Builders of multi-family houses in Orlando demand that the authorities accelerate project approvals

Builders of multi-family houses in Orlando demand that the authorities accelerate project approvals

Although Central Florida needs to build numerous apartment blocks to satisfy the growing demand for housing, the final project approval with the authorities takes a lot of time. Developers are concerned about this problem.

Some state leaders are trying to solve the problem of growing rentals with controversial methods. Developers and many local market experts declare that the protracted process is directly driving up the costs that are eventually passed on to tenants.

A joint study conducted by the National Association of Home Builders and the National Multifamily Housing Council showed that 40.6% of multi-family houses’ value is directly related to state regulation and the delays it causes.

Long project approval processes and the opposition of residents who do not support construction of new apartment blocks mean that developers have to wait for up to two years to get an approval. The Florida Apartment Association estimated that this costs developers from $1.5 million to $4 million.

“Time is money,” says Lee Steinhauer, General Counsel of the Apartment Association of Greater Orlando. “With every delay, every additional hurdle, it’s just costing more and more and that ultimately goes into whatever the rent is going to be.”

Developers encourage all cities and counties in Central Florida to accelerate the process, so that they could increase the supply in the local market faster. Orange County was the first to respond to this plea for help.

Last week, its Commission held a working session to discuss the approval process and the ways to accelerate it. “We need to find out how to make this process faster and more efficient,” says Alan Marshall, Assistant Director for Planning, Environmental, and Development Services. After the meeting, Marshall and other county officers met with developers and lawyers to discuss this matter and listen to their concerns.

One of the participants was Steve Ogier, CEO at Contravest, an Altamonte Springs-based developer. Before the company started building Addison house with 266 apartments in Lake Bryan near Disney World, it had to wait for 14 months for Orange County’s approval. To put things in perspective, another project was approved in only eight months.

“The main reason rent values are going up is because there is excess demand and not enough housing,” Ogier says. According to the Florida Apartment Association, Orange County alone will need about 55,000 additional apartments by 2030.

“The red-tape hurdles and multiple levels of approvals required restrict the new supply,” Ogier added. “They (government agencies) hold the key to the safe. It is their job to clear the way for more housing, not just say, “rent control”.”

Over the past few months, Orange County Commission has been focused on the rising rent. The members were considering the potential solutions for this problem. After a four-hour public hearing in July, the Commission suggested putting a controversial rent control measure on the general election ballot.

If it is approved, the government will impose a 9.8% annual limit to rental hikes for 104,000 apartments in Orange County. No other county in Florida has taken such measures. The Apartment Association sued the county over it.

Amanda White, Director of Government Relations at the Florida Apartment Association, says that many government agencies are reluctant to deal with builders of multi-family houses during the permit-issuing process.

“Rising costs, construction delays, and labor shortages are making it more and more difficult to build the housing our country so badly needs,” Doug Bibby, President of the National Multifamily Housing Council, declared.

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