Austin Contrarian

Context matters

The Daily Texan ran a piece a couple of weeks ago on the high cost of housing in West Campus which really illustrates the importance of putting neighborhood-level housing data in context of the larger metro market:

Characterized by its proximity to the UT campus and many conveniences, West Campus is one of the most popular — and expensive — living areas for UT students. According to Multiple Listing Service, a professional rent listing used by West Campus realtors, rent in the area has increased by about 15 percent since 2008.

At least three new apartment complexes will have their grand opening this year, including 2400 Nueces, Callaway House and 21 Pearl. West Campus has also caught the eye of some out-of-state and international investors, which increases the value of land.

The popularity of West Campus is driving up prices at older apartment complexes in the area, leading some UT students to share rooms or leave the neighborhood entirely. Apartments are also being leased quicker, forcing current and prospective students to make a housing decision or lose a space.

Rent for recently built apartments in West Campus averages $1,250 a month for one-bedroom apartments and $850 per bedroom a month for two bedroom apartments, according to the listing service.

Stories like this always generate a bunch of hand-wringing and some of it's justified -- West Campus, after all, is very expensive. 

But though the rents in West Campus are high, the 15% increase in rent since 2008 is not. Or, rather, it's not when compared to the rest of the Austin metropolitan market. Rents throughout Austin have risen since 2008. A bunch. West Campus, being a part of Austin and therefore linked to housing market in other neighborhoods, is experiencing the same pressure from rising demand.

In fact, here's some evidence that West Campus has fared better than the city as a whole. Below is a chart prepared by Charles Heimsath's Capitol Market Research depicting average rents and occupancy rates in the Austin market since 2007. Between the second quarter of 2008 and the the second quarter of 2013, average rents per square foot rose from $0.96 to $1.17, an increase of nearly 22%. 

Note that $0.96 (according to this chart) was the pre-recession peak; the increase over the trough was even higher.

When put in context of this larger market trend, a 15% increase in rents in West Campus is notable for being below average. It's all the more notable given that a large percentage of the housing in West Campus is new, and, as everyone knows, the new stuff is super-duper expensive. This means that any sort of average rent in West Campus that includes all the housing stock is skewed by the new stuff. By contrast, in the Austin metropolitan market as a whole, the expensive, new development makes up too small a percentage to have much effect on average rents. 

I'll caveat this by noting that it's dangerous to compare averages that were calculated with different methodologies using (possibly) different data sets. Perhaps the West Campus average quoted in the story was based on median rents, or average rents per bed, or some other metric, and the per-square-foot average has seen an increase similar to that of the Austin market as a whole. Dunno.

The point, though, is that you can't meainingfully evaluate trends like "rents rose X% in this particular neighborhood over the last five years" without understanding what's happening in the larger market. That worrisome trend might turn out to be the wrong trend to worry about. 

A New-ish Blog

Austin urbanist and frequent commenter, Dan Keshet, is writing a blog, Austin on Your Feet. Here's a  post analogizing the housing market to a game of musical chairs  and one on the association between city density and city size, a topic near and dear to my own heart.

Highly recommended. 

Block One

Jude Galligan at Downtown Austin Blog has posted a rendering of Trammell Crow's forthcoming apartment/office tower on the site of the Green Water Treatment Plant:

In case you're wondering, the dramatic step-backs from Cesar Chavez are mandated by the Waterfront Overlay. All buildings in this particular subdistrict must fit within a 70-degree envelope beginning at a point 45 feet above the southern property line, thereby advancing the little-known but very important public interest in ziggurat-themed architecture.

Austin's grid circa 1940

On Twitter, Niran Babalola linked to this great map of Austin's grid circa 1940 made by the Texas State Highway Department:

Back then, "planning" chiefly meant "planning streets." It's a shame that planning lost that focus. The street grid that permeated Austin in 1940  is of course still with us, and forms the backbone for a number of quite livable neighborhoods. 

So what happened? Developers building large, planned subdivisions (Allandale, Barton Hills) continued to add decent street networks after 1940. But the City itself appears to have gotten out of the grid-planning business not long after this map was made. 

Consider the area bounded by South Lamar, Manchaca, Bluebonnet, Del Curto, Clawson and (today's) Highway 71, outlined in red in the 1940 map:

This is a large tract of land:  a little over a quarter mile wide at its widest point and about 1.3 miles long. It's remarkable that, 73 years later, there is still no path through this tract, other than a token street (Fortview) at the southern edge. Topologically, it's a single block: 

The large, triangular tract bounded by South Lamar, Manchaca and Ben White is about as bad. Collectively, these could and should have been platted into 40 or so city blocks. Instead, they remain two big blobs of land. The lack of connectivity funnels traffic onto South Lamar and Manchaca; impedes east-west mobility, dividing eastern and western neighborhoods; forces people to make circuitous trips to run even simple errands; and forecloses any sort of low-intensity, mixed-use development in the area. Then there's the sheer loss of public space: South Austin should have a few more miles more of public, connected streets than it has today.

One can't even defend this runt network on the grounds that "people prefer it this way." Residents would say they prefer it this way if you took a survey, of course -- they'd say so sincerely, too -- but property values tell a different story. If the lack of connectivity actually made an area desirable, then this would be the most expensive residential real estate in South Austin. But it's not. It's the cheapest. The really expensive residential real estate in South Austin all lies on the old grid, in Zilker, Bouldin Creek and Travis Heights, not on these dead-end streets. The homes in Galindo, on the other side of the railroad tract, are also more valuable and, not coincidentally, sit on at least a rudimentary grid.

I'm not suggesting that we try to fix this now. It is not fixable. There are physical impediments (i.e., "houses") in the way. And it would be politically impossible to install a grid now even if the City had the will or the way. The homeowners living there simply wouldn't stand for that kind of radical change.

Which makes it all the more a shame that the City got out of the grid-planning business after 1940.

Those who live in big, blue boxes should not cast the first stone

One of the things that has interested me about the Taco PUD case is Zachary Scott Theater's opposition.

If you don't read the newspaper and aren't on Save Town Lake's mailing list, you might not know that a CALIFORNIA developer is seeking PUD approval to build a 96-foot tall residential "tower" on the site of the Taco Cabana at Riverside and South Lamar:

Although Save Town Lake is spinning this as some sort of grave affront to the Waterfront Overlay, the obstacle for the developer is actually the base zoning district's height limit of 60 feet rather than  the special height limit imposed by the Waterfront Overlay. Were it not for the base district height limit, the Waterfront Overlay for this subdistrict would allow the 96 feet the developer is requesting. The developer is seeking an increase in the maximum base height, among other things, via a PUD, for which it is offering various community benefits, such as $439,000 in affordable housing fees and free space for the Austin Parks and Recreation Department.

The usual suspects have turned out against this. Zilker and Bouldin Creek neighborhood association opposition was predictable. I suppose the Bridges' condo owners opposition was also predictable, even though the Bridges developer left the north face of the Bridges blank  in explicit anticipation of future development on the Taco Cabana site. 

I was genuinely surprised, however, to see the project opposed by Zach, which just opened its new Topfer Theatre directly across South Lamar from the Taco Cabana. I assumed, based on the orientation of the Topfer Theatre, that Zach does not care much what happens along South Lamar.

Now the Topfer Theatre has a very sleek glass-and-concrete entrance that spills into a sleek plaza and (somewhat less sleek) parking lot. But neither the entrance, the plaza nor the parking lot is visible from South Lamar.  All that's visible from South Lamar -- in particular, from the Taco Cabana sidewalk directly across the street -- is the Theatre's 80-foot tall fly tower:  

I like a big, blue-tile-and-exposed-concrete box as much as the next guy. But you really have to wonder what specific objection Zach has to a nine-story building being built across a very busy street from a very blank wall. I'm sure that for a couple of hours each morning, the "tower" will cast a shadow on its sleek fly tower, but how will anyone inside the theater know? (There  are two short rows of windows at the lower left of the building, but even these appear to be opaque from the outside.)

Things make more sense now that I've finally gotten around to reading through the case backup. Here's Zach's  letter of opposition. The most interesting paragraph states:

In 2008, ZACH was approved to build an 80 ft fly tower in the new Topfer Theatre. A copy of that particular ordinance is attached for your reference. In addition, at that time, ZACH agreed to support objections for requests of additional height buildings in the surrounding area, if asked to do so by the surrounding neighborhood associations.

It might seem strange for a theater company to agree in advance to support someone else's objections without knowing whether the objections will have a principled basis. But, assuming Zach has correctly summarized the deal, it makes perfect sense. Exchanging promises to lodge or waive objections is a very cheap medium of exchange accepted as legal tender by all neighborhood groups. Such an exchange could have helped Zach get an 80-fot fly tower while giving the neighborhoods a sort of proxy objection to bolster their moral case againt forthcoming development, whatever that development might turn out to be. 

Even if Zach's objection isn't merely a proxy, there's still the question how much weight it should get. After all, Zach chose to present South Lamar with the theater's featureless backside. The proposed development across the street, by contrast, will be a pedestrian's nirvana. What standing does Zach really have to complain about that?