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Council gives final OK to 4 East project

Tuesday, June 19, 2018 by Jo Clifton

Utilizing both the density bonus program within the Plaza Saltillo Transit-Oriented Development and the CURE density bonus program, developer Tocayo Investments GP LLC and CC Third and Comal LP won the right to develop six properties on East Fourth Street to a height of 74 feet at last week’s City Council meeting.

The 4 East building will likely have five stories including ground-floor commercial and four stories of offices, according to attorney Michael Whellan of Armbrust & Brown, who represented the developer.

The central urban redevelopment (CURE) combining district is a planning tool the city created in 1996 to further downtown development. However, there were no specific community benefits attached to CURE, and it eventually became apparent that it was no longer needed. Without CURE, the developer would have been able to build a 60-foot building.

Last October, Council Member Ora Houston introduced a resolution to eliminate the CURE tool east of Interstate 35, which Council approved. However, the developer in this case filed his application last August, so his request for CURE zoning was allowed to proceed.

This case is expected to be the last CURE case east of I-35, and CURE is expected to disappear once the city adopts a new land use code. CodeNEXT will have its own density bonus programs.

Council also approved a restrictive covenant between the developer and the Housing Authority of the City of Austin, with the understanding that the money would likely be spent to refurbish Chalmers Courts, an affordable housing complex across the street from the new project.

In exchange for the increased height, the developer will pay fees in lieu of on-site affordable housing, which amount to more than $1,737,384. Whellan explained that the first $681,384 would go to the Neighborhood Housing and Community Development Department. The remaining $1,056,000 goes directly to the Housing Authority of the City of Austin.

Whellan said that the housing authority has an approximately $2 million funding gap to complete the rehabilitation of Chalmers Courts. Council has endorsed that project.

Council Member Greg Casar voiced his support, saying, “We worked this case for a while, and I’m supportive of it. … I think it’s a good opportunity for us – for one floor ultimately achieving close to $2 million for Chalmers across the street … and I think that … this makes a lot of sense.” He added that if the NHCD needed any direction to ensure that “all that money goes to Chalmers, I’d be very open to that.”

Council Member Pio Renteria told Whellan that he was concerned about traffic in the area and wanted to make sure that people currently living there would be able to get in and out of their homes. He suggested that the city look at making Concho a one-way street. He said he had convinced the immediate neighbors not to oppose the project because of the large amount of community benefits the city would be receiving.

However, Council Member Leslie Pool said she would be voting against the zoning change because she received a letter from the neighborhood planning team, which opposed the zoning change. Council Member Alison Alter joined her in voting against the item.

Houston voted in favor of the zoning change but voted against accepting the restrictive covenant, which related back to use of CURE.

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