The housing department will get more space, 22,000 sf, while the building's owner, the Austin Revitalization Authority, gets a long-term tenant for its 57,000-sf building along 11th Street.
The council held up the deal last week, questioning whether the city was getting a good enough deal. With revisions reached during the week, the city leases fewer parking spaces (to encourage employees to use public transportation) and changes some terms for the lease. For example, the city can sublease space with the building owner's approval and it has a five-year option to renew at 95% of the market rate at that time.
Council member Will Wynn, who questioned the deal last week, pointed out that private sector tenants who have signed leases are paying slightly higher rates than the city. He said the lease changes made him "very comfortable" with the deal.
Mayor Gus Garcia said the office building and other development around it will help spark a renewal in the area. "I'm hoping this has the long-term effect that we have all talked about, and that is the redevelopment of that area, the revitalization of the area so that it once again can become the vibrant community that it once was."
Riata Partners is the project developer. Building construction should begin this summer.
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