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EDC talks deals but no details of creative space investments

Thursday, November 10, 2022 by Chad Swiatecki

At the end of this month the public will get the next detailed look at how the city plans to purchase and assist a handful of struggling creative spaces, but won’t get to hear specifics about which businesses have been chosen to receive city investment.

The Austin Economic Development Corporation, a semi-public deal-making entity created in recent years, will give a presentation at City Council’s Nov. 29 work session ahead of an executive session at the Dec. 1 meeting where Council members will get to approve the proposed investments that are still being negotiated. The EDC has made creative space preservation using the city’s cultural trust one of its first priorities, with $19.4 million available from three funding sources to purchase or create music venues and art spaces that would be operated by applicant groups or current owners.

Anne Gatling Haynes, EDC’s chief transaction officer, gave a presentation to the Music Commission Monday on progress with the 14 priority spaces that were identified from requests for proposal from current or potential operators. Haynes said only a few spaces are expected to receive investment in the first round of deals, though the RFP process was used to identify many other potential projects that could be preserved using city funds, loans, social impact investments or grants that the EDC can help access.

Even once the city enters into final negotiations with the initial sites, Haynes said it would likely take weeks or months before the details could be made public.

“These dollars are not for a grant program but for real estate investments, which has made it much more complicated in terms of reporting back, and we have lots of variables that determine the feasibility,” she said. “Each project has been unique and the execution of these will take time … as much as we would like them to all be done tomorrow, we’ll still take time to get through a number of different logistics around the investment, potential upgrades to spaces, and signing on the dotted line.”

Haynes said the evaluation of projects looked at the timeline for activation or continuing operations, with a priority placed on short runways for the initial spaces.

Creative spaces have been a city priority for much of the past decade as the cost of real estate has climbed, making rents and property taxes more expensive for businesses or nonprofits that typically operate with extremely small budgets or profit margins. In 2018, voters approved $12 million to be dedicated to creative space preservation. That money is still unspent and is included in the funding available to the EDC for its cultural trust work.

Commissioner Lauryn Gould said the ongoing threat to spaces such as Mosaic Sound Collective in East Austin illustrate the need for the city to use some of its idle properties as interim homes for arts and music groups at risk of closing.

“It appears there’s a lot of underutilized city-owned spaces and parks spaces, and the thought crossed my mind that there are organizations losing their spaces in the meantime. Is there a way to facilitate having some sort of stopgap situation in some of these underutilized community centers and parks department spaces?”

Haynes said threatened organizations are among those being considered for the first deals, though an ongoing interim space program is also a priority for her attention.

“The bond funds … provides the infrastructure for that sort of stopgap, although it’s not going to be enough. We have to keep thinking about that, but I’m intrigued by the idea of what an interim use would look like.”

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