AUSTIN (Talk1370.com) -- Austin City Council members voted Thursday to approve the purchase of two significant real estate parcels, totaling more than $90 million.
Council voted to approve the purchase of the former Salvation Army facility in downtown Austin at 501 East 8th Street. The purchase also includes a smaller 1,500 square foot retail building on Red River Street and a surface parking lot.
The $15 million purchase will allow the city to continue shelter operations at the site in the long term, after the Salvation Army closed its shelter in April.
City officials had negotiated a one-year lease with the Salvation Army, which began on July 1. During a work session on Tuesday, interim Homeless Strategy Officer David Gray told council members "the current plan for the Salvation Army site is to serve women as well as individuals who identify as transgender."
Also before Council members Thursday was the purchase of a two-story office building at 5202 East Ben White Boulevard. Several city departments are currently housed at the site, with the city currently leasing about 80% of the available space. The city's Economic Development Department, Communications, and Public Information Offices are currently located at the site.
Council members approved spending up to $75,545,000 for the acquisition, furnishing, and equipping of the space - roughly $71.5 million of which will go towards acquiring the property.
Lease costs for the property currently run about $6.4 million annually, which city staffers say exceeds the anticipated $6.1 million annual cost for debt service on the purchase. The Mexican Consulate also occupies about 10% of the property, with expected third-party lease revenue of roughly $1 million.
