Lowly Highland Mall loomed large in light rail route choice

As Austin’s two flavors of light rail activists duked it out over the past year about the city’s “urban rail” plan, the dispute over the proposed route came down to whether a rail line should serve people riding transit now or reach a theoretical influx of new residents and workers attached to predicted development.

A Guadalupe Street/North Lamar Boulevard route, favored by a loose coalition of veteran and newly enthused transit advocates, represented the first idea. Buses plying that corridor today have Capital Metro’s highest ridership by far.

The Red River Street/Airport Boulevard corridor to the east, chosen by Project Connect almost a year ago as the preferred path of the city’s first electric-powered light rail line, grew from that other notion of serving projected population and employment growth. Officials with Project Connect, the rail planning effort of the city and Capital Metro, have endlessly touted a “data-driven” analysis that produced that recommendation.

But Project Connect officials say now that advantage was based to a significant degree on projects already underway or in serious planning — most especially the makeover of the Highland Mall area by Austin Community College and a private partner — and that the 2013 analysis looked at projects only seven years down the road. Little or no consideration was given to the relative likelihood in each area for other development over the next generation.

“Yes, there’s development potential in both corridors,” said Kyle Keahey, a consultant with engineering firm HNTB who is managing Project Connect. “But we wanted to look at what is already in the pipeline.”

Those Guadalupe-North Lamar transit advocates, meanwhile, have become some of the most motivated critics of the city’s $1 billion rail-and-roads ballot proposition. Their not-so-friendly fire at the proposal has been an unexpected boon for the longtime rail opponents who are working to defeat the proposal on the Nov. 4 ballot.

The Highland area aside, it is far from clear that the Red River/Airport corridor over time will attract more people and jobs — and thus rail ridership — than the alternative route.

Eldon Rude, a longtime real estate analyst in Austin who owns 360 Real Estate Analytics, said both corridors have considerable stretches of older, low-rise commercial development ripe for the sort of wholesale makeover taking place now on East Riverside Drive east of Interstate 35. The proposed light rail’s southeast leg would go along that road.

But in the case of the city’s proposed route, that potential more or less starts at East 45th Street on Airport Boulevard and goes north to the mall. The other corridor’s notional redevelopment, he said, reaches much farther south to near the University of Texas and could extend beyond the ongoing Crestview Station development at Lamar and Airport.

“The Red River corridor south of Hancock Center is highly residential,” Rude said. “The properties are just smaller, and you abut much more of a neighborhood reality. I would anticipate that over time it would be very problematic to do some significant redevelopment, including commercial properties, next to those neighborhoods.”

That’s where Highland Mall and choices Project Connect made in its analysis come into play.

Over a several-year period ending in 2012, ACC spent $42.6 million to buy the struggling, 1.2 million-square-foot mall and the 81 acres on which it sits. Already the college has spent $60 million to renovate a former J.C. Penney department store on the mall’s north end, and more than 3,000 students are enrolled this fall at the new campus. A high-tech company plans to renovate and move into the former Dillard’s at the mall’s other end over the next couple of years.

If voters Nov. 4 approve selling bonds, ACC hopes to spend $152 million to overhaul a second large chunk of the mall for a variety of classrooms and programs. The college’s long-range plan for the property, including a couple of new buildings, contemplates as many as 25,000 students taking classes there.

Beyond that, ACC’s development partner, RedLeaf Properties LLC, has big plans over the next decade or more for the expanse of parking lots that rings the mall, building a series of four-story, mixed-use buildings. RedLeaf principal Matt Whelan said his company plans 1,200 residential units, 800,000 square feet of office space, 150,000 square feet of mostly ground-floor retail and 200 hotel rooms.

Like all such massive commercial plans, the market in the end will decide how much gets built and when, Whelan said. But passage of the city’s ballot measure, and the prospect of rail flanking the old mall tract, almost surely will goose that market, he said.

“The rail bond passing would obviously be a great thing for the Highland project,” Whelan said. “It would certainly speed up the development timeline and would also support additional density. Highland is zoned for about twice as much density as our current plan contemplates.”

Those ambitious plans, and their potential to stimulate redevelopment of the underused commercial space near the mall, loomed large when Project Connect was weighing various routes in 2013. By contrast, the Guadalupe/Lamar corridor has no comparable megadevelopment under construction now or on a list of near-term “emerging projects” compiled by the city and used by Project Connect in its calculations.

The net effect, as officials looked at the portions of each corridor north of the UT campus, was a mixed bag. In raw numbers, the Guadalupe/Lamar corridor would add about 1,000 more people than the Red River/Airport corridor from 2010 to 2030. But the rate of growth, both in population and jobs, is higher along the Red River/Airport corridor ending at Highland.

In the end, after taking into account a blizzard of other measures, Project Connect last November picked Highland as the preferred corridor. After clearing the Austin City Council in a series of votes, a fleshed-out version of rail on that corridor, through downtown and on East Riverside, will go before voters on the Nov. 4 ballot.

“I know there is tremendous development potential along Guadalupe-Lamar,” said Lyndon Henry, a former Capital Metro planner and board member who has been pushing for light rail in Austin since the 1970s. He opposes the ballot measure. “There is a lot of wishful thinking on the Highland corridor.”

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