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As Austin’s sky-high housing costs put increasing pressure on renters and homeownership out of reach for many working Austinites, a yearslong fight over what kind of housing the city should allow could be at a turning point.
Austin has long been the epicenter of the state’s housing affordability crisis, but the problem reached new heights in the pandemic era amid massive population and job growth.
The crisis — along with the rise of a new political bloc calling for reform — has given Austin leaders a renewed mandate to tackle the problem. After the collapse of big housing reform proposals in recent years, the Austin City Council is embarking on a new push to ease city restrictions on how much housing can be built and where.
The current restrictions, the thinking goes, impede the city’s ability to build enough homes to meet the crushing demand for housing — resulting in higher home prices and rents.
“We have a significant affordability crisis, and it is an emergency,” Austin Mayor Kirk Watson told The Texas Tribune. “We’ve got a supply and demand problem, and we’re going to have to come up with unique and different ways than we’ve thought of in the past to solve it.”
City leaders have proposed a number of measures to try to stimulate more and denser housing, like allowing more single-family homes on smaller lots and taller apartment buildings near single-family homes, as well as doing away with mandates that require developers to set aside a certain amount of land for tenants to park their cars.
But these reforms will probably run into some familiar obstacles. For decades, efforts to loosen the city’s land-use regulations have run into opposition from homeowners fearful of neighborhood change, old-school environmentalists and anti-gentrification activists — even as policymakers increasingly backed the idea and the city’s housing woes mounted. A group of homeowners, deftly wielding state law to their advantage, persuaded a judge in 2020 to kill a major overhaul of the city’s land development code that would have allowed denser housing.
But as musicians, teachers, police officers and firefighters struggle to find affordable housing within city limits, Austin’s housing crisis is increasingly seen as an existential one.
“Without change, where do you think this will go? What are you preserving at that point?” said Dianne Bangle, CEO of the Real Estate Council of Austin. “Is this an Austin for everyone, or is it just for people who want to maintain their large home and neighborhood?”
An unignorable crisis
An organized and steadily growing activist movement is backing — and pushing — city officials to allow more housing to be built.
On a morning in late August, dozens of demonstrators crowded the steps of the Travis County Civil and Family Courts Facility in downtown Austin to protest a court challenge by a group of homeowners seeking to kill a popular affordable housing program and other housing initiatives. Demonstrators held signs that read “Support affordable housing” and “Housing is a human right.”
Anoosh Razian, a 34-year-old Austin therapist, saw the effects of the city’s housing shortage while working for a nonprofit that helps single mothers experiencing homelessness regain their footing. Often, she said, the women would hesitate to move out of supportive housing because they couldn’t find homes they could afford.
“There’s nowhere to go if they had to,” Razian said. “If they want to move out of supportive housing, they would have to move out of the city.”
Her husband, Edgar Handal, an engineer at a tech company and a board member at AURA, an Austin organization that advocates for denser housing, said they can afford a home in East Austin but some of their friends have had to move far outside of the city.
“I’m here because I care that other people have housing, my family and my friends,” Handal said. “It shouldn’t be that you need to be so lucky to have a high-paying job to be able to afford a home in Austin.”
Housing costs in the Austin area rose dramatically in the past decade as the region transformed into a major tech hub and companies like Apple, Google and Oracle ramped up their presence in the city. The market kicked into overdrive during the COVID-19 pandemic as more than 120,000 people moved to the region and millennials sought to buy homes, sparking fierce bidding wars for limited housing supply.
For several months last year, the typical home in the Austin-Round Rock region sold for more than $500,000, pricing droves of would-be first-time homebuyers out of the market. Nearly half of the region’s renters spend so much of their income on keeping a roof over their heads that they struggle to pay for other expenses like child care, groceries and transportation.
Housing unaffordability dominated Austin’s most recent citywide election, which brought new faces to the Austin City Council and solidified its pro-housing bloc. Observers say the City Council and Watson, who also took office this year, got a clear signal from voters to do something about the city’s housing crisis. Over the summer, council members gave their first stamp of approval to a slew of housing reforms.
“I think people are seeing the hurt, the pain, the frustration, and it’s unfortunate that it took so long to get to this point,” said Austin City Council Member Zohaib “Zo” Qadri, one of the new members.
Housing advocates place much of the blame for the crisis on the city’s land development code, which governs how land is used. The code hasn’t had a substantial overhaul since 1984, when Austin’s population was less than half its current size. Each time the city has tried to give it a significant makeover, homeowner groups have successfully killed those efforts.
One of the biggest criticisms targets the limits on the kind of housing that can be built. Much of the city’s residential land can only be used to build single-family homes. On top of that, Austin requires most single-family homes to sit on at least 5,750 square feet of land — a restriction known as a minimum lot size that research has linked to higher home prices. Those kinds of restrictions, real estate and housing experts say, lead to fewer homes and apartments being built — and higher housing costs as a result.
“When we don’t allow densification, that means we have a lower supply of housing units, which in general increases the price of all housing units in the area,” said Adam Perdue, a research economist at the Texas Real Estate Research Center at Texas A&M University.
An older home in a single-family neighborhood displays a large orange sign reading “END CONSTRUCTION” on Sept. 16, 2023. Newly built duplex units are visible in the car mirror.
Credit:
Julius Shieh/The Texas Tribune
First: A tree provides shade in the yard of a newly-constructed duplex near downtown Austin on Sept. 16, 2023. Last: A placard displayed on a wall during an open house in Austin describes the ecological benefits of infill building, or the construction of new housing in existing neighborhoods.
Credit:
Julius Shieh/The Texas Tribune
The restrictions, critics say, have made it tough for Austin builders to meet housing demand.
The Austin-Round Rock region routinely ranked among the country’s busiest markets for housing construction during the pandemic years, according to A&M data. Even so, construction hasn’t kept pace with the growth in the number of households, data from the U.S. Census Bureau shows.
“We have tenants whose rents are skyrocketing, [would-be] first-time homeowners who cannot enter the market, people who want to age in place and they’re not able to move to a home that better fits their housing needs,” said Awais Azhar, who’s with the advocacy group HousingWorks Austin.
The city is short nearly 152,000 homes considered affordable enough for two-person middle-income households, a recent report from the Austin Board of Realtors shows — a shortage that’s even more drastic for families of four at that income level.
“People like EMS workers, teachers and firefighters want to be able to live in the community that they’re serving and really can’t,” said Emily Chenevert, Austin Board of Realtors CEO.
Austin-Travis County EMS medic Claudia Cadena and her husband bought a two-story home on San Antonio’s Far West Side in 2019 for about $180,000. The house is close enough to Cadena’s parents, who live in nearby Lytle and often watch their children, but the decision to buy a home in San Antonio was also because they couldn’t afford one in the Austin area, she said.
“It was either afford child care or afford a house,” said Cadena, who makes the two-hour drive from San Antonio to her post near Austin-Bergstrom International Airport at least twice a week.
Claudia Cadena, a medic with Austin-Travis County EMS, stands in the EMS garage bay at the end of a shift on Sept. 14, 2023.
Credit:
Julius Shieh/The Texas Tribune
Cadena in her car at the end of a shift before commuting back to her home in San Antonio.
Credit:
Julius Shieh/The Texas Tribune
Commuting long distances is a relatively common experience for Austin-Travis County EMS employees, some of whom live as far as Killeen, about 70 miles north of Austin. Nearly one in five of employees live outside of the immediate Austin-Round Rock region, Chief Robert Luckritz said, partly because medics and other EMS staff can have a hard time finding nearby housing they can afford.
That distance can make it difficult to quickly call people in an emergency — and for workers to build camaraderie and develop a relationship with the community they serve, Luckritz said. The Austin region’s high housing costs, he said, also get in the way of hiring new recruits and filling vacancies.
The distance has taken its toll on Cadena. Years of long drives, with often sleepless 24-hour shifts in between, have left her exhausted. Cadena has stuck with the job for the benefits — and because she wants to help people.
Cadena may not endure the drives much longer. Her husband recently obtained his electrician license, which Cadena said will let her leave her Austin job and focus on getting her fledgling tattoo practice off the ground.
“I thought this was the place I was going to retire from,” Cadena said of Austin-Travis County EMS. “If the drive wasn’t so long, I definitely would, but I can’t imagine being here for another 30 years.”
More density, more homes
The housing crisis is not unique to Austin. By various estimates, the country needs to build millions more homes to meet the nation’s housing demand and slow the steep rise in housing costs.
A growing body of research has tied strict land-use rules to high housing costs — a conclusion embraced by the Biden administration as well as state and local policymakers across the country who have loosened zoning rules to try to juice their housing supply.
In recent years, cities like Minneapolis and Portland found some success in slowing down the rampant rise of housing costs. In 2018, Minneapolis officials enacted a series of zoning reforms — like allowing duplexes and triplexes to be built in areas previously reserved for single-family homes and getting rid of minimum parking requirements for new developments — that helped the city keep a tight lid on rental cost growth during the pandemic era, according to a recent study by The Pew Charitable Trusts. According to a recent Bloomberg report, the changes have even helped the city beat back inflation.
Meanwhile, states like California, Oregon, Washington and Montana have enacted statewide reforms to local zoning laws in order to increase housing production and short-circuit local opposition from elected officials and neighborhood groups.
Republicans in the Texas Legislature this year flirted with relaxing cities’ housing restrictions, to allow more homes to be built amid the state’s housing crunch, though those efforts ultimately failed. As GOP state lawmakers increasingly sap authority from the state’s bluer urban areas, some Austin leaders fear if they don’t loosen restrictions on how much housing can be built and where, state lawmakers will finish the job when they return to the Capitol in two years.
Now, the year after Austin became the 10th-largest city in the nation, city officials are pushing for similar solutions.
Perhaps the most sweeping proposals — and the ones likely to draw the most heat from opponents — would allow more kinds of housing units to be built in areas currently reserved for single-family homes and nearly halve the amount of land the city requires to build housing on those lots.
The idea, pitched by Council Member Leslie Pool, would allow up to three housing units to be built almost anywhere single-family homes are currently allowed. It would also reduce Austin’s minimum lot size in the city’s three most common single-family zoning categories to 2,500 square feet. More than half of the cost of a single-family home in Austin comes from the land, according to a recent city-commissioned study. If would-be homeowners don’t have to buy as much land, the ultimate cost of the home won’t be as high, advocates argue.
Austin’s zoning restrictions don’t just limit what kind of housing can be built and where, homebuilders say — they make it more difficult for that housing to be built quickly, which also adds to the cost of a home.
It took Austin homebuilder Scott Turner three years to build four homes on roughly a quarter of an acre in the neighborhood of South Manchaca. Even with that much land, the plot’s zoning wouldn’t allow for more than two units. So Turner opted to subdivide it — a process that took the city two years to approve, he said.
Had Pool’s proposal been in place, Turner said he would have built three homes instead of four — but they wouldn’t have taken him as long to build, which would have reduced the total cost of the project. The longer local governments take to approve housing projects, the more money homebuyers and renters also have to ultimately pay for that housing, studies show.
“You want somebody to buy a house? Don’t make it expensive,” said Turner, past president of the Home Builders Association of Greater Austin.
Austin officials are eyeing other ideas to allow for more housing construction. A proposal pitched by Qadri would get rid of city rules that require new developments have a set amount of parking, which studies show lead to fewer housing units and drive up housing costs.
Another idea would ease the city’s “compatibility” requirements that limit how tall apartment buildings can be depending on how close they are to single-family homes. Austin has the strictest compatibility rules among peer cities, which “significantly restrict the development capacity for high-density residential housing throughout Austin,” a recent city analysis found.
Proponents argue relaxing the land-use restrictions will at least help slow the growth of the city’s housing costs and give more middle-class families a better shot at homeownership. Nearly three-quarters of households in the Austin region can’t afford a home going for the median sales price, according to the National Association of Home Builders.
“If [this proposal] can keep families in Austin and attract younger families to raise their families in Austin, that’ll be a net plus,” Pool said.
Council members advanced Pool’s proposal and the parking and compatibility initiatives over the summer, but they haven’t taken effect. City staff first must figure out the nuts and bolts of each idea and bring the plans back to the council for final votes, the first of which is expected in December.
A staunch opposition
Some Austin homeowners have been fiercely opposed to any policies that would allow denser housing, saying they would radically alter their neighborhood’s character.
They have successfully blocked every recent attempt to change the city’s land development code to allow denser housing, including a proposed zoning overhaul in 2018. When the Austin City Council tried again to make changes the next year, a group of homeowners won a court battle to stop them.
For Frances Acuña, the homeowner at the heart of the legal battle against the changes, fighting the city on the proposed zoning reforms means making sure she and her neighbors aren’t priced out of their homes. Acuña has lived for more than a decade in her home in Dove Springs, the predominantly Latino neighborhood in Southeast Austin where she raised her three sons.
Home prices in the area have accelerated sharply during that time: The typical home went from less than $126,000 in the early 2010s to almost $400,000 in January, according to Zillow data. A 2018 report from the University of Texas at Austin deemed her neighborhood “more vulnerable” to gentrification and displacement because of its higher proportions of people of color, residents without higher education and renters, among other factors.
“I’m 52 years old,” said Acuña, a climate advocate and organizer with Go Austin/Vamos Austin, a community health coalition. “How long before I am not able to work and I don’t have a home? Where am I going to go? How am I going to survive?”
Frances Acuña stands in the front yard of her South Austin home on Sept. 16, 2023.
Credit:
Julius Shieh/The Texas Tribune
In 2019, Acuña joined forces with 18 other Austin homeowners — many of whom have owned their homes for decades and some of whom have seen their home values climb north of $1 million amid the region’s hot housing market — to sue the city of Austin.
Austin officials, the homeowners alleged, broke state law by failing to formally notify homeowners of the citywide zoning overhaul — the same way they would have to if a nearby property owner wanted to rezone their land. The city also ignored a state law that requires a supermajority of the City Council to approve a rezoning if enough neighbors protest the change, they said. Lawyers for the city of Austin argued neither law applies when a city overhauls its land development code.
In a ruling that will undoubtedly complicate any other Texas city’s efforts to overhaul its zoning code, a Travis County judge sided with the homeowners — a decision later upheld by an appeals court. Ensuing efforts at the Texas Legislature to peel back the laws the neighborhood groups cited in their lawsuit have failed.
Since then, Austin officials have picked away at smaller zoning reforms intended to stimulate housing supply. Last year, council members greenlit new rules that allow developers to build housing in commercial areas and denser housing along transit corridors.
However, the same group of landowners that blocked past citywide rezoning efforts has set their sights on those changes — as well as a city affordable housing program the council passed in 2019 that has produced thousands of lower-cost units.
Dubbed Affordability Unlocked, the program eases rules like height restrictions, minimum lot sizes, parking requirements and density limits if builders set aside half of a development’s units for households making less than the city’s median family income. The program has proved to be an effective driver of affordable housing and is already helping produce more units than other local affordable housing programs, according to a recent report from the Urban Institute. Of the nearly 7,700 ownership and rental units approved under the program since it began in 2019, the report found, more than two-thirds are affordable for households making 80% of the median family income and below.
Motorists commute northbound along Interstate 35 in South Austin on Tuesday, Aug. 29, 2023.
Credit:
Eli Hartman/The Texas Tribune
Despite the program’s virtues, the effort to block it and the other initiatives is about making sure the city isn’t violating homeowners’ rights, said Austin ethics lawyer Fred Lewis, one of the landowners suing the city.
“For most working-class and middle-class people who own a home, the biggest asset they will ever own is their home,” Lewis said. “And their home is not only an asset, it’s their stake in their community and their neighborhood, and it should be respected.”
For some, blocking rules that would allow more housing development is about protecting their neighborhoods from gentrification and displacement.
After witnessing the gentrification of East Austin over the past decade, some fear that clearing the way for more housing construction will accelerate that process in the city’s low-income neighborhoods and oust Black and Latino residents who live there. There remains deep skepticism that allowing the market to produce more housing will moderate housing costs — despite a growing body of evidence to the contrary.
“This is a gentrification provision,” one resident critical of Pool’s proposal told the Austin City Council at a July meeting. “It will increase the number of luxury condos, and it will absolutely not increase affordable housing.”
Whether allowing more market-rate construction leads to displacement of low-income homeowners and renters has been difficult for researchers to prove. Recent research shows that allowing more market-rate housing eases housing costs around that development and across the broader region. Allowing more construction means the crushing demand for housing in the region won’t fall just on existing homes; more housing units mean more places for demand to go, thus moderating prices, research shows.
“When people get mad and they see a giant fancy condo building going up, they should just reflect on the fact that that building is absorbing a lot of buyers with a lot of money who might otherwise be unleashing their spending power on existing houses or the existing housing stock,” said Jake Wegmann, an associate professor at UT-Austin’s School of Architecture who studies housing affordability.
Building market-rate housing in a gentrifying neighborhood could contribute to displacement in cities like Austin with high housing demand, a shortage of housing and strict rules on what kinds of housing can be built and where, experts say. Allowing greater density across a city — including in single-family neighborhoods that aren’t as vulnerable to gentrification — and building cheaper housing like townhouses and duplexes would lower that risk, said Claudia Aiken, director of new research partnerships at the NYU Furman Center and Housing Solutions Lab.
“Having sufficient housing is critical to preventing displacement,” Aiken said. “To do that, we have to build housing. It’s just a question of where and how.”
What’s more, loosening citywide zoning restrictions could shield low-income neighborhoods from gentrification and displacement. A recent Furman Center paper found that in the decades after Houston relaxed land-use restrictions to allow more housing units on smaller lots, the places where townhouses replaced traditional single-family homes mostly took place in wealthier neighborhoods or in parts of town that already had gentrified, though some of that development has taken place in poorer neighborhoods like the Fifth Ward.
“It’s not like you change the zoning and then overnight, the entire city gets torn down and replaced with townhouses,” said Wegmann, the paper’s author. “That’s just not how it works. It’s much, much more gradual.”
Proponents of the Austin proposals are quick to point out: the displacement that East Austin experienced happened under the current code.
Housing affordability advocates at the August protest were outraged at the attempt to end the Affordability Unlocked program.
U.S. Rep. Greg Casar, D-Austin, center, joins protesters gathered in support of affordable housing at the Travis County Civil and Family Courts Facility in Austin on Aug. 28, 2023.
Credit:
Julius Shieh/The Texas Tribune
“Opponents of affordable housing couldn’t win this fight in the court of public opinion,” said U.S. Rep. Greg Casar, an Austin Democrat who authored the Affordability Unlocked proposal when he served on the Austin City Council, noting that the program passed unanimously. “So now they’re trying to use the courts to try to block the overwhelming majority of Austinites who want to see housing prices come down in the city.”
Nicholette Lindsay, a 41-year-old Army veteran who lives in one of the affordable units made possible by Affordability Unlocked, said the opposition to the program was hurtful.
Her landlord evicted Lindsay in 2015 after a Microsoft supplier laid her off and she couldn’t pay rent, forcing her and her son to stay at a Salvation Army shelter. With the help of a city program to rehouse homeless veterans, they moved into a new apartment the following year.
This year, she and her son moved into a housing complex created through the Affordability Unlocked program. The complex’s affordability has helped her stay in the city while she runs a private security company, she said.
“If [program opponents] understood how much of a lifeline affordable housing was for individuals … it’s not just a lifeline, it’s life-saving,” Lindsay said.
Disclosure: Apple, Google, HousingWorks Austin, Microsoft, Texas A&M University and University of Texas at Austin have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.
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Real estate experts now have a much clearer picture regarding the resilience shown in Austin’s housing market. The latest Austin Board of Realtors’ (ABoR) report revealed that July 2022 was when the Austin-Round Rock housing market initially started stabilizing. If current trends continue, ABoR says 2023 will have a “strong finish.”
“We now have a direct year-over-year comparison of when our market began stabilizing, and the big fluctuations we’ve previously seen have started to even out,” said 2023 ABoR president Ashley Jackson in the report. “Potential buyers who have been on the fence about purchasing a home should know interest rates are settling, and now is the time to act.”
Even with interest rates beginning to settle, affordability is still a major limiting factor for potential buyers. According to Dr. Clare Losey, ABoR’s housing economist, the median family income in the Austin-Round Rock metropolitan statistical area (MSA) is $122,300 in 2023, which is not enough to afford many homes for sale in the area.
“This means buyers generally can afford a home priced between $300,000 to $400,000, however, less than 40 percent of homes sold in the Austin-Round Rock MSA in July of this year alone fall into this price range,” Dr. Losey said. “ABoR’s July housing market data stresses not only the strong, ongoing housing demand in our region, but also the critical need for more housing stock at all price points.”
June’s real estate report stressed a need for more housing inventory, which continued to be a limitation in July. Active listings in the MSA increased 13 percent to 9,663 last month, continuing a slow but steady improvement for the year.
Dr. Losey pointed out that Central Texas is becoming less and less likely to experience a recession with every passing month. She predicted Austin’s strong labor market will allow the region to continue exceeding “national expectations” despite rising mortgage rates.
“With a rise in pending sales and closed sales remaining consistent, this further indicates that buyers are becoming more accustomed to the higher interest rate environment and understand that elevated mortgage rates may continue,” she said.
Median prices dropped to $462,000 in the Austin-Round Rock MSA, which is 10 percent decrease year-over-year from July 2022. Homes are spending an average of 59 days on the market, which is 37 more days than this time last year.
Travis County
More than 1,300 homes were sold in July 2023 in Travis County, with median prices dropping 9.2 percent year-over-year to $545,000. There are 4,697 active listings on the market; about 16 percent more than July 2022.
Williamson County
Fewer than 900 homes were sold in July, with median prices sitting at $428,350. There are more than 1,200 new home listings in Williamson County, with a total 2,788 active home listings.
Hays County
Exactly 400 homes were sold in July in Hays County, with median prices continuing to fall to $405,243. Pending sales are up by 27.3 percent year-over-year, while active listings have also risen 31.1 percent to 1,493.
Bastrop County
Bastrop County has the highest inventory in the MSA at 4.6 months’ worth, which is 1.2 months more than July 2022. 132 homes were sold this past July, and median prices are just under $350,000 (a 15.7 percent decrease). There are 25.6 percent more active listings on the market in Bastrop County, coming out to 545 homes.
Caldwell County
Homes in Caldwell County sold for a median of $298,048 in July, which is a massive 20 percent drop year-over-year. 44 homes were sold last month, which is nearly 23 percent less than the year before, and there are 140 active homes on the market.
Hobby Building in downtown Austin up for sale
The for sale sign officially went up at the Hobby State Office Building in downtown Austin. The announcement comes with the condition that the new development there will include affordable housing for government employees.
AUSTIN, Texas – The for sale sign officially went up at the Hobby State Office Building in downtown Austin. The announcement comes with the condition that the new development there will include affordable housing for government employees.
The Hobby State Office Building has been closed off for several months. The state agencies once there were relocated, some into new buildings north of the State Capitol.
Tuesday, Texas Land Commissioner Dawn Buckingham put up a for sale sign.
“This is a premier-mixed use vertical redevelopment site in the heart of downtown Austin,” said Buckingham.
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The Hobby State Office Building was built back in 1984. It’s now surrounded by new high-rise development, which has made this one-time landmark between 3rd and 4th Streets easy to miss. Purchasing the entire downtown block comes with conditions.
“I am looking for a visionary proposal to bring substantial workforce housing with childcare to this site,” said Buckingham.
Buckingham made the stipulation for affordable housing with several government employees standing next to her and Austin Mayor Kirk Watson.
“It’s huge. There are people, people who keep trying to move out of town because it’s just not affordable to live in Austin anymore,” said Nancy Sisk, a nurse who works downtown.
For more than a decade, city leaders have promised to make housing more affordable, only to see prices in Austin skyrocket. Sisk believes the idea is still possible.
“It can. Of course, it can. Will it? You know, it’s the last thing to lose is hope. I mean, I don’t know what to say. I mean, I have to hope that it will,” said Sisk.
The Hobby building, over the past few years, has been infested with rats and bugs that fall out of ceiling tiles. Repairs estimates were at almost $50 million which prompted the decision by state lawmakers in 2019 to sell it.
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SB 1349 was filed by then State Sen. Kirk Watson. The legislation was sponsored in the House by State Rep. Gina Hinojosa, and after, the passage was quickly signed by Governor Greg Abbott.
As part of the legislation, the property cannot be sold for “less than the property’s fair market value, which is to be established by an independent appraisal obtained by the asset management division of the General Land Office (GLO).”
Offers to buy, and redevelop the site are on the clock. They must be submitted within the next 90 days. The state wants developers to be creative. They don’t want a reflection of what’s already been built here in Austin. That’s why they’re not saying how many affordable units they want or how much they should cost.
“So you can’t jump to conclusions about what actually might come out of it. But the goal is to get workforce housing out of this development, something that would be very unique and something that frankly, most people didn’t think would happen when the Hobby building was redone,” said Mayor Kirk Watson.
The sales pitch from Buckingham did come with a warning.
“Now, some developers may not hear me or think that I am not serious if we do not get a response matching our goals the first time around, we will put it out for solicitation again,” said Buckingham.
Money from the sale is to go to the Permanent School Fund which is managed by the Texas General Land Office. The final decision on any offer will be made by the 5 members of the School Land Board, which includes Commissioner Buckingham.
On June 27, 2023, the firm’s Emerging Companies Practice (ECP) announced that Neuron, its proprietary cloud-based software platform for start-up clients, now has the ability to generate simple commercial non-disclosure agreements (NDAs) within its corporate governance module. Users may now work with Wilson Sonsini attorneys directly through Neuron to complete a single form, and their legal team can quickly generate an NDA tailored to exact specifications.
This latest enhancement follows Neuron’s addition of the corporate governance module in late 2023. At that time, Neuron was expanded to include corporate governance offerings such as employment and consulting agreements, offer letters, and other agreements enforceable in all 50 states. That release allowed clients and their ECP legal teams to manage corporate governance and board management activities through the Neuron platform. In addition, the ECP launched an innovative fixed-fee subscription for Neuron clients, providing emerging company clients with consistent pricing so they can develop reliable budgets while still accessing world-class legal services.
For more information, please visit https://ecp.wsgr.com/neuron.
On May 25, 2023, SaaS-based IT service management software vendor 4me announced a strategic growth investment led by growth equity firm PSG. Wilson Sonsini Goodrich & Rosati advised 4me on the transaction.
Along with the investment, 4me announced that Kevin McGibben was named as CEO and chairman, and that co-founders Cor Winkler Prins, Laurens Pit, and Mathijs Sterk will continue their involvement in the business.
4me is an SaaS-based enterprise service management platform that combines ITSM, ESM, and Service Integration & Management (SIAM) capabilities designed to deploy and manage compared to traditional vendors for mid-market, enterprise, and externally managed service providers. PSG is being joined by other software and technology-enabled services in the investment, which is designed to help 4me’s ongoing product innovation, as well as geographic expansion in EMEA and entry into the U.S. market.
The Wilson Sonsini team that advised 4me includes:
Corporate
Robert Day
Jake Gatof
Amanda Creedon
Tamara Labanowski
Andrew Savage
Amy Martin
Technology Transactions
John McGaraghan
Atussa Simon
Employment and Trade Secrets
Matt Gorman
Quinn Christie
Privacy and Cybersecurity
Matt Staples
Daniel Chen
Michael O’Brien
Diya Jajal
Employee Benefits and Compensation
Sriram Krishnamurthy
Gregory Hughes
Jason Chan
Lori Howey
Tax
Jonathan Zhu
Derek Wallace
Anthony Yanez
Regulatory
Mike Casey
Jahna Hartwig
For more information, please see the press release.
Byron Smith was sitting at a Tex-Mex restaurant in Houston when it struck him. Looking out of the window, he could see a church, a school and a strip club: This city doesn’t have zoning laws.
That’s why, after previously deeming his vision for a chain of what he calls “commercial condos” an unviable concept in Los Angeles or New York City, he decided to launch his second XSpace development in the city. After opening the first XSpace in Austin last year, its second location, at 7022 Old Katy Road inside the 610 loop in northwest Houston, is slated to open in Q1 2024.
Courtesy of XSpace
A rendering of the Houston location of XSpace, where users can drive right up to their units.
“I said ‘Does anyone care that there’s a school right there?’ And they’re like ‘Ah, no. No zoning,’” Byron Smith said. “I was like OK, fair enough. That gave me the idea [that] I think we should be in Texas.”
XSpace is a place for “anyone who’s cool, interesting, successful,” to buy a space to use as an office, a garage, a man cave, or whatever they want, save for a home, he said.
It’s also a relatively rare asset class at the intersection of storage and coworking — so rare that Byron Smith was at a loss for what to call it. Commercial condo might not fully cover it, he said, describing it as similar to coworking space, but with drive-up access to all units and a 4K SF community lounge, almost like a “quasi town center.”
“It’s a commercial building, and we put a condominium regime over it, which is basically just a legal thing,” Byron Smith said. “It’s commercial, but it’s a condo, so you can do everything but sleep in it, basically.”
The concept isn’t totally novel. What’s known as “strata storage” is popular in Australia, where Byron Smith is from. Strata is a model of property ownership that allows individuals to own certain parts of a property or parcels of land, like condominiums in the U.S., only for commercial use.
Units can be used for office space, showrooms, storage for high-end cars or studio space for podcasting or artists. Major League Baseball All-Star pitcher Roger Clemens is one early adopter, buying two units at XSpace Austin to store baseball memorabilia and as office space for his nonprofit, the Roger Clemens Foundation. Former NFL offensive guard Kasey Studdard has also bought an Austin unit for his barbecue restaurant, Whitfield’s.
Courtesy of XSpace
XSpace Houston
The use of condos is commonplace for residential and garage units, but is not usually a word associated with property zoned for commercial use. But rental rate growth has piqued interest in new solutions for entrepreneurs and others who prefer to own rather than rent an asset.
XSpace’s concept is not entirely new to the U.S. There are car storage sites for sale in Texas, like Garages of America, for example.
Those “very high-end personal garages” and other forms of commercial condos have proliferated in Ohio as well, said Ted Smith, partner at Vorys law firm in Columbus.
Ohio is one state that has seen the commercial condo asset class boom over the past 20 to 25 years, Ted Smith said.
“I’ve been doing condo law since the early 2000s, and I know there are practitioners out there whose practice is still focused primarily on residential condominiums,” he said. “But I would say 90% of new condominium work that I do is all commercial-oriented.”
In Ohio, the range runs from mixed-use condos with a few floors of retail, office and residences above it to “purely office condos,” Ted Smith said.
For tax reasons, among others, many users would prefer to own rather than lease their office space, he said.
“Because of their needs and their desired location, they’re not going to go out and buy an existing office building, or even go out and build their own office building,” Ted Smith said. “They find that it’s easier to just have a portion of an office building. So you can either create a commercial condo from the get-go, or you can subject property to the condominium form of ownership at a later date.”
Courtesy of Ranie Vanarsdall
Ranie Vanarsdall in her XSpace unit in Austin. She customized the unit, including the floors and walls, to accommodate her vinyl wrapping business.
Ranie Vanarsdall wanted to own her office space at XSpace in Austin because she hoped to invest in a space and have the freedom of ownership, she said.
Vanarsdall used to run her certified vinyl vehicle wrap shop, Virtue Wraps, out of a leased space. When her senior dog was recovering from surgery and needed to come to work with her, her landlord was not happy.
That’s when she put a payment down on XSpace and paid for her unit in full by the time construction was completed last year. Now she and many others in the building bring their dogs daily, Vanarsdall said.
“I don’t even have any overhead other than the HOA monthly, which is a really low price,” she said.
The HOA fee averages about $150 a month, Byron Smith said. It pays for cleaning, maintenance and security, he said, which is something important to Vanarsdall.
“[XSpace’s garages] have codes and community hallways. As a single female, that’s a really big relief,” she said. “I don’t have to go on-site to strangers’ garages anymore … I’m fully secure and fully safe. It’s a nice feeling.”
If she decides to sell her business one day, Vanarsdall said she’d keep her XSpace unit and use it as a weight room.
Courtesy of XSpace
Part of a rooftop lounge at XSpace Houston
The Austin XSpace has sold all of its units, though some are in the process of switching hands, Byron Smith said. Some owners bought them with the intent of leasing them out, he said.
Austin units, which range in size from 300 SF to about 3K SF, have sold for between $100K and $300K, though some have sold for as much as $1.3M, per CoStar.
The Houston location, which will have 86 units, is already 20% sold, Byron Smith said.
Terry Dařílek — an entrepreneur and co-owner of a senior home healthcare business and Austin-based car detailing business Authentic Details — has bought four units on the first floor.
Dařílek hasn’t decided what he’ll use the units for, though he’s leaning toward storing his cars. He has two with “one on the way,” and is also interested in turning part of his space into a man cave. He will probably add a mezzanine as well, he said.
His units will have garage doors on either side and the drive-up access is flat, he said, adding the set-up is great for cars that sit low like Lamborghinis and Ferraris.
“They do not go outside, they’re called garage queens, if you will,” Dařílek said.
Commercial condos can satisfy many needs, Ted Smith said: “As people look to redevelop urban areas and satisfy space needs, they’re going to find that commercial condominiums allow them to provide purchasers with buying opportunities that don’t exist outside of the condominium arena.”
XSpace plans to open its next locations in Dallas and East Austin as well as in The Woodlands. It also hopes to expand this year to Las Vegas, Chicago and Miami and find sites in Atlanta, Denver and Salt Lake City by mid-next year, CoStar reported.
Chicago firefighters spent Monday afternoon battling a blaze in the 4700 block of West Lake Street on the city’s West Side, with one person suffering an injury.
There were a larger than normal amount of firefighters on scene for the fire, with a spokesperson for CFD telling NBC 5 that the department had issues getting enough water onto the blaze in its early stages.
The call came into the department just after 2 p.m. Monday, according to authorities. The fire broke out inside a multi-use building, with several businesses inside.
Three individuals who were inside the building were able to escape without injury. One of the men did suffer a dog bite as he helped bring an animal to safety, but no injuries were directly caused by the blaze.
“Fire tends to make animals behave a little erratic and the dog might have been afraid or scared. It might have turned and bit the guy that was trying to bring him out,” explained CFD Chief Mark Ferman.
The building fire occurred near the CTA Green Line stop at Cicero, according to authorities. Trains continued to run in both directions as fire crews remained on scene.
Firefighters battled a warehouse blaze in Chicago’s Austin neighborhood on Monday afternoon, causing street closures and calls for additional resources at the scene. NBC 5’s Evrod Cassimy reports.
“We assessed that the wind was favorable,” Ferman said. “It was blowing away form The El tracks. There was no fire impingement or danger. If there been any danger, if the wind directions had been blowing the other direction we probably would have thought about (shutting down service).”
Services also continued on the UP-W Metra line, which runs just to the north of the building.
Within hours, the Chicago Fire Department had the blaze under control. Part of the domed-roof did collapse, but no one was inside when that occurred.
There is no immediate word on the cause of the fire.
“That’s going to be a process that may take a while,” Ferman said.
The Chicago Fire Department Office of Fire Investigation remains on scene and is looking into the cause of the fire.
AUSTIN — In speaking of the U.S. Constitution, the late, great American statesman Benjamin Franklin once said in a letter, “In this world, nothing is certain but death and taxes.”
Two Republican lawmakers in Austin — Sen. Pete Flores of Pleasanton and Rep. Brad Buckley of Salado — have said they are working on alleviating the effects of the latter during this year’s 88th Legislative Session.
Sen. Pete Flores, R-Pleasanton, speaks about property tax relief in his office last week. As a retired state game warden, Flores said he understands and has felt the same impact rising property values have on property owners.
State lawmakers in the 88th Legislative Session have prioritized property tax relief. Property values have increased sharply, and while caps are in place, the state is looking to put some of the money back into homeowners’ pockets.
Rep. Brad Buckley, R-Salado, speaks about the importance of property tax relief from his office last week. He said a big part of property tax relief is providing a level of predictability for homeowners and commercial property owners.
– Wilson Sonsini’s partner-elect class includes six women and 12 men from the firm’s corporate, litigation, intellectual property, technology transactions, and regulatory departments –
Contact:
Wayne Kessler
Baretz+Brunelle
+1 732.239.9710 (Mobile)
wkessler@baretzbrunelle.com
PALO ALTO, CA (December 5, 2022) –
Wilson Sonsini Goodrich & Rosati, the premier provider of legal services to technology, life sciences, and growth enterprises worldwide, today announced that the firm has elected 18 new partners from its attorney ranks. The promotions will be effective February 1, 2023.
“Our 2023 class of partners is remarkable in how closely it reflects our values and the strength of our business,” said Doug Clark, Wilson Sonsini’s managing partner. “These attorneys have accomplished much in their careers and showcase not only the deep expertise within our firm, but also our diversity—both of which help define us. We are excited to welcome this group as our newest class of partners and look forward to continuing to work with them to provide clients with the sophisticated legal services we are known for.”
The 2023 partners-elect are:
Lester Ang, Corporate. Based in Palo Alto, Ang represents start-up and late-stage private companies in matters ranging from incorporation and initial capitalization to venture capital, debt financing, and initial public offerings. He also represents public companies in securities offerings, M&A transactions, SEC reporting, and corporate governance matters. In addition, Ang advises investment banks, venture capital firms, and private equity firms. He received his J.D. from UC Davis School of Law.
Haley Bavasi, Privacy and Cybersecurity. Based in Seattle, Bavasi focuses primarily on advising digital health companies across a range of privacy, transactional, research, and healthcare regulatory issues. In particular, she leverages her expertise in the Health Insurance Portability and Accountability Act (HIPAA) to provide early-stage companies with practical day-to-day counseling, as well as to advise in the context of complex commercial transactions, M&A, and go-to-market strategy. She received her J.D. from UC Berkeley School of Law.
Robert Broderick, Corporate. Based in New York, Broderick practices corporate and securities law and focuses on start-ups and venture capital. He regularly works with high-profile technology companies, with an emphasis on capital raising through complex financings. He also provides advice with respect to corporate governance, strategic transactions, and day-to-day corporate matters. Broderick received his J.D. from Columbia Law School.
Jose Campos, Corporate. Based in London, Campos advises U.S. and European technology start-ups and scale-ups through all stages of their life cycles, including incorporation, venture capital financings, mergers and acquisitions, and other strategic transactions. Campos also supports investors that invest in technology companies. He is well-versed in assisting non-U.S. technology companies with their U.S. expansion plans and “flipping” them into U.S. holding companies. He received his J.D. from UC Hastings College of the Law.
Jonathan Chan, Corporate. Based in San Francisco and Palo Alto, Chan works in the emerging companies practice, and represents private technology companies and investors in formation, venture capital financings, and mergers and acquisitions. He focuses on representing companies and investors in the fintech, blockchain, and gaming sectors. Before joining the firm, Chan was a co-founder and COO of a venture-backed investment platform and previously served as a senior director of business development at Electronic Arts. He received his J.D. from Harvard Law School.
Andy Cordo, Litigation. Based in Wilmington, Cordo focuses on corporate governance litigation in the Delaware Court of Chancery. His experience includes representing stockholders, officers, and directors of Delaware corporations and alternative entities in appeals, disputes over corporate and alternative entity control, fiduciary duties and management, corporate appraisal actions, and contract and other commercial disputes. Cordo received his J.D. from the Pennsylvania State University Dickinson School of Law.
Elina Coss, Energy and Climate Solutions. Based in Seattle, Coss represents borrowers and sponsors in project and structured finance, acquisitions, and project development transactions, with a focus on financing cash flow streams from the renewable energy technology sector. Coss advises clients on complex asset-based financings at all levels of the capital stack, including joint ventures, construction, back-leverage and mezzanine financings, tax and cash equity financings, capital market securitizations, and forward flow financings. She also advises lenders, tax equity investors, private equity funds, and other investors in the renewable energy space. She received her J.D. from New York University School of Law.
Jake Gatof, Corporate. Based in Boston, Gatof represents life sciences and technology companies, as well as their sponsors, through all stages of growth and investment. He represents companies with respect to venture capital financings, corporate governance, mergers and acquisitions, and other complex strategic transactions. He also advises leading growth equity, venture capital, and other institutional sponsors. Gatof received his J.D. from the University of Michigan Law School.
Broderick Henry, Corporate. Based in Palo Alto, Henry focuses on mergers and acquisitions, divestitures, equity investments, and other strategic matters involving public and private companies. He primarily represents clients in the technology industry, but he has represented clients in a wide range of sectors, including aviation, financial services, consumer products, energy and infrastructure, security, and manufacturing. Henry received his J.D. from New York University School of Law.
Jocqui Kaup, Corporate. Working virtually in Washington, Kaup focuses on corporate and securities matters for emerging growth companies and venture capital and private equity firms in both equity and debt financing transactions and mergers and acquisitions. She also advises on strategic alliances, spinouts, recapitalizations, and other corporate reorganizations. Kaup represents private technology growth companies ranging from start-ups to late-stage enterprises, with an emphasis on larger private companies. She received her J.D. from the Benjamin N. Cardozo School of Law.
Megan Kayo, Privacy and Cybersecurity. Based in San Francisco, Kayo advises clients on information security and privacy issues under various laws and regulations, specializing in data breach response and mitigation. She has worked on hundreds of security incidents and acted as the lead counsel, directing the investigation, notifications, and responses to regulators and consumers in connection with global data breaches. Kayo received her J.D. from the University of Virginia School of Law.
Brendan Mahan, Mergers and Acquisitions. Based in Seattle, Mahan advises public and private companies on mergers and acquisitions, divestitures, minority and controlling investments, and other strategic transactions. His experience includes public and private mergers, tender offers, asset and stock purchases, and spin-off transactions, as well as financings and structured finance transactions, across North America, Asia, and Europe. He received his J.D. from Cornell Law School.
Chris McAndrew, Patents and Innovations. Based in Boston, Dr. McAndrew advises early-stage life sciences companies on intellectual property issues and helps clients develop and build a meaningful IP portfolio from inception through their exits. He specializes in representing companies within the complex life science biologics space, including antibodies and cell therapies. Dr. McAndrew was a patent agent at the firm before becoming an attorney. He received his J.D. from the George Washington University Law School.
Victor Nilsson, Corporate. Based in Seattle, Nilsson practices corporate and securities law with a focus on representing issuers, investment banks, and strategic investors on a broad range of capital markets transactions. These include IPOs and follow-on offerings, ADS offerings, ATMs, PIPEs, private placements, and convertible note offerings, as well as high-yield and investment-grade debt offerings. He also advises public companies on SEC reporting, securities law compliance, and corporate governance matters. Nilsson received his J.D. from the University of Arizona College of Law.
David Pirko, Technology Transactions. Based in Palo Alto, Pirko represents leading life sciences companies and venture capital investors in strategic transactional and corporate matters, including partnering and collaboration agreements, licensing agreements, services agreements, clinical trial agreements, manufacturing and supply agreements, and other complex matters. His practice extends from start-ups to public companies operating in all sectors of the life sciences industry. Pirko received his J.D. from Harvard Law School.
Deborah Smith, Patents and Innovations. Based in San Diego, Dr. Smith advises companies on IP strategy beginning from early platform development through commercialization. This includes venture capital, capital markets, and M&A transactions in the fields of chemistry, pharmaceuticals, and biotechnology. Dr. Smith specializes in advising clients that use platform technologies to bring new therapeutics to market. She received her J.D. from the University of San Diego School of Law.
Stephen Strain, Litigation. Based in Palo Alto, Strain is part of the firm’s complex litigation and investigations group. He focuses on representing clients in government and internal investigations, including matters involving allegations of insider trading, complex financial reporting and accounting fraud, violations of the FCPA, and disclosure violations, among others. Strain also frequently represents companies, as well as their officers and directors, in securities class actions, shareholder derivative suits, and related litigation matters. He received his J.D. from New York University School of Law.
Eva Yin, Regulatory. Based in Seattle, Dr. Yin is part of the firm’s FDA regulatory, healthcare, and consumer products practice. She focuses on conducting FDA and healthcare regulatory due diligence for corporate transactions; providing legal counsel to manufacturers regarding FDA approval/clearance for various products, including medical devices, mobile apps, and drugs; FDA compliance; regulation of promotional materials and labeling; and manufacturer compliance. Dr. Yin received her J.D. from UC Hastings College of the Law.
About Wilson Sonsini Goodrich & Rosati
For more than 60 years, Wilson Sonsini’s services and legal disciplines have focused on serving the principal challenges faced by the management and boards of directors of business enterprises. The firm is nationally recognized as a leading provider to growing and established clients seeking legal counsel to complete sophisticated corporate and technology transactions; manage governance and enterprise-scale matters; assist with intellectual property development, protection, and IP-driven transactions; represent them in contested disputes; and/or advise them on antitrust or other regulatory matters. With deep roots in Silicon Valley, Wilson Sonsini has 19 offices in technology and business hubs worldwide. For more information, please visit www.wsgr.com.
Austin City Hall notebook: Council opens up corridors, commercial zones for more housing development
City Council wrapped up a two-day meeting Dec. 2 with key votes on new city development rules, putting a cap on a yearlong effort to pass agreed-upon housing policy updates before several officials leave office.
A push to completely revamp the city’s intricate and decades-old land development code, governing how and where building takes place in Austin, has extended through the terms of current council members—and ended without any broad changes in place after a resident lawsuit successfully halted the city’s process. Late last year when that legal outcome was still in question, city leaders announced a renewed attempt to tackle Austin’s housing crisis and rising cost of living by considering only more specific ideas that could pass through City Hall with consensus support.
On Dec. 2, officials approved two of those items geared toward expanding housing options across Austin’s transportation corridors and in areas where the city hopes to encourage more residential construction. One unlocks commercially zoned areas for housing development, a practice generally restricted in the code, while the other cuts down on some development limits along transit networks.
Mayor Pro Tem Alison Alter said the changes—while not perfect—represented progress built on compromise between several council members and constituents.
“I believe the mayor and I have demonstrated that a broad and diverse caucus representing multiple corners of the city can work together to achieve results,” Alter said. “It may not be what any one of us would have crafted on our own, but rather than lamenting that whether this proposal is only half a loaf, we should remember that half a loaf is still a lot of bread. And we can always continue to work to make our city more livable and more affordable.”
Compatibility, commercial updates
The first update approved by council allows residences on properties now zoned under a commercial category. The change applies to thousands of parcels, including a majority near both existing transit and future Project Connect routes.
The affordable incentive program requires that anyone interested in bringing housing to land that is now reserved for offices, shops or other commercial uses must include a portion of income-restricted housing. Ten percent of units in a participating rental development must be available at 60% of the median family income, or MFI, while the same amount of spaces in an ownership project must be available at 80% MFI or below. The Austin metropolitan area’s MFI is $110,300 for a family of four.
Council also addressed a limit on new construction that officials and developers have long pointed to as one of the more significant constraints on housing locally. Austin’s compatibility standards, or rules designed to keep development in line with existing homes and neighborhoods, are believed to be among the strictest in Texas and comparable cities nationwide.
The December code update reduces certain compatibility effects, such as a cap on building height, along corridors where council generally agreed larger development should be placed. New construction with more affordable housing will see even greater compatibility reductions allowing for taller and denser buildings closer to existing residences.
Corridors include stretches of Congress Avenue, Braker Lane, Lamar Boulevard, Slaughter Lane and dozens more roadways as well as major highways.
The concepts ended up earning majority support on the council dais, with some reservations. Community feedback was generally split between more pro-housing voices encouraged by the potential for new development and those concerned the changes could infringe on existing properties and further contribute to displacement, especially in gentrification-prone areas, such as East Austin.
While council passed the code updates in supermajority votes, some residents opposed to the changes may again challenge the city’s land-use action in court. Community Not Commodity, which advocates for homeowner and neighborhood perspectives in housing debates, said it is “seriously considering” legal action over the city’s handling of the December votes and related public hearings.
“Council chose to rush to approve in a lame duck period two unvetted land-use ordinances that will greatly undermine the current communities in neighborhoods. The burden will fall on current Austin residents, but the gain will go to real estate speculators and investors. Little to no ‘affordable’ housing will be built for middle-class and working families, and these amendments will result in even more displacement of nonaffluent Austinites,” the group said in a statement.
Equity in focus
The residential in commercial code update opens new housing possibilities on almost 3,000 properties in “high-opportunity” areas, or places where residents have better socioeconomic outcomes and chances at upward mobility. In Austin, those areas are generally concentrated on the west side where affordable housing is largely absent.
The change also applies to more than 4,200 properties in places the city has found to be more prone to displacement, largely on the east side.
The proposal was recommended by city staff, with positive reviews of its affordability effects raised alongside concerns about future negative effects for residents who may be bunched around highways, where health outcomes can be worse.
“Given the city of Austin’s history of implementing racist policy with respect to industrial zoning and communities of color, special care must be taken to engage with communities who the city has harmed in the past, so that harm is not repeated,” staff wrote in their analysis.
Conversely, the compatibility measure was not recommended by staff in its current form. Their report on the program raised issues with an additional layer of code complexity and questioned whether it will effectively bring more housing for low- and middle-income Austinites to market. Erica Leak, a representative of the city’s housing department, also told council Dec. 2 that the corridor policy is not designed to be equitable across town.
Aside from highways such as MoPac and FM 620, almost none of the heavily trafficked corridors featuring reduced compatibility limits are located in West Austin. The policy’s disparity between the more affluent west side and Central and East Austin, which have seen more rapid redevelopment and displacement in recent years, led District 1 Council Member Natasha Harper-Madison to cast her vote in favor “very hesitantly.” She also shared commentary on the city’s continued east-west split in housing production and affordability, and asked officials to better prioritize the concept of equity in future housing policy debates.
“This item as it is currently designed is designed as inequitable. The exclusion of corridors in high-income areas was purposeful and by council direction, and we are left with no option to address these inequities today,” Harper-Madison said. “The fact that a well-intentioned and necessary reform to our really desperately outdated land development code has been warped to once again exclude West Austin and other high-income areas from this much-needed housing conversation is sadly not at all surprising.”
Other council members echoed her view that the city was putting a less equitable policy into place, and she and District 4 Council Member Chito Vela both said they plan to review how relevant policies could become more balanced citywide next year.
Alter, who represents West Austin’s District 10 and helped draft the list of corridors this spring, said she hopes to work on ways to increase affordable housing on her side of town alongside other officials. Alter also said council’s action on housing in commercial areas could end up being the more effective policy, and that compatibility tweaks may not be the best way to make a dent in the west side market.
“Every tool that we use is not going to solve all of the problems at once, which is why we have to look at all of the different tools. And I think that we have made a lot of progress on a lot of different fronts, and so I’m glad that we’re able to conclude this council with passing these two items,” she said.
Locating the ‘missing middle’
On top of those two final votes, council also kicked off consideration of a new development process to ease more “missing middle” housing into Austin.
A proposal from District 8 Council Member Paige Ellis requests city management to waive often expensive and time-consuming development planning requirements for three- and four-unit projects, moving them in line with single-family and two-unit homes. Ellis’ resolution also calls for the creation of a “site plan lite” for five- to 16-unit complexes aimed at speeding up their production. Both items could now move forward as soon as next spring.
“We’ve got units that are getting stuck in the permitting process that’s designed for much larger projects,” Ellis said. “When you have missing middle housing as small as five units having to undergo a very, very lengthy process and costly process, that’s why we’re not seeing housing coming onto the market. People can’t live in the pipeline, and so we need to make sure that these units are coming online, that people are able to buy homes, that people are able to have units to rent.”