West Melbourne council approves Stellar townhomes after split vote over owner-occupancy limits

The West Melbourne City Council approved a development agreement for the Stellar townhome project and followed with second-reading approvals of a future land-use map amendment and a rezoning ordinance on Feb. 3, 2026, after extended discussion over owner-occupancy and rental restrictions.

Planning Director Christie Fisher presented the application for a 133-unit townhouse subdivision on roughly 17.12 acres south of West New Haven Avenue, describing the requested waivers, a 30-year development agreement and staff—s recommendation to approve the revised agreement with three conditions. Fisher summarized that staff—s review considered utilities, consistency with goals and objectives in the comprehensive plan, and compatibility with surrounding residential areas.

Cole Oliver, attorney for the applicant, told council the development team had incorporated neighbor feedback and made design changes including increased setbacks, tree-preservation language and a one-year minimum lease period in the homeowners association documents. Oliver said his client could not accept a separate owner-occupancy residency requirement (a provision that would require an owner to live in a unit for a set time before selling or leasing) because lenders had told them such a restriction would make the project unfinanceable and could raise Fair Housing Act concerns. "If council decides to require that residency restriction," Oliver said, "this developer will have to bow out of the project." (Oliver's remarks are from the applicant—s presentation.)

Council members were divided. Councilmember Bentley supported approval, saying the applicant had made a good-faith effort to incorporate comments and that pushing a new residency restriction could cause the project to fail. Councilmember Francis said the council—s earlier discussion had sought a percentage-based rental limit in HOA covenants to reduce corporate ownership, and he pressed the applicant on why that approach was not in the latest agreement. Several council members said they had understood the project to be presented originally as fee-simple, owner-occupied townhomes but that financing realities later prompted the applicant to request flexibility to rent units if necessary.

Johanna Gantz, a nearby resident, urged a development that would yield owner-occupied homes rather than what she characterized as a rapid turnover of renters, saying she wants long-term neighbors and stability.

The council voted 5-2 to approve the development agreement (motion by Councilmember Bentley; second by Deputy Mayor McGuire). The council then passed ordinance 2026-03 (future land-use amendment) and ordinance 2026-04 (rezoning to R2) on second reading, each by 6-1 votes.

The applicant and staff stressed that approval does not guarantee how the project will be marketed at sale, only that the development agreement and associated waivers and conditions allow the proposed land use and zoning to proceed. Oliver repeated that, without flexibility for leasing, the applicant would withdraw the application and the property owner could pursue other uses.

Next steps: with the development agreement and the two ordinances approved, the applicant may proceed with the development agreement finalization and subsequent permitting steps; final sales strategy and any HOA rental restrictions will be governed by the recorded covenants and applicable law.