Half a billion dollars!
I keep hearing that the provisions of the Residential Infill Project (RIP) will curb demolitions because they impose restrictions on height and home size. But in Eastmoreland, this just isn’t true. In fact, there is over half a billion dollars (yes, Billion, with a ‘B’) in potential value in the proposed Eastmoreland historic district (HD) if homes were developed to the maximum allowable size under RIP. With this kind of financial opportunity, we will not see the end of demolitions and speculative development for a long time to come. If you’re interested in how I got to this figure, then keep reading.
A common claim is that the RIP will limit home sizes to 2,500 square feet. This is true if your lot size is only 5,000 square feet. But in the proposed Eastmoreland HD, the average lot size is actually 7,129 sq. ft. and this means that homes can be quite a bit larger. Let’s break down what the RIP says about size restrictions…
1) Maximum home size is a function of the lot size and the Floor Area Ratio (FAR), in order to constraint scale. For the R5 lots in Eastmoreland, a FAR of 0.5 means that the area of the home can be half the area of the lot itself.
2) This maximum, however, excludes basements and low ceiling finished attics. Most homes in Eastmoreland have a basement that is nearly as large as the main floor, so this creates potential for an even larger home.
3) The maximum also excludes accessory dwelling units (ADU). In an effort to promote density growth, you can have an additional 0.15 FAR. On a 5,000 sq.ft. lot, this means you can have a 750 sq.ft. ADU in addition to the main home.
4) Height limits of 30 ft. as measured from the lowest point and a maximum of 2.5 stories will have little impact. Eastmoreland is fairly flat and there are very few 3-story homes here today.
5) The final concept report from the City of Portland RIP contains additional details. You can find that on the City of Portland’s BPS website.
Now, back to the analysis. If you apply these terms of the RIP, you’ll see that not only are almost all homes in the proposed Eastmoreland HD compliant today, but many are far below what is allowed. Out of 1,274 homes, only 46 (or 4%) exceed the area constraints allowed by RIP. And you’ll see in the chart of lot size vs. above grade home size that most homes can be larger than they are today. With an average lot size in the proposed Eastmoreland HD of 7,129 sq.ft. the allowable above grade home size is really 3,565 sq.ft. When you add in a basement, homes can easily be 4,000 – 5,000 sq.ft. even under RIP. Developers already see this untapped potential.
Relative to many other parts of Portland, Eastmoreland homes are large, but not excessively so. 77% of all homes have an above-grade area of 2,500 sq.ft. or less. Our comparatively large lot sizes is what creates the opportunity for developers. This has led to lot splitting where two homes replace one, or out-of-scale building where home size is increased to maximize profit. Both of these have the effect of increasing density by reducing open areas, the tree canopy, and space between homes. The demolished homes are typically replaced with a more modern design and style that is out of character. And to make matters worse, it drives up the cost of the new homes making Eastmoreland less affordable.
With almost 90% of homes offering opportunities for enlargement (even under RIP), there is tremendous potential profit. If a developer or property owner simply increased the above-grade livable space to the maximum allowable RIP levels, the incremental value of those improvements is around $544 Million (assuming a value of $300/sq.ft.). So the average home in the proposed Eastmoreland HD is worth at least an additional $426,000 due to above grade enlargement. Factor in a full modernization, basement expansion, and an ADU on the property and it’s much larger.
Sure, the RIP will save some homes from demolition, but without the Historic District, it will still be open season for developers in Eastmoreland. And in the process, Eastmoreland will slowly lose its unique character and greenspace while delivering very little real increase in population density.
This analysis relied on property data gathered from PortlandMaps.com.
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