How Zoning Is Changing Avenue of the Fountains
August 13, 2026
August 13, 2026
If you've walked the Avenue this summer and clocked a new storefront every few weeks, that is not a trick of attention. Something structural changed underneath the sidewalk you're standing on.
Most residents assume the churn is just the economy loosening up, or a post-pandemic bounce, or Fountain Hills finally getting "discovered." The real explanation is less romantic and more useful to know: the Town Council passed a rule in April that makes it almost impossible for a ground-floor space on the Avenue to become anything other than a restaurant, a shop, or an entertainment venue ever again.
On April 21, 2026, the Fountain Hills Town Council formally adopted a new Downtown Overlay during its meeting on Tuesday, April 21. The headline provision is simple and specific. Over time, ground-floor spaces along the Avenue of the Fountains must be occupied primarily by restaurants, retail shops, or entertainment venues. That single sentence is doing more to explain your Saturday morning walk than any amount of "downtown is having a moment" talk.
The overlay splits downtown into purpose-built zones. The Business District sits south of Palisades Boulevard between Saguaro Boulevard and La Montana Drive, designed for offices and professional services. North of Palisades and south of La Montana, an Innovation District is meant to support labs and light manufacturing. The Avenue itself, plus Verde River Drive over to Parkview Avenue, is carved out as the retail-and-dining engine of the whole plan. Nobody currently leasing space downtown has to move. Existing businesses will not be affected and will be permitted to continue operating under current regulations. The rule only bites on turnover. Every time a lease ends, the next tenant defaults into food, retail, or entertainment. That is the mechanism. Everything else on the Avenue this year is downstream of it.
The town's own framing, from Development Services Director John Wesley, tied the vote directly to years of planning rather than a sudden trend, calling it a milestone the Downtown Strategy needed to move forward.
The clearest way to see the ordinance working is to watch what happened to two very different businesses that landed on the Avenue within eight months of each other.
| Good Living Greens | Streets of New York | |
|---|---|---|
| Backstory | Local microgreens brand that had wanted an Avenue location for years | Neighborhood pizzeria that closed its original Fountain Hills spot |
| What changed | Finally secured and moved into a larger storefront | Reopened in a fully remodeled former restaurant box |
| Reopened | July 2026 | December 17, 2025 |
| New address | 16845 E. Avenue of the Fountains, Suite D104 | 12645 N. Saguaro Blvd, at the corner of El Lago |
| Size shift | Grew from about 1,300 to nearly 3,000 square feet | Full remodel of an existing dining space |
The Fountain Hills location had been open for more than twenty years before it closed in January 2025. The space then sat as Euro Pizza before Streets of New York took over the former restaurant with a full remodel. A returning brand reoccupying a dead restaurant box is exactly the kind of turnover the new overlay is built to guarantee, since a restaurant closing on the Avenue can now really only be replaced by another restaurant, shop, or entertainment concept.
Good Living Greens tells a different side of the same story. This was not a business struggling to find any lease. It was a business that specifically wanted the Avenue and, according to its owners, dreamed of expanding Good Living Greens and relocating to the Avenue of the Fountains for years before it happened. A health food shop competing for Avenue real estate against offices and professional services was always going to be a longer wait than it should have been. The zoning change removes that competition going forward. Every future vacancy on the Avenue now tilts toward businesses exactly like this one.
Mayor Gerry Friedel's comment on the Streets of New York reopening pointed at the same pattern from the town's side, framing the return as a sign that its comeback adds to the vitality of downtown rather than something happening in spite of it.
Numbers make this easier to trust than anecdotes do. In October 2025, downtown Fountain Hills was described as home to 280 businesses. By the middle of 2026, the same downtown was being described as home to nearly 300 businesses.
That is roughly twenty net new businesses landing downtown in under a year, across the exact window when the Downtown Overlay District moved from proposal to adopted ordinance. Twenty storefronts is not a rounding error in a district the size of the Avenue corridor. It is a visible, walkable shift, and it lines up almost exactly with the timeline of the zoning debate, not with any broader regional retail boom.
There is a second piece of the ordinance worth knowing if you like understanding why a place changes, not just that it does. Properties in the Business and Avenue Districts may be developed at up to 35 units per acre on an individual parcel, provided the overall density across a full block does not exceed an average of 15 units per acre. That means the same overlay that is filling ground floors with shops and restaurants is also quietly clearing the path for more housing stacked above them. The Avenue is being built, on paper, to have more people living directly above the businesses the zoning is protecting. Give that a few years and the churn you are noticing now becomes the baseline, not the exception.
None of this is theoretical if you are deciding what to do this weekend. The corridor has real, dated activity on the calendar right now:
None of these events exist because a zoning ordinance mandated live music. They exist because a corridor with mandatory restaurant, retail, and entertainment ground floors has more reasons to program its sidewalks than a corridor with half its ground floor tied up in office leases. The ordinance created the container. The Craft Showcase and the brewery classes are what fills it.
The easy read on a new restaurant or a reopened pizzeria is that Fountain Hills got lucky, or trendy, or discovered. The more accurate read is that the town wrote a rule in April that removes the option for a downtown vacancy to become anything boring again. Good Living Greens waited years for its shot at the Avenue not because it lacked interest, but because the zoning let offices compete for the same square footage. That competition is gone now. Streets of New York didn't just get nostalgic and come back. It walked into a box that, under the old rules, could have sat vacant or become something with no reason for you to walk past it.
Twenty new businesses in under a year, a formally adopted overlay, and a density allowance that points toward more rooftops on the Avenue itself all point the same direction. This is not a neighborhood that got busy by accident. It is one that voted, in April 2026, to make busy the default setting.
If you are watching this shift because you're weighing what it means for a home near downtown, or you're simply curious how far the Avenue's momentum could run, Colleen Marie Heaney tracks these kinds of local changes across Fountain Hills and the North Valley as they happen, not after the fact. Reach out any time you want a straight read on what a shift like this actually means for the streets around it.
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