Why Commercial Zoning Reports Are An Integral Part Of Due Diligence

Not only do commercial zoning reports provide vital information on property use, but it also allows key insight into future development potential. Here’s why this report should be prioritized during your due diligence process. 

Because zoning laws and regulations vary by each municipality, zoning reports are the best way to investigate the use and restrictions of a property. With more than 25 years of experience, National Due Diligence Services (NDDS) is one of the fastest-growing commercial due diligence firms in the nation, boasting a one-stop-shop model for assessment services. Whether your zoning needs involve a complex single site, a multi-state, or a multi-site project, NDDS has you covered with our efficient and timely zoning report process. 

What are Commercial Zoning Reports?

A commercial zoning report is a document that provides information regarding the regulations of a property. It is based on a review of public records like zoning maps, permits, ordinances, and site inspections. While the report usually includes restrictions, limitations, and zoning classifications, it can also show helpful information on pending zoning changes or variances that could have an impact on the property’s use.

For example, if a company is considering purchasing a property to expand its manufacturing operations, they may request a commercial zoning report to ensure the property was zoned for its intended use. 

While the property may be zoned for industrial use, it could have specific restrictions on the types of manufacturing processes allowed or potential environmental regulations that could impact the company’s operations. By uncovering these issues before purchasing the land, the company is able to avoid costly compliance problems and poor investment.

Please note that an American Land Title Association (ALTA) survey with a minimum of Table A Items 4, 7, and 9 are required in order to initiate a zoning report.

How is a Zoning Report Created?

The process of creating a zoning report typically involves four main steps:

  • Research – Gathering public records and conducting any necessary interviews with public officials.
  • Information Collection – Identifying the current status of the property based on local zoning ordinances, maps, and various public records.
  • Analysis – Determining the zoning classification and permitted uses of the property based on the collected information.
  • Report – A completed report will include a summary of a property’s zoning classification, permitted uses, restrictions, limitations, and pending changes or variances. These reports feature maps and municipal documents for support.

Why is a Commercial Zoning Report Necessary for Due Diligence?Zoning reports

There are a few primary reasons why a zoning report is a foundational element of due diligence for the commercial buying, selling, development, redevelopment, or renovation process. It can clue in a buyer on potential obstacles and provide needed confirmation that a property is—or is not—zoned for its intended purpose, whether that may be commercial, industrial, or mixed-use development. 

A commercial zoning report is necessary in order to: 

  • Understand the status of a property and whether it is conforming, non-conforming, or legal non-conforming.
  • Recognize parking requirements and use.
  • Secure financing, as it is a requirement from many financial lenders.
  • Learn height, setback, density, and area compliance requirements.
  • Identify building, safety, fire, or zoning code violations.
  • View planned developments that might impact the property.

What Is the Protocol for a Non-Conforming Property?

If a zoning report has been conducted and it returns with a notice of non-conformance, ownership of the property in question may be affected. Many lenders will ask for additional insurance, and the nonconforming property may require a rebuild in order to comply with the area’s zoning code. Should this be the case, a zoning report company will be able to provide a list of solutions tailored to your property that are in accordance with local regulation.

What Does a NDDS Zoning Report Include?

When you schedule a zoning report from NDDS, you will receive a comprehensive package of items:

  • A zoning verification letter from our database of local jurisdictional agencies. Letters for multiple sites will be in a tabulated spreadsheet.
  • Land development standards reviewed by NDDS specialists.
  • A certificate of occupancy.
  • A complete review of all code sections including zoning, building code violations, fire code violations, permits, zoning ordinances, condemnation, and conformance status. 
  • A current ALTA Survey review for compliance analysis that may include setbacks, building height, density protocol and more.

Enlist the Help of National Due Diligence Services

As the nation’s premier surveying and mapping company, we offer a team of professionals who will keep your project on time and compliant with federal, state, and local regulations. In addition to zoning services, NDDS also specializes in Environmental Assessments, Zip Maps, ALTA Surveys and more. Contact us today to get the process started.