April 22, 2015
Staff Writer-Austin Business Journal
South Austin gets its shot at the artist economy
South Austin could soon give the east side a run as the new frontier for the creative class in Austin.
A pair of large parcels south of Ben White Boulevard are slated to host creative hubs in the coming years. On South Congress Avenue near St. Elmo Road, an 8-acre parcel slated for a development known as The Yard by ZIR Investment Group is expected to feature creative office space, maker space and artist studios.
But the biggest is GroundFloor Development's St. Elmo's Market and Lofts, which the company hopes will lure creative businesses that could turn the project into a smaller version of Nashville's Music Row.
Dallas-based GroundFloor is interviewing brokerage firms that would recruit music-focused businesses from Austin as well as other major music centers including Nashville, Los Angeles and New York. Executives plan to select a broker next month.
Brandon Bolin, GroundFloor's founder and CEO, said music-focused technology, publishing, marketing, publicity, nonprofits and retail operations are among the tenant types envisioned for the development's 200,000 square feet of office space. He said his company is already negotiating with anchor tenants for the office space, which is expected to be completed by early 2018, if not sooner.
The St. Elmo's project is planned for a 9.5-acre industrial parcel at South Congress Avenue and St. Elmo Road that would feature a music venue and a public market on par with Pike Place in Seattle. The owners of popular Austin live music venue The Saxon Pub on South Lamar Boulevard are among those looking at the property.
A boutique hotel, condominiums and creative office space are also planned for the St. Elmo. The deal to acquire the land is expected to close this summer.
"There's not a huge inventory of the kind of office space we have planned, but it's what there's the most demand for, with tall ceilings, lots of light and an open floor plate," Bolin said. "When you go to Nashville as a musician, Music Row is right there. We want this to be a sort of first stop for any musician who's coming here when they first arrive in town, to take advantage of the services that will be available to them in Austin."
Incorporating space for nonprofit groups was one of the community benefit options Bolin and his partners agreed to while negotiating with the city to get planning approval for the property. Other developments have offered assistance to creative groups in recent years in exchange for planning consideration, with the South Shore District complex on East Riverside Drive providing new office space for the Austin Music Foundation.
Bolin said that trend will likely continue as development moves south, with the area bordered roughly by Ben White Boulevard, South Congress Avenue, I-35 and his own development as the most hospitable for creative spaces going forward.
Asked about concerns over the viability of music-related businesses, Bolin said a he's most interested in creative industry startups that have a technology component.
"Music is fundamentally changing but here in Austin we're in an interesting intersection with music and technology," he said. "Those are the types of users we are very interested in because the music industry has fundamentally changed and the days of record labels throwing a huge budget at an artist are gone."