Transactions and business projects involving commercial real estate can be complex because of the many different factors and players involved. In many cases, a successful transaction involves not just negotiating an agreeable deal between a buyer and a seller, but also ensuring that the project-as envisioned by the prospective owner-can go forward as planned. Whether someone is looking to buy an existing property or build a new property, it is critical to look at the zoning laws and what they will allow.
Land use and development is generally governed by the zoning laws outlined in the Philadelphia Zoning Code. These laws apply to many different characteristics of a property or business, including not only how the land is used, but also the size of a building, parking, sign placement, property use, population density and the character of the development.
There are two primary types of permits related to zoning laws. In order to newly construct a building or add on to an existing structure, the builder or developer must obtain a zoning permit. In contrast, use registration permits relate to how a building or property will be used. Whether or not a use registration permit can be successfully obtained can affect whether a person who purchased a property for a specific use can actually do what he or she intends to do with the property.
If a buyer or developer finalizes a commercial real estate transaction without reference to what the zoning laws will allow, he or she can be sorely disappointed and end up losing a great deal of money. It is important to remember that zoning laws do not only affect new construction or new proposed uses. Approval by the zoning laws is required for demolition projects, additions to buildings, the creation or reconfiguration of parking areas, sign installation and other projects, as well.
Source: City of Philadelphia, “Licenses & Inspections: Zoning,” accessed Sept. 7, 2014