Latest news with #SenateBill840
Newsweek
13-07-2025
- Business
- Newsweek
Texas Housing Market To Change in September: What To Know
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Texas lawmakers trying to solve the state's housing affordability crisis passed a bill during the last legislative session that experts say will be a "game-changer" for the development of multifamily homes. Senate Bill 840 or SB 840, which was introduced by Republican state Senator Bryan Hughes and signed into law by Governor Greg Abbott in June, would streamline the process of turning non-residential commercial buildings in the state into mixed-use and multi-family residential ones. Under the new legislation, any land that is already classified as a zone for office, commercial, retail, warehouse or existing mixed uses could be turned into mixed-use residential housing without the need for a zone change. Essentially, the legislation does away with a process that some have complained can be time-consuming and expensive—at least in some cases. The mixed-use housing and office property The Republic is seen undergoing construction downtown on October 9, 2023, in Austin, Texas. The mixed-use housing and office property The Republic is seen undergoing construction downtown on October 9, 2023, in Austin, To Know About The Bill "SB 840 aims to tackle the state's widening housing shortage by allowing underused commercial land and buildings to be repurposed for multifamily development 'by right,'" Fawaz Bham, real estate law expert and partner at Dallas-based law firm Hunton Andrews Kurth, told Newsweek. "More pointedly, it rebalances the power dynamic between developers who are eager to create new mixed-use projects or convert existing commercial properties against the desire of municipalities to closely negotiate, guide, and shape build sites in their cities," he said. The bill applies only to cities with more than 150,000 residents that are in a county with more than 300,000 residents. That means that the legislation will impact less than 20 cities, including the Texas capital, Austin, where proposals to add thousands of units to two sites—almost 900 residential units 200 East Riverside Drive and up to 2,400 in Anderson Square—have already been approved. But SB 840 does more than reforming zoning regulation. It also prohibits certain restrictions on density, building height and parking for multifamily and mixed-use developments. Under the bill, municipalities cannot require more than one parking space per dwelling unit or a multilevel parking structure. They must allow the multifamily density to be the highest allowed in the municipality or 36 units per acre, whichever is greater; and the heights limits must allow the greater of the highest height allowed on the side by the zoning code or 45 feet. "By removing these barriers for the repurposing of these vacant and underutilized properties, the legislature has opened the door to a significant opportunity for developers to meet the ever-growing housing needs in Texas," Clay B. Pulliam, partner at Dallas-based law firm Troutman Pepper Locke, wrote in a recent report assessing the bill. The bill is expected to go into effect on September 1, 2025. Newsweek contacted Hughes for comment by email on July 4 for comment. How The Bill Could Change Texas Real estate experts believe that the bill will spark a "revolution" in the Lone Star State's multifamily market, where it is being hailed as a likely "game-changer." The most significant impact of the new legislation would be to allow developers in the state to utilize vacant or underutilized office buildings—which became a problem for some cities in the state, like Houston, during the pandemic years—retail centers and warehouses for multifamily housing. "There are suburban and infill areas with empty big boxes or underutilized retail and office buildings which have become acquisition targets as developers realize the potential upside of SB 840 and other companion bills that have recently passed," Bham said. Julia Parenteau, Director of Public Policy at Texas Realtors, told Newsweek: "While commercial conversions are a more niche issue, I'd anticipate the allowance of mixed-use and multi-family by right in certain zoning areas will have a positive impact by way of more multi-family housing developments going onto the market in the coming years. "Additionally, zoning by right shaves approximately 18 months off the time frame for development, allowing the conversation to focus on what amenities and designs the municipality wants or needs in the development, not whether the project is feasible." This infusion of new inventory could, in turn, help first-time and lower-income homebuyers in the state, as multi-family homes tend to be more affordable than single-family housing. "SB 840 is part of a broader suite of bills that the legislature passed, all designed to infuse the market with additional supply so that affordability improves for Texans," Emily Brizzolara-Dove, a policy adviser at Texas 2036, a nonprofit, nonpartisan public policy organization dedicated to improving lives and opportunities for all Texans through 2036, told Newsweek. "Home prices in Texas have gone up 35 percent, 40 percent since the beginning of the pandemic, and that is simply unsustainable," she said. "Housing affordability is really one of our biggest competitive advantages in the state, but that is a very tenuous advantage. Ohio has cheap houses, too. "So, if our housing supply gets to the point where families are really cost burdened by their rent and by their mortgage, we are at risk of losing that competitive advantage." SB 840 helps Texas build more housing where people want to live, Brizzolara-Dove said, by essentially reducing red tape. The big impact of the new legislation, she said, is going to be allowing residential in commercial, retail and warehouse zones—areas that are already developed and which would become more livable, more walkable, and more-resident friendly once more homes are introduced at little to no additional cost, as key infrastructure is already in place. "When you can do something that will make a really significant impact on housing prices for Texas families, and you can do it with no fiscal note, then you're in a good spot," Brizzolara-Dove said. 'The Devil Is In The Details' Bham, however, said that whether the legislation would work to fix the Lone Star State's shortage of affordable homes would still depend on how the market reacts to it. By cutting red tape and slashing costs, SB 840 should be able to attract developers willing to pursue new housing projects, but they will still need to ensure that any project is "still economically fruitful, financially viable, and sustainable in the long-run to secure investors, financing, and—ultimately—paying renters," Bham said. Real estate experts also worry that the bill could also have a negative impact on the Texas housing market. While Pulliam says that the bill does "an admirable job of addressing the bottlenecks and administrative burden of converting properties to residential uses," he warned that the legislation might have some unintended consequences. "Zoning ordinances are often cumbersome and sometimes antiquated, but the framework that these ordinances provide gives some degree of certainty to property owners, residents and the municipalities themselves," he said. "For example, no consideration has been given to the impact on public schools when these additional projects result in an influx of students. Will dispensing with the need for traffic studies or traffic mitigation measures create more congestion? Developers who have invested heavily in entitling their multifamily projects must now compete with developers who can skip that entire process. Will owners of existing multifamily or mixed-use projects be at a disadvantage to those who can now bypass barriers to entry quickly and without cost?" he asked. Weston B. Rockers and Benjamin W. McKay of Polsinelli, on the other hand, are concerned about the potential for a sudden surge in converted multifamily to devalue existing multifamily properties and/or saturate the multifamily housing market in some municipalities. "As multifamily supply increases, developers relying on exclusive and/or isolated multifamily zoning classifications will experience less demand," the two wrote in a June report. At the same time, the single-family market could also suffer, they say, as reclassifying commercial sites to multifamily "has the potential to devalue single-family homes, which were planned or developed in close proximity to commercial developments." Brizzolara-Dove remains optimistic about the impact of the bill, even as she admits that "the devil is in the details when it comes to implementing these bills, and there is no state agency oversight of them." It will be "all down" to the municipalities, she said: "We will be able to see in a year from now how the cities have implemented [the legislation], if they are fully embracing the law and if changes would need to be made—and they likely will."
Yahoo
07-07-2025
- Business
- Yahoo
New Texas law allows apartments in some nonresidential zones
This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. A Texas bill designed to simplify the conversion of nonresidential sites into mixed-use or multifamily properties was signed into law by Gov. Greg Abbott on June 20 and is set to take effect on Sept. 1. Under Senate Bill 840, the state will permit apartment construction on qualifying office, commercial or warehouse sites without the need for zoning changes. This includes both existing building conversions and undeveloped land. To qualify for SB840 as a conversion project, buildings must be at least five years old and undergo at least a 65% conversion to multifamily. Municipalities are restricted from rejecting any permit proposals as long as they meet the requirements of SB840, and cannot require developers to change the zoning of these sites. The law only applies to municipalities with a population of over 150,000 in counties with a population of over 300,000. It does not apply to heavy industrial sites, designated clear zones or any property within 1,000 feet of a heavy industrial site or 3,000 feet of an airport or military base. The Texas Apartment Association, which supported SB 840 during its legislative process earlier this year, has stated that the new law will remove major barriers to housing in the state. 'This is a common-sense reform that expands options for where and how new housing units can be built,' Chris Newton, executive vice president of the Texas Apartment Association, told Multifamily Dive, 'and we applaud the Texas Legislature for taking steps that will help increase housing supply and enhance housing affordability for Texans.' In addition to being unable to reject permit applications under SB840, municipalities cannot impose height, density, setback or parking requirements more restrictive than 36 units per acre, one parking space per unit, 45-foot building heights or 25-foot setbacks. For building conversion projects specifically, local authorities cannot require a traffic analysis, impose parking requirements or impact fees, ask for utility or traffic improvements or make restrictions on design beyond the building code. The law does not affect regulations related to short-term rentals, water quality programs, density bonuses, stormwater mitigation requirements or historic preservation.
Yahoo
21-05-2025
- Business
- Yahoo
Texas lawmakers tackle housing crisis by loosening zoning rules in big cities
The Brief Texas lawmakers passed legislation Tuesday allowing the construction of multifamily and mixed-use residential areas in areas previously zoned for offices, warehouses and retail. The bill would also allow for the conversion of offices, retial spaces and warehouses that are less than 5 years old. The bill limits the amount of restrictions that cities can place on the developments. AUSTIN, Texas - A bipartisan group of Texas lawmakers has passed legislation that would relax the rules on land zoning, allowing multifamily and mixed-use housing to be built in areas not zoned for residential and allowing the conversion of some buildings to housing in an effort to address the lack of housing in larger cities. Senate Bill 840 allows the construction of multifamily and mixed-use developments in areas that have previously been zoned for offices, stores or warehouses. The bill limits the amount of restrictions a city can place on developments. Under the bill, cities must allow at least 36 units per acre of land and allow buildings to be constructed to at least 45 feet tall or what is allowed for commercial buildings in the area. If the proposed development meets the requirements laid out, then the permits must be approved automatically. The bill blocks cities from imposing special limits or demands just because the development includes housing. The bill would also allow for the conversion of office buildings, retail sites and warehouses into mixed-use or multifamily residential homes. The building must be less than five years old at the time of the proposal and at least 65% of the building and 65% of each floor of the building being converted must be used for housing. The bill would block a city from requiring traffic studies, new parking spaces, road upgrades or fees, major utility upgrades and design changes beyond code standards. The bill would only apply to cities with a population of more than 150,000 people that are located at least partially in a county with more than 300,000 people. Why you should care According to the comptroller of public accounts, Texas needed 300,000 homes in 2021 in order to keep up with the state's growth. What's next The bill has cleared both chambers in the Texas Capitol and heads to Gov. Greg Abbott's desk. The Source Information in this article comes from the Texas Legislature.
Yahoo
20-05-2025
- Business
- Yahoo
Vacant offices, strip malls may get new life as housing in Texas' largest cities
DALLAS — Empty offices, vacant strip malls and warehouses could help solve Texas' housing affordability crisis after state lawmakers advanced legislation Tuesday. The Texas House gave preliminary approval to Senate Bill 840, which aims to allow apartments and mixed-use developments to be built in certain cities along retail and commercial corridors and in places that now only allow office buildings. The bill by state Sen. Bryan Hughes, a Mineola Republican, would let owners of those properties build homes on that land without having to get it rezoned — a process housing advocates and developers note is costly, lengthy and ultimately drives up the final cost of a home. House members approved the bill, which has already cleared the Senate, by a 108-23 vote. The bill must come back for a final House vote. The bill would only apply to Texas' largest cities. It's limited to cities that have a population greater than 150,000 people that sit in a county with at least 300,000 residents. The bill is part of a suite of GOP proposals aimed at curbing the state's high housing costs — chiefly by allowing more homes to be built. Texas needs 320,000 more homes than it has, according to one estimate. That shortage, housing experts argue, helped drive up home prices and rents as Texas boomed over the last few years. Republicans in the Texas Legislature, including Lt. Gov. Dan Patrick and House Speaker Dustin Burrows, have sought ways to curtail housing costs by allowing more homes to be built. Lawmakers have advanced bills to allow smaller homes on smaller lots and additional dwelling units in the backyards of single-family homes. They've also pushed legislation to more quickly put city building permits in developers' hands and make it harder for property owners to stop new homes from being built near them. With key deadlines looming and less than two weeks to go in the legislative session, none of those bills have reached Gov. Greg Abbott's desk. [Is it law yet? See how far some of the most consequential bills have made it in the 2025 Texas Legislature] Tuesday's vote was a key test in how House members would tackle perhaps some of the more controversial aspects of the GOP's slate of housing bills — chiefly those that would relax city rules, known as zoning regulations, that say what kinds of homes can be built and where. Similar proposals died in the House two years ago. But Senate Bill 840 cleared its first vote in the House without debate. Bills to allow smaller homes on smaller lots, a top Patrick priority, as well as accessory dwelling units haven't been scheduled for a vote in the House. There's broad support among Texas voters for allowing more homes in business and shopping districts and vacant office and commercial buildings to become homes, a recent poll conducted by YouGov and Texans for Housing found. That support also holds for moves to make it possible to build accessory dwelling units and smaller homes on smaller lots, the poll showed. First round of TribFest speakers announced! Pulitzer Prize-winning columnist Maureen Dowd; U.S. Rep. Tony Gonzales, R-San Antonio; Fort Worth Mayor Mattie Parker; U.S. Sen. Adam Schiff, D-California; and U.S. Rep. Jasmine Crockett, D-Dallas are taking the stage Nov. 13–15 in Austin. Get your tickets today!
Forbes
24-03-2025
- Business
- Forbes
If Texas Wants To Get Even Bigger, It Needs To Build Housing
Austin is one of Texas's many booming cities. But the state can do even more to encourage home ... More building. Texas Governor Greg Abbott is eager to make Texas bigger. Last year, he flew across Asia touting his state as a good place to do business. He has consistently urged American companies to move their headquarters to the Lone Star state, citing the low cost of business and lack of state income tax. But even though Texas still has lots of wide-open spaces, the state is struggling with a lack of housing and the affordability of housing. About 1,000 people move into the state each day. According to housing advocacy group Up For Growth, Texas trails only California in the number of missing housing units. Dallas-Fort Worth ranked high among metro areas for housing underproduction. Like much of the United States, the barriers to building housing in Texas are laid thick. Fortunately, there are lots of good ideas in the Texas Legislature to reform zoning codes and pave the way to new homes. Smaller, more affordable homes can be especially hard to build in much of America. Many cities have minimum lot sizes for new developments. This makes it impossible to build starter homes in some communities. Senate Bill 15 reduces minimum lot sizes for new developments in certain sized cities. It's just simple economics that reducing the minimums will encourage home builders to go smaller. While most new development may be in outlying areas, major Texas cities have a lot of land that can be developed. According to Dallas officials, the city has 21,000 acres of vacant land. Urban growth in Texas has been shaped by restrictive zoning, with residential and commercial areas often strictly separated. But getting in the car every time you want go to the grocery store or grab a latte isn't for everyone. Mixed use development, with housing above or around stores, has been on the rise for years. But building such projects often means getting special permission from cities. Senate Bill 840 would allow mixed-use and multifamily housing to be constructed by right in commercial zones. This would pave the way for a type of housing that is both in demand and would help add density in places that may have easy access to transit. The bill would make it much easier to convert existing commercial buildings into housing. Since the pandemic greatly increased the number of Americans working from home, the demand for office space has decreased. Converting vacant office space to housing is difficult, with a New York Times article comparing it to a 'Rubik's cube.' But even when the architectural problems are surmountable, the zoning barriers remain. This bill would let the market, rather than zoning boards, decide whether conversion is feasible. The Legislature is also considering Senate Bill 673, a bill that would allow construction of accessory dwelling units by right. ADUs are a great way to provide affordable housing to fill in urban areas without replacing existing homes or changing the scale of existing neighborhoods. Although often called 'grandmother suites,' ADUs are affordable for younger workers and retirees. While California has struggled to build homes in many ways, legislation enabling ADUs has led to a building boom. ADUs accounted for 20% of California's new home construction in 2023. And since these units cost about one-third of constructing a single-family home, rent is much more affordable. Another way to bring down construction costs is to clear the backlog of plan approvals at city halls. Senate Bill 1450 would allow applicants to use a third party to review building plans. Those plans have to meet the city's standards and failing to build to code would have all the typical repercussions. While there are some worries that third parties may not be as capable as government bureaucrats, the government isn't immune from making mistakes either. Dallas improperly approved construction of a duplex in a neighborhood with special zoning restrictions. The city stopped construction for a time but ultimately granted the builder a variance to move forward. The builder lost an estimated $60,000 to the delays and cost to rework his plans. One barrier to housing that many people may not even be aware of is restrictions preventing people who aren't in the same family from sharing a home. These laws prevent people from renting a room out to a friend, or roommates locating shared housing. SB 1567 would overrule these antiquated restrictions that have nothing to do with ensuring health or safety. By the time Texas celebrates its bicentennial in 2036, it may be home to three to five million more people. But there won't be more Texas jobs and more proud Texans unless there are places for people to live. The Legislature and Governor should push forward with zoning reforms to keep Texas growing.
