Big changes for Asheville's River Arts District: Airbnbs, apartments, zoning

ASHEVILLE - The River Arts District, an area already undergoing a $60 million infrastructure overhaul, will see more big changes following City Council votes on short-term tourist rentals, a 133-unit apartment complex, parking rules and a sweeping zoning change.

Several of the issues were addressed as part of a long-planned zoning change for the River Arts District. The new form-based zoning code is supposed to focus on the layout and look of new buildings, as opposed to how they are used.

New buildings are to be closer to sidewalks and oriented more toward pedestrians than cars.

"It tends to return to the way cities used to be built," said Sasha Vrtunski, a staff member of the city's Planning and Urban Design Department, overseeing the new zoning.

The council passed the form-based code on a 5-2 vote Tuesday. Voting yes were Mayor Esther Manheimer, Vice Mayor Gwen Wisler and council members Brian Haynes, Julie Mayfield and Gordon Smith. Councilmen Cecil Bothwell and Keith Young voted no.

'STR' restrictions

One part of the zoning rules that split the council was a recently added restriction on short-term rentals or "STRs"

Those are rentals of less than 30 days. They are banned in residential zones that cover most of the city with violators subject to $500 fines.

STRs had been allowed in the River Arts District.

Members of the public speaking at Tuesday meeting of council came down on both sides of the issue.

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Helaine Greene, an owner of Riverview Station artists studios and galleries at 191 Lyman St., said the form-based code came from two years of community input. She protested the STR restriction, which the council decided to add in the summer.

"If you want to have input from community, there has to be respect for what the community comes up with," Greene said.

But Casey Campfield, a downtown bar owner and STR opponent, said the rentals exacerbate the housing shortage for locals.

"With more than 10 million visitors each year into a city of 90,000 residents and with a terrible housing shortage looming over us, it is increasingly ludicrous to argue for more tourist housing," Campfield said.

Smith, the council's most outspoken STR critic, pushed back against the idea that the new rule was a "ban," saying it means property owners would no longer be able to do tourist rentals "by right." Property owners can still ask the council permission to do the rentals through individual conditional zoning changes.

"City Council is saying, 'Hey, we want to make sure we aren't going to squeeze out locals to make room for tourists,'" the councilman said.

But Bothwell, who supports loosening STR restrictions, said the rule goes against the idea of the form-based code, which doesn't focus on how buildings are used.

It also creates different rules for STRs than in residential zones and other parts of the city.

"I think it should be handled comprehensively for the city and I hope the incoming council will do that and come up with some more rational rules than we have now," Bothwell said.

With two new members joining the council after the Nov. 7 election, there will be a majority supporting looser rules on STRs in backyard cottages and other accessory dwelling units. There will also be a majority of members backing more uniform rules

Land trust concerns

Some members of the public said at the Tuesday council meeting they were concerned the rezoning could cause gentrification and scuttle an affordable housing land trust they hope to put on Ralph Street.

Dee Williams, a council candidate in the Nov. 7 election, said the area, which was cleared of structures during urban renewal programs in the historically African-American neighborhood, would be a good site for a land trust, an agreement where a group owns the land and leases it to homeowners at affordable rates.

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Williams said the form-based code could have "unintended consequences," encouraging the building of high-priced housing that in turn raises neighboring property values. "And a lot of adjoining property owners can't keep up," she said.

Council members said the increased density allowed in the zoning could be another route to affordability and that it also wouldn't rule out a land trust.

Mayfield said Asheville's popularity was the primary case of gentrification.

Worried industry

Some businesses near the east bank of the French Broad River had asked to be excluded from the zoning, but a majority of council members rejected that idea.

Attorney Albert Sneed spoke Tuesday saying his client Asheville Waste Paper was concerned if it had to rebuild after a flood "the cost would be enormous" under form-based code rules.

Bothwell suggested the recycling company be removed from the zoning. But Mayfield said the main goal of the zoning was to ensure that future owners of the property had to comply with the standards if they built a new structure.

RAD's biggest housing project?

The council voted 5-2 to conditionally zone the Stoneyard Apartments project at 175 Lyman St., clearing the way for what could be the biggest housing development in the River Arts District.

Voting yes were Manheimer, Bothwell, Haynes, Mayfield and Young. Wisler and Smith voted no.

The project, last estimated at $19 million, would include apartments, a restaurant, 10 artists studios and a parking structure with 85 public parking spaces. Built on a former stone yard, developers wanted apartments to fit in with the character of the district and preserve a more than 100-year-old Carolina Coal and Ice building, said David LaFave with Altinvest developers of Asheville, Saluda and Charlotte.

In August, a majority of council members, including Haynes and Young, said affordability would be a big factor in whether they voted for the project. Mayfield was out of town and couldn't be reached for comment.

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Smith pushed developers to reserve more than 26 of the units at below market rates or give $750,000 to the city's housing trust fund for low-interest loans to affordable housing developers.

But Tuesday, LaFave offered $50,000 for the fund without any rent reductions. Rents would likely run from $750 for a studio apartment to $1,400 for a two-bedroom unit, he said. The artists studios, which are only work spaces, would be rented for $300 to $400, he estimated.

Short-term rentals would not be allowed, the developer said.

In supporting the project, Bothwell said having to flood-proof the buildings, which sit in the floodplain, likely made it difficult to price them below market rates.

Mayfield said she had concerns about affordability but thought the parking spaces, which she said would cost the city $1.5 million to build, offered something to the public.

"That is not an insignificant amount for the city to spend," the councilwoman said.

It would also be good to concentrate parking instead of spreading it out throughout the district, she said.

Young, meanwhile, said future developers should not take the vote as an "acquiescence" on affordable housing.

The apartments could be finished in the late summer of 2019, LaFave said. Another project, the $58 million mixed commercial and residential RAD Lofts, are slated to add 235 apartments, including some at below market rates on Roberts Street. RAD Lofts was given a completion date of spring 2019, though it has faced delays and it's not clear if the project will be finished then.

Parking and greenway

In another move, the council voted to keep a parking reduction area that would allow new buildings to have less parking than other places in the city.

Voting to keep the parking reduction were Bothwell, Mayfield, Smith and Young. Haynes, Manheimer and Wisler voted to do away with the reduction.

The new zoning also reduces parking requirements, meaning those in the parking reduction area would be allowed to build even fewer spaces.

In the consent agenda, the council unanimously voted to fund a $7,400 gravel fines greenway on the south side of Town Branch stream between Depot Street and South French Broad Avenue. The trail will be built and maintained by the nonprofit job trainer Green Opportunities. The city will apply for a $5,000 grant to reimburse most of the cost.

The trail is meant to be an interim piece of the proposed Town Branch Greenway. That project was pulled from the main River Arts District infrastructure overhaul after no contractor offered a bid.