A Trailblazing Reform Supports Small-Scale Development in Memphis

Memphis, TN. (Source: Flickr.)

There’s no large city in America that’s doing a better job of pivoting to a Strong Towns approach than Memphis, Tennessee. And there are many working from easier starting points. For decades, Memphis aggressively annexed outlying land, juicing cheap suburban growth while older neighborhoods suffered poverty and blight. In recent years, city officials have made a remarkable U-turn, shifting their emphasis to building back up the city’s core neighborhoods and supporting the existing residents in them.

It’s working. Memphis is home to some stellar examples of bottom-up revitalization and urban reinvention, and no shortage of local heroes doing the work. Now, Memphis is continuing this impressive streak by tackling some deeper issues that are necessary for the city’s renaissance, but don’t really have a place in the public consciousness.

One of those is building codes. Memphis is now the site of a first-in-the-nation (as far as we, or they, can tell) building code reform intended to make it easier to build missing middle housing, by removing regulatory restrictions that too often cripple the financial feasibility of these small-scale projects.

Under Memphis’s new rules, three- to six-unit residential structures can now be built under the residential building code, instead of the commercial code. This is a change that may seem wonky and obscure to most laypeople, but any small-scale developer will tell you it’s a big deal. Here’s why.

Why Building Codes Need Reform

Nearly every American city and town uses a building code modeled on the International Building Code (IBC), and its counterpart, the International Residential Code (IRC). Cities are free to adjust the code for their own purposes—the model codes, published by a non-profit consortium, have no force of law. But because they are widely replicated, flaws in the code, where something reasonable to do becomes disallowed or prohibitively complicated, can now take a particular building and render it functionally illegal almost everywhere. Under these codes, a conservative approach to safety tends to result in one-size-fits-all requirements that make sense for big buildings, but kill the economics of small ones.

The most infamous example is that of fire sprinkler requirements. Under the commercial code, sprinkler systems are required; under the residential code, one- and two-unit buildings can be exempt from them. These systems are not truly necessary in a house-scaled building with modern construction techniques, and their expense can make it impossible to build a three- or four-plex with rents low enough for the local market to support in a place like Memphis.

To make matters worse, the cutoffs in the building code don’t line up with the ones often present in zoning, nor in financing arrangements. You can build a fourplex with a federally insured (FHA) mortgage that has a low interest rate, because it meets all of Fannie Mae and Freddie Mac’s requirements for a standard residential loan. But you can’t build it under the standard residential code. This creates a sort of twilight zone of buildings that should be the simple, replicable building blocks of our cities, but are extremely difficult to execute.

The IRC vs. IBC distinction also matters because many small-time and more affordable building contractors are familiar with the residential but not the commercial code. Conversely, a lot of the general contractors who know the IBC inside and out are building much bigger projects like block-size apartment complexes and large commercial buildings. So it’s difficult to find a contractor who knows the code to take on a missing-middle job.

“It’s really homebuilders who should be building those kinds of [three- to six-unit] buildings,” John Zeanah told me. Zeanah is the Director at the Memphis and Shelby County Division of Planning and Development, and he walked me through the changes Memphis is making.

Memphis, TN. (Source: Flickr.)

What Memphis Is Changing

Memphis recently launched a new comprehensive plan, called Memphis 3.0. Among many other elements, the plan calls for a greater emphasis on enabling infill housing throughout the core city and in neighborhoods. According to Zeanah, Memphis is particularly looking for incremental development around key “anchor” intersections—community centers of activity where more walkable density would help support existing businesses and other activity.

As city planners sought ways to enable more housing choice and accessibility, they were fortunate to have the input of an impressive crop of small-scale developers and urbanists attuned to the practical issues with making redevelopment happen, in less obvious places such as the building code and the tax code. City leaders engaged Opticos Design, known for coining the concept of the “missing middle,” to help Memphis address its code challenges. Since Memphis updates its building codes every three years, 2021 was the next opportunity after the adoption of the comprehensive plan to implement changes.

The changes are summarized in greater depth in a post by Zeanah on Opticos’s blog. Some are more technical, while others are more straightforward. They list the following highlights:

• Modify the scope and definitions of the IBC and IRC to apply the residential code and all subject provisions to three- to six-unit structures.

• Remove the sprinkler requirement for buildings with two-hour fire rated walls and floor–ceiling assemblies.

• Limit public spaces to shared means of egress, but allow upper floor residences to share common egress.

• No longer require separate mechanical, electrical, and plumbing drawings.

• Consider how seismic provisions should apply differently to one- and two-family structures versus three- to six-unit structures.

I asked Zeanah to walk me through the implications of some of these. For example, “separate mechanical, electrical, and plumbing drawings” did not seem like a big deal, but Zeanah explained that under the simpler residential code (IRC), you need one set of drawings done by one design professional, as opposed to having to engage (and pay) experts in many disciplines.

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It all comes down to cost. The sprinkler provisions allow incremental developers to save on not just up-front costs but maintenance. And the egress requirements, while too complex to detail here, are important in giving the architect flexibility to design an efficient floor plan that will work on a small home site.

Lest you think this is about cutting costs for developers at the expense of safety, Zeanah assured me that the fire department was heavily involved in the process, and it was a priority that they be comfortable with the final approach. The proposal went through a year of extensive debate within an advisory board made up of building professionals, including structural engineers and architects, and was modified multiple times in response to those professionals’ safety and practicality concerns.

“I think every community who wants to include something like this in their codes needs to be prepared to have that debate, but also be willing to hear these various perspectives,” says Zeanah. “It’s not as simple as just saying, ‘We’re gonna switch this building type from this one code to this other code.’”

Memphis’s reform is precedent-setting, and Zeanah hopes other cities will follow suit. There are massive benefits to the mainstreaming of missing middle housing, in community vitality, housing affordability, walkability, and financial solvency. But is there a bigger systemic solution to this, other than amending these codes city by city?

“Ultimately our goal is to bring this to the attention of the ICC,” says Zeanah, referring to the International Code Council, the non-profit entity that writes the model building codes. The ICC would have the power to make changes that will affect thousands of communities in one fell swoop.

In the meantime, the response in Memphis from people who do smaller-scale development work has been very positive. The issue has been too niche to attract much media attention, but the changes are going to unlock the potential for good things to be built that the public will ultimately see.

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