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Can changing the zoning on a small industrial property help you?

On Behalf of | Jan 11, 2021 | Land Use & Zoning |

Turning a profit as a small-scale real estate investor or aspiring landlord can be difficult.  Properties that are ready to rent out already will be difficult to find on the market for a reasonable price.  Properties that aren’t currently desirable may be more affordable but will require a lot of work before they generate profit for your company.

One potentially worthwhile approach for anyone hoping to generate a steady stream of rental revenue to flip a property for profit is to take an unoccupied and aging industrial facility, like a warehouse, and convert it to dual-purpose space with retail downstairs and a home or apartment upstairs.

Some people might even just split the property into two or three small apartment or condominium units.  Whether you intend to sell them or rent them, those industrial-turned-residential living spaces can be a major source of profit.  In order for either of those ideas to work, you may need to change the zoning for the property.

Zoning rules restrict property use to protect communities

Zoning is a key component to successful urban planning.  Without careful zoning, residential neighborhoods can become undesirable due to noise, smells and traffic from industrial facilities or retail businesses.

Zoning rules protect the character of communities and the value of properties by keeping most of the properties in an area in the same general category based on purpose or use.  However, changes in a community over time may require changes to local zoning as well.

If you want to take a property currently zoned for commercial or industrial purposes and convert it into a residential property, you will need to request a zoning change or variation.

The community might see the change as a beneficial thing

Zoning changes typically require hearings and effort to convince the local community about the benefit of changes and development.  However, if an industrial space or warehouse has sat empty for years, neighbors in the community may feel eager to fill the space to bring more traffic and revenue to their community.

Provided that the renovation costs still allow for a profit after you factor in the expenses of changing the zoning, converting a space once used to manufacture or store items into a trendy living space could be a way to earn a significant return on your investment.


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