Item2a_AEDC_Urban_Renewal_Board_Update — original pdf

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Urban Renewal Board Austin Economic Development Corporation June 21, 2021 Council investigated the creation of an EDC since 2014 A series of resolutions identified the need to first investigate and then create a real estate focused entity that could assist with inclusive growth outcomes and the preservation of existing cultural spaces as well as the development of new affordable spaces. § 20141211-122: Directed the CM to explore the feasibility of an EDC § 20160303-019: Music & Creative Ecosystem Omnibus § Included the coordination of the preservation and creation of affordable cultural and music space by a specialty entity that could also negotiate in public/private projects and be integrated into public projects. § 20170216-040: Directing the CM to bring forward proposals for the EDC § 20180215-082: Use an EDC to create a Cultural Trust § Directed using the Cultural Asset Mapping Project (CAMP) as a guide for broad inclusion § Cultural Trust to be integrated into an EDC § Investigation of code revisions, retail incentives and other real estate mechanisms to assist as needed § 20190808-072: Authorizing the creation of the EDC (see next slide) Austin EDC Overview | 2 In August 2020, Council Directed Staff to Create AEDC ”to complement the City's vision and programming for inclusive economic development through the formation of public-private partnerships and facilitation of resulting projects that generate additional resources or revenues for the City”…. § City Council directs the City Manager to initiate the necessary processes to authorize the Creation of an economic development entity, identify potential funding sources, solicit stakeholder feedback on the entity’s governance and operational structure, and, if necessary, contract with a subject matter expert to develop an implementation plan. § City Council directs the City Manager to structure the entity broadly enough to manage a range of projects, which could include affordable housing development, public-private Partnerships with private-led development such as the South Central Waterfront that could provide community benefits, and shall include a Cultural Trust to support acquisition and preservation of creative space. § City Council directs the City Manager to bring forward a recommendation for funding needs to implement this direction for consideration during the Fiscal Year 2020 budget deliberations. Austin EDC Overview | 3 Purpose of EDC: Inclusive Economic Development A PUBLIC DEVELOPER: a real estate developer working for the public interest § Inclusive Economic Development has as a goal retaining the ability for families to stay in their homes and local businesses to thrive in place. § A Public Developer is a partner of existing City and other government departments, agencies, quasi-public entities and non-profits. It provides support for: § Affordable Housing § Affordable commercial space for local businesses § Childcare and early childhood education § Support of inclusive growth around Transit Oriented Developments – retaining affordable commercial and housing § Support of efforts to end homelessness § Support for districts to become inclusive and not just promote growth § The use of AEDC should allow for increased community participation, outreach and transparency in public/private developments. Austin EDC Overview | 4 AEDC Status FORMATION PROCESS AEDC BOARD OF DIRECTORS March 25 | Council approved Board nominations. June 10| Council approved AEDC interlocal agreement (“ILA”). July| Seeking approval of South Central Waterfront TIRZ. Rosie Truelove (Chair) Diana Maldonado Sylnovia Holt-Rabb Jeremy Martin Kellee Coleman David Steinwedell Ed Van Eenoo Carl Settles Stephen Levy Sharmila Mukherjee Emmett Beliveau Tamara Atkinson Bradford Patterson Molly Beth Malcolm Xavier Peña Awais Azhar Suchitra Gururaj Matias Segura Cathy McHorse Char Hu Veronica Briseño (Acting CEO) Austin EDC Overview | 5 AEDC Engagement AEDC is transitioning from general stakeholder meetings to targeted committees and public discussions: AEDC Stakeholders Cultural Trust Advisory Committee (CTAC) Joint Music and Arts Commission South Central Waterfront Advisory Committee (SCWAB) AEDC Real Estate Committee Austin EDC Overview | 6 AEDC Roles AEDC is working with EDD, HPD, and Finance to support several future objectives… Implement the South Central Waterfront TIRZ Design and develop the Cultural Trust Manage the public pipeline assets Negotiate future real estate transactions (including with Huston Tillotson University) Austin EDC Overview | 7 AEDC Is a Public Developer Modeled on Atlanta, Philadelphia and New York City Separate Entity Board Funding General Fund Bonds Dedicated Tax to support operations Contract for Services to government Real Estate Sales, Lease Revenues, Transaction Fees, AM Non-Local Government Grants and/or donations Fees for Managing Private Funds Real Estate Powers and Special Relationship Projects Corporate Attraction & Retention Industry development Inclusive Growth (Affordability, Workforce, and/or MWBE) Affordable Housing and/or Affordable Commercial Cultural Trust or cultural affordability program NYCEDC Yes Mixed Invest Atlanta Yes Austin Yes Mixed Mixed Mixed Pass through Pass through Yes* Yes* PIDC Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes* No* No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No Yes Yes Yes Yes* No Yes Yes Yes Yes Yes Yes* No Yes Yes Yes Yes Yes Yes No No Yes Yes Yes Austin EDC Overview | 8 Case Studies HR&A Advisors, Inc. PANYNJ Advertising | 9 Case Studies | Bedford Union Armory (Crown Heights, Brooklyn) Austin EDC Bedford Union Armory | 10 Case Studies | Bedford Union Armory (Crown Heights, Brooklyn) Local elected officials asked NYCEDC to issue a request for proposals (RFP) to redevelop the vacant site and transform it into a space for housing, jobs, and the community. After extensive engagement with residents, business owners, elected officials, and other local stakeholders to better understand the needs of the Crown Heights community, the community expressed the need for affordable housing, affordable recreational opportunities for all ages (including a swimming pool) and space for local nonprofits to offer cultural, educational, and healthcare services. With the community’s ideas in mind, NYCEDC selected a proposal from Bedford Courts LLC, partnered them with a non-profit recreation operator, managed the affordable housing negotiation with the NYC Housing Preservation and Development Department, and implemented a “double bottom line” ground lease to insure long term maintenance of affordability and access. Austin EDC Bedford Union Armory | 11 Case Studies | Bedford Union Armory (Crown Heights, Brooklyn) Austin EDC Bedford Union Armory | 12 Case Studies | Bedford Union Armory (Crown Heights, Brooklyn) Crown Heights Residents lost access to a community pool and have been demanding recreation and swimming opportunities for years. Nearby Medgar Evers College, an HBCU (CUNY), is lacking rec and classroom space. Bedford Union Armory | 13 Austin EDC Case Studies | Beacon Station (Augusta, Georgia) Austin EDC Beacon Station | 14 Case Studies | Beacon Station (Augusta, Georgia) After a failure to reach economic agreement in a competitive RFP in the City of Augusta, Georgia, local elected officials asked Augusta Regional Collaboration Corporation (ARCC) to enter the negotiations to develop a long standing brownfield site in the historic Laney-Walker Bethlehem neighborhood. ARCC worked directly with the City’s Housing and Community Development department, the local HBCU Paine College, and the newly consolidated state university Augusta University. ARCC was able to support and/or structure multiple deals, including the first Public/Private Partnership for student housing at Augusta University as well as the first ground lease transaction with a developer. ARCC managed the brownfields process and clean-up to expedite the project while completing the negotiations to create Foundry Place. The proceeds from this project paid down all outstanding bond balances of the Urban Redevelopment Corporation, allowing them to accelerate their operations to end blight in the local area housing stock. Austin EDC Beacon Station | 15 Case Studies | Beacon Station (Augusta, Georgia) • • CHALLENGE: Aligning economic interests of the Urban Redevelopment Authority, the Housing and Community Development Department, the developer, the state university and the City. This caused two years of delay and a stalemate for development. SOLUTION: Unique structure in which Augusta’s EDC (“Augusta Regional Collaboration Corporation”) funded brownfield clean- up as it negotiated a ground lease and URA bonding structure to expedite a new form of public/private development. No cash was given to the developer. Instead, the URA purchased the land, and ground leased to developer, with the developer paying all debt service and project costs as a lease payment. • DEVELOPMENT: Brownfield remediation and clean-up • • • • • 7.6 Acres 221 Market Rate Units Commercial Space Community space Pay-back of previously outstanding URA bonds Austin EDC Beacon Station | 16 Blocks 16 & 18 HR&A Advisors, Inc. PANYNJ Advertising | 17 Multiple Paths to Success • AEDC represents a series of new tools that now can be used by AHFC as well as URB. Public Real Estate Developer Public & Private Funding Cultural Trust Funding & Expertise Development Expertise Long term inclusive asset management Mixed Use and Mixed Income expertise • • • • • • • Option 1: AHFC led procurement with AEDC support. • Option 2: AEDC led procurement with AHFC support. Critical differences: Timeline Budget BATNA-based negotiation • • • • • • • Structure recommended (applies to both options) Extensive outreach Pre-Development Agreement with “teeth” Ongoing restrictions through title or ground lease AUSTIN EDC Austin EDC Next Steps | 18 Next Steps • Critical Partners • URB to discuss pathway forward – AEDC available for consult • Cultural Trust and RFP (Aug/Sept release) – engage ACF • Huston Tillotson University – opportunity for strategic partnership on housing and/or commercial • Outreach strategy • Is additional funding available from COA to insure equitable outreach and outcomes? • Double bottom line financial model – URB to identify success • MOU needed between URB, AHFC, and AEDC Austin EDC Next Steps| 19