The skyline rules are changing in the Texas capital. Last month, the Austin City Council adopted an ordinance setting a 350-foot right-of-way height limit for projects in the Central Business District, replacing the city’s floor area ratio (FAR) system after state lawmakers limited local zoning powers.
The cap will be in effect for development applications filed from Nov. 3 through “early June 2026,” according to city government officials, when staff hope to move forward with a broader rewrite of the downtown code.
Projects that want to exceed 350 feet must now enter the Downtown Density Bonus Program (DDBP) and get council approval. The Planning Commission unanimously approved the change on Oct. 14, following an affordability-impact analysis in September.
How Senate Bill 840 forced Austin’s hand
The new rule comes from Senate Bill 840, a state law that went into effect Sept. 1, that prohibits Texas cities from regulating the FAR for mixed-use or multifamily development in commercial zones.
With this restriction, Austin planners warned that the CBD’s previous FAR baseline of 8:1, roughly equivalent to a 200-foot to 230-foot tower, would have left downtown with no effective height limit.
This ENR chart shows downtown Austin towers taller than 350 feet and indicates whether each is within the new CBD/DDBP zone. Click on the image to view the table.
To prevent uncontrolled growth while maintaining incentives for community benefits, the city established a fixed base height of 350 feet and retained the DDBP as a mechanism for taller buildings.
Under the bonus program, developers trade additional height or density for on-site affordable housing units, payments to the city’s housing trust fund or participation in its Great Streets initiative, which includes wider sidewalks, shade trees and active ground-floor uses along downtown corridors.
Staff reports note that the average height of recent DDBP projects was about 220 feet, while many new proposals exceeded 500 feet, prompting the city to choose a threshold in line with recent market patterns but below the upper ranges.
Planning officials describe the move as an “interim fix” that preserves predictability for developers while a new development code language is prepared. The height limit is extended until mid-2026, after which the council will consider a comprehensive update to the downtown zoning.
Councilman Chito Vela said the intent is to “hold both the density bonus dollars and our downtown treatment of Great Streets.”
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However, the Center Commission opposed the 350-feet limit, calling it arbitrary and warning that fewer projects could participate in the bonus program, thereby reducing affordable housing revenue.
The Downtown Austin Neighborhood Association, a nonprofit organization made up of businesses and residents, expressed opposition to the height limit in a letter to city council, arguing that height limits and other “exclusive” zoning mechanisms hinder housing production and contradict the city’s affordability goals.
“Density allowance programs are based on exclusionary zoning to ‘work’ and produce less housing relative to granting the same rights by right,” the organization wrote.
The ordinance directs staff to report by February 2027 on the results of the DDBP and possible permanent amendments to the code.
Meanwhile, developers and engineers preparing new towers in the center will have to design within a smaller envelope or budget time for the council’s review to go further. Structural teams say the new baseline could alter tower-to-podium relationships, crane sequencing and facade selection as Austin’s downtown skyline adjusts to the post-SB 840 era.
