Commercial Real Estate in Mill Valley: C-D Downtown, Miller Avenue and Redwood Highway Zoning

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

Mill Valley’s commercial property is concentrated in four areas: the downtown around Throckmorton Avenue and the Depot plaza, the Miller Avenue corridor running toward Highway 101, the Alto Center near Camino Alto and East Blithedale, and the Redwood Highway frontage near the freeway. The city rewrote its commercial zoning chapter in April 2026, so older summaries and listing notes may be out of date. Confirm the zoning and any overlay for each parcel with the Mill Valley Planning and Building Department.

Who controls the parcel

Inside city limits, the City of Mill Valley regulates land use under Title 20 of its municipal code. Many addresses with a Mill Valley mailing label are not in the city. Strawberry, Tamalpais Valley, Homestead Valley, Almonte and Alto are unincorporated and follow Marin County’s Title 22 Development Code; see our Marin County commercial guide. The Shelter Bay and Manzanita commercial areas near Highway 1 deserve the same check.

Inside the city, the City of Mill Valley runs the sewer collection system and the Sewerage Agency of Southern Marin treats wastewater. The city’s sewer chapter, not the county, sets the lateral rules described below.

Mill Valley zoning for commercial, industrial and mixed use

Chapter 20.40 was repealed and replaced by Ordinance 1368 on April 20, 2026. It sets four commercial districts. Mill Valley has no general industrial zone; warehouse and light industrial uses are conditional in C-G and C-N only.

District	Intended uses	Notes
C-D Downtown Commercial	The town’s social, commercial and cultural center, with ground-floor retail and services and housing or offices above	FAR 1.5, 100% lot coverage. 35 ft and three stories, up to 38 ft for an 18-ft ground-floor plate. Retail and restaurants under 3,000 sq ft permitted. Ground-floor office and bars need a CUP. No drive-throughs
C-N Neighborhood Commercial	Local-serving corridors, including the Miller Avenue Main Street and Gateway areas	FAR 1.0, 50% coverage, 35 ft. Ground-floor office by administrative use permit. Bars and drive-throughs by CUP
C-G General Commercial	Larger centers serving the wider community, including Alto Center and Redwood Highway	FAR 0.50 at Alto Center and Gateway, 0.75 on Redwood Highway. Groceries and indoor recreation by AUP or CUP depending on size
C-L Limited Commercial	Transition areas such as Near East Blithedale	Ground-floor offices permitted. Retail and restaurants need a CUP. Two stories on the East Blithedale frontage. No drive-throughs
C-R Commercial Recreation	Recreation-oriented commercial	Ch. 20.52
PD combining	Site-specific plans	Ch. 20.57
H-O Historic Overlay	Any base district	Design review under Secretary of the Interior standards

All four C districts allow mixed-use housing at 17 to 29 units per acre. Live/work needs an administrative use permit, and ADUs, home occupations and short-term rentals are allowed only where a residential unit already exists.

Downtown, Miller Avenue and Redwood Highway

Downtown (C-D). The chapter calls for multi-story buildings with active ground floors. Mixed-use projects facing listed sidewalks, including the Downtown Plaza, must keep ground floors or entries non-residential unless a CUP is granted. The 1.5 FAR and full lot coverage make C-D the city’s most intensive zone, but height stays at three stories. A buyer planning a bar, a large restaurant or a ground-floor office should expect a Planning Commission hearing.

Miller Avenue (C-N). The Main Street segment emphasizes pedestrian frontage and ground-floor commercial use. The lower 1.0 FAR and 50% lot coverage mean many existing buildings may already be at or near their limit, so check the as-built floor area before planning an addition.

Alto Center and Redwood Highway (C-G). These are the only areas built for larger-format retail. Drive-throughs need design review and a CUP. The Redwood Highway frontage gets a slightly higher FAR, and in the Opportunity Site housing overlay its frontage must keep ground-floor commercial.

Housing on commercial land. Chapter 20.30, adopted by Ordinance 1349 in February 2024, maps three housing overlays onto the 2023–2031 Housing Element sites. Small lots under half an acre may build 17 to 40 units per acre and 40 feet tall. Opportunity sites of half an acre or more allow 20 to 40 units per acre, with ministerial approval when 20% of units serve lower-income households. The Office Conversion overlay lets owners turn upper-floor office space into housing with ministerial approval and no added parking for units of 1,000 square feet or less. For an office building with vacancies, that last rule can change the math.

Cannabis, historic review, live/work and lodging

Cannabis. Chapter 20.14, adopted by Ordinance 1297 in 2017, bans commercial cannabis uses in every zone, bars owners from leasing to them and prohibits deliveries that begin or end in the city, except from state-licensed businesses outside the city to medical patients. Do not underwrite a cannabis tenant.

Historic overlay. In an H-O district, new construction, demolition, signs and exterior alterations go through design review using the Secretary of the Interior’s standards. The Zoning Administrator can suspend an application for up to 180 days, and the Council can extend that by another 180.

Live/work. Under Section 20.40.061, the business operator must live in the unit, units are capped at 3,000 square feet with no more than half in work use, and the live and work space cannot be rented separately. At least one occupant needs a Mill Valley business license.

Lodging. Mill Valley’s transient occupancy tax is 10% of rent on stays of 30 consecutive days or less, and operators must hold a transient occupancy registration certificate.

Unreinforced masonry. Title 14 includes Chapter 14.35 on hazard reduction in unreinforced masonry buildings. Ask whether an older downtown building is on the city’s list.

Transfer tax, business tax and property tax

The Marin County Recorder’s transfer tax sheet shows the county rate of $0.55 per $500, net of assumed liens, and lists only San Rafael as adding a city tax. Mill Valley’s own Chapter 5.10, adopted by Ordinance 686 in 1967, sets a city real property transfer tax of $0.275 per $500, administered by the County Recorder. City taxes of this kind are commonly credited against the county tax, so confirm the actual charge with escrow.

Under Chapter 5.08, businesses with a fixed place in the city pay a gross receipts tax in classes A, B or C, due each July 1. Apartment and house rental operators pay a flat $15 per unit per year. A sale generally triggers Proposition 13 reassessment.

Due diligence that matters in Mill Valley

Start with our commercial due diligence checklist, then add:

Confirm the parcel is inside city limits, not unincorporated Strawberry, Tam Valley or Alto.
Re-check zoning against the April 2026 version of Chapter 20.40, not an older summary.
Test existing floor area against the FAR for the district and sub-area.
Check for a housing overlay and the H-O historic overlay.
Order the sewer lateral inspection report: the city requires one from the seller before title transfers, unless the lateral was replaced within 20 years or inspected or repaired within 3.
For older masonry buildings, ask the Building Division about Chapter 14.35 status.

Questions people ask

How tall can a downtown Mill Valley building be?

35 feet and three stories in C-D, or 38 feet when the ground floor has an 18-foot plate height for commercial use.

Can I lease ground-floor space downtown to an office?

Only with a conditional use permit in C-D. In C-N and C-G, ground-floor office needs an administrative use permit. In C-L it is permitted.

Is there industrial zoning in Mill Valley?

No industrial district. Warehouse and light industrial uses are conditionally allowed in C-G and C-N.

Are cannabis businesses allowed?

No. The city bans commercial cannabis uses in all zones and prohibits deliveries that begin or end in the city, with a narrow exception for licensed outside medical delivery.

Can an office building be converted to apartments?

Upper-floor office space in the Office Conversion overlay can be converted with ministerial approval. Ground-floor units are barred unless the building was originally residential.

Does Mill Valley have a city transfer tax?

Its code sets $0.275 per $500, but the county’s sheet lists only San Rafael. Confirm the charge with escrow.

What sewer paperwork is required at sale?

A lateral inspection report by a licensed plumber, given to the City Engineer before transfer, or by the buyer within 30 days after.

Does Diamond handle commercial property in Mill Valley?

Contact Matthew Martinez to discuss buying, selling or leasing commercial property in Mill Valley.

Sources & notes

Mill Valley Municipal Code Title 20 index (GoCodebook, Oct. 2026)
Ch. 20.40 commercial districts (Ord. 1368, 4/20/2026)
Ch. 20.30 housing overlay districts (Ord. 1349, 2024)
Ch. 20.14 cannabis and Ch. 20.54 historic overlay
Mill Valley Title 5: Ch. 5.08 business licenses, Ch. 5.10 transfer tax, Ch. 5.28 TOT
Ch. 17.04 sewer construction and laterals
Marin County Recorder, transfer tax

Note: We did not review the C-R and PD chapters, Chapter 14.35’s building list, the zoning map or the business tax rate table, and did not read any formula retail rules beyond the portions of Chapter 20.40 we read.

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

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