20221460 Ver 1_More Info Received_20230315

Jamie S. Schwedler
Partner
t: 919.835.4529
f: 919.835.4618
[e-mail]
J�
Parker Poe
March 13, 2023
Atlanta, GA
Charleston, SC
Charlotte, NC
Columbia, SC
Greenville, SC
Raleigh, NC
Spartanburg, SC
Washington, DC
Via E-mail sue. homewood(aD_ncdenr.pov
Via Certified Mail [401 & Buffer Permitting Branch, 1617 Mail Service Center, Raleigh, NC
27699]
Sue Homewood
Division of Water Resources
Department of Environmental Quality
Re: Moxy Hotel Raleigh — Minor Exception Request Additional Information No. 2
Dear Sue:
We are assisting Vision Hospitality Group in responding to DWQ's request for additional
information to show the proposed hotel use at 501 N West Street is a reasonable use, and that
adhering to the buffer requirement prevents the reasonable use of the property. In accordance
with 15A NCAC 02B .0611, please see below our responses to the Division's request for
additional information dated February 6, 2023.
1. Per 15A NCAC 02B .0611(c)(1)(C), "If the applicant complies with the provisions of this
Rule, he or she can secure no reasonable return from, nor make reasonable use of, his
or her property. "
a. From the application materials, it appears that the only use being contemplated
by the prospective purchaser is construction of a hotel. The specific use and
design proposed by applicant is inconsistent with the spirit and intent of the rule
and the Division's longstanding implementation of the rule. Please address why
construction of a hotel is the only reasonable use of the property.
Response: 15A NCAC 02B .0611(c)(1)(B) requires a showing that (1) adhering
to the DWR Riparian Buffer Rules prevents the applicant from securing a
reasonable return from, or making reasonable use of, the property, and (2)
granting the exception is the minimum possible deviation from the DWR Riparian
Buffer Rules that makes reasonable use of the property possible. The proposed
hotel is not only a reasonable use of the property, but the only use that makes
sense for this particular parcel given its unique nature. Further, the existing use
of the property as a surface parking lot that intrudes into the buffer is
unreasonable given the surrounding land uses (e.g. multistory apartment
PPAB 8588444v5
Parker Poe Adams & Bernstein LLP PNC Plaza 301 Fayetteville Street Suite 1400 Raleigh, NC 27602-0389
t 919.828.0564 f 919.834.4564 www.parkerpoe.com

Sue Homewood
March 13, 2023
Page 2
buildings, etc.) and allowing that use to continue would be unreasonable and
inconsistent with the general spirit, purpose, and intent of the State's riparian
buffer protection requirements because the proposed use will protect the water
quality of the stream while the existing use will only continue to cause harm.
The small 0.24-acre site is located on West Street adjacent to an elevated
railroad and trestle, a large parking garage, and directly across the street from
the Smoky Hollow development, which includes apartments, a grocery store,
retail, and office space. Most of the development along this creek has been built
over the creek or developed within the buffer up to and within the creek. All of the
other parcels within 2 blocks upstream and downstream of this site are much
larger, and all of them have been developed, so there are no other parcels with
similar factors that would seek a similar exception in the future. This site is also
adjacent to a future stop for a transit line, and in the immediate vicinity of two
sites zoned for up to 40 stories, in various stages of permitting and construction.
The property itself is zoned for up to 12 stories in the downtown mixed -use
zoning district with Shopfront frontage (DX-12-SH). This zoning district has been
intentionally planned to be the most intensely developed zoning district in the City
of Raleigh and includes hotel as a permitted use. As such, the existing surface
parking lot, which is essentially a hold -over from the original Pine State Creamery
parking lot, is inconsistent with the City's current planned uses for this area as
indicated in the current zoning, and is not a reasonable use for this property.
Given the City's expectation of an up to a 12-story use on this property, the small
size of the lot, proximity to the railroad, and uses that already exist or will soon
exist in the area, there are very few uses that would be reasonable for this
parcel. For example, an office or retail building would not be a reasonable use for
this parcel because the required footprints for most office or commercial buildings
are a minimum of 25,000 sf whereas this site is only approximately 10,250 sf.
Even if these uses could be built on smaller floorplates, office and retail space
already exists directly across the street, some of which is still vacant and
available for lease.
Other uses such as a gas station or pharmacy would also be unreasonable
because these uses, if constructed in isolation, almost always require surface
parking and other similar space -intensive elements such as drive-thrus and gas
pump rows which would not be possible due to the unique and small size and
configuration of the parcel. Rather, these uses would have to be constructed in
conjunction with another use, such as retail space, which is not typically how
those uses are built.
In addition, the property was marketed for a variety of uses, but given these
unique constraints, the lack of offers for other uses during what has been a very
favorable real estate market in a growing City, is a strong indication that other
uses are neither feasible nor reasonable for this site.
Each of the unique characteristics of this parcel that make these other uses
unreasonable only support the reasonableness of the proposed use. A small
boutique hotel is the most reasonable use for this parcel because of the up to 12-
story zoning, small size and unique configuration of the lot, proximity to the
elevated railroad and future rail stop, context in the surrounding urban area, uses
PPAB 8588444v5

Sue Homewood
March 13, 2023
Page 3
that already exist or are in the process of being constructed in the immediate
area, lack of parking needs, and the need for lodging in urban areas near transit
facilities.
The model for this boutique hotel is also specifically designed to create not only a
smaller footprint than most other uses, but the smallest hotel footprint possible by
implementing smaller "smart bedrooms" and smart design elements such as peg
walls instead of closets, under -bed storage, and folding tables and chairs that
double as artwork.
As such, the proposed hotel is not only a reasonable use of the property, but the
only use that makes sense for this particular parcel given its unique nature.
The 0.24-acre site is currently used for a paved parking lot, which takes up the
majority of the site and intrudes into the existing buffer. According to Wake
County GIS records, the parking lot has been in existence since at least 1981
and was paved since at least 2002. Since at least 1906, the site has been used
for industrial purposes — first by the Railroad and then by the old Creamery.
The existing parking lot already intrudes into the buffer without providing a
proportional benefit and is not the best or most reasonable use of the lot (as
described above). Although the proposed hotel would intrude slightly further into
the buffer than the existing parking lot, the mitigation measures which are
proposed as conditions of the Minor Exception request and that will be
implemented by this project will be an improvement to water quality and nutrient
removal from the existing conditions. As the site exists today, water runoff flows
directly from the existing parking lot into the stream via sheet flow, gutter and
other stormwater conveyances. There are no stormwater measures in place to
prevent disturbance to the stream bank. As a result, the creek is filled with trash
and debris. The creek bank is almost entirely comprised of fill, riprap, concrete
and other debris, as well as concrete in the bed of the stream.
This project proposes to improve the water quality of the creek by implementing a
stormwater system that will ensure no runoff from the site will flow into the stream
and only rainfall that directly lands on the embankment will flow down the stream
embankment. All other runoff will be routed into stormwater BMPs for treatment
and will be discharged into the municipal storm sewer system adjacent to the
site. This is a significant benefit to this parcel as well as the downstream water
quality, as the sites both up and downstream from this project have built parking
garages and buildings over the buffer and stream, removing much more
significant amounts of impervious areas. Any potential injury that may be caused
to the stream bank will therefore be minimal and mitigated because intrusion into
the buffer occurred over 40 years ago when the parking lot was installed. This
project proposes to improve the conditions caused by that intrusion.
For these reasons, the existing use of the property is unreasonable, and allowing
that use to continue would not only be unreasonable but inconsistent with the
general spirit, purpose, and intent of the State's riparian buffer protection
requirements because the proposed use will protect the water quality of the
stream while the existing use will only continue to cause harm.
PPAB 8588444v5

Sue Homewood
March 13, 2023
Page 4
From the application materials, the hotel (including its footprint) is based on a
design that is the same or similar to other hotels that the applicant owns and is
premised on 169 rooms. The applicant indicates that maintaining a 169-room
capacity within a smaller footprint would require additional floors at an estimated
cost of $2.8 million/floor and that the additional two floors at a cost of $5.6 million
would "kill this deal. " However, there is no explanation as to why 169 rooms is
the only point at which the applicant can secure a reasonable return from the
property. The applicant's stated goal to It maximize the number of hotel rooms, "
does not adequately address the regulatory criteria, especially where the criteria
explicitly states that It merely proving that the Authorization Certificate with
Exception would allow a greater profit from the property shall not be considered
adequate justification for an Authorization Certificate with Exception. "As a result,
please provide information demonstrating that this size of hotel is the "minimum
possible deviation from the terms of this Rule that shall make reasonable use of
the property possible. "
Response: The current design of the hotel, which contemplates the Exception, is
of a similar, although not typical, design to other hotels in the applicant's portfolio.
That is, even if the entirety of the site were to be utilized, it would still be
considered "constrained" from a programming and constructability standpoint.
Therefore, the design on this site necessitates material deviations from what
would be considered "typical" in order to accommodate back -of -house
programming elements on a narrow footprint (e.g. housekeeping, laundry,
kitchen, offices) and typical programming elements required by governing
municipalities (e.g. electrical, plumbing & life safety infrastructure). The applicant
sought out a hotel brand that has a smaller footprint and operation space
requirements, because the site is too small to operate any other brand, or a
typical hotel with standard sized rooms and operations. Typically, the minimum
footprint for this brand prototype would be approximately 12,100 sf; 4,374 sf of
that total is dedicated to back of house space and 6,636 sf is dedicated to public
space. However, due to the unique nature of this site, the footprint of the
proposed hotel is the minimum possible at only 7,1178 sf; 1,046 sf of that total is
dedicated to back of house space and 4,704 sf is dedicated to public space. as
shown in the attached floorplan exhibit of the first and second floors, the spaces
on the first floor are vital for operations on the ground floor, have been placed
there due to code enforcement (Fire Command), or have proximity to major
utilities at the ground floor. For example, fire command has to have direct access
to the exterior, the electrical room is placed next to the ground -mounted
transformer, and the riser room is located on the ground floor for incoming fire
service. See Floorplan exhibit p. 1. These are utility and emergency services
that need dedicated ground -floor space and are labeled as Back of House (BOH)
on the exhibit. Some back of house elements that did not require ground -floor
space were moved to the second floor, such as laundry, sales, and employee
breakrooms. See Floorplan exhibit p. 2. With our already limited footprint, we
have relocated several required back of house spaces and public spaces to
upper floors. We have relocated approximately 1,800 sf of back of house spaces
to the second floor and 1,284 sf of public space to the ninth floor. If we are to
PPAB 8588444v5

Sue Homewood
March 13, 2023
Page 5
observe the entirety of the buffer, the building footprint would be further reduced
and create an even greater hardship with these operations and utility placement
requirements.
The requested Exception allows for the hotel to be physically constructed with
the required setbacks from the right of way and power lines located on N. West
Street. The remaining footprint meets the minimum criteria for the necessary
utility, programming, and back -of -house functions noted above. Without this
Exception, the public spaces of the hotel would be overwhelmed by the required
back -of -house programming such that the applicant would be unable to meet the
reasonable design assumptions and common area spaces that the market and
hotel operators require. Further, if we were required to fully observe the buffer,
the location of utilities, infrastructure, and other logistical concerns would likely
render the building unbuildable. Thus, the structure has been designed in the
manner that causes the least possible deviation from the Rule that still allows for
reasonable use of the property.
2. Per 15A NCAC 028 .0611(c)(1)(D), the applicant must demonstrate that they did not
cause the hardship.
a. The Division's understanding is that the applicant does not currently own the
property but is seeking to purchase the property for a specific use and design.
Under those circumstances, please explain how the applicant can demonstrate
that the applicant did not cause the hardship.
Response: There are two conditions under 15A NCAC 02B .0611(c)(1) related to
hardship. First, under section (C), the hardship must be due to "the physical
nature of the applicant's property, such as its size, shape, or topography."
Second, under section (D), the applicant must demonstrate that it did not cause
the hardship. These two sections of 15A NCAC 02B .0611(c)(1) must be read
together, and the question thus becomes whether the actions of the applicant
resulted in the physical nature of the property changing, such as by altering its
size, shape, or topography, which in turn created the hardship the applicant is
seeking relief from.
Here, the unnecessary hardship is due to the current physical nature of the
property. As explained above, the property is a 0.24-acre site that is currently
used for a paved parking lot and located directly next to a railroad. The size of
the parcel and proximity to the railroad prevent compliance with the buffer
requirements, and neither of these conditions are the result of actions taken by
the applicant. This property was originally part of a larger tract deeded to Raleigh
and Pamlico Sound Railroad Company, predecessor in title to the Norfolk
Southern Railway, in 1906. In 1961, the Railway conveyed some of this property
to Norwood Oil Company and Pine State Creamery Company as joint tenants.
Then, in 1981, the tenancy in common between Pine State Creamery Company
and Norwood Oil Company was severed by Deed Book 2952, Page 240, and this
small 0.24acre parcel was created and conveyed solely to Pine State Creamery
Company. The parcel has had several owners since that time but has remained
0.24 acres. As such, the size of this parcel and its proximity to the railroad are
PPAB 8588444v5

Sue Homewood
March 13, 2023
Page 6
conditions that have existed for many years and are in no way the result of any
action taken by the applicant.
The Department appears to have applied this reasoning in several other cases
where the property was purchased after the effective date of the Neuse Buffer
Rules. See, e.g., Trinity Road DWR#20131240 (Current owner purchased on May
6, 2013 (after effective date of the Neuse Buffer Rule 15A NCAC 02B .0233;
8/1/2000, Major Variance was issued on May 11, 2000, Major Exception was
issued for more impact on April 13, 2021) and Midtown East DWR#2015-
1288/2017-0156 (Major Variance issued on May 3, 2016 for Wegman's shopping
center on Wake Forest Road, finding "The applicant purchased the property after
the effective date of this Rule. However, the property was platted in 1973" and
issued the variance approval). In both Trinity Road and Midtown East, the
Department concluded that the practical difficulties were not caused by the
applicant.
PARKER POE ADAMS & BERNSTEIN LLP
Sincerely,
Jamie S. Schwedler
CC: Brian Parker, Vision Hospitality Group, Inc.
Bob Zarzecki, Soil & Environmental Consultants, PA
PPAB 8588444v5

SLAB O
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EXISTIN
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2 SECTION AT CREEK scale: 1/4" = 1'-0"
FIRST FLOOR SF = 7,178 SF
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SECOND FLOOR 7,197
TYPICAL FLOOR (3-8) 7,086 (x6)
NINTH FLOOR 6,656
TOTAL BUILDING SQUARE FOOTAGE _
63,547 SF
ZONE 2 (20')
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FLOOR PLAN NOTES
1. G.C. TO PROVIDE AND COORDINATE
BLOCKING FOR ALL FURNITURE, FIXTURES,
DRAPERIES, TOILET ACCESSORIES, AND
INTERIOR ACCESSORIES.
2. COORDINATE TUB AND SHOWER UNIT
ROUGH OPENING SIZE AND MAINTAIN FIRE
AND SOUND RATING AROUND TUB AND
SHOWER UNITS.
3. PRIOR TO CONSTRUCTION OF THE PROJECT,
THE CONTRACTOR SHALL COORDINATE AND
VERIFY THE LOCATION OF LIGHTING
FIXTURES AND ELECTRICAL RECEPTACLES
WITH THE OWNERS FURNITURE AND
EQUIPMENT PLAN. THE CONTRACTOR SHALL
BRING ANY SUSPECTED DISCREPANCIES TO
THE ATTENTION OF THE OWNERS
REPRESENTATIVE FOR RESOLUTION PRIOR
TO CONSTRUCTION.
4. ALIGN FINISHED FACE OF CONTINUOUS
PARTITIONS THAT CHANGE PARTITION
TYPES ALONG A STRAIGHT RUN.
5. MAINTAIN ALL CLEARANCES AT ADA
BATHROOMS
6. COORDINATE WITH FIRE PROTECTION
SUBCONTRACTOR REGARDING LOCATION
OF INSPECTORS TEST VALVE AND SIGHT
GLASS. PROVIDE FIRE RATED ACCESS
PANEL AS APPROPRIATE FOR ALL
LOCATIONS
7. DIMENSIONS ARE FROM FACE OF
STRUCTURE TO FACE OF STRUCTURE U.N.O.
8. WALL ON GRID REFERENCE LINES ARE
CENTER OF STUD/CMU U.N.O.
9. SEE 1 STAND 2ND PLANS FOR TYPICAL
DIMENSIONS AND DETAIL CALLOUTS
FLOOR PLAN LEGEND
INDICATES ADA ACCESSIBLE GUESTROOMS
INDICATES COMMUNICATION FEATURES
WALL RATING LEGEND
NON RATED PARTITION
1 HOUR RATED PARTITION
2 HOUR RATED PARTITION
SEE PARTITION TYPES ON SHEET G2.01
ODA Architecture
2010 South Tryon St., Suite 1a
Charlotte, NC, 28203
704.332.161E
www.oda.us.com
SEAL:
PROGRESS PRINT
NOT FOR
CONSTRUCTION
CONSULTANT:
vISI;-414��N
HOSPITALITY GROUP
MOXY HOTEL
RALEIGH, NC
ODA Project No. 213605
PROGRESS SET
2
101
03/07/2023
REVISIONS
No. Description Date
FIRST FLOOR PLAN/
SITE PLAN
Q
co
N
N
co
N
O
N
co
01 FIRST FLOOR
scale: 1/8" = 1'-0"
AIIIIIIIIIIIIIIIIIIIIIIi 10 1
Copyright 2022 ODA Architecture

SECOND FLOOR SF = 7,197 SF
17 KEYS AT 2ND FLOOR
ROOF
BELOW
FLOOR PLAN NOTES
1. G.C. TO PROVIDE AND COORDINATE
BLOCKING FOR ALL FURNITURE, FIXTURES,
DRAPERIES, TOILET ACCESSORIES, AND
INTERIOR ACCESSORIES.
2. COORDINATE TUB AND SHOWER UNIT
ROUGH OPENING SIZE AND MAINTAIN FIRE
AND SOUND RATING AROUND TUB AND
SHOWER UNITS.
3. PRIOR TO CONSTRUCTION OF THE PROJECT,
THE CONTRACTOR SHALL COORDINATE AND
VERIFY THE LOCATION OF LIGHTING
FIXTURES AND ELECTRICAL RECEPTACLES
WITH THE OWNERS FURNITURE AND
EQUIPMENT PLAN. THE CONTRACTOR SHALL
BRING ANY SUSPECTED DISCREPANCIES TO
THE ATTENTION OF THE OWNERS
REPRESENTATIVE FOR RESOLUTION PRIOR
TO CONSTRUCTION.
4. ALIGN FINISHED FACE OF CONTINUOUS
PARTITIONS THAT CHANGE PARTITION
TYPES ALONG A STRAIGHT RUN.
5. MAINTAIN ALL CLEARANCES AT ADA
BATHROOMS
6. COORDINATE WITH FIRE PROTECTION
SUBCONTRACTOR REGARDING LOCATION
OF INSPECTORS TEST VALVE AND SIGHT
GLASS. PROVIDE FIRE RATED ACCESS
PANEL AS APPROPRIATE FOR ALL
LOCATIONS
7. DIMENSIONS ARE FROM FACE OF
STRUCTURE TO FACE OF STRUCTURE U.N.O.
8. WALL ON GRID REFERENCE LINES ARE
CENTER OF STUD/CMU U.N.O.
9. SEE 1 STAND 2ND PLANS FOR TYPICAL
DIMENSIONS AND DETAIL CALLOUTS
FLOOR PLAN LEGEND
INDICATES ADA ACCESSIBLE GUESTROOMS
INDICATES COMMUNICATION FEATURES
WALL RATING LEGEND
NON RATED PARTITION
1 HOUR RATED PARTITION
2 HOUR RATED PARTITION
SEE PARTITION TYPES ON SHEET G2.01
ODA Architecture
2010 South Tryon St., Suite 1a
Charlotte, NC, 28203
704.332.161E
www.oda.us.com
SEAL:
PROGRESS PRINT
NOT FOR
CONSTRUCTION
CONSULTANT:
vISI;-414��N
HOSPITALITY GROUP
MOXY HOTEL
RALEIGH, NC
ODA Project No. 213605
PROGRESS SET
03/07/2023
REVISIONS
No. Description Date
SECOND FLOOR
PLAN
'I 02 SECOND FLOOR
A�l 02
scale: 1/8" = 1'-0" Copyright 2022 ODA Architecture