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Zoning panel recommends approval of Lakeway Heights PUD amendment to condominium regime over neighborhood objections
Summary
The Zoning and Planning Commission recommended approval of an amendment to the Lakeway Heights Planned Unit Development that would convert the project to a condominium regime and keep the same schematic and unit count; the motion passed 3-2 after debate over investor rentals, short-term rentals, platting and infrastructure.
The Lakeway Zoning and Planning Commission on Wednesday voted 3-2 to recommend that City Council approve an amendment to the Lakeway Heights Planned Unit Development (PUD) to convert the project to a condominium regime rather than subdivided single-family lots.
City staff described the amendment as a change in legal ownership regime — from individual sale lots to a condominium regime — while keeping the previously approved PUD schematic and unit count. Aaron Carr presented the staff report and said the street in the development would remain a private but publicly accessible three-street (private, non-gated) and that in-lieu-of-parkland fees totaling $382,500 would be provided.
Developer Bruce Rainey, who told commissioners he owns the property, said the change is primarily a financing and ownership decision and that the physical layout and number of detached homes would remain consistent with the approved PUD. The property is roughly 13.366 acres and borders the Lakeway Elementary site and the city’s extraterritorial jurisdiction (ETJ) and Austin’s ETJ.
Commissioners and several citizens discussed long-term implications. Commissioner Vance and other commissioners expressed concern about investor ownership and short-term rentals. Commissioners asked whether condominium status would affect short-term rental rules; staff said the short-term-rental permit language in the city code is based on zoning and that the PUD’s base zoning is R3, which keeps the city’s thousand-foot rule for vacation/short-term rental permits in play. Staff also explained that state law and regime differences affect subdivision plat requirements: a condominium regime over five acres may not trigger the same platting requirement as creating many individual lots.
Residents raised traffic and neighborhood impacts and urged caution. Rebecca Ellis, 114 Kohlmeier, opposed the change and said the current proposal “has gone off the rails” from the original presentation, arguing the development backs up to Lake Travis Elementary’s playground and raising concerns about short-term rentals adjacent to a school. John Miller and John Wicks also spoke in opposition, citing deed restrictions, setbacks and potential traffic impacts.
Commissioners discussed protections: the base zoning in the PUD remains R3, which staff said will continue to control setbacks and the built-environment; the condominium regime is primarily a legal/financing construct. Commissioners asked whether the developer could add PUD language to limit short-term rentals or rental percentages; staff said some controls could be added in PUD language but that state law dictates certain condominium/regime treatments. The developer confirmed the fee-in-lieu amount and that the sidewalks and streets would be consistent with the PUD’s earlier approval.
A motion to approve the applicant’s requested amendment to the PUD carried 3-2. The commission’s recommendation goes to the Lakeway City Council for final action.
