The Kick Off - TX Tour Day 1 pt. 1

We started the morning off at City Hall. Our first speaker was Mr. Fred Evins from the Economic Growth & Redevelopment Department. The department encourages large corporations such as Samsung to do business in Austin while preserving the city's overall landscape. Mr. Evins acts as a liaison between the city departments and developers untangling red tape that can cause project delays. He mentioned that large projects can often be time consuming. Depending on the type of project residents in the community can be very vocal about what they want or don't want in their backyards. Therefore much planning and communication has to occur on all projects. Bidding developers seek to exceed the city's expectation offering additional incentives such as adding trails and or donating other valuable amenities to the city in their master development agreement. All projects are considered to be the highest and best use. Like most cities, the city of Austin uses the RFP (Request For Proposal) bidding process with line items. Although the city of Austin was affected by the recession they have not initiated mandatory furloughs.


According to Mr. Michael Knox the city has however made some adjustments due to the lag in the economy, such as withholding employees annual raises and not hiring staff in some instances. I asked if any of the developers or businesses failed to live up to there obligations. Mr. Evins informed me that there were times when projects were prolonged but none that failed outright. This is due to the overall strength of the companies and their access to capital. Austin has several projects taking place such as the Greenwood Treatment Plant and the public/private partnership Gables residential properties.

Like most major cities in Texas, the city of Austin also wants to hinder sprawl and create higher density. The city is aggressively leveraging its non performing real estate assets such as an old jail and various municipal properties. Austin also provides 99 year ground leases in some instances. Trammel Crow is tackling a 1.9 million square foot high density project. Creating dense projects in Austin is not an easy feat due to the city's height restrictions. This was placed in law several years ago in an attempt to give all tenants/residents clear views to the Texas State Capitol Building.

Mr. Knox's area of expertise lies in the downtown business district. Unlike other major cities, Austin makes no grand cash incentives to prospective businesses. It does offer a low interest loan up to $250,000 for 15 years with moving and sale restrictions and basic TIF initiatives. In spite of its reluctance to issue the grand cash incentives businesses still seek to do business here. Mr. Knox credits the city's ability to stay committed to its initial vision regardless of the city management shifting staff. Compared to other cities Austin is conservative averaging roughly 30 to 40 projects. The city has created a refreshing atmosphere using urban based guidelines which prevents stagnation such as closed end streets.

Building owners and property managers alike can participate in the Doing Business Downtown Austin Alliance. This gives them a platform to discuss any issues they deem relevant creating an open dialogue between the city and property owners. One challenge Mr. Knox faces lies between senior tenants and new tenants implementing their new ideas without considering what the affects these actions will have on their neighbors.

Currenlty downtown does not have enough grocery stores or school options for families seeking to live downtown. Overall Austin appears to thrive due to their planning consistency, although their due diligence is somewhat cumbersome.