The URL can be used to link to this page

Home My WebLink AboutSS3 - Fractional Home Ownership - PowerPoint (Staff)Fractional Home Ownership City Council Study Session November 1612021 November 16, 2021 Item No. SS3 Fractional Ownership of Personal Property: What is it? Not a 'ractional Ownership of New Idea 1 Real Estate Partial ownership of property: Single Family — Residential Use Vacation property (2ndor 3rd homes) Fractions offered for sale online Companies Selling Fractional Ownership Pacaso Cadre Equity Estate Funds Nelson Family Estates MillionAcres How it Work.4-. a) Property is purchased under a Limited Liability Corporation (LLC) b) Operating Agreement is used to manage the property Shares of the property are sold: 1/8 ownership or greater 56% of Single Family properties in City are owned under an LLC or Trust OOperaticn,.I Co-owners enjoy 100% use of the property Co-owners agree on usage (days, week) Co-owners can sell their interest Short-term lodging or renting is not allowed Property may or may not be professionally managed mi4nivy Concerns Non-resident vacation behavior Larger gatherings, noise, parking, etc. • Transient occupancy (higher turnover) • Time-share use City Regulation City can regulate Land Use but not Ownership City regulates what is adopted in the Newport Beach Municipal Code Municipal Code Review of Fractional Ownership Single-family dwelling use - OK STL use — Not allowed in R-1 zone - OK • Time Share usage — ? Municipal Code's Allowed Use Table TABLE 21.18.1 ALLOWED USES Land Use See Part 7 of this I mplernentation Plan for land use definitions. See Chapter 21.12 for unlisted uses. R -A Residential Uses Home Occupations A Single -Unit Dwellings—Attached — Single -Unit Dwellings—Detached A Multi -Unit Dwelling — Two -Unit Dwellings — Acc ry Dwelling Units A Residential Coastal Zoning Districts A Allowed — Not Allowed R-Ei R-1 R-2 RM Specific Use R-1-6,000 R-2-6,000 RM -6,000 Regulations MENE0001-- — A A A A A A A A A A A A A A Section 1.48200 to'Accommodatians, Residential and Breakfast Inns F — — A A rt -Term Lodging — — A A Municipal Code's Definitions Visitor Accommodations (Land Use). 1. "Bed and breakfast inn" means a dwelling unit that offers guest rooms or suites for a fee for less than thirty (30) days, with incidental eating and drinking service provided from a single kitchen for guests only, 2. "Campground" means a lot upon which one or more sites are located, established, or maintained for rent as an overnight tenting or camping area for recreation or vacation purposes. 3. "Hostel" means establishments offering supervised overnight sleeping accommodations, primarily for travelers who use nonmotorized transportation or commercial or public transportation. Such sleeping accommodations are designed, intended to be used and are used, rented or hired out as temporary or overnight accommodations for guests in which daily services of linen change, towel change, soap change and general cleanup are provided by the management. If kitchen or eating facilities are provided, they are communal in nature. 4. "Hotel" means an establishment that provides guest roams or suites for a fee to transient guests for sleeping purposes. Access to units is primarily from interior lobbies, courts, or halls. Related accessory uses may include conference and meeting rooms, restaurants, bars, and recreational facilities. Guest rooms may or may not contain kitchen facilities for food preparation (i.e., refrigerators, sinks, staves, and ovens). Hotels with kitchen facilities are commonly known as extended stay hotels. A hotel operates subject to taxation under Revenue and Taxation Code Section 7280. 5. "Motel" means an establishment that provides guest rooms for a fee to transient guests for sleeping purposes. Guest rooms do not contain kitchen facilities. A motel is distinguished from a hotel primarily by direct independent access to, and adjoining parking for, each guest room. A motel operates subject to taxation under Revenue and Taxation Cade Section 7280. 6. "Recreational vehicle (R%J park" means a lot upon which two or more recreational vehicle sites are located, established, or maintained for occupancy for a rental fee by recreational vehicles of the general public as temporary living quarters for recreation or vacation purposes. 7. "Short-term lodging" means a dwelling unit that is rented or leased as a single housekeeping unit (see "Single housekeeping unit") for a period of less than thirty (30) days. g. rSingle room occupancy, residential hotels (SRO yr means buildings with six or more guest roams without kitchen facilities in individual rooms, or kitchen facilities for the exclusive use cf guests, and which are also the primary residences of the hotel guests. 9. 'Timeshare project" means a development in which a purchaser receives the right in perpetuity, for life, or for a term of years, to the recurrent, exclusive use or occupancy of an ownership interest in a lot, unit, room( s), or segment of real property, annually or on some other seasonal or periodic basis, for a period of time that has been or will be allotted from the use or occupancy periods into which the project has been divided and shall include, l not be limited to, time share estate, interval ownership, fractional ownership, vacation license, vacation lease, club membership, time share use, hotelicondominium, or uses of a similar nature See also "Limited use overnight vi -it accommodations (LUOVA)." 10. 'Timeshare estate" means a right of occupancy Ira timeshare project that is coupled with an estate in the real property. 11. 'Timeshare interval" means the period or length of time of occupancy in a timeshare unit. 12. 'Timeshare unit" means each portion of the real property or real property improvement in a project that is divided into timeshare intervals. 13. 'Time share use" means a license or contractual or membership right of occupancy in a time share project that is not coupled with an estate in the real property. "Time Share" Defined 9. "Timeshare project" means a development in which a purchaser receives the right in perpetuity, for life, or for a term of years, to the recurrent, exclusive use or occupancy of an ownership interest in a lot, unit, room(s), or segment of real property, annually or on some other seasonal or periodic basis, for a period of time that has been or will be allotted from the use or occupancy periods into which the project has been divided and shall include, but not be limited to, time share estate, interval ownership, fractional ownership, vacation license, vacation lease, club membership, time share use, hotel/condominium, or uses of a similar nature See also "Limited use overnight visitor accommodations (LUOVA)." 10. "Timeshare estate" means a right of occupancy in a timeshare project that is coupled with an estate in the real property. 11. 'Time share interval" means the period or length of time of occupancy in a timeshare unit. 12. 'Time share unit" means each portion of the real property or real property improvement in a project that is divided into time share intervals. 13. 'Time share use" means a license or contractual or membership right of occupancy in a time share project that is not coupled with an estate in the real property. NBMC §21.70.020 �IWIP 0 �OR� U � BT "Development" Defined "Development" means the division of a parcel of land into two or more lots; the construction, reconstruction, conversion, structural alteration, relocation, addition to, or enlargement of a structure; any mining, excavation, landfill or land disturbance; and any use or enlargement of use of land. See "Enlargement of use." Ownership, including multiple owners is not development Municipal Code's Tir++p Share Requiremominfo • Visitor accommodations • Conversion of dwellings prohibited • Minimum 100 timeshares or less with 300 -unit resort hotel complex • Substantial amenities required • (e.g. golf courses, tennis courts, swimming pools, etc.) • Sales, operating, management, and contingency plans required • Use Permit and Development Agreement Required Adapted from NBMC §20.48.220 Commercial visitor accommodations are not residential uses Municipal Code Review of Fractional Ownership Single-family dwelling use - OK Short -Term Lodging use - Permit RQD— OK Time Share usage — Does not meet City's code as a Time Snare project Questions and Discussion City Council Study Session M November 16, 2021 Seimone Jurjis, Community Development Director sjurjis@newportbeachca.gov \_ Jim Campbell, Deputy Community Development Director jcampbeII@newportbeachca. guv