Gulf Shores City Council Renews Condo Debate

Originally approved in 2005, developers say their projects aren't feasible under new rules, request 2009 deadline

Published By Mobile Press Register
Friday, May 11, 2007
By RYAN DEZEMBERStaff Reporter

GULF SHORES -- The City Council is scheduled to vote Monday to set a date for developers of nonconforming condo towers to either start construction or recast their designs to fit new zoning rules.
In March 2005, on the eve of adopting new zoning guidelines that limited density and building heights along the beach, the council gave approval for 12 condos that were already being planned. At the time, elected officials said they didn't want to do fiscal harm to landowners who had bought land at prices that reflected development potential under the old rules.
Since then, city approvals granted for two of those projects -- the East Beach Lifestyle Center and West Shore -- have expired. The remaining 10 projects have essentially run out the time extensions that the council typically grants.
To that end, a group of developers representing five of the 10 projects, all originally approved in 2005, has asked the council to set a deadline in May 2009 for them to start building.
Developers of some of those 10 projects say that because they bought their property when the coastal real estate market was at its peak, and because costs have soared and prices plummeted, they won't likely be able to build under new, more restrictive zoning rules.
"All we're trying to do is stay alive," said Michael Weber, one of the developers for the 90-unit, 12-story Armada Pass project. "We've been 24 hours away from having our property sold on the courthouse steps three times."
Former Gulf Shores Mayor David Bodenhamer, who has been asked to represent the developers of five of the projects, told council members during a work session on Monday that, "With the exception of one of these five that are represented, I would warrant to you that it is highly possible, not necessarily probable, but it is highly possible that the current ownership, if we can't work this out, will not develop those properties at all under the new guidelines because the numbers will not work given when the property was acquired and what the impact of the reduction in the density does to that price.
"In another day, in another time, at another price, that would be another story."
Bodenhamer, who sometimes works as a consultant to developers, said that he has no financial interest in any of the five projects -- Armada Pass, Majestic, Wave, Laguna Cay and Crystal Breeze -- and is not being paid to represent the developers of those projects.
"I'm simply here to do what I told them I would do, and that is to present their case as to what I think is a reasonable approach for the city to consider to try to resolve this issue once and for all," the former mayor said.
For months the council has debated whether to give the projects, because they now fit outside of zoning rules, extra time to start construction.
Gulf Shores' current mayor, G.W. "Billy" Duke III, said that if all 10 developments are built -- a prospect he called "not very realistic" -- it would add a total of about 340 condominium units to what could be built under the new rules.
"In the overall scheme of things, I don't really know if that makes a heck of a lot of difference," Duke said.
The new zoning, a product of the Envision Gulf Shores planning process after 2004's Hurricane Ivan, was aimed at limiting the development potential of Gulf-front parcels to prevent unworkable traffic congestion and a canyon of condo towers, as well as to create more open space and a pedestrian-friendly downtown area.
While many parcels were "down-zoned," city officials compromised with 12 developers who had bought land and were in the midst of planning projects under the old rules.
"When we granted these people certain development rights because they had already purchased the project, our concern at that time was to not hurt anyone financially in that process," Duke said. "And I still struggle with this today because conditions have changed so drastically."
Some council members said they were concerned about setting a precedent with such long site-plan extensions. It has been the city's policy -- dating back before the 1980s, Bodenhamer guessed -- to offer a maximum of two six-month extensions.
"I don't want to send a message to every site plan that comes in here that you're guaranteed this 36-month extension or whatever it is," Councilman Philip Harris said. "So I want to be careful that we package this in a way before we take action on it that we're clearly addressing the circumstances in these special projects here."
Councilman Robert Craft said he supports a hard deadline for all of the grandfathered projects to come out of the ground, but "May '09 is a little further than I thought.
"But that, to me, is what this is going to come down to: What is that date and how long are we willing to sit out there with basically nonconforming projects?"
Duke said the council will be presented on Monday with a resolution specific to the 10 developments, with a blank date. The council can further debate the exact deadline before the measure is voted on, he said.