wait and see” attitude that hampered industry confidence in 2016: contracting access to credit, the growing risk of oversupply in some markets, and the changing profile of a profitable project all combined to handcuff industry enthusiasm.  For attendees of ALIS 2017 hoping this year’s event would put an end to the persistent uncertainty, the summit’s official theme said it all: “Please stand by.”  With 2016’s conditions unchanged coming into the new year, summit attendees seemed ready to accept that uncertainty may be the new normal in 2017.  Here’s a glimpse why:

Geopolitics will continue to depress access to credit for years to come

Last year Brexit and the threat of a Euro currency break-up put jitters in exchanges around the world.  Not unexpectedly, those jitters had the effect of making banks and private investors skittish as global geopolitics influenced their lending appetite on a month-to-month basis.  Lenders that did have the funds and the appetite to invest in hospitality real estate retreated to REITs with their more-or-less predictable performance, leaving those seeking financing for hospitality projects with a shrinking pool of lenders to back their projects.

In 2017, it looks as though geopolitics will continue to dampen lender appetite with “Trump Uncertainty” replacing Brexit as the source of concern.  For markets at large, and in spite of the rally US exchanges enjoyed following Trump’s inauguration, it remains to be seen if the Trump presidency will be good or bad for business and credit markets.  For the hospitality industry specifically, the Trump presidency is even more curious given Trump’s notable hotel holdings and the unique dependence the hospitality industry has on unionized and first-generation American labor – two things Trump has been less than eager to appreciate.

In a phrase, don’t expect access to credit to improve any time soon as lenders continue to wait and see how the Trump presidency will play out.  Also, anticipate REITs to increase their investment activity and compete more vigorously for projects as their equity continues to grow and they look to leverage their capital.

Peak supply in key markets will impact development opportunities and client-side profitability

According to STR’s Senior VP Jan Freitag’s ALIS day two keynote address, 2017 will be the first year in this current cycle (and nearly a decade) that supply will outstrip demand.  In most cycles, such a prediction wouldn’t be cause for alarm, but in this cycle, with development pipelines flush with projects adding rooms to markets already signalling peak inventory, Freitag’s comments raise a red flag.  Adding credence to STR’s numbers was CBRE’s Mark Woodworth, noting that the benchmark and longstanding average of 2% inventory growth seen in 21 key markets ballooned to 46 markets last year, the suggestion being more-and-more markets are seeing inventory growth above what’s traditionally been considered sustainable.

On their own, slightly concerning supply numbers are one thing, but combined with declining consumer-side demand the issue gets a little more serious; once again citing Freitag’s day two keynote, consumer demand in 2017 is only expected to reach 1.7% YOY – well under GDP-levels of growth.  If consumer demand continues to soften with fewer guests filling the surplus of rooms in the pipeline, hotel operating profitability is likely to suffer.

The profile of the profitable hotel transaction is sure to change

2016 saw what might be the last “mega-transaction” the industry will see for a number of years: Marriott’s acquisition of Starwood Hotels.  One of the largest hospitality transactions ever – one that certainly created the largest hotel company in the world – consequences of the merger understandably dominated conversations in M&A sessions at ALIS 2017.  While attendees debated the merger’s influence on the mid and upscale hotel chain markets, what was well understood was how market dynamics that made the merger feasible in the first place had changed.  Although on a much smaller scale, for developers of large individual projects, many of the same changes are poised to affect the economics of their projects too.  Most significantly, and largely on account of real estate costs that continue to balloon in defiance of logic in many key metropolitan markets, project costs continue to erode profitability.  Given the industry’s challenges accessing credit, and with the question of oversupply unanswered in many markets, large projects in metropolitan markets are likely to give way to smaller, shorter, and less expensive projects in ancillary markets.

Operating in the uncertainty

With such similarity in conditions between 2016 and 2017, it’s not surprising the prescribed approach in 2016 continues to make sense in 2017.  In my blog post following last year’s ALIS event, “An Architect’s Perspective – 3 Hospitality Development Opportunities Highlighted at ALIS 2016”, minor markets, smaller and more nimble projects, and renovation projects that require less credit funding revealed themselves as key areas of opportunity last year.  Moving into 2017, it looks as though the same advice makes sense.

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First off, the 2016 event marked the third consecutive year I was invited to speak as an expert panelist at the conference.  Participating on the “Repositioning Your Hotel for Success” panel moderated by Russell C. Savrann, Partner at Sandman Savrann PLLC, the session fostered some amazing discussion on the design and business considerations for repositioning hotels from segment to segment or brand to brand.

As well, the 2016 event marked the second year AXIS hosted a welcome reception leading into Tuesday evening’s marquee social festivities and signature pool party.  With compelling conversation over canapes and cocktails, it was a pleasure bringing together many of the hospitality industry’s most influential personalities.  Our thanks to everyone who was able to join us.

But perhaps the most irresistible reason the AXIS leadership team was anticipating this year’s Lodging Conference was on account of the event’s reputation for forecasting the future health of the industry with uncanny accuracy.  As close followers of the industry can tell you, 2016 has been a year of mixed signals; guest-side indicators continue to demonstrate bullish performance while at the same time corporate-side indicators strongly suggest this recent boom cycle’s peak is likely behind us.  With 2016 continuing to demonstrate the uncertainty the industry endured throughout 2015 – during which the end of the current cycle was already being predicted – the AXIS team and I were very much looking forward to gaining some clarity as to what to expect in 2017.

“Enjoy the ride”

Unfortunately, for those attendees looking forward to a concrete assessment as to what to expect in the coming quarters, the 2016 Lodging Conference wasn’t ready to commit one way or the other.  Perhaps the clearest signal of that reticence was the conference’s unofficial theme.  Each year, The Lodging Conference captures the prevailing sentiment in the hospitality industry in a brief statement that serves as the central theme for the event; this year, in an almost teasingly tongue-in-cheek nod to the admission that the fate of this cycle was still in the air, the conference adopted the theme, “Enjoy the ride”.  Whether “enjoying the ride” meant capitalizing on the opportunities the coming quarters would present, or if it meant holding-on while the rollercoaster finally crested the highest peak was entirely dependent on what indicators you paid attention to.

Consumer spending and guest fundamentals remain solid…

As speakers on the conference’s A View From The C-Suite keynote session were quick to point out, if one were to gauge the health of the industry solely based on consumer spending it would be safe to assume the current growth cycle is alive and well.  In fact, as Steve Hennis, VP of Consulting and Analytics at STR pointed out, July 2016 saw the highest demand for occupancy ever.  Undeniably, the juggernaut of the current cycle has slowed somewhat with increases in RevPAR less impressive than they have been in recent years (apologetically receding to historical norms near $80), but on the aggregate, consumer fundamentals continue to show steady growth.  As far as anyone at The Lodging Conference was willing to guess, the prevailing sentiment was that current growth would continue for the foreseeable future.

…but industry indicators hint at trouble to come

While consumers with their spending appear willing to do their part to keep the current growth cycle humming, the industry itself seems less willing.  As Adam Lair, Managing Director at HVS captured it with his input on the A View From The C-Suite panel, “We’ve had this dramatic dislocation between the transaction market and what’s actually going on in underlying hotel fundamentals.”  Of those transaction market indicators that start to raise flags is the 52% drop in transaction volume year-over-year.  REITS have largely retreated from active development, and with many funds trading below asset value many are much less willing to consider significant transactions.  To mirror the recent and monumental Marriott-Starwood merger, an increasing portion of transactions are mergers and acquisitions of properties as opposed to new developments, a signal that suggests developers are hesitant to initiate new projects until clearer signals prevail.  The continuing decrease in credit appetite also looks to continue to strip even more momentum from the current cycle.

Adding to the confusion is the industry’s indecision on the current state of the hotel development pipeline.  Depending on the scale of your yardstick your view changes; at the macro/industry metric level, the market is already overbuilt and about to oversupply with the rooms currently in the pipeline; at the local market level, plenty of markets appear capable of benefiting from even more development.  STR’s April 2016 report on the year-over-year comparison of the US hotel pipeline hints that a risk of oversupply may be the case; with over 161,000 rooms in development earlier this year – a number that represents a whopping 28.3% increase over 2015’s already record-breaking numbers – the risk of oversupply can’t be ignored.

External influences may sway the balance

As Oxford Economics’ Aran Ryan’s input on The View From The C-Suite panel suggests, much of the uncertainty on the current cycle may lie in influences out of the industry’s control.  With the fallout from Brexit still yet to be seen, the November election likely to influence credit markets for at least a number of quarters, the continuing threat of China’s credit exposure in the industry increasingly vulnerable to global influences, and the threat of interest rate increases hinging on a number of unpredictable factors, perhaps the fate of the current cycle is yet to be determined.  Curiously, in the weeks following The Lodging Conference, Hilton adjusted their RevPAR expectations for Q3 2016 by roughly 50% from ~4% to a concerningly low ~1.5%, that despite STR’s prediction of a 5% RevPAR across the industry for the coming quarters.  Perhaps this is exactly what The Lodging Conference meant with their suggestion, or warning, that we “enjoy the ride.”

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