Thursday, March 12, 2020 by Ryan Thornton

Minus a few hiccups, Adler says real estate community can expect great things for Austin

Despite how things may appear in this moment, in the wake of the cancellation of South by Southwest, Mayor Steve Adler believes the future could hardly look brighter for the city of Austin.

With the city ready to adopt a new Land Development Code as well as the best transit proposal ever to make it to the ballot, Adler told the Real Estate Council of Austin on Wednesday that mayors all across the country would love to be in his position, leading a city with an unemployment rate of around 2.3 percent and one of the nation’s “hottest economies.”

While the code won’t be perfect right out of the box, Adler said it will finally get passed the first week of April, after six years and $10 million of effort.

The long, contentious fight over transition zones – the areas mapped for “missing middle” housing types from triplexes to 10-unit apartments – continues, but Adler said he is still ready to support cutting them down to two lots deep in exchange for the support of Council members Kathie Tovo, Leslie Pool, Alison Alter and Ann Kitchen, who all voted against the code on both first and second readings.

Modeling has shown that bringing the transition zones down to two lots would amount to a loss of about 1,000 units over a 10-year period. The entire code rewrite is expected to bring the city’s housing capacity – the number of units that could be built under ideal circumstances – to between 350,000-400,000.

“From where I sit, I’m not going to fight to keep transitions deep over 1,000 units out of a 400,000 add,” Adler said. “I’m just not going to fight that hard for that so long as I can preserve the ability to not have compatibility standards on corridors.”

Adler said the transition zones themselves are not ultimately going to make the difference in the success of Project Connect, with up to 98 percent of transit users expected to come from the corridor itself, not from the transition zones or farther within the neighborhoods.

“I don’t lose the transit benefit on the rewrite of the Land Development Code by narrowing the transition zones down,” he said. “And again, the game for the blood is just not worth it to me. Let’s start a process, let’s get it passed, let’s socialize it over time, but let’s bank right now the 98 percent of additional supply that we get.”

Come the first week of April, Adler said he plans to offer the two-lot limit to his colleagues once again. If they don’t go for it, he said he’ll be voting for the previously reduced transition depth as proposed in second reading.

“Whatever (the depth) is, I really believe that we’re going to see infill development that has (missing middle) units, and people in neighborhoods will like it,” Adler said. “They’ll like the feel of it, they’ll like the diversity that it adds, the energy that it adds to a neighborhood. And then over time I think that the city is going to want more of this and then allow more of it.”

Regarding the density bonus program, which RECA Board Chair Peter Cesaro said is a top concern for members, Adler said it will need to be recalibrated over time; ideally every year as part of the budget process, based on whether or not the program is being used. As opposed to eight months ago, Adler said Council has begun to understand that bonus incentives need to be attractive if the city wants builders to take advantage of them.

Adler said Council has also heard calls from the real estate community about the need to test and discuss the specifics of new criteria manuals before going to the Planning Commission for review. Quite frankly, Adler said, city staffers had good reasons to oppose an initial public review process, but Council agreed to explore a similar concept during second reading.

The first code adoption may not go far enough for some people, Adler acknowledged, but “wouldn’t it be nice if we only had to come to City Council a fifth of the time to do zoning matters?” That, he said, is what is being accomplished in April.

Adler also praised the city’s decisions to finally make solving homelessness a priority, to create a public transit plan, and to take advantage of the state’s work on Interstate 35 to create a more connected city.

Expressing particular enthusiasm for the underground transit stations proposed for the downtown stretch between the Austin Convention Center and Republic Square, Adler said the renditions of that activated space are incredible. “It’s about time that Austin as a city steps into that measure of cities that want to actually be sustainable 20, 30 and 40 years from now. And that’s critical.”

“You’re living in one of the really golden ages for the city of Austin with the economy where we are today,” Adler said. “And you’re living in a golden age because you’re with a city that is not shying away from any of its most significant and relevant challenges.”

Adler did not shy away from the fact that Austin, like every other city, will certainly be seeing cases of COVID-19. “It’s a question of time, not if, but when, the virus is being passed from person to person in our city,” he said. In the meantime, Adler urged the community to try to “flatten the curve” of the virus spread by opting for fist bumps and saying “Namaste” instead of handshakes.

Historically, he said, communities that best handle epidemics are the ones that draw out the rate of infection over time in order to manage the situation, rather than allowing a rapid spike in infections that overloads medical resources.

For now, he said, we should all still be going out to restaurants and clubs and double-tipping service industry workers who typically rely on tourism from South by Southwest to pay the bills.

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Key Players & Topics In This Article

Mayor Steve Adler: Mayor of the city of Austin, elected in November 2014

Real Estate Council of Austin: 501(c)6 for "more than 1,700 commercial real estate professionals representing the top leaders in the Central Texas business community." RECA is a donor to the Capital of Texas Media Foundation, the parent of the Austin Monitor.

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