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Grumet: Austin needs affordable housing. Will council demand more from old Statesman site?

Bridget Grumet
Austin American-Statesman
The former site of the American-Statesman on the south shore of Lady Bird Lake at South Congress Avenue is the site for a proposed development with about 3.5 million square feet of building space.

UPDATE, April 7, 2022: The Austin City Council is slated today to discuss plans for redeveloping the old Austin American-Statesman site.

As I reported earlier this year, the plans include 1,378 residential units – only 4% of which would be affordable for people making less than 80% of the median family income.

As the Austin Monitor reported this week, Council Member Kathie Tovo is suggesting a more ambitious goal: affordable housing among 10% of the apartments and 5% of the condominiums.

No one site will solve Austin’s affordability problems. But the Austin City Council needs to use every opportunity, every tool at its disposal, to get as many units as it can, each time it can. Today provides one of those opportunities.

Read on for my initial coverage of this issue:

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Affordable housing — or really, the scarcity of it — is The Big Problem in Austin.

Every year, rising rents and home prices make the city increasingly unaffordable for teachers, nurses, college students, construction crews, musicians and service industry workers. I know people who have moved as far away as Elgin and Liberty Hill, compounding their commutes, to find rents they could afford.

Among those remaining in Austin, nearly half of the renters are “cost burdened,” meaning they spend more than 30% of their income on housing, straining their ability to pay for food, transportation and other necessities.

And the latest scorecard by HousingWorks Austin shows the city has created only 7,010 of the 60,000 affordable housing units it pledged to add by 2028.

Given the scale and urgency of the need, it is extremely disappointing that the proposed redevelopment of the old American-Statesman site, a prime tract in the heart of the city, offers precious little in the way of affordable housing.

The plans presented last month to the city’s Planning Commission envision six gleaming towers on the south bank of Lady Bird Lake, just east of South Congress Avenue. Nearly 1.5 million square feet of office space. A 275-room hotel, alongside shops and restaurants. Plus an eye-popping 1,378 residential units, a mix of condominiums and apartments — only 55 of which would be affordable to people making less than 80% of the median family income.

It gets worse. Of those 55 affordable units, only 47 would be actual apartments in the development. For the other eight, the developer would pay a fee to the city’s affordable housing fund instead of providing those units on site.

Pretty paltry.

Now perhaps you’re thinking: "This is America. A developer doesn’t have to build a stick of affordable housing if they don’t want to." And you’re right – if they are developing the site as the current zoning allows.

But when a developer asks the city for permission to go well beyond that zoning, to build significantly more office space and more housing units than would otherwise be allowed — then yes, the city can demand meaningful community benefits in return.

In those situations, for properties in this part of town, city policy says 20% of the housing units should be affordable.

The proposal on the old Statesman site coughs up just 4%.

“That number needs to be considerably higher,” Council Member Kathie Tovo, who represents the central city, told me last week.

Just how much is up for debate.

Project also brings sizable perks

Endeavor Real Estate Group is proposing a massive amount of development on the nearly 19-acre site owned by the Atlanta-based Cox family, former owners of the Statesman. But it’s important to note the plan also offers significant community benefits in the form of parks and transportation amenities.

On the development side: Endeavor proposes about 3.5 million square feet of building space instead of the 660,000 square feet currently allowed on that tract. The city’s own vision for redevelopment in that area, documented in the South Central Waterfront Plan, suggested something closer to 2.1 million square feet.

Endeavor also proposes towers ranging in height from 215 to 525 feet. The site is currently capped at 96 feet. The South Central Waterfront Plan suggested a limit of 400 feet.

City leaders want the site to develop into a vibrant gateway to downtown. They are also mindful that this is a once-in-a-lifetime opportunity to secure amenities that will serve generations to come.

ALSO READ: Keep pressing for affordable housing. But don't count on it

On the community benefits side: Endeavor would set aside 6.5 acres — a third of the site — for parkland, protecting public access to Lady Bird Lake and Austin’s famous urban bat colony.

The developer also would also give up nearly 2 acres for the extension of Barton Springs Road, and provide land for a future transit stop on the Blue Line.

The jaw-dropper for me: Endeavor will put 95% of the project’s parking underground to avoid towers of above-ground parking alongside the river.

“That is a very huge get for us,” zoning chief Jerry Rusthoven told the Planning Commission last month.

That much underground parking doesn’t come cheap, especially that close to a body of water. It’s also far more ambitious than what the South Central Waterfront Plan envisioned, which was tucking most of the parking into buildings above ground.

Taken altogether, Rusthoven said, the old Statesman site is “giving up a lot in terms of parkland and in terms of right of way, and so the burden for affordable housing on this tract was lessened to make up for those things."

City staffers were ready to accept only 4% of the housing units as affordable.

A balanced tradeoff is needed

But that figure doesn’t sit well with some members of the Planning Commission and the City Council, which will make the ultimate call on this project.

Planning Commissioner Joao Paulo Connolly openly worried the city could “end up with laughably few or no affordable units on site at all for this development.”

Fellow Commissioner Solveij Rosa Praxis challenged Endeavor to dig deeper: “If big profits are anticipated, we want to see big community benefits as well.”

Tovo told me that should include more affordable housing, although she does not yet have a firm number in mind. She has asked staff for more information so she can reach a sensible figure.

Importantly, Tovo noted the city requirement should touch not only on the number of affordable housing units, but also the type. The city needs to ensure some of these affordable units have multiple bedrooms that could house families, instead of solely providing tiny studio apartments.

“We want the waterfront area to be home to different kinds of families: families with children, individuals who might have a caregiver,” Tovo told me. “We want a diverse mix of families. To do that, we need a diverse mix of unit types and bedroom counts.”

Richard Suttle, the attorney for the developers, told the Planning Commission he’s open to revising the proposal, but ultimately the project must remain financially viable. “It’s like a Christmas tree,” he said last month, offering a suitably seasonal analogy. “You can only load it up so much and it starts tipping over.”

Come to think of it, the plan approval process is like a gift exchange between the city and the developer. Both are giving something and getting something in return. But it has got to be a fair trade.

The deal so far contains too little of the affordable housing units that Austin badly needs. Given the handsome profits this project is bound to make, Endeavor can afford to be more generous. The crews that will build this project, and the hotel and restaurant staffers who will someday work there, need affordable places to live, too.

Grumet is the Statesman’s Metro columnist. Her column, ATX in Context, contains her opinions. Share yours via email at bgrumet@statesman.com or via Twitter at @bgrumet.