County prepares to strike lucrative deal for failed courthouse site

Instead of a new civil courthouse, how about a massive, privately financed mixed-use development that will pour millions of dollars into public coffers?

That’s the direction Travis County is close to clinching for its hyper-valuable piece of downtown property at 308 Guadalupe St.

The Travis County Commissioners Court will vote today to approve a deal with two firms – Lincoln Property Company and Phoenix Property Company – that will give them a 99-year ground lease on the land.

The county will net a total of $430 million throughout the lifetime of the deal. At $13.4 million, the first installment alone – set to be paid this Wednesday – is more than half of the $21.8 million sum that the county shelled out when it bought the property in 2010.

That purchase was made with an eye toward building a brand-new civil courthouse on the site to replace the 86-year-old Heman Marion Sweatt Courthouse eight blocks to the north. However, voters narrowly rejected the $287 million bond that would have funded that plan in 2015.

Opponents of that proposal argued that a courthouse would be a poor use of one of downtown’s last undeveloped blocks, especially one that is unencumbered by a Capitol view corridor. At the instruction of the Commissioners Court, staff has been working since last fall on the plan that birthed the deal with Lincoln-Phoenix.

“We listened to the community when they told us that this downtown block was an asset that should be available for private development,” County Judge Sarah Eckhardt said. “By establishing a smart, competitive procurement process, we are unlocking the potential of this block to contribute hundreds of millions of dollars in revenue to Travis County and its taxpayers.”

The Lincoln-Phoenix proposal envisions a titanic mix of office, residential, retail and parking. Per the county’s stipulations, the developer must adhere to stringent construction worker protections that align with the city of Austin’s Better Builder Program, a set of conditions endorsed by the Workers Defense Project. The firms will also ensure that 10 percent of all housing on the site is reserved for “low-to-moderate-income residents, based on the city’s Density Bonus Program,” according to a county press release. Furthermore, Lincoln-Phoenix will make a “major donation” to the Austin Parks Foundation to support the restoration of Republic Square Park just to the property’s north. The amount of that donation has not yet been revealed.

Commissioner Gerald Daugherty, whose Precinct 3 includes downtown Austin, hailed the deal as “great news.”

“Downtown Austin continues to be a booming and dynamic market that creates prosperity that is shared by all residents of Travis County,” he said.

The county’s relinquishment of 308 Guadalupe represents partial closure of the failed 2015 bond election. However, the pressing issue of finding a new site for a new civil courthouse remains. The county’s Civil and Family Courts Community Advisory Committee recommended a privately owned property as its preferred candidate earlier this year, but details on the location as well as ongoing negotiations remain secret.

The 308 Guadalupe property has been used as a surface parking lot for years even as massive new developments rose up around it. When Edwin Waller drew out his original plan for Austin, he intended for the block to serve as the site of a courthouse.

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