Austin officials signed off on the $15.07 million purchase of a downtown homeless shelter and several nearby properties owned by The Salvation Army months after the nonprofit announced it intended shut down the facility, in a stated attempt to maintain a centralized space for homeless clients.

“Today marks a milestone in our commitment to ensure homelessness is rare, brief, and nonrecurring,” interim Homeless Strategy Officer David Gray said in a Nov. 9 statement. “The acquisition of the former downtown Salvation Army shelter is not just adding beds, it’s also extending our arms to embrace those in need. Maintaining this shelter is a testament to our shared responsibility and commitment of building a city where no one is left without a home or hope."

The overview

The city's acquisition of several Salvation Army-owned properties on the east side of downtown was approved by City Council on Nov. 9.

Altogether, the city will buy up just over 1 acre of land, including the shelter, an adjacent parking lot and a retail space on Red River Street.

The $15.05 million purchase was proposed alongside more than $17,000 in anticipated closing costs. That total was based on a new third-party appraisal, according to the city, and came in under the $16.12 million value of the land as of its most recent public appraisal.

Acquisition costs will be split between three sources: $5 million from Austin's Housing Trust Fund, $5 million from the city's federal Community Development Block Grant program funds, and about $5 million in projected lease savings from a separate civic office building purchase advanced Nov. 9.

How we got here

The Salvation Army in February announced it planned to close the downtown shelter, one of the few centrally located resources for those experiencing homelessness in Austin, especially women.

Following that update, city leaders pushed to extend shelter operations and eventually voted to lease the facility and bring on nonprofit Urban Alchemy—which has managed the Austin Resource Center for the Homeless next door since last year—to take over at the shelter.

Next steps

Moving forward, the shelter will continue to serve homeless women and transgender clients.

With the facility's future now secured, Urban Alchemy plans to continue its work transforming the facility alongside the ARCH next door.

Kirkpatrick Tyler, Urban Alchemy's chief of government and community affairs, told Community Impact the nonprofit aims to provide 120 beds at the shelter by the end of the year and add new community features such as a park he said will serve as an "oasis" for clients.

“Our focus is to create community, to create healing spaces to really transform the scope of how we provide shelter there to be really therapeutic,” Tyler said.

Tyler also said shelter space may eventually be converted for use as longer-term supportive housing.

The building purchase will end the city's lease and allow for more significant facility improvements. While $300,000 had been invested in the center under the lease so far, the property acquisition now opens the door for a five-year, $3 million renovation and upgrade plan there.

Renovations will be made to "ensure effective operation as a shelter and safeguard the condition of the city’s asset long-term," a Building Services Department spokesperson said. The city will address a maintenance backlog while tackling planned HVAC, roofing, electrical, plumbing, flooring, painting, parking, elevator, security, and kitchen and bathroom improvements.

Interim City Manager Jesús Garza also said the city will likely seek community feedback on how the parking and retails spaces on Seventh and Red River streets should now be used under Austin's ownership.

Put in perspective

City Council's Nov. 9 vote on the purchases was opposed by the Downtown Austin Alliance, an advocacy group representing downtown property owners and other stakeholders that's active in homelessness and public safety policy discussions.

Bill Brice, the organization's senior vice president for investor relations, asked to delay the process to further consider whether it was the best option for the city's homeless strategy downtown.

“We know more shelter services and housing are desperately needed, and we appreciate the council’s recent efforts to increase these resources. But the community deserves assurance that decisions we make including large investments to purchase, repair and operate this property are without doubt the highest and best use of tax dollars, and that social services are designed for the future not the past," Brice said.

Ahead of the council vote, Mayor Kirk Watson defended the city's increased focus on shelter capacity this year and said he believes The Salvation Army purchases are needed to continue addressing a mounting shortage of available shelter beds.

“When the $65 million that was obtained from the state to help with housing, when we’re in a position to put more people into emergency shelter beds or noncongregate shelters as a result of being able to actually utilize that money, that may speed up our ability to make other decisions related to other nonemergency shelters," Watson said Nov. 7. "But I’m just going to say, it undermines the effort to house our homeless population and to solve some of the very problems that people bring to our attention on a daily basis—and arguably an hourly basis—by saying we shouldn’t go forward on something like this.”

Katy McAfee contributed to this report.