New development to reshape South Central Waterfront
When former First Lady Lady Bird Johnson created the Town Lake Beautification Committee in 1971, she hardly could have imagined the scale of the development that would one day take place along the banks of the waterway that would later be renamed for her.
Johnson’s vision for the lake began with a visit to London in 1971 alongside Ann Butler, the wife of then mayor Roy Butler. During a stroll along the Thames Path, a verdant trail in the heart of London, Johnson wondered whether they could create something like it in Austin.
Thus was born the idea for the 10-mile trail that today is named for the Butlers, as well as a pavilion and other amenities. The effort restored vegetation and breathed civic life into Austin’s south shore, which had been an unbuildable, deforested floodplain prior to the construction of Longhorn Dam in 1960. Johnson’s committee “raised funds to plant hundreds of trees along the banks of the lake and spent years beautifying the trail,” according to a 2011 resolution of the City Council.
Today a stretch of that riverbank is at issue in a contested zoning case involving the developer Endeavor Real Estate Group, the Atlanta-based Cox Family—the billionaire owners of the property—and lobby firm Armbrust and Brown, which represents the owners and developer and is a major donor to Austin City Council candidates.
Endeavor is seeking permission from the city to build as many as six high-rises on an 18-acre site next to the Congress Avenue Bridge, featuring ground-floor retail, 1,378 condos or apartments, a 275-room hotel, and 1.5 million square feet of office space.
The plan has stoked the fury of environmental group Save Our Springs Alliance, which sees it as an encroachment on a vital waterway and a giveaway to the developer in the form of fee waivers, infrastructure subsidies, and exemptions from normal parkland requirements.
Some housing and homeless advocates have also criticized the plan, saying the city should require the site to have more affordable housing rather than luxury condos.
The developer, on the other hand, presents its plan as an integrated, walkable development near the city center and transit corridors—an ideal location for greater density. Endeavor has won the backing of the mayor and urbanist activists who say the plan represents the type of dense, mixed-use project that is needed to reduce traffic and sprawl and meet climate goals.
The fight epitomizes the broader political battle in Austin between pro-growth forces and growth skeptics who tend to question whether greater density is making the city more affordable and livable.
Lack of parkland
Supporters and critics clashed over the plan at a city council meeting September 29th, ahead of a scheduled vote on the rezoning of the property at 305 South Congress Avenue. Although the council opted to delay its vote until October 13th, the speakers were given a chance to address the council anyway.
“There’s been two or three decades of community efforts to establish and protect the shoreline along Lady Bird Lake,” said Bill Bunch, Executive Director of the Save Our Springs Alliance. “This started with Lady Bird herself and others (and) we’re all blessed that they made those efforts. And now you’re going to sweep out the door, into the trash can, the most important part of this, and that’s the reduction of the setback from the shoreline, the primary setback, from 150 feet to 90 feet.”
Bunch told the Bulldog that he’d be happier with the proposal if it scrapped one of the high rises and left that as open space, as well as all of the subsidies for the developer. His organization was an influential player in Austin politics in the 1990s after notching successes against developers. But today Bunch says he’s increasingly frustrated with a council that has fallen again under the sway of developers.
He called Endeavor’s proposal “a nightmare precedent for the entire circumference of Lady Bird Lake subject to the lake overlay ordinance along with a nightmare precedent for our park dedication ordinance.” Bunch was referring to existing code requirements intended to preserve the lake and public parkland.
Under Endeavor’s proposal, the city will receive 6.53 acres as a dedication of parkland. Bunch says this amount is inadequate given the size of the proposed towers, which would house thousands of tenants, generating high demand for parkland.
Moreover, the dedicated acreage includes land that Endeavor wouldn’t be allowed to build on anyway because it’s too close to the lake. A map of the proposal created by Endeavor, and posted on the city website, shows that only a sliver of the dedicated parkland is outside of the critical water quality zone and even less is outside of the primary setback, the setback distance required by code.
Yet, if approved, Endeavor will receive 50 percent parkland credit for a commercial plaza located between two high rises, and 50 percent credit for lakeside land that it wouldn’t be allowed to build on anyway, according to the map. City Code requires developers to either dedicate parkland or pay a fee in lieu. Austin’s Planning Department calculated that only 1.6 acres of the 6.53 acres dedicated park land were “unencumbered,” meaning outside of the Critical Water Quality Zone and easements, according to a staff summary of the proposed zoning changes.
Moreover, the proposal would allow Endeavor to use some of the “parkland” for water quality control ponds. “These are indisputably part of the private development and not park land,” Bunch said.
Roy Whaley, conservation chair for the Austin regional group of the Sierra Club, commented, “This is like thanksgiving. we’ve got a half-baked turkey and it’s not ready to serve. Let’s stick it back in the oven, let’s tighten this up.” Whaley, speaking at the September 29th council meeting, added, “I’m all for the development of this site. It can be an outstanding development and an outstanding park. Something that the whole state of Texas could be proud of…(but) the Sierra Club doesn’t want to see any waivers or subsidies to the Town Lake Ordinance, setback, and impervious cover.”
“The number of acres of parkland per citizen in Austin has been steadily declining since 1995,” said Garrett Nick, a resident who dialed in to the council meeting to criticize the plan.“The precedent that this project sets only helps to exacerbate that problem as everyone after this will be asking for the same sort of pretend PUD [Planned Unit Development] exemptions.”
Some critics want the council to do more than just increase the parkland requirement—they’d like to see the council turn the whole site into a park. Musician Bill Oliver voiced his objections in the form of a song: “They low-balled their numbers and block out the sky/ For luxury high rises, cry baby cry/ The banks of South Austin will look like a mall/ Unaffordable housing and condos for all.”
“Setbacks and variances, whose fooling who?/ These billionaire bullies got your numbers too/ …This land is alive with the Lady Bird heart, Austin should buy it and make it a park.”
Beth Gallagher, another musician, said, “In the 35 years that I’ve lived in Austin, I’ve spent a lot of time on our beautiful river. I’d hate to see it become a narrow canyon if we gut our Ladybird Lake protection ordinance by shrinking the required shoreline setback for construction from 150 feet to less than 90 feet, and doubled or more the allowable development within 200 feet of the shore.”
Two neighborhood groups, South River City Citizens and the Bouldin Creek Neighborhood Association, have also written letters to the council opposing the rezoning in part because of the lack of parkland.
Council members backtracking on affordable housing
When the council approved zoning changes for the South Congress site on first reading April 7th, it included an amendment by Council Member Kathie Tovo that would require that 10 percent of rental units be affordable at 60 percent Median Family Income (MFI). That would be 138 of the total 1,378 residential units at the site.
The developer, however, has refused to accept that change and has continued to lobby council members to change their position. Endeavor would prefer instead to include just 55 units of affordable housing at 80 percent MFI, which would be 4 percent of the total, according to the Neighborhood Plan Amendment Sheet, a planning document dated September 1st.
That’s below the standard for Planned Unit Developments (PUDs), and below the 20 percent target in the South Central Waterfront Vision Plan. Nonetheless, the city’s Planning Department has backed Endeavor’s proposal, and Mayor Steve Adler in remarks from the dais supported the idea of a lower affordability requirement at the site—either 4 percent of units or none—if Endeavor would promise to build affordable housing elsewhere, or pay a fee in lieu. “I want to be sure we’re not asking for so much that we just don’t get anything,” he said.
Adler drafted a motion for the September 29th meeting asking the City Manager to make a recommendation whether to include the 4 percent on-site requirement, a 10 percent requirement, or a $23.2 million fee-in-lieu. Although the motion didn’t come up for a vote, it reflects Adler’s position not to stick with the first-reading language. The developer’s representative, Richard Suttle, an attorney at Armburst and Brown, has said they’d be okay with the fee-in-lieu.
Alternatively, Suttle proposed putting the affordable housing somewhere else, either at One Texas Center, which is a nearby city-owned property, or at another nearby Endeavor property. “We now control 422 on The Lake which is a currently built apartment complex, a very nice one, and we ran the numbers and we were able to do more than 55 units at 80 percent,” he said at the September 29th council meeting. “And it gets more units a lot faster. And we have proposed that recently to the city as yet another option.”
Mayor Adler and Council Members Pio Renteria voiced support for reducing the affordability requirement at 305 S. Congress if Endeavor would offer units instead at 422 on The Lake. “I’m comfortable with the 70 units at 422,” said Renteria.
Council Member Chito Vela went a step further, asking city staff to draft a version of the ordinance reflecting the developer’s preferences. This draft, published on the city council discussion board, struck out the 10 percent requirement included in the first-reading ordinance and replaced it with 4 percent. Vela told fellow council members at the work session September 27th that he’d like to offer the draft as a substitute to the one the council had passed in April.
“What we passed on first reading was really just a placeholder. I mean, we did not debate anything, we did not really vet any of the amendments.” He called his substitute ordinance a “clean version so we know where the consensus area among all the parties is at.”
Tovo retorted, “For me that doesn’t represent the consensus for where I am and where a lot of the community is with regard to housing… What you’re bringing forward is really just a shift back to (the developer’s) original proposal.”
When Vela ran for council in a special January 30th election to replace resigning Council Member Greg Casar, he received $8,042 from attorneys employed by Ambrust and Brown and their spouses and $12,058 from Endeavor employees and their spouses, for a total of $20,100, according to a January 18th campaign finance report. Most of those contributions were at the then maximum of $400.
Although the city charter restricts donations from lobbyists to just $25, Ambrust & Brown skirted that requirement by registering just a few of its attorneys as lobbyists while their colleagues and spouses made mass donations. According to Vela’s campaign finance report, two of the attorneys’ spouses listed the firm’s offices as their personal address, indicating that their participation could be part of a corporate initiative.
Council Member Alison Alter opposed Vela’s proposal. “I am uncomfortable with the notion that we are taking what the developer is saying as the base, especially with respect to affordable housing…this is really stacking the deck in favor of what the developer has agreed to in ways that make me really uncomfortable.”
‘Rein in this kind of development’
Several citizens asked the council to stick to the higher requirement for affordable housing at the site. “People from all walks of life should be able to live, work, and play throughout Austin…and certainly on the shores of Lady Bird Lake,” said Karen Paup, a member of the Community Development Commission.
“I ask you to stick with the affordability set on first reading and to push for a way to third reading that realizes the affordability goal of the South Central Waterfront Vision.”
Paulette Soltani, a nonprofit worker, also spoke against the rezoning as currently proposed. “I’m the director of organizing at the Texas Harm Reduction Alliance. I organize with people experiencing homelessness every day—people who have little access to deeply affordable housing or resources like rental assistance to find housing. At our membership meetings, people have said: I sleep on the ground and when I wake up, I see towers going up all around me. Why are these units so expensive? How would I ever have any chance at living there?”
“We need to be developing more housing, we are not against developing housing, but we should not be incentivizing development if it promises to worsen our housing crisis and if it excludes unhoused people and low-income people,” Soltani added.
“Endeavor is a massive luxury developer, we don’t buy that they can’t build more affordable housing and you shouldn’t either. We’re calling on you to do more to rein in this kind of development in Austin, demand that developers build truly affordable housing. We’re calling on you to connect the dots and do more to use development in Austin as an opportunity to solve homelessness and our affordability crisis.”
‘A city for the rich and the homeless’
Paul Mullen, a citizen advocate on housing issues said, “While we are building the housing for high-paid tech people who are working for Tesla and Facebook and Google and Apple and you’ve been very successful at that, each of those high-tech jobs generates an additional five jobs in service industries and most of those people are in retail or the catering business are not well paid. Where are they going to live? You’ll be finding your local restaurants closed down because they can’t get any staff? If we don’t have affordable housing we won’t have a viable city. It will be the rich people and the homeless, a bit like the center San Francisco at the moment. And that’s where you’re going.”
On the other hand, Gary Babitz, a resident and homeowner in District 3, criticized proposals to add more affordable housing at the site. “I would like to voice my opposition to any amendments which would require even more subsidized affordable housing on this, frankly, very luxury real estate,” he said.
“I understand the urge to help people afford housing, but the data on these requirements, sometimes called inclusionary zoning, are clear. While they help the very small number of individuals who are lucky enough to receive the subsidy, the net effect these policies is to restrict supply of market rate housing and drive up housing prices for everyone else.”
Babitz added, “To address affordable housing in Austin I urge the council to focus more on removing restrictions and requirements from property not adding them.”
Special tax treatment
If the council does backtrack on the 10 percent requirement at 305 S. Congress and opt for the alternative site at 422 at the Lake, it would potentially be on the hook for infrastructure commitments under a proposed Tax Increment Reinvestment Zone (TIRZ).
That’s because Suttle, the Armbrust and Brown attorney representing the owner of 305 S. Congress, has linked the two issues, saying that Endeavor wouldn’t agree to offer affordable housing at the 422 on the Lake without the TIRZ.
As previously reported by the Bulldog, Endeavor Real Estate has sought special tax status for the South Congress site to subsidize infrastructure in and around its property, including for public art, roadways, and park amenities. The mechanism for funding such subsidies, a Tax Increment Reinvestment Zone (TIRZ), remains under consideration by the council but hasn’t moved forward since a preliminary vote last December.
The TIRZ could end up paying for certain amenities on the current Endeavor property, such as a children’s play area, ‘Great Lawn,’ and a pier, according to the staff recommendation in the zoning case.
However, several council members are seeking to clarify that Endeavor will have to pay for at least some amenities. Council Member Leslie Pool has proposed an amendment stating that the landowner will have to pay the full cost of “all plaza areas throughout the project (including those with parkland easements,” the “Great Steps,” water quality ponds, an underground rainwater cistern, and 1,700 feet of reconstructed hike and bike trail, according to a motion sheet published on the council agenda website.
Save Our Springs and an allied group, Taxpayers Against Giveaways, oppose any use of the TIRZ financing mechanism. They have circulated emails blasting the idea and urging supporters to contact their council members about it. The latter group also collected more than 2,400 signatures for an online petition opposing the TIRZ.
The petition says the proposed TIRZ would divert revenue for “pools, public libraries, park maintenance, affordable housing, and other things Austin desperately needs. The city has not shown, and cannot show, that these massive public tax subsidies are necessary for the private developers to reap the profits of redeveloping this massive, luxury project. The TIRZ is a giveaway from us to the wealthy.”
Not everyone agrees that the redevelopment at 305 S. Congress would be bad for the environment. “The most important thing we can do here for climate is to provide for people to live healthy low-carbon lifestyles in the existing urban places and to stop destroying land out to the west with single family homes sprawling across our region,” said Jay Blazek Crossley, Executive Director of Farm&City.
The new development would be next to a bus corridor along South Congress Avenue and a planned light rail station, the Waterfront stop of the Project Connect Blue Line. Tech workers employed in the Central Business District would be able to simply walk or bike across the Congress Avenue Bridge to get to work.
Daniel Kavelman, an organizer at Farm&City, called Endeavor’s project “exactly the kind of development that the city needs more of.”
“To oppose this project from an environmental perspective is bizarre and dishonest. The alternative to large dense projects near transit and jobs is sprawl. Sprawl is bad for the environment. It paves over undeveloped land and increases vehicle miles traveled,” he said.
Asked how he would respond to this argument, Bunch said, “When all is said and done it’s really not that climate friendly to build mega skyscrapers.” He cited the “enormous amounts of energy consumption and embedded greenhouse gas emissions” involved in the construction and operation of the buildings, including heating and cooling and pumping water to the top of the buildings.
Moreover, the sprawl would happen anyway. “Building here doesn’t really relieve building out here. It’s two different markets,” he said.
“There are people with children who want at least a small lawn. Or they want to be near a school that has ball fields. No matter how many high-dollar condos you build on the lake it’s not going to touch the demand for sprawl development. And if we have to import a bunch of workers to build this stuff, then it’s actually increasing demand, not reducing it.”
Trust indicators: Bulldog reporter Daniel Van Oudenaren is a journalist with 13 years experience in local, state, and international reporting.
Related Bulldog coverage:
Luxury subsidy deal stalls at council, February 3, 2022
Luxury real estate to get special tax status under ‘blight’ statute, December 21, 2021