An additional $2.32 million will be spent to repair a former hotel acquired by the city of Austin to use for supportive housing for people exiting homelessness, bringing the project’s total cost to nearly $11 million before its doors have opened.

The setup

City Council voted in 2021 to buy a Texas Bungalows Hotel and Suites located at 13311 Burnet Road for $6.7 million. The facility is now called the Bungalows at Century Park and will be operated by Integral Care.

The purchase was one of the city’s several recent hotel acquisitions intended to expand Austin’s homeless shelter and housing capacity, including the following:

• Southbridge, a former Rodeway Inn off I-35, was purchased for $6.4 million to use as a COVID-19 protective lodge. It was turned into a city homeless shelter in 2021.
• Northbridge, a former Country Inn & Suites off I-35, was purchased for $8.76 million. It was also first used as a ProLodge and converted into a homeless shelter in 2021.
• Pecan Gardens, a former Candlewood Inn & Suites at 10811 Pecan Park Blvd., was purchased in 2021 for $9.55 million to convert into permanent supportive housing. Family Eldercare will run the facility once it's open.
• Balcones Terrace, a former TownePlace Suites at 10024 N. Capital of Texas Hwy., is being renovated for supportive housing by Foundation Communities. The project’s initial acquisition was supported by more than $16 million from the city.

Northbridge and Southbridge have been operating since 2021 as part of the city’s Housing-focused Encampment Assistance Link, or HEAL, program that’s moved hundreds of unhoused people into shelter over the past three years.

Bungalows at Century Park, Pecan Gardens and Balcones Terrace will bring nearly 260 new supportive housing units to a system that's long been targeted for expansion.

However, those three housing projects have been marked by delays from maintenance and security issues since their bond-backed acquisitions and all have yet to open.

The details

City staff said the renovations needed to open the Foundation Communities-led Balcones Terrace project were expected to take "four to five months" back in August 2021. The city has added more than $4 million for building rehab since then, and an opening is now expected later this year.

Pecan Gardens has weathered a break-in, legal challenge from Williamson County and further repair needs since its controversial purchase. About $6.6 million has been needed to address "significant" facility issues there with the most recent funding reserved last fall.

As of late 2023, the Bungalows project required an additional $1.76 million for rehab following its original purchase. That total increased to $4.08 million on May 2 when council agreed to spend $2.32 million more.

City staff said most of the latest cost increase was due to severe weather-related damage and addressing foundation issues.

The foundation repairs weren't expected when Austin bought the building several years ago. At that time, a staff report found the building to be in "good condition" overall and that "no significant immediate repair items" would be needed.

What's next

After past opening dates were pushed back, the city now projects Pecan Gardens will open in June, Balcones Terrace will open this summer and the Bungalows will open in the fall.