Multifamily Developers Win in Texas’ Deregulation Push

Texas lawmakers are clearing the way for new homes on old commercial sites.

The Texas House of Representatives have approved a measure to allow apartments and mixed-use projects to be built along retail corridors and on office-zoned land without rezoning, the Texas Tribune reported.

Senate Bill 840 aims to fast-track housing development by removing local zoning restrictions. The measure applies to cities with populations over 150,000 in counties of at least 300,000. That includes the state’s five major cities, as well as places like Arlington, Brownsville, El Paso, Frisco, Irving, Lubbock, McKinney and Plano.

The proposal still requires the Senate to sign off on House amendments before heading to Gov. Greg Abbott’s desk. The bill’s sponsor is Sen. Bryan Hughes, a Republican from Mineola.

It is part of a broader Republican-led push to tackle the state’s housing affordability crisis by making it easier for developers to build.

Texas is short an estimated 320,000 homes, according to one industry estimate. Lawmakers have introduced a slate of proposals to loosen local zoning rules, streamline permitting and legalize additional dwelling units like mother-in-law suites on single-family lots.

The measure passed its first House vote without debate, a sign that Texas legislators are increasingly willing to override city zoning rules to spur development.

Supporters argue that converting vacant offices, strip malls and underused warehouses into housing could increase supply without relying on greenfield development.They say it could reduce costs by cutting out lengthy and expensive rezoning processes.

If signed into law, the bill would let property owners in eligible cities add housing to commercial sites “by right,” rather than applying for special permits. That would benefit cities where sprawling strip malls and office vacancy are common, advocates say.

Texas isn’t alone in rethinking commercial land use to tackle housing shortages, and neither are Republicans. California passed laws in 2023 to allow by-right housing on retail sites, the same year Washington opened the door to fourplexes and streamlined adaptive reuse of underused commercial buildings.

— Judah Duke