July 17, 2024

With a massive redevelopment proposal on the table that could transform the southern bank of Lady Bird Lake in downtown, Austin City Council and Endeavor Real Estate Group LLC are in the middle of a Ping-Pong match that will determine the future of South Austin’s physical and economic landscape.
Following three postponements in recent weeks, Endeavor’s rezoning request is scheduled to again be heard by Council on Sept. 29. Council members are considering whether to approve the second of three readings needed to make way for the massive mixed-use project.
Under the proposed planned unit development, or PUD, Endeavor could transform the 18.9-acre site at 305 S. Congress Ave., the former home of the Austin American-Statesman, into six towers ranging from 215 feet to 535 feet in height.
The project, called 305 South Congress, would create nearly 1.5 million square feet of office space, more than 1.6 million square feet of residential space, 220,000 square feet of hotel space and 150,000 square feet of retail space.
The property is owned by the Cox family, who bought it in 2015 from their namesake company, Cox Media Group. Endeavor is the master developed.
In 2021, the Statesman relocated its headquarters to the MetCenter business park near Austin-Bergstrom International Airport.
So what is holding up the PUD process for what is likely the largest real estate project on the table in Austin’s urban core?
Much of the debate comes down to one key issue: the total number of affordable housing units the development will create for the city.
Endeavor said the project only works with 4% of the residential units, or about 55, reserved as affordable, in line with what has already been approved, but some city leaders are pushing for the developer to price up to 10% of the units at a below-market rate.
The 55 units would be offered for those earning 80% of the median family income level, as proposed in the agreement for the site. That is currently $79,450 for a family of three in Travis County, according to Austin’s Housing and Planning Department.
In an interview with Austin Business Journal, the attorney representing Endeavor before Council, Richard Suttle of Armbrust & Brown PLLC, emphasized that the 4% was the most affordable housing possible and that it fit into the South Central Waterfront Initiative, a long-term city plan to guide development of 118 acres south of Lady Bird Lake.
That plan outlined a goal of making 20% of all new housing in the district affordable at rates that correspond with the city’s median family income.
Suttle said the 55 residential units would be valued at about $23.2 million and dedicating 10% of the project’s residential units for use as affordable housing would cost Endeavor an estimated $50 million.
But some members of Council and affordable housing advocates feel differently.
“I really do look forward to seeing a PUD on this property that has higher levels of affordability. … I think there was a significant call made for more affordable housing,” Council Member Kathie Tovo, who represents District 9, said during a discussion of the site during a July 28 meeting.
During that meeting, Tovo emphasized that the city’s existing PUD ordinance includes a 10% requirement for affordable housing.
Under a 10% dedication, Endeavor would have to reserve 137 of the 1,378 proposed units for affordable housing.
If Endeavor moves forward with the redevelopment, it could take up to a decade to bring the 55 units online, Suttle said. However, the company could also provide the same number of units at a neighboring site or outright pay the city $23.2 million to help fund the creation of affordable housing elsewhere.
“That is all we can do unless there is a decrease in some other obligation,” Suttle said. “Right of way, that kind of stuff.”
Suttle said that the city and developers must work together when it comes to creating more affordable housing.
“The city’s goal is to have more affordable housing,” Suttle said. “In order to do that, the city has to be a partner and invest in that. It can’t expect the private industry to cover a public problem. That’s the truth. It’s amazing to me that the very thing that will solve the housing issue is more units and yet we tax — it’s not really a tax, but I’ll use the word — multifamily developers with solving the affordability issue when we ought to be encouraging it.”
Suttle described the situation as “discouraging” but is confident that the Statesman redevelopment will “work out,” as the project remains the centerpiece of the waterfront initiative and would significantly expand the city’s amount of public space downtown.
“I just keep telling people that it’s just math,” Suttle said. “They, Endeavor, are doing their share and the city needs to be doing their share.”
Endeavor has been working on this project for close to three years.
“If they don’t want to approve the project that makes sense, then fine, we’ll mothball it and we’ll have an industrial use site sitting on the river,” Suttle said. “Th rest of the South Central Waterfront Plan does not work without it. We own the park. The key piece here is there is zero parks there right now. There is a 12-foot trail.”
As drafted, each of the six planned towers would include two to three levels of outward-facing retail and restaurant space encircled by outdoor patios.
Endeavor’s current plans promise about 8 acres of new public open space, a third of a mile of restored hiking and biking trails and an acre of restored shoreline.
“I think is a once in a lifetime opportunity to create this park experience right on the water, looking back on the ever-changing skyline of Austin,” said Sander Mohn, a development associate with Endeavor.
The project could also host a rail station under the Project Connect transit expansion.
“I think people have really changed their opinion on density here in Austin as we continue to grow,” Mohn said. “To add that pedestrian focus and create that multi-modal dynamic project is one of those things that I am really excited about. It is my personal opinion that this is an opportunity for the city to add density in an area that should really be allowed to have density and create that tax base, and that tax base can then in turn create the community befits that the community wants to see in this district. There are not very many opportunities like this to really imagine a new dense district for a city like Austin.”
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