The Travis County health care district owns 14.3 acres of property surrounding the 9-story hospital tower at Red River and 15th streets in Central Austin.
The demolition is part of Central Health’s plan to redevelop the property, generating revenue to fund health care for county residents with low incomes.
“We honor people born here; who received life-saving care here; families who said goodbye to loved ones here; and of course the staff, nurses and doctors who worked here,” said Dr. Guadalupe Zamora, chair of the Central Health board, in a May 15 news release. “As the tower comes down, it’s making way for a new chapter in health care delivery in our community.”
The Brackenridge campus, sometimes called "the Brack," was home to a public hospital for 133 years until closing 2017. That year, Ascension Seton moved its hospital operations from the campus to the new Dell Seton Medical Center at The University of Texas, allowing for the Brackenridge property to be redeveloped.
“There is no better example of this city evolving and changing for the better … than this spot we’re standing on right now, looking at the Brack and looking at Dell Seton,” said Austin Mayor Steve Adler at a May 15 news conference held on the roof of the Dell Seton parking garage, which looks out onto the Brackenridge building.
Central Health took ownership of the property in 2004 when the city of Austin transferred ownership to the health care district.
Four years ago, Central Health launched a community engagement process that led to a master plan for the property's redevelopment.
The district's initial plan was to turn the campus into a mixed-use, high-density development that would include commercial and residential uses with a focus on health care services and research. The redevelopment was intended to recoup about $34 million in annual lease payments that had come from Ascension Seton to operate the former hospital.
Plans have shifted along with leadership changes at Central Health, including the 2017 appointment of Mike Geeslin as the district's CEO.
Central Health decided to lease some of the property’s six tracts as a cost-saving measure while maintaining its ability to redevelop the property's remaining tracts.
“It would have been at least 15 years until Central Health realized any net revenue if we’d stick with a master developer strategy, and that just didn’t make sense in terms of funding our mission,” Geeslin said in a May 15 statement.
In February, the University of Texas Board of Regents voted unanimously to lease two tracts of the Brackenridge campus. The university will sublease those tracts to the 2033 Higher Education Development Foundation, a nonprofit founded by alumnus Sandy Gottesman.
“Central Health will benefit from having tenants on its campus paying rent as quickly as possible,” Zamora said in a statement following the February vote.
By the end of fiscal year 2018-19, Central Health is due to receive $4.1 million from UT Austin for the property. Since the lease took effect in June, the healthcare district has received $2.75 million in based rent. Once construction begins, it will receive another $1.35 million.
While the demolition is moving forward, there are no firm plans yet for the property’s remaining four tracts.
Central Health is “keeping its options open,” per the May 15 release, and may pursue redeveloping the remaining tracks, selling them or a combination thereof.