Introduction: We’ve embarked on a big project - the Center for Social Innovation - and have been learning lots along the way. We’ve decided to share our experience here in the hopes that our lessons will be of some benefit to others. Please reach out if you are thinking about a similar project for your community and we’d be happy to chat - email@example.com
in case you missed it, read part one: Developing the Vision
Interested in touring The Center for Social Innovation? Schedule a time here.
Part 2: Finding Our Home
Our vision for the Center for Social Innovation was coming into focus, but we still needed to put a foundation under our castle in the sky. The next step was site selection.
The primary challenge with site selection (other than location, zoning, permitting, availability of utilities, impervious cover requirements, storm water management, whether you are located in a transit oriented development zone, etc.) was identifying a tract of land that was priced to allow for long-term affordability. This was especially difficult in a city seeing rapid land appreciation and population growth.
We had narrowed our search to East Austin because we believed we would still be able to find affordable land, and because the community need was high while still being close to downtown.
With the help of some excellent real estate professionals from Cushman and Wakefield, we evaluated about a dozen projects that fit our loose initial criteria. We created detailed financial models of the most promising projects, but in most cases we couldn’t create an affordable product for some reason. Some required prohibitively expensive subterranean parking, another restricted our potential uses due to its location in the airport overlay, and another required costly stormwater management improvements that meant we couldn’t arrive at a sufficiently low lease rate to attract the tenants we wanted.
It was about this time that we met Central Austin Management Group (CAMG). They had developed one of our favorite eastside projects, Canopy. Canopy resulted from the conversion of an old goodwill fulfillment center into affordable artist studio space, some creative office, and Sa-Ten - a coffee shop, restaurant and gathering place. It also supports a vibrant community of artists year round as well as during events such as East Austin Studio Tours. Canopy is more than the sum of it’s parts. We found ourselves in the business of placemaking and Canopy always struck us as an unusually successful example of placemaking.
But, Canopy offering the all-too-rare affordable studio space, had quite a wait list. Commercial lease rates in Austin were rapidly approaching an all-time high and the writing was on the wall for the non-profit, social venture, artist and maker communities. We’ve lost track of the number of folks we’ve talked to who had rent increases between 100% and 400% when it came time to renew their lease or simply were denied the option to renew because the property was being sold or re-developed.
CAMG, always on the look out it seems to create value by repurposing undervalued assets, had acquired the property, previously a tank farm, and completed the necessary environmental remediations.
After some early discussions it became clear to Notley and CAMG that we were trying to solve the same problem for two different but complementary tenant groups. By working together to create a truly exceptional place, Springdale General could play a larger role in the development of Austin’s innovative ecosystem generally and the Springdale Rd./Airport Blvd. corridor specifically.
Matt McDonnell is a Partner at Notley Ventures, a micro private equity firm focused on the intersection of profit and social impact. He previously served as COO of Famigo, an early childhood EdTech company, and a sailing instructor at Outward Bound. He holds an MBA from the College of Charleston, a JD from the University of Texas School of Law, and has been a contributor to Ed Surge and Venture Beat.