Rezoning to Add a Unit

8 Replies | Chicago, Illinois

Hi all. I am under contract on a Chicago property that has 3 cashflowing units but the zoning cert says it is only a 2-unit + commercial space (which has been turned into a 3rd unit. It is zoned RT-4). I am wondering what the rezoning process is like and any advice you have from that front. If rezoning is just time consuming, I imagine a price reduction on this property would make it worthwhile. Thanks for your help and tips in advance!

rezoning is not feasible, it's very costly. if it's zoning a 2 unit then you are in a so called pre-existing non-conforming, check the floor area ratio if you are already over then there is not much you can do, however if you your FAR is below then there are potential opportunities for the garden unit considering the newly passed ordinance. 

I personally have never been involved in the rezoning of a building in Chicago.

However, a Google search helped me find this City of Chicago website about the process of amending the zoning of a building in Chicago:

City of Chicago :: Zoning Amendment

Frankly it doesn't look like there is a fast way to complete the process before purchasing the subject property.

It looks like you will need the approval of the City Council of Chicago and therefore it might be a good idea at some point to reach out to the Alderman for support.

More specifically, it will be a good idea to hire an attorney to represent you who has experience dealing with the Chicago zoning board and local politicians.

Therefore, a price reduction could/should be requested.

Good luck

@Tan Su , the property was actually accepted as a 3 unit in 2014 but now the zoning department is rejecting that. The 3 units are all above ground. Does that change your suggestion?

If anyone has attorney suggestions, I would appreciate them. Thanks!

hi Harry,

I cannot give legal advice please do not take this as legal advice, but I can give a personal advise. 

Call the Chicago Zoning board of appeals and ask them directly why it is rejected and what can you do to make it accepted as a 3 unit.

If they tell you that there is a specific requirement you need satisfy then do it. if they tell you there is nothing you can do unless you request a re-zoning then consider whether you want to spend the money and time going through the rezoning process or accept it as is or reject the deal. 

USUALLY, there is a reason they reject what they have accepted. 

Originally posted by @Hemang S. :

@Tan Su, the property was actually accepted as a 3 unit in 2014 but now the zoning department is rejecting that. The 3 units are all above ground. Does that change your suggestion?

If anyone has attorney suggestions, I would appreciate them. Thanks!

@Hemang S. the zoning process in Chicago makes no sense. I recently listed a legal three unit in Avondale and when we finally got it under contract the city sent us back the zoning cert stating that it was a two unit. My sellers were super organized, and we had the zoning cert from when they had purchased the property just a few years before stating as clear as day that the property was a three unit. It took us weeks to get the corrected zoning cert back, even using an attorney who knows what he is doing. 

I think it makes a lot of sense to ask questions and push back when it comes to this process. I will send you my attorney, but really any competent RE attorney in Chicago should know the ropes here. 

@Hemang S. - I've been through the zoning process and a very painful one at that.  If you are already RT4 and if zoning is saying it's a 2 unit + 1 commercial there may be a reason - is it on a busy street?

I would start by touching base with an architect (@Prashanth Mahakali or @Samuel Pavlovcik ) about your rights by law given your current zoning and situation.   Then one of them can definitely point you in the direction of a good Chicago zoning attorney.

Thanks for the info everyone. @John Warren , the situation you described is almost exactly what the seller is experiencing. I saw their zoning certificate saying it is 3-unit, but now that it is being sold, the city said it is a 2-unit. It sounds like you were able to contest what the city said and so I expect we can do the same.

@Jonathan Klemm . The property is not really on a busy street, but the first floor used to be used as commercial space a while ago so I am assuming it has something to do with that. I'll check in with the contacts you mentioned and go from there. Thanks for the assist!

@John Warren thanks for the mention!

@Hemang S. from what I read in the posts, it sounds more like the issue is that the commercial space was converted to a Resudential unit at somepoint, and there was never a permit pulled for the work. The good news is that RT-4 allows for Residential Units to be located on the fround floor By Right, which means that (Depending on FAR and lot size) it is Unlikely that this is a Zoning Issue, and more likely that this is a Building Department issue. This means that you (most likely) Do Not need to worry about changing the Zoning and instead, just need to get a permit to remodel the 1st floor into a Legal residential Unit.