Building Codes, Setbacks, and Internal Requirements Drive Up US Construction Costs, Developer Argues

US Housing Development Faces Complex Hurdles Beyond Parking Minimums, Says Industry Expert

A recent social media post by Andrew Damitio, a prominent figure in the construction sector, has ignited discussion regarding the multifaceted challenges hindering urban development in the United States. Damitio contends that while parking minimums are frequently cited as a primary obstacle, the intricate web of building codes, setback regulations, and mandatory internal space allocations significantly escalates construction costs and complicates project feasibility.

"People love blaming parking minimums as why the US doesn't build this. It's more complicated. The lot couldn't be used corner to corner due to setbacks. The project wouldn't pencil due to space lost for the large elevator, dual stairwells, and hallway to meet building codes," Damitio stated in his tweet. This highlights how regulatory requirements directly impact a project's financial viability and design.

Building setbacks, which mandate minimum distances between structures and property lines, are designed for public policy reasons such as safety, privacy, and environmental protection. However, these requirements can drastically reduce the usable buildable area on a lot, particularly for smaller parcels, making dense urban development less efficient. Critics argue that excessive setbacks contribute to urban sprawl and hinder fine-grained urbanism by forcing land consolidation.

Beyond external site constraints, internal building codes impose substantial spatial and financial burdens. Requirements for features like large elevators, dual stairwells, and wide hallways, often driven by life safety and accessibility standards such as those outlined by the National Fire Protection Association (NFPA) and the International Building Code (IBC), consume significant floor area. This "lost space" directly reduces the rentable or sellable area of a project, impacting its economic viability.

The debate around parking minimums has seen increasing reform efforts across the US, with cities like Buffalo and Minneapolis eliminating or reducing these mandates. Studies indicate that removing parking minimums can boost housing construction by allowing developers greater flexibility and reducing costs, as structured parking can add tens of thousands of dollars per space. However, Damitio's perspective underscores that even with parking reforms, other stringent building regulations remain formidable barriers to affordable and efficient urban development.