Photo by Weaver Buildings
Developer of parking-free downtown apartments surrenders building to lender
Thursday, October 5, 2023 by Chad Swiatecki
A parking-free, 30-unit apartment building that gained attention as one of the first attempts to bring “missing middle” housing downtown has been turned over to its lender after failing to generate enough occupancy to operate successfully.
Weaver Buildings, the company that created the Capitol Quarters project on Nueces Street near 12th Street, announced this week it had gone through a deed-in-lieu transfer of the property to North Carolina-based Churchill Real Estate Holdings. The 45,000-square-foot project broke ground in 2019 and offered three-bedroom apartments exclusively at a cost of $1,200 per bedroom in an attempt to offer shared living options for the downtown workforce.
Occupants began moving into the apartments last August.
Jen Weaver, president of Weaver Buildings, said demand was lower than expected in large part because of the shift to remote work after the Covid-19 pandemic. With employees for major downtown companies such as Google and Meta no longer required to be on-site all week, Weaver said there was less of a pull to live downtown.
“I really created this product for people who had to be downtown and wanted a lower price point. And then with work from home and hybrid, it’s not the same market that I’m going after as a landlord,” she said. “It seemed like there are a lot of employees that, even though this is kind of a niche option, they would appreciate that option to live a little bit cheaper than a studio to be able to walk to work. That was the thesis.”
Weaver, who is a member of the Downtown Commission and recently resigned from the Design Commission, said the mix of commercial offerings downtown likely isn’t yet suited to attract families once more working-class housing becomes available.
“When we talk about urbanism in Austin, a lot of people know the focus has been that we need to provide mixed-income housing solutions to address more than just the luxury market, and we need mass transit,” she said. “But do we have the programming to support the mixed-income users of downtown? If you’re a cop and you have a kid … where are you taking them to karate? There’s no kids’ stuff downtown. There’s no elementary school downtown.”
As of earlier this year, Weaver had another project in the works – Shoal Cycle at 812 W. 11th St. – with completion expected in 2024. She declined to discuss the status of any other developments the company is involved in.
Capitol Quarters, which was built on property that previously housed offices, had its height limited by an overlay for the 12th Street neighborhood. A drainage tunnel located in the building’s right of way prevented underground parking as a development option.
Attempts to bring new, denser housing types to downtown and other areas are expected to increase as the city gradually institutes changes to the building code that has for decades catered only to single-family homes and multifamily apartments.
Michael Wilt, senior manager of external relations for the Texas State Affordable Housing Corporation, said the Austin market likely has the demand for new types of housing, but there may be some unfamiliarity with buyers or those trying to fill those homes once they’re built.
He said areas like Colony Park and surrounding new transit corridors are likely to see the first surges in new housing types as the city makes those possible, with a batch of building code amendments scheduled for consideration by City Council expected to make more duplexes, triplexes and other “soft density” styles possible.
“If you think of housing as a product, you want as many different product types in the market as possible to meet the many different types of consumer demands that are out there,” he said. “I just don’t think that we’ve had an understanding of the demand for it because we’ve never introduced the product at scale.”
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