Developer, neighborhood at odds over changed Plaza Saltillo plan


Highlights

Endeavor Real Estate wants allowed building heights on East Austin tract increased to 70 feet and 125 feet.

Endeavor would provide ‘affordable’ rents for 15 percent of the apartments, but said 25 percent in 2014.

The company said that promise was always contingent on the city of Austin subsidizing the added 10 percent.

The shape and the future of the long-stalled Plaza Saltillo development in East Austin, seemingly resolved 10 months ago when the Capital Metro board unanimously approved contract terms with Endeavor Real Estate Group, remains unsettled.

The fate of the project probably hangs on a decision by Austin’s Planning Commission, which will hear requests Tuesday night from Endeavor and its partner Columbus Realty Partners to increase allowable building heights on the 11-acre tract. The Austin City Council will have the final say on those proposed zoning changes.

Opponents accuse Endeavor, which beat out three competitors in 2014 for the right to develop the old rail yard, of reneging on a promise to make “affordable” 25 percent of the 800 units planned there (along with office space and retail) even as it asks the city for the right to exceed the 60-foot building heights allowed under the site’s current zoning. Endeavor and Capital Metro officials say the developer’s 2014 written proposal only guaranteed 15 percent affordable housing — defined generally as rents costing no more than half of the median family income — with another 10 percent possible only if subsidized by city of Austin dollars.

But that’s not what Endeavor said publicly in 2014.

“We are committed to providing 25 percent affordability,” Endeavor executive Jason Thumlert said June 23 of that year to the Capital Metro board as it prepared to pick a winning developer from two finalists. “Our two plans are the same on this percentage, but differ dramatically in that we offer a greater number of affordable units” because it intended to build more apartments overall. Thumlert at the time also told the board that Endeavor would not seek zoning changes or variances.

“The decision-makers were very clear on it” at the time, Thumlert said Monday, referring to the Capital Metro board. “It has always been our providing 15 percent.”

The city is not inclined at this time to provide money for that extra 10 percent affordable housing, Endeavor officials say.

Endeavor’s written proposal for Plaza Saltillo — which is bounded by Interstate 35, East Fifth Street, Onion Street and East Fourth Street — has never been made public. Nor has the agency’s pending contract with the developer, the terms of which the Capital Metro board approved last March.

“The contract has not been signed by the parties,” Capital Metro spokeswoman Mariette Hummel said Monday. “As soon as it is signed, it will be available, but there are still open items.”

Mark Rogers, executive director of the Guadalupe Neighborhood Development Corp., which was part of the losing development finalist group in 2014, in a December letter to the Planning Commission said Endeavor is pushing “a classic developer ‘bait and switch’ scenario. … The developer would walk away with much more and Austin could end up with much less than was originally intended.”

Endeavor officials, however, say they have actually increased their promise on affordable housing from 120 of the planned 800 apartments to 141. In addition, according to a fact sheet from the company, it would pay the city more than $600,000 for other affordable housing projects. The company is asking for allowable building heights to be increased to 70 feet on most parts of the site and to 125 feet adjacent to I-35 for a planned office building.

“We will continue to work with all stakeholders to develop a quality project that is in keeping with the character of the neighborhood,” said a statement Monday from Endeavor, which is separately involved with the American-Statesman’s owners to redevelop the site where the newspaper operates.

The company’s agreement with Capital Metro, Endeavor said last March, would pay the agency more than $200 million over the 99-year life of the agreement. In March, officials said that would begin with a $1.6 million payment the first year, increasing 3 percent each of the next four years and then growing by an undisclosed formula tied to rental income on the site.

Austin City Council Member Ann Kitchen, who also serves on the Capital Metro board and voted for the Endeavor deal in March, was unenthusiastic Monday about the proposed zoning changes.

“I am concerned about the height variance,” Kitchen said in an interview with the Statesman, “and would not be in favor of it if it were averse to what the neighborhood wants.”

The neighborhood, as represented by the East Cesar Chavez Neighborhood Planning Team, opposes the height variances sought by Endeavor. The group, which includes Austin City Council Member Sabino “Pio” Renteria, voted “overwhelmingly” against the proposal at a meeting last week, according to a Jan. 4 letter from its chairman, Jose Valera, to the Planning Commission and City Council.

The neighborhood group in that letter called on the commission to force Endeavor to convene a “special affordable housing committee” with members from the developer, Capital Metro, the Austin Housing Coalition, Renteria’s office, Mayor Steve Adler’s office and the neighborhood. Renteria could not be reached for comment.



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