zoning due diligence for commercial real estate transactions

ZONING DUE DILIGENCE ZONING DUE DILIGENCE FOR COMMERCIAL REALFOR COMMERCIAL REALESTATE TRANSACTIONSESTATE TRANSACTIONS

OROR

““HOW NOT TO GET ZONED HOW NOT TO GET ZONED OUT ON YOUR NEXT DEAL”OUT ON YOUR NEXT DEAL”

Presented byPresented by

David K. Anderson, PresidentDavid K. Anderson, PresidentThe Planning & The Planning &

Zoning Resource Corp.Zoning Resource Corp.

SEMINAR OBJECTIVESSEMINAR OBJECTIVES

Understand the Risks Understand the Risks Associated with Zoning Associated with Zoning NoncomplianceNoncompliance

Understand the Role of Understand the Role of Zoning in Real Property Zoning in Real Property TransactionsTransactions

Define and Understand Define and Understand Zoning Conformance StatusZoning Conformance Status

Zoning Analysis and the Zoning Analysis and the Land Title SurveyLand Title Survey

The The PZR ReportPZR Report®®

Analyzing the Risk Analyzing the Risk Associated with Your Associated with Your

PropertyProperty

Can you rebuild your property Can you rebuild your property in the event of casualty?in the event of casualty?

If you have to meet current If you have to meet current Code in the event of Code in the event of destruction, what can you destruction, what can you rebuild? How does it affect rebuild? How does it affect the financial viability of your the financial viability of your property?property?

If your property is in violation, If your property is in violation, is it likely the municipality will is it likely the municipality will enforce action?enforce action?

What steps need to be taken What steps need to be taken to protect your interest? to protect your interest?

The Role of Zoning Due The Role of Zoning Due Diligence as to Risk in Diligence as to Risk in

Financing and AcquisitionsFinancing and Acquisitions

• Analyzing the Risk Analyzing the Risk Associated with Your Associated with Your PropertyProperty

–3.0 & 3.1 Zoning Endorsements

•What is a Zoning Endorsement?•What states do not issue Zoning Endorsements?

–Law and Ordinance Coverage

What is Law & Ordinance Coverage?

The Role of ZoningThe Role of Zoning

• Zoning is the mechanism municipalities Zoning is the mechanism municipalities use to control growth and development, use to control growth and development, minimize over-crowding and land use minimize over-crowding and land use conflicts.conflicts.

• Tells property owners what and how Tells property owners what and how they can and cannot build on their land. they can and cannot build on their land.

• Court cases have shown that Court cases have shown that municipalities have both a municipalities have both a responsibility and a right to protect the responsibility and a right to protect the public welfare by placing limits on the public welfare by placing limits on the uses of private property. uses of private property.

• Village of Euclid v. Ambler Realty Co. – Village of Euclid v. Ambler Realty Co. – Supreme Court Case decided in part by Supreme Court Case decided in part by the common law nuisance doctrine.the common law nuisance doctrine.

The Effect of Zoning The Effect of Zoning on “Pre-existing” on “Pre-existing”

PropertiesProperties Pre-existing uses and structures Pre-existing uses and structures required legislative remedy. required legislative remedy.

A building in existence at the A building in existence at the time a new zoning law is adopted time a new zoning law is adopted is said to be “grand-fathered” or is said to be “grand-fathered” or “legally nonconforming” and “legally nonconforming” and cannot be declared cannot be declared “nonconforming” or in violation. “nonconforming” or in violation.

If the legally nonconforming If the legally nonconforming structure is destroyed beyond the structure is destroyed beyond the threshold set forth in the Code, threshold set forth in the Code, the owner may be allowed to the owner may be allowed to rebuild only in accordance with rebuild only in accordance with present zoning laws.present zoning laws.

Terms Related to Terms Related to Zoning Conformance Zoning Conformance

StatusStatus

Legal ConformingLegal Conforming

Legal NonconformingLegal Nonconforming

NonconformingNonconforming

Conformance Status -Conformance Status -Legal ConformingLegal Conforming

TThe project meets all zoning he project meets all zoning district use, area, setback, district use, area, setback, height, density, and parking height, density, and parking requirements according to the requirements according to the most recent zoning ordinance or most recent zoning ordinance or land use requirements in your land use requirements in your jurisdiction. jurisdiction.

The (legal) nonconforming The (legal) nonconforming Rebuildability clause will not Rebuildability clause will not apply because your project is apply because your project is legal and has 100% right to legal and has 100% right to rebuild in the event of any rebuild in the event of any percentage of destruction.percentage of destruction.

Conformance Status -Conformance Status -

Legal NonconformingLegal Nonconforming The project was conforming at the The project was conforming at the

time of construction but due to time of construction but due to changes in the zoning ordinance, changes in the zoning ordinance, the governing jurisdiction, or the governing jurisdiction, or zoning designation, the project is zoning designation, the project is no longer conforming. no longer conforming.

Jurisdictions have different rules Jurisdictions have different rules governing legal nonconforming governing legal nonconforming projects. Some allow 100% rebuild projects. Some allow 100% rebuild in the event of destruction while in the event of destruction while others require Planning others require Planning Commission approval to rebuild, Commission approval to rebuild, regardless of the percentage of regardless of the percentage of destruction. destruction.

All are subject to the All are subject to the Nonconforming Rebuildability Nonconforming Rebuildability Clause of the zoning ordinance as Clause of the zoning ordinance as they have been granted certain they have been granted certain legal protections for rebuild. legal protections for rebuild.

What Causes a What Causes a Property to become Property to become

“Legally Nonconforming”“Legally Nonconforming”

• Built Prior to the Establishment Built Prior to the Establishment of the of the Zoning CodeZoning Code

• Changes in the Zoning Code Changes in the Zoning Code Over TimeOver Time

• Annexation from one Annexation from one jurisdiction to anotherjurisdiction to another

• Subdivision of the PropertySubdivision of the Property

• Condemnation Proceedings Condemnation Proceedings (often affects building and (often affects building and parking setbacks)parking setbacks)

• Rezoning of the PropertyRezoning of the Property

Examples of a Examples of a “Rebuild Clause”“Rebuild Clause”

According to the City of Ann Arbor Zoning According to the City of Ann Arbor Zoning Ordinance Section 5:87, “A nonconforming Ordinance Section 5:87, “A nonconforming structure shall not be replaced after structure shall not be replaced after damage or destruction of the damage or destruction of the nonconforming structure if the estimated nonconforming structure if the estimated expense of reconstruction exceeds 75% of expense of reconstruction exceeds 75% of the appraised value, as determined by the the appraised value, as determined by the building official, of the entire building or building official, of the entire building or structure, exclusive of foundations.”structure, exclusive of foundations.”

Per Section 17.64.040.B.4, (City of Per Section 17.64.040.B.4, (City of Rochelle, IL) “In the event any non-Rochelle, IL) “In the event any non-conforming structure is damaged or conforming structure is damaged or destroyed, by any means, to the extent of destroyed, by any means, to the extent of more than 50% of the cost of replacement more than 50% of the cost of replacement of the structure new, such structure shall of the structure new, such structure shall not be restored unless it and the use not be restored unless it and the use thereof shall thereafter conform to all thereof shall thereafter conform to all regulations of the zoning district in which it regulations of the zoning district in which it is located.”is located.”

Per Section 165-153 of the Frederick Per Section 165-153 of the Frederick County, VA Code: If a legally nonconforming County, VA Code: If a legally nonconforming use or structure is destroyed or damaged in use or structure is destroyed or damaged in any manner, it may be repaired or restored, any manner, it may be repaired or restored, provided any such repair or restoration is provided any such repair or restoration is completed within 12 months from the date completed within 12 months from the date the legally nonconforming use or structure the legally nonconforming use or structure was destroyed or damaged. was destroyed or damaged.

Interpreting the Interpreting the Nonconforming Clause Nonconforming Clause in the Zoning Ordinancein the Zoning Ordinance

Nonconforming Use and/or Nonconforming Use and/or Nonconforming StructureNonconforming Structure

– – Important to determine Important to determine whether the same Rebuild whether the same Rebuild Clause is in affect dependant Clause is in affect dependant on a “use” question as on a “use” question as opposed to a “structure” opposed to a “structure” questionquestion

Percentage of Destruction Percentage of Destruction

– – Sometimes difficult to quantify Sometimes difficult to quantify a dollar number to apply to a dollar number to apply to the % of casualty. the % of casualty.

Legal Nonconforming Buffer Yards - This Florida café has enjoyed patio seating for years, but current Code now requires a buffer between the property line and any improvements. In the event of destruction, the restaurant will have to provide a 30 foot buffer, resulting in lost seating area.

Legal Nonconforming Setbacks and Parking – This AZ Hospital was built in the County and later annexed in the City. Differences in Code requirements between the two jurisdictions caused setback and parking deficiencies.

Legal Nonconforming to Height - This Multi-Family Complex was built prior to changes in the Zoning Code, which lowered the allowable building height from 3 Stories to 2 Stories.

Conformance Status -Conformance Status - NonconformingNonconforming

The project does not conform to The project does not conform to current zoning requirements, current zoning requirements, and did not conform to the and did not conform to the requirements in place at the requirements in place at the time of construction. time of construction.

In the event of destruction of In the event of destruction of any percentage or value, the any percentage or value, the project will required to be re-project will required to be re-constructed according to the constructed according to the requirements of the current requirements of the current zoning ordinance. zoning ordinance.

The Nonconforming The Nonconforming Rebuildability Clause of the Rebuildability Clause of the zoning ordinance will not apply zoning ordinance will not apply to a nonconforming project to a nonconforming project because the site does not have because the site does not have a legal status. a legal status.

What Will Cause My Property What Will Cause My Property to Become “Nonconforming”to Become “Nonconforming”

A Change of Use (retail to A Change of Use (retail to restaurant), without Approvals, restaurant), without Approvals, which Requires Additional Parkingwhich Requires Additional Parking

Illegal Use (retail in residence)Illegal Use (retail in residence) Re-striping of the Parking Lot Re-striping of the Parking Lot

which Causes Spaces to be Lostwhich Causes Spaces to be Lost Removal of Landscaping to Removal of Landscaping to

Accommodate Additional Parking Accommodate Additional Parking or Structuresor Structures

Conversion of Apartment, Hotel or Conversion of Apartment, Hotel or Nursing Home Units that Exceed Nursing Home Units that Exceed the Total Number Approved at the the Total Number Approved at the Time of ConstructionTime of Construction

A Structure Built Closer to the A Structure Built Closer to the Property Line than What was Property Line than What was Originally Approved.Originally Approved.

Construction ErrorConstruction Error

Resort Hotel in Michigan – Resort Hotel in Michigan – Nonconforming to ParkingNonconforming to ParkingApproved w/parking to be constructed on Approved w/parking to be constructed on adjoining lot also owned by the Owner, adjoining lot also owned by the Owner, spaces never built, City never noticed, spaces never built, City never noticed, C.O. issued, Owner sold the land.C.O. issued, Owner sold the land.

Assisted Living Center in AZ Nonconforming to Density– Approved for 85 Beds, C.O.’d for 85 Beds, now has 95 Beds by converting other space which was never applied for or approved

Multi-Family Site in GA –

Nonconforming to Density and Open SpaceApproved and developed on 30 Acres, owner sold 10 acres of unimproved land which caused density, open space and landscaping problems not easily cured

What Are My Remedies if What Are My Remedies if the Project is the Project is

Nonconforming?Nonconforming? Fix the ProblemFix the Problem

- Stripe more spaces- Stripe more spaces

- Move the encroaching - Move the encroaching accessory accessory buildingbuilding

Apply for a Variance or Special Apply for a Variance or Special Use PermitUse Permit

Draw up a Reciprocal Parking Draw up a Reciprocal Parking Agreement with the AdjoinerAgreement with the Adjoiner

Purchase Land from the AdjoinerPurchase Land from the Adjoiner

Apply for a Change in the Zoning Apply for a Change in the Zoning DistrictDistrict

Analyzing the Risk Analyzing the Risk Associated with Your Associated with Your

PropertyProperty

Can you rebuild your property Can you rebuild your property in the event of casualty?in the event of casualty?

If you have to meet current If you have to meet current Code in the event of Code in the event of destruction, what can you destruction, what can you rebuild? How does it affect rebuild? How does it affect the financial viability of your the financial viability of your property?property?

If your property is in violation, If your property is in violation, is it likely the municipality will is it likely the municipality will enforce action?enforce action?

What steps need to be taken What steps need to be taken to protect your interest? to protect your interest?

What is a Zoning What is a Zoning Endorsement?Endorsement?

3.0 Zoning Endorsement- This 3.0 Zoning Endorsement- This endorsement to the Loan or Owner’s endorsement to the Loan or Owner’s Policy provides insurance of the Policy provides insurance of the applicable zoning classification and applicable zoning classification and authorized use of the land. It is designed authorized use of the land. It is designed for issuance on unimproved property.for issuance on unimproved property.

3.1 Zoning Endorsement - This 3.1 Zoning Endorsement - This endorsement to the Loan or Owner’s endorsement to the Loan or Owner’s Policy is designed for issuance on Policy is designed for issuance on improved property. Like the 3.0, this improved property. Like the 3.0, this Endorsement insures (1) the zoning Endorsement insures (1) the zoning classification, and (2) authorized uses classification, and (2) authorized uses under that classification. In addition, this under that classification. In addition, this Endorsement insures against a final court Endorsement insures against a final court order prohibiting the present structure, order prohibiting the present structure, and requiring removal or alteration of the and requiring removal or alteration of the present structure, because of violation of present structure, because of violation of the zoning ordinance as to (1) area, width the zoning ordinance as to (1) area, width or depth of the land as a building site, (2) or depth of the land as a building site, (2) floor space area of the structure, (3) floor space area of the structure, (3) setback of the structure, (4) height of the setback of the structure, (4) height of the structure, or (5) number of parking structure, or (5) number of parking spaces.spaces.

Important to note that some states do not Important to note that some states do not issue Zoning Endorsements or are limited issue Zoning Endorsements or are limited in scope, i.e., Texas, Florida, New York, in scope, i.e., Texas, Florida, New York, New MexicoNew Mexico

Example 3.1 EndorsementExample 3.1 Endorsement ALTA Zoning-Completed Structure Endorsement 3.1 ALTA Zoning-Completed Structure Endorsement 3.1 POLICY NUMBER __________ POLICY NUMBER __________ ISSUED BY:ISSUED BY:

1. The Company insures the insured against loss or damage sustained by 1. The Company insures the insured against loss or damage sustained by reason of any incorrectness in the assurance that, at Date of Policy:reason of any incorrectness in the assurance that, at Date of Policy:

(a) According to applicable zoning ordinances and amendments thereto, the (a) According to applicable zoning ordinances and amendments thereto, the land is classified Zone __________. land is classified Zone __________.

(b) The following use or uses are allowed under that classification subject to (b) The following use or uses are allowed under that classification subject to compliance with any conditions, restrictions, or requirements contained compliance with any conditions, restrictions, or requirements contained in the zoning ordinances and amendments thereto, including but not in the zoning ordinances and amendments thereto, including but not limited to the securing of necessary consents or authorizations as a limited to the securing of necessary consents or authorizations as a prerequisite to the use or uses: prerequisite to the use or uses:

2. The Company further insures against loss or damage arising from 2. The Company further insures against loss or damage arising from a final decree of a court of competent jurisdiction a final decree of a court of competent jurisdiction

(a) prohibiting the use of the land, with any structure presently located (a) prohibiting the use of the land, with any structure presently located thereon, as specified in paragraph 1(b); or thereon, as specified in paragraph 1(b); or

(b) requiring the removal or alteration of the structure on the basis that, at (b) requiring the removal or alteration of the structure on the basis that, at Date of Policy, the ordinances and amendments thereto have been Date of Policy, the ordinances and amendments thereto have been violated with respect to any of the following matters: violated with respect to any of the following matters:

(i) Area, width or depth of the land as a building site for the structure; (i) Area, width or depth of the land as a building site for the structure; (ii) Floor space area of the structure; (ii) Floor space area of the structure; (iii) Setback of the structure from the property lines of the land; (iii) Setback of the structure from the property lines of the land; (iv) Height of the structure, or(iv) Height of the structure, or(v) Number of Parking Spaces (v) Number of Parking Spaces There shall be no liability under this endorsement based on the invalidity of There shall be no liability under this endorsement based on the invalidity of

the ordinances and amendments thereto until after a final decree of a the ordinances and amendments thereto until after a final decree of a court of competent jurisdiction adjudicating the invalidity, the effect of court of competent jurisdiction adjudicating the invalidity, the effect of which is to prohibit the use or uses. which is to prohibit the use or uses.

Loss or damage as to the matters insured against by this endorsement shall Loss or damage as to the matters insured against by this endorsement shall not include loss or damage sustained or incurred by reason of the refusal not include loss or damage sustained or incurred by reason of the refusal of any person to purchase, lease or lend money on the estate or interest of any person to purchase, lease or lend money on the estate or interest covered by this policy. covered by this policy.

This endorsement is made a part of the policy and is subject to all of the This endorsement is made a part of the policy and is subject to all of the terms and provisions thereof and of any prior endorsements thereto. terms and provisions thereof and of any prior endorsements thereto. Except to the extent expressly stated, it neither modifies any of the Except to the extent expressly stated, it neither modifies any of the terms and provisions of the policy and any prior endorsements, nor does terms and provisions of the policy and any prior endorsements, nor does it extend the effective date of the policy and any prior endorsements, nor it extend the effective date of the policy and any prior endorsements, nor does it increase the face amount thereof. does it increase the face amount thereof.

Signed under seal for the Company, but this endorsement is to be valid only Signed under seal for the Company, but this endorsement is to be valid only when it bears an authorized countersignature.when it bears an authorized countersignature.

Law and Ordinance Law and Ordinance CoverageCoverage

Three Separate Coverages:Three Separate Coverages:

Coverage A: Building Ordinance – Coverage A: Building Ordinance – Covers the value of the undamaged Covers the value of the undamaged portion of the building that must be portion of the building that must be demolished should the casualty demolished should the casualty exceed the % threshold set by the exceed the % threshold set by the Rebuildability Clause of the CodeRebuildability Clause of the Code

Coverage B: Demolition Cost – Covers Coverage B: Demolition Cost – Covers the cost to actually demolish the the cost to actually demolish the undamaged portion of the structure undamaged portion of the structure once it is declared a total lossonce it is declared a total loss

Coverage C: Increased Cost of Coverage C: Increased Cost of Coverage – provides the additional Coverage – provides the additional cost sustained in building to new cost sustained in building to new code requirements, i.e., windstorm code requirements, i.e., windstorm in Florida or earthquake in in Florida or earthquake in CaliforniaCalifornia

Site Criteria analyzed for Site Criteria analyzed for conformance prior to the issuance conformance prior to the issuance

of Zoning Endorsements and/or of Zoning Endorsements and/or Law and Ordinance CoverageLaw and Ordinance Coverage

Is the Property inIs the Property inConformance with:Conformance with:

• Use – Survey not requiredUse – Survey not required

Survey Required for Review:Survey Required for Review:• SetbacksSetbacks• HeightHeight• DensityDensity• Open Space/Lot CoverageOpen Space/Lot Coverage• Landscape BuffersLandscape Buffers• ParkingParking

Use of the PropertyUse of the Property

Permitted by RightPermitted by Right

Permitted by Conditional Permitted by Conditional or Special Use Permitsor Special Use Permits Drive-Thru Banks, etc.Drive-Thru Banks, etc. Convenient StoresConvenient Stores

Permitted as an Permitted as an Accessory Use Accessory Use Manager’s residence Manager’s residence

within a mini-warehousewithin a mini-warehouse

2005 ALTA Survey 2005 ALTA Survey Requirements Requirements

for Zoning Analysisfor Zoning AnalysisA current survey which A current survey which reflects the following:reflects the following:

1.1. Building Building improvements (Base improvements (Base ALTA 5g)ALTA 5g)

Setbacks –Setbacks –

Generally, the Minimum Horizontal Generally, the Minimum Horizontal Distance Between the Line of the Distance Between the Line of the

Building or Structure and the Building or Structure and the Property Line (some municipalities Property Line (some municipalities apply maximum distances as well)apply maximum distances as well)

Front or Street Front or Street SetbacksSetbacks

Side SetbacksSide Setbacks

Rear SetbacksRear Setbacks

Corner Side Corner Side SetbacksSetbacks

Parking Parking SetbacksSetbacks

Landscape Landscape SetbacksSetbacks

Accessory Accessory StructuresStructures

Distance Distance between between BuildingsBuildings

What is included in an What is included in an Base ALTA Survey?Base ALTA Survey?

Dimensions of Property (5a)Dimensions of Property (5a) All elements of each curve, if any All elements of each curve, if any

(5a)(5a) Difference in Record & Measured Difference in Record & Measured

dimensions (5b)dimensions (5b) Evidence of access to public Evidence of access to public

streets (5c)streets (5c) Names and recording data of Names and recording data of

adjoining landowners of adjoining landowners of non-non-plattedplatted lands (5d) lands (5d)

Recording Data of subdivision Recording Data of subdivision plats if adjoining lands are plats if adjoining lands are platted.platted.

Contiguity, gores and overlaps Contiguity, gores and overlaps along the exterior boundaries (5d)along the exterior boundaries (5d)

What is a Base What is a Base ALTA? cont’dALTA? cont’d

Character of all evidence of Character of all evidence of possession (fences, walls possession (fences, walls hedges, etc) (5f)hedges, etc) (5f)

Location of Buildings (5g)Location of Buildings (5g) All record easements as All record easements as

provided to surveyor (5h)provided to surveyor (5h) Observable Evidence of Observable Evidence of

Easements (5h)Easements (5h) ALL visible improvements ALL visible improvements

within 5 feet of boundary (5i)within 5 feet of boundary (5i) Driveways across property Driveways across property

(5j)(5j) Required ALTA certificate (8)Required ALTA certificate (8)

What are the optional What are the optional Table A items?Table A items?

The items of Table A need to be The items of Table A need to be negotiated between the surveyor negotiated between the surveyor and client. It may be necessary for and client. It may be necessary for the surveyor to qualify or expand the surveyor to qualify or expand upon the description of these items, upon the description of these items, e.g., in reference to Item 6, there e.g., in reference to Item 6, there may be a need for an interpretation may be a need for an interpretation of a restriction. The surveyor of a restriction. The surveyor cannot make a certification on the cannot make a certification on the basis of an interpretation or opinion basis of an interpretation or opinion of another partyof another party. .

Items 16, 17 and 18 are only for Items 16, 17 and 18 are only for use on projects for the U.S. use on projects for the U.S. Department of Housing and Department of Housing and Urban Development (HUD). Urban Development (HUD).

1. 1. MonumentsMonuments

All ALTA surveys must determine where the All ALTA surveys must determine where the property corner lies, but monuments are not property corner lies, but monuments are not required to be set in some statesrequired to be set in some states

Monuments help locate property boundaries Monuments help locate property boundaries in the futurein the future

Not all states require monuments to be set Not all states require monuments to be set and may incur additional costs.and may incur additional costs.

Some corners cannot be set and will require Some corners cannot be set and will require offset or reference monumentsoffset or reference monuments

2. Vicinity 2. Vicinity MapMap

Orients to Orients to major major intersectionsintersections

Can show off Can show off site site easementseasements

3. Flood Zone 3. Flood Zone StatementStatement

Determines if Flood Determines if Flood Insurance is requiredInsurance is required

References the FEMA References the FEMA mapmap

Flood Hazard ZonesFlood Hazard Zones FEMA Flood Insurance Rate Map (FIRM)FEMA Flood Insurance Rate Map (FIRM)

• Depicts Special Flood Hazard Areas (SFHA)Depicts Special Flood Hazard Areas (SFHA)• 100 year Flood?100 year Flood?

Zone B, C, D and XZone B, C, D and X (Non-Special Flood (Non-Special Flood Hazard Area)Hazard Area)• Areas of moderate or minimal hazardAreas of moderate or minimal hazard • Flood insurance is available in participating Flood insurance is available in participating

communities but is not requiredcommunities but is not required Zone A and VZone A and V (Special Flood Hazard Areas) (Special Flood Hazard Areas)

• Subject to inundation by the 100-year floodSubject to inundation by the 100-year flood • Areas where detailed studies have not been Areas where detailed studies have not been

performedperformed• Mandatory flood insurance purchase Mandatory flood insurance purchase

requirements applyrequirements apply Zone AE, AO and A1-A30 Zone AE, AO and A1-A30 (Special Flood (Special Flood

Hazard Areas)Hazard Areas)• Subject to inundation by the 100-year floodSubject to inundation by the 100-year flood• Base flood elevations are shown within these Base flood elevations are shown within these

zones zones • Mandatory flood insurance purchase Mandatory flood insurance purchase

requirements applyrequirements apply



1.1. Building improvements (Base Building improvements (Base ALTA 5g)ALTA 5g)

2.2. Total acreage (ALTA Total acreage (ALTA Optional Item #4)Optional Item #4)

4. Land 4. Land AreaArea

Helps determine if all of desired Helps determine if all of desired property is surveyedproperty is surveyed

Area to be determined by clientArea to be determined by client Usually not insurable by the title Usually not insurable by the title

companycompany Needed to determine Bulk Density for Needed to determine Bulk Density for

ZoningZoning

5. Contours & 5. Contours & ElevationsElevations

If requested, the contours If requested, the contours (elevations) of the property (elevations) of the property would be shownwould be shown

NOT necessary for most NOT necessary for most transactionstransactions

Usually NOT requested unless Usually NOT requested unless construction is plannedconstruction is planned

6. Zoning Restrictions6. Zoning Restrictions

List current setbacks List current setbacks (but no longer (but no longer required to plot required to plot zoning setback zoning setback lines)lines)

List height List height RestrictionsRestrictions

List Floor Space List Floor Space Restrictions (bulk)Restrictions (bulk)

Setbacks from Setbacks from recorded plat (a Title recorded plat (a Title but not a Zoning but not a Zoning issue, similar to issue, similar to deeded setback and deeded setback and parking requirement)parking requirement)

Surveyors can not Surveyors can not certify to an certify to an interpretation or interpretation or opinion of another opinion of another party.party.

7(a) Exterior Dimensions of 7(a) Exterior Dimensions of BuildingsBuildings

Without this item, buildings are only Without this item, buildings are only shown visually, not dimensionedshown visually, not dimensioned

In some cases an overall length In some cases an overall length and width will suffice (very intricate and width will suffice (very intricate buildings)buildings)





3.3. Square footage of the Square footage of the building footprint (ALTA building footprint (ALTA Optional Item #7b(1)Optional Item #7b(1)

7(b) Square Footage of:7(b) Square Footage of:

If this item is checked, there are If this item is checked, there are up to three (3) subcategories up to three (3) subcategories that should be requestedthat should be requested

7(b)(1) Exterior Footprint7(b)(1) Exterior Footprint

This is the area that the building This is the area that the building occupies on the property at occupies on the property at ground level (1ground level (1stst Floor Only) Floor Only)

Used for bulk density calculationsUsed for bulk density calculations

7(b)(2) Gross Floor Area7(b)(2) Gross Floor Area Usually obtained from rent rolls Usually obtained from rent rolls (surveyors do not typically measure (surveyors do not typically measure the interior of buildings) the interior of buildings) Used for Floor Area Ratio (FAR) Used for Floor Area Ratio (FAR)

calculationscalculations

Density Density

Bulk / Density rules place limits Bulk / Density rules place limits on how much of a use/activity on how much of a use/activity can be constructed on the land. can be constructed on the land. The most common density rules The most common density rules are:are:

Lot Size per Dwelling UnitLot Size per Dwelling Unit Number of Units allowed per Number of Units allowed per

Acre of LandAcre of Land Percentage of Building Footprint Percentage of Building Footprint

per Acre of Landper Acre of Land Floor Area Ratio: Specifies the Floor Area Ratio: Specifies the

amount of total building floor amount of total building floor area relative to the lot size. An area relative to the lot size. An FAR of 2.0 means one can put a FAR of 2.0 means one can put a 2-story building covering the 2-story building covering the entire lot, or a 4-story building entire lot, or a 4-story building covering half the lot.covering half the lot.

77(b)(3)(b)(3) Other Areas Other Areas

Landscaped area, if required Landscaped area, if required by restrictive covenantby restrictive covenant

Areas lying within a Flood Areas lying within a Flood Hazard AreaHazard Area

Area lying within public or Area lying within public or private right-of-wayprivate right-of-way

Be specific if you check this Be specific if you check this itemitem





3.3. Square footage of the Square footage of the building footprint (ALTA building footprint (ALTA Optional Item #7b(1)Optional Item #7b(1)

4.4. Height of the Height of the building/number of building/number of stories (ALTA Optional stories (ALTA Optional Item #7c)Item #7c)

Height LimitationsHeight Limitations

May Be May Be Restricted Restricted by:by:

Number of Number of StoriesStories

Height of the Height of the StructureStructure

Combination of Combination of BothBoth

Proximity to the Proximity to the Property LineProperty Line

7(c) Height of 7(c) Height of BuildingsBuildings

Used mainly for zoning Used mainly for zoning compliancecompliance

Feet AND number of storiesFeet AND number of stories Surveyor should specify where Surveyor should specify where

the building height was the building height was measured.measured.

8. Visible Improvements8. Visible Improvements

Without Item 8, only buildings are Without Item 8, only buildings are required to be shownrequired to be shown

Substantial visible improvements (in Substantial visible improvements (in addition to Buildings) billboards, addition to Buildings) billboards, signs, parking structures, paved signs, parking structures, paved areas, swimming pools, etc.areas, swimming pools, etc.

Billboard SignsBillboard Signs Indication of use by othersIndication of use by others


for Zoning Analysisfor Zoning AnalysisA current survey which reflects the A current survey which reflects the following:following:


2.2. Total acreage (ALTA Optional Total acreage (ALTA Optional Item #4)Item #4)

3.3. Square footage of the building Square footage of the building footprint (ALTA Optional Item footprint (ALTA Optional Item #7b(1)#7b(1)

4.4. Height of the building/number of Height of the building/number of stories (ALTA Optional Item #7c)stories (ALTA Optional Item #7c)

5.5. Total number and location Total number and location of parking spaces (ALTA of parking spaces (ALTA Optional Item #9)Optional Item #9)

9. Parking Areas and Striping9. Parking Areas and Striping

Need to determine zoning Need to determine zoning compliance.compliance.

Parking Areas and if striped, show Parking Areas and if striped, show and striping and type (handicapped, and striping and type (handicapped, motorcycle regular, compact) and motorcycle regular, compact) and total number of stripes.total number of stripes.

Should include a total of surface Should include a total of surface spaces, and any parking garage spaces, and any parking garage and/or underground spacesand/or underground spaces

Examples of Examples of Parking RequirementsParking Requirements By Specific Use (Commercial, By Specific Use (Commercial,

Industrial, Office, Warehouse)Industrial, Office, Warehouse) Per Living Unit, often by # of Per Living Unit, often by # of

bedroomsbedrooms By Square Footage of Gross or By Square Footage of Gross or

Leasable AreaLeasable Area In Mixed Uses, by Square In Mixed Uses, by Square

Footages broken down by Footages broken down by different types of usesdifferent types of uses

By # of employees on the By # of employees on the Maximum ShiftMaximum Shift

In Restaurants, by # of Seats In Restaurants, by # of Seats and the Square Feet of Patron and the Square Feet of Patron Area, or by linear feet of the barArea, or by linear feet of the bar

The # of vehicles used by the The # of vehicles used by the tenant in the operation of the tenant in the operation of the businessbusiness

10. Access to Public 10. Access to Public RoadRoad

Survey to show curb cuts, driveways, Survey to show curb cuts, driveways, access to and from waters adjoining access to and from waters adjoining the property (boat slips, piers and the property (boat slips, piers and docks)docks)

Allows title company to insure Allows title company to insure accessaccess

Survey should state Direct or Indirect Survey should state Direct or Indirect access.access.

Physical access vs. legal accessPhysical access vs. legal access

11. Location of Utilities11. Location of Utilities

Confirms that property has access to Confirms that property has access to public utilitiespublic utilities

Confirms that visible utilities enter or Confirms that visible utilities enter or exit though public easements or rights exit though public easements or rights of wayof way

Is there a need for appurtenant Is there a need for appurtenant easement across others?easement across others?

Indication of unrecorded easementsIndication of unrecorded easements Two subcategories of Item 11Two subcategories of Item 11

11 (a) Observed Evidence. 11 (a) Observed Evidence.

Only visible Only visible evidence of evidence of utilities:utilities:

Manholes, Manholes, power poles, power poles, transformers, transformers, fire hydrants, fire hydrants, drain inlets, drain inlets, etc.etc.

For example, For example, location of location of sewer lines sewer lines between between manholes will manholes will not be shown. not be shown.

11 (b) Underground 11 (b) Underground Utilities from Observed Utilities from Observed

Evidence, Utility Markings Evidence, Utility Markings & Utility Plans. & Utility Plans.

Plans provided Plans provided by client, utility by client, utility companies and companies and other other appropriate appropriate sources.sources.

For example, For example, city utility plans city utility plans (WHEN (WHEN AVAILABLE)AVAILABLE)

This does not This does not require require surveyor to surveyor to utilize the “One utilize the “One Call” systemCall” system

12. Governmental Agency 12. Governmental Agency Requirements. Requirements.

HUD RequirementsHUD Requirements Additional FANNIE MAE Additional FANNIE MAE

Requirements not otherwise Requirements not otherwise covered in Table Acovered in Table A

Usually not requestedUsually not requested

13. Names of Adjoiners / 13. Names of Adjoiners / Platted. Platted.

Non-Platted adjoiners are already required by Non-Platted adjoiners are already required by base ALTA.base ALTA.

Adjoining deed information or Tax Records Adjoining deed information or Tax Records need to be provided by client or title company.need to be provided by client or title company.

Needs to be negotiated in original survey Needs to be negotiated in original survey order.order.

14. Distance to Nearest 14. Distance to Nearest Intersecting StreetIntersecting Street

Specific street intersection Specific street intersection request to be specified by request to be specified by client, for example if you need client, for example if you need to know how far the site is from to know how far the site is from a certain Interstate.a certain Interstate.

15. Use of 15. Use of OrthophotographyOrthophotography

Useful in certain situations Useful in certain situations where large areas are involved where large areas are involved without many improvements.without many improvements.

Boundary is done using Boundary is done using traditional methods.traditional methods.

Field location of Improvements Field location of Improvements varies with each situation.varies with each situation.

Potential encroachments are Potential encroachments are field verified.field verified.

16. Earth Moving and 16. Earth Moving and Construction Construction within recent within recent

monthsmonths

Evidence of possible Evidence of possible lien rightslien rights

For use on For use on Department of Department of Housing and Urban Housing and Urban Development (HUD) Development (HUD) projects onlyprojects only

17. Changes in Street 17. Changes in Street Rights-of-Way or recent Rights-of-Way or recent

constructionconstruction Completed OR proposedCompleted OR proposed Indicates possible additional Indicates possible additional

right-of-way takingsright-of-way takings Observable evidence of Observable evidence of

recent street or sidewalk recent street or sidewalk construction or repairconstruction or repair

Documents are typically not of Documents are typically not of recordrecord

For use on Department of For use on Department of Housing and Urban Housing and Urban Development (HUD) projects Development (HUD) projects onlyonly

18. Solid Waste Dump18. Solid Waste Dump

Only visible evidence can be Only visible evidence can be noted or locatednoted or located

For use on Department of For use on Department of Housing and Urban Housing and Urban Development (HUD) projects Development (HUD) projects onlyonly

19. Other19. Other

Client specific requestsClient specific requests Usually not requestedUsually not requested

Information Needed To Information Needed To Prepare an ALTA Land Prepare an ALTA Land

Title Survey orTitle Survey or PZR REPORTPZR REPORT®®

Specific Specific street street addressesaddresses

Specific Specific “use” “use” informationinformation

Tax Parcel Tax Parcel ID #ID #

Legal Legal DescriptionDescription

As-Built As-Built SurveySurvey

Available Site Available Site PlansPlans

Rent Roll / Rent Roll / Unit Mix, with Unit Mix, with gross floor gross floor areaarea

Old Zoning Old Zoning Letters, C.O.’s Letters, C.O.’s and other and other Approval Approval DocumentsDocuments

Date of Date of ConstructionConstruction

ANY ANY QUESTIONS?QUESTIONS?

zoning due diligence for commercial real estate transactions

Real Estate