Nearly 450 commercial realty professionals networked and learned about a range of issues impacting the city of Austin, Central Texas and the real estate industry today at the Real Estate Council of Austin’s annual Exchange event. Here are a few topics discussed during today’s sessions:
Opportunity Austin, an economic development initiative aimed at investing in job creation in Central Texas, was launched in 2004 and is now a function of the Greater Austin Chamber of Commerce. Today, over 240 corporate and community partners participate in Opportunity Austin.
Mike Rollins, president and CEO of the Greater Austin Chamber of Commerce, and Gary Farmer, a former chamber board member, shared some insight into Central Texas job creation with a few key points:
- Companies are attracted to the young business professional community in Austin:
“We are a very appealing location for young people from across the country,” Farmer said. “If we lose that we’re in trouble.”
- Companies are struggling at the mid-management level:
“The lack of talent [in Austin]has been at the mid-management level,” Farmer said. “Companies are lacking those people who have 10 to 12 years of experience.”
- The permitting process in Austin is complicated:
“Most developers experience the most pain at occupancy permit process,” Rollins said. “Hopefully [the city]will speed up the process with new efforts.”
- The business community needs to get involved at the local level:
“Business people made an appearance at the Capitol [during the special legislative session]earlier this month to meet with members of the House [of Representatives]and say [the bathroom bill]is bad legislation for businesses and people,” Rollins said. “There is an air of respect for business people and we need to figure out a way to get the business community more engaged.”
Affordability and the CodeNEXT Opportunity
As the city of Austin begins to rewrite its land development code, commercial real estate professionals said they question what that means for affordability and growth in the city. A panel of city housing development program advisors and developers addressed a few of these concerns today.
- Developers want more incentives to build affordable housing and a simpler permitting process:
“In the [affordable housing]program now, developers can build affordable homes but the fees [awarded as an incentive]don’t offset cost of construction,” said Scott Turner, founder of Turner Residential and owner of Riverside Homes.
- Create a successful density bonus program that will benefit both developers and residents, similar to the one created in Nashville, Tenn.:
“[Ours] is not just a code,” said Adriane Bond Harris, senior advisor for affordable housing in Nashville. “It’s a full0on tool kit that incentivizes [for-profit and nonprofit] developers… We also invest $10 million a year to a housing trust fund [that helps funds affordable housing projects].”
- Establish other low-income housing programs to meet the needs of the community
“We started a workforce housing program [in Nashville]where we work with our schools and nonprofit companies to develop affordable housing opportunities for their employees,” Harris said.
Affordable housing is a nationwide issue
Luke Tate, former senior policy advisor for the White House Domestic Policy Council, said the improved economy has negatively affected the cost of construction and housing across the nation. Tate addressed attendees Wednesday as the afternoon’s keynote lunch speaker and commented on the affordable housing crisis that is sweeping the nation.
- Families can’t afford housing:
“Parents are working multiple jobs just to make rent or mortgage payments,” Tate said. “[The average] rent costs is 40 percent higher now than it was in 1980 and income is only up 10 percent.”
- New development displaces families and contributes to family homelessness:
“Cities are increasing displacement as a result of new development,” Tate said. “Cities say ‘let’s build across our region and allow all our communities to grow.’ But as development improves in those low-income communities, those families are being pushed out because [rent and tax bills increases]and then they can’t afford to live there anymore.”
- Cities are starting to take action:
“We’ve started to see cities accelerating their permitting processes, offering more incentives to developers and eliminating parking requirements in order to make that construction process easier and to open up opportunities for more affordable housing,” Tate said. “This isn’t just about Austin. If we can’t get this right we’re going to drag our economy down, increase inequality that has double in the last 10 years and shut out opportunity to grow.”