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Planned tower project gets endorsement from Downtown Commission

Thursday, October 20, 2011 by Kimberly Reeves

The Downtown Commission gave attorney Steve Drenner another win last night on CURE zoning for a 380-foot downtown tower that features office and hotel space. 


The proposed site, which would combine the former Hickory Street Bar & Grill and the historic Bosche-Hogg Building, would offer a number of features: an open air plaza at the corner of Congress Avenue and Eighth Street; a below-grade live music venue that opens onto ground level; retail and restaurant space on the ground level; a 200-room hotel; and 100,000 square feet of office space.


The relatively small footprint of the Congress Avenue site would require upzoning from CBD and CBD-H to CBD-CURE and CBD-H-CURE. That means jumping from a floor-to-area ratio of 8-to-1 to 20-to-1.


Affordable housing advocate Heather Way, just appointed to the Downtown Commission by Council Member Laura Morrison, has been a vocal opponent against CURE zoning and in favor of downtown density bonuses. Under new terms being proposed by the downtown plan, Way said, community benefits could be considered for increased density in office and hotel projects.


“Has there been any kind of analysis of community benefits that were going to be under the density bonus in the Downtown Plan, rather than going through CURE, especially on affordable housing?” Way asked Drenner.


Drenner produced a long list of what he considered to be community benefits: new life on Congress north of Seventh Street; an active public plaza and live music venue; the creation of 200 construction and 1,000 permanent jobs. Overall, he said, the impact of the project was expected to be $50 million annually, with an estimated additional $3 million in taxes going to the city each year.


If the project had participated in the fee-in-lieu program, it would have been a $3 million hit, which, Drenner said, the project’s developers couldn’t afford.


“Adding a $3 million tariff on this project kills it,” Drenner said the potential density bonuses. “And if it kills it, what you have is a 1980s office building and a retail establishment that already is dying on the vine.”


Nor would the fee-in-lieu be consistent with other recent actions by Council, Drenner said. No other recent hotel projects had been asked to pay fee-in-lieu. He also noted that city staff had assessed the project had earned at least 16-to-1 in increased FAR, given the benefits and updates proposed.


Way said she could not easily sign off on the $3 million, just because an applicant says it would bankrupt a particular project.


“Without having an analysis, a true outside economic feasibility analysis, I can’t supporting giving up those community benefits that Council had adopted,” Way said at the point of the vote on CURE zoning.


The final vote on the upzoning was 8-1-3, with Way voting against the project and Commissioners Mandy Dealey, Linda Guerrero and Dan Leary abstaining since their respective commissions likely would hear or deal with the case. The historic zoning on the Bosche-Hogg Building goes to the Historic Landmark Commission on Monday night, Leary said.


This project, dubbed The Austin Hotel, is still speculative with a number of significant details to work out, including the location of off-site parking. The Downtown Commission can’t dictate parking for a hotel use, but it would definitely need to see parking in place somewhere for office space. Drenner admitted securing that space was a work in progress.


“We didn’t want to have an active ground floor and then seven layers of parking above that to create a dead zone,” Drenner told the commission. “Parking can function off site, with a valet, from a hotel standpoint, but office use is more problematic.”


Parking, in fact, was critical to the office function of the tower, Drenner said. New owner David Kahn was looking at two or three options for off-site parking. If nothing panned out, it was likely the office would be removed from the project, cutting the project from 28 stories to roughly 13 stories.


Drenner also faces a problem with step-backs from Congress Avenue. The building’s architectural design proposes two 15-foot step backs at 45-foot intervals on the first 90 feet street face on Congress Avenue. While Drenner argued that such exceptions were allowable under the downtown plan – and this exception, too, was critical to the project’s success – Charlie Betts of the Downtown Austin Alliance testified against it.


The DAA rarely frowns on new downtown high-rise projects, so Betts objection was highly unusual. Even so, Betts praised other aspects of the project but said the step-backs would be the most extreme on the west side of Congress Avenue. Drenner said 800 Congress was one of the few lots configured in such a narrow way that it would require such step-backs.


Reaction from commissioners on the step-back issue was mixed, with the developer members like Robert Knight saying he didn’t find the configuration, especially with a ground-floor plaza, to create any type of canyon affect. Drenner urged the commission to look at the building’s relationship to others.


“We think that by creating all this articulation that you see in these pictures that we have more than met the intent of both the existing code as well as the downtown plan,” Drenner said. “We also think, with this mixture of uses in the building, that you be able to do all these things rather than just a couple of these things. The impact to this area is going to be very positive.”


Commissioners did ask whether the design plans, drawn up by Lake Flato Architects, would run with the project, given it did not have a backer yet. Drenner acknowledged the discomfort and encouraged the commission to set conditional overlays on the project, as it moved forward, to reflect the type of development and specifics the commission wanted to see on the project, beyond FAR.


This case was the first big one for Drenner since he and his team, including attorney John Donisi and planner Michele Haussmann, moved to the Winstead firm earlier this month.

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