More news about the Starr Building in downtown.
From the Austin Business Journal
http://austin.bizjournals.com/austin/stories/2008/03/03/story7.html?b=1204520400
Friday, February 29, 2008
Should it stay or should it go? Starr Building's future debated
Austin Business Journal -
by A.J. Mistretta ABJ Staff
When it was constructed in 1955, the American National Bank Building was Austin's first major example of modernist architecture -- and the first building in the city to have an escalator.
A half-century and several tenants later, the days may be numbered for the vacant four-story structure on the southeast corner of Sixth and Colorado streets.
Developers and downtown advocates see incredible value in the property -- if not the building itself -- just one block from the enviable intersection of Sixth Street and Congress Avenue. Yet when it might actually be sold and what could eventually rise there remains uncertain.
The Texas Comptroller's Office -- the last tenant to be housed in what is now known as the Starr Building -- moved out in April 2005, shortly after the building was purchased by the General Land Office on behalf of the state's Permanent School Fund. Since then, the roughly 90,000-square-foot office building and attached 107,000-square-foot garage have sat vacant in the middle of a downtown construction boom.
With a footprint of just under 40,000 square feet, existing zoning would allow for up to 350,000 square feet of development on the nearly half-block property. But given the lack of height restrictions on the site and the city's desire for more downtown density, a developer could request a greater allowance to maximize return on investment.
"Because of this location, the sky is the limit," says Michael Knox, principal planner in the city of Austin's economic growth and redevelopment office.
Knox says the city has referred several developers interested in the property to the GLO.
"I'm really a little surprised that something hasn't happened there yet," he says.
Nothing has happened yet because the GLO, which makes money for the school fund partly through the purchase and sale of property across the state, is not marketing the building.
Laura Rogers in the asset management/real estate division of the GLO says the agency is aware there is market interest in the Starr Building, but the property is not on the sales block -- yet.
"We get interested parties contacting us frequently, but at the moment there is not a sale date set," Rogers says.
Fred Higgins, an investment broker with NAI Austin, calls the Starr Building a "gross underutilization" of a prime downtown site. He argues that the building itself is inefficient and lacks historical merit. If the property were brought to market, Higgins believes it could attract a slew of suitors and a significant sales price.
Demolition costs aside, Higgins estimates the nearly 40,000-square-foot site could draw $250 a square foot or more if the lot were vacant, based on what's been paid for other prime downtown parcels.
"This is right in the bull's-eye of downtown development," he says.
Daniel Roth, a broker with Southwest Strategies Group and one of the partners in the redevelopment of the Seaholm Power Plant, says that when it comes to the Starr site, "the more the better, as far as mixed-use goes."
Roth points out that while there may currently be a glut of office space in the pipeline, a large-scale project incorporating retail, office and possibly other uses would take years to realize.
But not everyone believes the building should face a wrecking ball.
"If there's a redevelopment plan that includes keeping the building as a long-term citizen of Austin, I would like to see that happen," says Robert Summers, an attorney with Austin law firm Hohmann Taube and Summers who has launched an effort to preserve a large interior mural crafted by artist Seymour Fogel.
Sergio Ortiz, CEO of Houston-based Orion Hotels Inc., also wants to see the building preserved. He says he first began looking at the possibility of putting a boutique hotel in the Starr Building in 2003.
"It's a great building with a lot of character," says Ortiz. "I thought it would be a good counterweight to the beautiful new buildings surrounding the site to preserve this one. I think it would be a grave error to allow this building to be torn down."
Orion even went so far as to hire a designer to come up with a plan to renovate the Starr as a hotel. Drawings were developed for an art-deco style hotel that would feature 100 suites. But the company waited in vain for the state to make a decision on putting the property out to bid.
Ortiz says when the state does decide to act, his group will likely still be interested. While he recognizes the best value for the property may not be to keep the 90,000-square-foot building intact, he points out that sometimes sacrifices should be made to preserve unique structures.
Reuse of the Starr Building would require some remediation, though. Rogers with the GLO confirms there is some asbestos still in the building, which would need to be removed during a renovation.
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