Changes for development in Austin's industrial zones, along highways up for review in 2025

New city development policies that could affect properties along some highways and in Austin's industrial zones will be considered in early 2025 after City Council postponed action late last year.

What's happening

At council's request, city planning staff have been working on new land-use rules for development in areas tapped for some industrial and commercial uses. A pair of changes are now proposed for planned development area, or PDA, zoning as well as on commercial highway and industrial properties.

The first update would create a new zoning designation, PDA2, to limit future residential additions in some commercial and industrial areas. The second update, a density bonus program for those zones called DB240, would allow projects to include housing—with some affordable units—and build up to 240 feet high in similar places. More information on PDA2 and DB240 is available online.

The changes were proposed after dozens of recent rezoning requests were made for mixed-use projects in relevant areas, and to address conflicting regulations that apply there. City staff have since highlighted dozens of sites where housing was allowed on PDA properties, even though that designation wasn't originally intended to be used for new residential construction. Those have included plans for housing at a Denny's location off I-35 and several large-scale mixed-use redevelopments on the east side off US 183.

The details

After moving through public review in late 2024, including Planning Commission consideration, council members decided to postpone final votes on PDA2 and DB240 in December. While pointing to issues with the current system and an often "messy and difficult" zoning process, council member Chito Vela said officials should hold off for at least another month to allow for more community engagement and the release of a new staff report on all of Austin's bonus programs expected in early 2025.

"This doesn’t quite get there, but we’re going to keep working on it," Vela said of the proposals Dec. 12.

If approved, the new policies would have the biggest potential impacts in South and Southeast Austin along Hwy. 71, on the east side along US 183 and Hwy. 130, and in pockets throughout North Austin. An interactive map of eligible areas is available online.

Council member Vanessa Fuentes, who represents Southeast Austin, said differing impacts around the city should be addressed before any final changes are locked in.

“If you take a look at the map, you can see a lot of the industrial-use zoning sites are primarily located on the east side, and we know that is by design," she said. "Certainly, I would want to be careful in how we craft this policy moving forward, and I want us to have those considerations in mind, particularly with the health impacts. ... We have a need for industrial zoning and industrial sites, but we should be careful in how we plan out our city, particularly in the areas that are quickly and rapidly growing.”

As the updates remain in review, council member Alison Alter—who leaves the council dais in 2025—also suggested her colleagues could instead funnel PDA requests down a different track for city reviews or halt any votes on relevant zoning changes until the development code revisions are complete.

Also of note

While postponing a final vote on PDA2 and DB240 on Dec. 12, officials also approved two PDA rezonings in Central and South Austin for mixed-use residential projects. A decision on another PDA request that could allow for the redevelopment of the Anderson Square shopping center in North Central Austin was delayed.