Incentive Zoning for Affordable Housing

The City of Seattle's Incentive Zoning allows commercial and residential developers achieve extra development capacity when they provide for affordable housing. Chapter 23.58A and Chapter 23.49 of the Land Use Code, depending on the location of the development seeking extra floor area, provide the regulatory framework for incentive zoning. The Office of Housing and Department of Planning and Development coordinate the review process for developments taking advantage of incentive zoning for affordable housing.

In 2015 the City approved a new rule that allows developers of affordable housing in downtown to participate in the Incentive Zoning Program as well as receive other incentives or funding, similar to other areas in Seattle. Read the official Director's Rule.

Prithy Korathu

Community Development Specialist 206-684-0362

Generally, residential developers opting to seek additional floor area in IZ-eligible zones with maximum height limits 85 feet or less must dedicate a percentage of extra residential floor area as rental housing affordable to households with incomes up to 80% of the area median income (AMI).

Bonus Residential Floor Area: Extra floor area above the base height or base floor area ratio (FAR) may be achieved in residential projects as an incentive for affordable housing. Developers can either include affordable housing units as part of their projects or, in certain zones, make a cash contribution to the City to help fund production and preservation of affordable housing for moderate-wage workers in households with incomes primarily ≤ 60% of area median income (AMI). This incentive is available in midrise and highrise zones in several neighborhoods.

In most commercial zones, the majority of the extra non-residential floor area above the base floor area ratio (FAR) may be achieved through bonus floor area for affordable housing and childcare or by purchasing housing TDR.

Bonus Non-Residential Floor Area: Extra floor area above the base FAR may be achieved for commercial projects as an incentive for affordable housing and childcare facilities. Developers can either include the affordable housing and/or childcare facility as part of their project or, in zones with height limits 85 feet or higher, make a cash contribution to the City to fund preservation and production of affordable housing and construction of new childcare centers. The benefits primarily serve Seattle's moderate-wage workers, with maximum income and rent limits for both housing and childcare at 80% of area median income. This incentive is primarily available in the Downtown and South Lake Union urban centers. Outside of downtown, the requirements for achieving extra residential floor area currently apply to commercial development as well.

Housing Transferable Development Rights (TDR): As an alternative to bonus nonresidential floor area for affordable housing and childcare, a developer of a project in certain zones may purchase Housing TDR from the owner of Housing TDR sending site approved by the City of Seattle. This option helps Seattle maintain a more variable scale of buildings in Downtown and South Downtown by allowing density to be moved from one site to another. The proceeds of TDR sales are used for preservation and recapitalization of existing low-income housing.