Commercial Real Estate in Del Rey Oaks: C and C-1 Zoning, Fort Ord Land and the Visitor Commercial Overlay

By Matthew Martinez, Founder, CEO & Managing Broker, Diamond Real Estate Group. California DRE #01869679.

Del Rey Oaks is one of the smallest cities on the Monterey Peninsula, and its commercial land falls into two very different settings: small neighborhood-scale centers in the established town around Canyon Del Rey Boulevard, where City Hall sits, and former Fort Ord land to the east, around South Boundary Road and General Jim Moore Boulevard. The city writes its own zoning, and its code is short and older in style, so many standards are cross-referenced from residential chapters. Confirm the zoning district, overlay and permit history for every parcel with City Hall before relying on this page.

Who controls the parcel

The City of Del Rey Oaks is the land use authority inside its limits. Its city hall sits at 650 Canyon Del Rey Boulevard, and the city’s 2023 Housing Element environmental notice describes the city as covering about 670 acres, bordered by Highways 1, 68 and 218 and the Monterey Regional Airport area. With so little land, a single rezoning can change the commercial picture for the whole town.

The former Fort Ord parcels add a second layer of history. In 2016, the Fort Ord Reuse Authority board certified a city General Plan and zoning package for the Monument RV Resort as consistent with the base reuse plan, according to FORA Resolution 16-18. The city had adopted that package as a voter initiative measure on May 24, 2016. For any Fort Ord site, ask the city which reuse-era approvals, deed restrictions and environmental covenants still run with the land.

Planning decisions go to the Planning Commission, with appeals to the City Council. Under Chapter 17.20, plot plans and elevations for any new commercial building must be reviewed by the commission, and an appeal must be filed in writing with reasons.

Del Rey Oaks zoning for commercial, industrial and mixed use

District	Intended uses	Notes
C (Ch. 17.20)	General commercial: retail, offices, banks, gas stations, storage garages, studios; R-district uses also allowed	Use permit for wholesale, laundries, contractor shops, lumber yards, pawn and second-hand stores, animal hospitals, kennels. Height follows R-2 (3 stories, 35 ft)
C-1 (Ch. 17.24)	Restricted neighborhood commercial: small retail, services, professional and medical offices	10,000 sq ft minimum new lot; 35 ft front setback; 2 stories or 30 ft. Use list amended by Ord. 312 in 2023
Visitor Commercial overlay (Ch. 17.32)	Lodging and recreation: RV parks, park models, clubhouses, plus C-1 permitted uses	Inn or resort/conference hotel (10+ acres) by use permit; stays capped at 30 days unless extended
C-1-D and C-1-V	Combined C-1 districts named in the cannabis chapter	Confirm on the zoning map what each combination controls
Affordable Housing overlay (Ch. 17.90)	Income-restricted housing on City-owned Fort Ord Sites 1 and 1a	Not commercial, but it reshapes the Fort Ord land around South Boundary Road

The code has no separate industrial district. Light industrial and service uses fit, if at all, in the C district by use permit.

Canyon Del Rey and the neighborhood centers

C-1 is written for the scale of a small residential city. Permitted uses include bakeries, delis, florists, drug and hardware stores, food markets, restaurants without floor shows, dancing or drive-in service, banks, salons, and administrative, medical and dental offices. Hotels, cocktail lounges and indoor theaters, social halls, auto service stations, schools and caterers need a Planning Commission use permit, and so does any use not on the list.

The chapter’s operating conditions matter for leasing:

Most activity must happen inside a closed building, with exceptions for service stations, parking, nurseries and approved sidewalk cafes.
Goods sold must be mostly new merchandise sold at retail on site.
More than three people fabricating or processing goods per business requires a use permit.
Parking across from residential land must be set back 10 feet and landscaped, and lot lighting cannot spill onto homes.
Utilities must be underground, and architectural and landscape plans need council or committee approval.

Parking ratios in C-1 run one space per 300 square feet for offices, one per 500 for retail and banks, and one per 2.5 seats for restaurants and bars. Each space must be at least 180 square feet before aisles, which is generous by modern standards and can limit how much building fits on a small lot.

Fort Ord land, lodging, cannabis and other local rules

Visitor Commercial overlay. Chapter 17.32 was rewritten in its entirety by Ordinance 284 in June 2016. It permits RV parks, park models, clubhouses and the uses C-1 allows outright. A full-service inn or resort/conference hotel needs at least 10 acres and a use permit, and its restaurants, lounges and meeting rooms are treated as auxiliary uses. Hotel-serving uses get a 50% parking reduction, and the city engineer may approve surfaces other than asphalt or concrete if they follow best management practices. If a permitted use stops for six consecutive months, the council may begin proceedings to end the permit.

No casinos. The overlay chapter bans card rooms and casinos both in the overlay and on former Fort Ord lands generally.

Cannabis. Chapter 17.60, adopted by Ordinance 289 in 2017 and amended in 2019, allows commercial cannabis businesses in C, C-1, C-1-D and C-1-V with a conditional use permit, a city cannabis permit, a business license and a state license. Outdoor commercial cultivation is prohibited. The city’s cannabis tax sits in Chapter 4.07, which we did not review.

Lodging tax. Under Chapter 3.20, the transient occupancy tax is 12% of rent from January 1, 2025 (Ordinance 319), with a voter-approved ceiling of 14% that the council may approach by resolution. Operators must register within 30 days of opening and post the certificate.

Transfer tax, business tax and property tax

City transfer tax. The city’s $0.275-per-$500 share is credited against the county tax under Monterey County Chapter 5.32. The combined standard rate is $0.55 per $500 of taxable value, subject to exemptions and the recorded transaction. Confirm the calculation with escrow.

County transfer tax. Monterey County Code Chapter 5.32 sets the county documentary transfer tax at $0.55 per $500. How the city and county amounts combine on a recorded deed should be confirmed on the escrow estimate.

Business license tax. Chapter 5.04 states the license is enacted to raise revenue. General and retail businesses pay on a gross receipts scale starting at $20, and hotels with four or more rooms pay a quarterly per-room amount. Annual licenses are due before July 1, and late penalties can reach 50%.

Property tax. A change of ownership generally triggers Proposition 13 reassessment.

Due diligence that matters in Del Rey Oaks

Start with our commercial due diligence checklist, then add:

Pull the zoning map and confirm whether the parcel is C, C-1 or a combined C-1-D or C-1-V district.
For Fort Ord land, ask for reuse-era approvals, deed covenants and any munitions or environmental restrictions recorded on title.
Check whether the planned use is on the C-1 permitted list or needs a use permit.
Measure parking at 180 square feet per space and the city’s ratios before signing a restaurant or office lease.
Confirm water availability and any water permit with the city and the regional water management district before a change of use.
For lodging or cannabis, budget for the 12% TOT, a city cannabis permit and the Chapter 4.07 tax.

Questions people ask

Is there an industrial zone in Del Rey Oaks?

No separate one appears in Title 17. Some service and light-industrial uses can be approved in the C district with a use permit.

Can I open a restaurant in a C-1 center?

Yes, restaurants and cafes are permitted outright, but not with floor shows, dancing or drive-in service. A cocktail lounge needs a use permit.

What can be built on the Fort Ord land?

In the Visitor Commercial overlay, RV parks, clubhouses and C-1 uses are permitted, and a resort or conference hotel on 10 acres or more is possible with a use permit.

Are cannabis businesses allowed?

Yes, in the C, C-1, C-1-D and C-1-V districts, with a conditional use permit and state and city licenses. Outdoor commercial cultivation is banned.

Does Del Rey Oaks have its own transfer tax?

The city share is included in the county rate. The combined standard rate is $0.55 per $500 of taxable value, subject to exemptions and the recorded transaction. Confirm the calculation with escrow.

What is the hotel tax?

12% of rent, effective January 1, 2025.

Does Diamond handle commercial property in Del Rey Oaks?

Contact Matthew Martinez to discuss buying, selling or leasing commercial property in Del Rey Oaks.

Sources & notes

Note: We did not open the city zoning map, the Chapter 4.07 cannabis tax or the 1997 General Plan, and we did not confirm whether the Monument RV Resort or any hotel has been built. The C-1-D and C-1-V names come from the cannabis chapter. Code text is from the October 2026 GoCodebook edition.

This page is general information, not legal or tax advice. Last reviewed October 2026 by Matthew Martinez.

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