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ITEM 7.b. TOWN OF FOUNTAIN HILLS STAFF REPORT Meeting Date: 4/13/2026 Meeting Type: Planning and Zoning Commission Regular Meeting Submitting Department: Development Services / Planning Prepared by: Farhad Tavassoli, Senior Planner Staff Contact Information: Phone: 480-816-5139 Email: ftavassoli@fountainhillsaz.gov Request to Town Council Regular Meeting (Agenda Language) PUBLIC HEARING, with CONSIDERATION AND POSSIBLE ACTION: Relating to a SPECIAL USE PERMIT to allow up to six (6) residential units on a 6,000 square-foot property generally located 150 feet west of the southwest corner of Saguaro Blvd and Parkview Ave. (16865 E. Parkview Ave.; APN#176-06-099) in the C-2 (Intermediate Commercial) zoning district. Staff Summary (background) This request is for development on a 6,000 sq. ft. lot on Parkview Avenue, west of Saguaro Blvd. The area was originally plated in 1971 as Plat 208, and the boundaries of the subject property has since remained unchanged. The property is zoned C-2 (Intermediate Commercial) and is also within the Planned Shopping Plaza and Entertainment Overlay Districts. The applicant requests a Special Use Permit to construct a three-story, mixed-use building consisting of approximately 1,000 square feet of ground-floor commercial space and six (6) residential units above. Each residential unit is configured as two-bedroom, two-bath layouts ranging from approximately 1,300 to 1,400 square feet, with private balconies and central stair/elevator access. Each residential unit will include a private, one-car garage accessed from the rear of the property via the internal Tract 208 circulation network. These garages are designed to reduce demand on shared and public parking while providing secure, enclosed parking for residents. The site is located within the Town Center area, approximately 500 feet north of the northwest corner of Avenue of the Fountains and Saguaro Blvd. This property is currently vacant. The lot has a platted 5-foot front yard setback and a 20-foot rear yard setback. Five existing parking spaces are located on the site and will remain. To accommodate the proposed 10-foot setback along the south property line, the lot will need to be replatted to reduce the existing platted setback from 20 feet to the proposed 10 feet. The garage doors will face west and will be set back 6 feet from the driveway to provide adequate clearance and ensure maximum visibility of traffic between Parkview Avenue and the common parking area. The site has remained undeveloped since it was originally platted in 1971. Consistent with similar recent proposals in the area, this project introduces a mixed-use component to Plat 208. The building features a contemporary, desert-appropriate material palette, including a stone veneer base at the ground level, fiber-cement lap siding, EIFS cladding with decorative reveals, and aluminum-and-glass storefront systems along the commercial frontage. The upper-level residential units incorporate large window openings, metal trim accents, and balcony railings with glass or cable systems. The overall massing and material selection are intended to create visual interest along the street frontage while ensuring durability and compatibility with the surrounding context. General Plan • Our Commitment, page 13: Maintain the delicate balance of land uses that make the Town a desirable place to live, work, enjoy and visit. • Our Commitment, page 13: Support existing businesses and continue to attract businesses that stimulate the Town’s economy. • Our Vision, page 14: Residents enjoy a walkable community that is conducive to civic involvement and activities. • Our Vision, page 14: A variety of housing options are available in safe, quiet, pleasant, and enjoyable neighborhoods. • Thriving Neighborhoods Goals and Policies, page 23 o Goal 2: Support a housing strategy that encourages a broad range of quality housing types to address current and future housing needs and to support long- term economic vitality. ▪ Policy 1. Encourage a broad range of housing types affordable to all income ranges and age groups in a manner compatible with adjacent development. ▪ Policy 2. Encourage a range of housing types and residential densities and maintain consistency with the existing character of infill areas in conformance with criteria provided in Table 1: Character Areas Plan. ▪ Policy 4. Encourage quality urban, compact, walkable mixed-use development that complements surrounding uses in the Town Center and in other areas that may become available for urban development. ▪ Policy 6. Support quality residential development that meets Town housing needs, promotes the vitality of established neighborhoods, and enhances the quality of life of Fountain Hills. o Goal 4: Attract quality residential development that supports the healthy and active lifestyle valued by the community. • Policy 1: Ensure that new neighborhoods: ▪ a. Sensitively and aesthetically integrate residential development to the social, built and natural environments by supporting neighborhood connectivity to Fountain Hills’ Great Places. ▪ Character Area Goals and Polices, page 38 o Goal 1: Encourage future development, redevelopment and infill in a manner that will maintain and protect existing neighborhoods, the Town’s economic health, community well-being, and natural environment. ▪ Policy 4. Direct commerce and employment to the character areas that sustain them in conformance with the Character Areas Plan map and Table 1. o Goal 2: Development, redevelopment and infill support Fountain Hill’s small town identity and the distinct character of each area while fostering long term viability. ▪ Policy 3. Support a mix of residential, employment, and commercial uses at densities and intensities and in the development form that reflect the small- Town character of Fountain Hills. ▪ Policy 5. Strongly encourage a wide range of housing types, densities and prices to support the current and projected populations (particularly families and working professionals) and to ensure the future stock of affordable housing for all income ranges. This is in the Town Center character area. The General Plan statement for this area is: "Continue to develop a highly integrated mix of uses to provide a vibrant town center. Encourage development with an urban form with buildings brought to the street forming a continuous street wall. Encourage active ground floor uses with a high degree of transparency and office and residential above." The 2009 Specific Area Plan for the Avenue District includes the statement: "The Avenue District is designed to accommodate a degree of other uses including second story office space, condominiums and small-scale businesses along with limited neighborhood services." Zoning Ordinance Requirements The property at 16865 E Parkview Avenue is zoned C-2 (Intermediate Commercial) and is located within both the Entertainment Overlay District and the Planned Shopping Plaza Overlay District. While the C-2 zoning district allows a variety of commercial uses by right, residential uses above the ground floor are permitted through the Special Use Permit process when located within the Entertainment Overlay if the density is more than 8 dwelling units per acre. The proposed development includes six (6) residential units (which equals 44 units per acre) above approximately 1,000 square feet of ground-floor commercial space, consistent with the intent of the zoning and overlay districts to promote a vibrant, mixed-use downtown. Per the Fountain Hills Zoning Ordinance: • Group commercial buildings require 1 parking space per 275 square feet of floor area. • Multi-family dwellings require 2.25 spaces per unit. Based on these standards, the proposed mixed-use development would require approximately 18 parking spaces. In contrast, a fully commercial three-story building of similar size would require approximately 50 spaces. The existing Tract 208 shared parking lot provides sufficient parking to meet the requirements for this development, as it was originally designed to accommodate build-out of the subdivision. In addition, the applicant proposes to accommodate six (6) private garages, each serving one residential unit. These garages are designed as one-car garages, approximately 24 feet deep, with access from the rear of the building. The driveway width behind the garages will be maintained at 26-feet for two-way traffic. This configuration meets the ordinance requirement for one covered space per unit, and the remaining parking demand can be accommodated within the shared lot. Solid waste enclosures are required to be located within 250 walking feet of the main entrance. The proposed enclosure meets this requirement due to the rear access doors for each unit. However, the enclosure is part of the shared Tract 208 facilities and may not have sufficient capacity for the additional residential and commercial waste. Prior to issuance of a building permit, the applicant must provide written confirmation from the Tract 208 Property Owners Association that adequate solid waste service will be provided, or propose an alternative solution. Following approval of the special use permit, the applicant will be required to submit a Site Plan Review application to ensure zoning compliance. Once the site plan is approved, the applicant must then apply for a building permit. Citizen Participation The applicant submitted a citizen participation plan outlining his outreach efforts, which included sending notification letters to all property owners within 300 feet of the subject site. The letter described the SUP request and invited recipients to provide comments or concerns via email, mail, or phone. As of April 2, 2026, the applicant has not received any responses from neighboring property owners. A copy of the citizen participation plan, along with a statement confirming that no inquiries were received, is attached to the staff report. Related Ordinance, Policy or Guiding Principle Zoning Ordinance Chapter 2, Procedures Zoning Ordinance Chapter 12, Commercial Zoning Districts Zoning Ordinance Chapter 25, Entertainment Overlay District Zoning Ordinance Chapter 26, Planned Shopping Plaza Overlay District Risk Analysis N/A Recommendation(s) by Board(s) or Commission(s) N/A Staff Recommendation(s) Staff supports approval subject to: 1. Approval of a replat for the subject parcel to reflect a 10-foot minimum building setback from the south property line. 2. Approval of a site plan consistent with the conceptual site and that complies with code requirements. 3. A letter from Plat 208 addressing the provision of a solid waste enclosure prior to issuance of a building permit. Suggested Motion MOVE to approve the Special Use Permit 26-000001 for up to 6 dwelling units, all residential units to be on the second and third floors, with the stipulations listed in the staff recommendation. FISCAL IMPACT Fiscal Impact: Budget Reference: Funding Source: ATTACHMENTS 1. Vicinity_Map__SUP26-000001 2. REvised narrative_16865 E. Parkview Mixed Use 3. Revised Conceptual Drawings - 16865 E Parkview 4. Citizen Participation Plan Parkview (1) 5. Good Neighbor Statement 6. Citizen Participation No Responses Letter