The Price of Progress
While living in New York City, she started a catering business. When her husband, John Downing, was offered the position of Chair of the Radio-Television-Film Department at UT, the couple moved to Austin in 1990. After suffering through a few years of employment at a state agency, Corea found her way back to cooking professionally. Some friends, the owners of Fonda San Miguel, rented her their restaurant kitchen at a minimal cost six mornings a week so she could make various types of empanadas which were successfully marketed to Whole Foods, Martin Bros., and various Austin cafes. In 1994 she finally took the plunge and signed a lease for the boarded-up property at 500 E. Fourth for around $1,600 a month. Requisite repairs and fitting out the former car bumper showroom as a kitchen/cafe cost about $130,000, secured from friends, a CDC loan of $40,000, and her own savings. Corea opened her cafe/bakery on Feb. 7, 1995. Justly proud, she says, "We took a non-paying property and made it into an active business."
Why empanadas? One of Corea's delicious childhood memories, Cornish pasties (with the "aaa" of a sheep, not the long "a" that I used in confusion with Fifties strippers' apparel) were similar to what she discovered to be called "empanadas" in the Western hemisphere -- a food item surrounded by fried or baked pastry. Through her travels, Corea had tasted many variations of the empanada in Mexico and other countries of Latin America. Even more adaptable food containers than tortillas, pita pockets, or sandwiches, the empanada in Corea's hands becomes an amazing treat. She drops meat, vegetable, condiments, or fruit into a disk of light pastry, which is then folded and pinched along the edges to form a half-moon, and finally baked, not fried.
Laying Tracks Downtown For the last four years, the Empanada Parlour's fame has grown, primarily by word of mouth. Most customers are downtown office workers and business people, and up until January business was quite good. But then the street work commenced as utility lines were dug up and relocated along the two-block stretch of East Fourth to make way for the railroad tracks. Diana Walters, executive director of the Steam Train Association, says the "purpose of the extension is to bring the steam train closer within the downtown area but also basically to bring the steam train back home to where it sat for a little over 40 years," behind the Fifth Street fire station and O'Henry Museum on Brush Square, one of the original 1839 parks of Austin.
Since 1997, the River City Flyer, pulled by an 83-year-old Southern Pacific steam locomotive, has come into town to pick up passengers at Fourth and Red River. A 90-minute round-trip on the Flyer takes riders east from downtown, passing under I-35, through Zaragosa Park and along the Boggy Creek greenbelt, crossing 12th and then Martin Luther King before slipping back under I-35 near Hancock Center, and finally along Airport Boulevard to just behind the old Buttercrust bakery near Koenig Lane. Target date for use of the two new blocks of tracks is June 6. By 2002, the northern doors of the enlarged Convention Center will open right onto the new terminus of the River City Flyer, which should prove to be a popular recreational feature for convention-goers.
Arthur Sampson, project inspector for the Public Works and Transportation Department, said construction of the new tracks, which began the first week of February, is scheduled for 60 working days. Austin Filter Systems is presently excavating the roadway and placing 12 inches of ballast material (gray rocks) in the center strip. Longhorn Railways will then arrive to install ties and rails, and finally Austin Filter Systems will return to pave the entire street. Once the block between Red River and Neches is completed, then the same process will be repeated from Neches to Trinity. Corea fears that the noise, dust, and constant disruption will keep even her most faithful customers away. She wants to move her cafe to another location, but lacks the resources to just pick up and leave. Having continually invested more money beyond the $130,000 originally spent for remodeling the space four years ago, she needs financial assistance to start over again elsewhere. When approached in early January, officials told Corea that the city is under no legal obligation to compensate her for loss of business since the property on which her cafe sits was not bought by the city.
Councilmember Jackie Goodman noted that the hardest part in implementing any initiative is always the accompanying disruption of existing businesses, homes, and other facilities. She says the council intends to discuss and formulate the criteria that successfully support Smart Growth. Goodman said she wants to be sure that existing, viable businesses are not wiped out by new construction but can find compatible, nearby locations to continue operating. One option she hopes to explore for such relocation assistance would be low-interest rehabilitation loans from funding sources similar to HUD.
Councilmember Daryl Slusher points out that the principal problem in helping small businesses is that they generally lease, rather than own, property. But Slusher said he is in the preliminary stages of considering ways to encourage property owners to retain existing small businesses rather than jump into land speculation. One possible route is to provide tax abatements to property owners who have retained small business tenants for a certain number of years. Even if the landlord did not pass a portion of the tax savings along to the tenant, at least the business could remain in an area of rising land values.
What is obvious from discussions with various councilmembers is that the situation of the Empanada Parlour is generating creative ideas about the relationship between government, property owners, and small businesses.
On Feb. 11, Corea sent a four-page letter to City Manager Jesus Garza detailing the escalating problems of access, noise, dust, and contamination. She pointed out the financial loss already suffered: Her January 1999 gross income was $3,342 less than January 1998. In a small business, that kind of loss inflicted over a few months can be sufficient cause for closing the doors. Because of declining sales in January, Corea had to release two of six full-time employees. In her letter to Garza she delineated exactly what she would need to survive: "Sufficient financial assistance from the city to relocate my business on a site that will enable my clientele to continue their so far very loyal support." With land values shooting up all over the Central Business District and even in the larger Central Austin area, Corea knows that she will be paying a much higher monthly lease rate. And since she almost certainly won't be able to afford a turn-key kitchen site, she knows she's faced with reconstruction and build-out of a new site, dismantling and removing her present kitchen appliances, dual rental for four months as the new place is fitted out, retention of personnel, and other expenses which would conservatively total around $150,000, the amount she is seeking from the conscience of the city.
City Plays Monopoly
A study of land acquisition for the additional 205,000 square feet of exhibit, ballroom, and meeting space in the Convention Center shows a lot of money moving around and provides a concise picture of the dynamic changes in property values in the southeast quadrant of downtown. To expand northward of the existing Convention Center, the city had to acquire two additional blocks (original city block numbers 33 and 34) between Third and Fourth. Each block in that area was established during the original 1839 survey as a 276-foot square containing eight lots -- four on the north, four on the south -- with a 20-foot-wide alley running between.
Two years before the Convention Center expansion bond proposal passed, the city was able to buy the four lots of the 500 block of East Third from Southern Pacific Railroad for $780,000. Jumping across Neches, the city acquired two lots from Bluebonnet Lofts on July 21, 1997 for $1.2 million. Shortly after the bond proposal passed last May, the city was able to finish off purchases on East Third by buying the remaining two lots from members of the Becker family for another $1.2 million. The next big hurdle was getting the eight lots on Fourth Street, seven of which contained nearly half of the Railyard Apartments, just recently beginning to convert to condos. July 7 brought an end to negotiations with the Brothers Property Corp. of Miami, which sold the 400 and 500 blocks of the Railyard Apartments for a very tidy $9,525,000. The one remaining lot, held by the Louis Shanks company, was the sole holdout. A store manager said that when faced with the threat of eminent domain seizure, the company sold the land for an undisclosed sum ($875,000, according to Larry O'Neal, the city's manager of Real Estate Services). So the city acquired the necessary two blocks for the Convention Center expansion for a total of $13.58 million. During the two years of purchases, the price per lot went from $195,000 to $600,000 to $1,360,714, with the Louis Shanks compromise as a bargain by then. Naturally, property values in the blocks surrounding that area have begun to rise and will doubtlessly continue over the next three years as the Convention Center expansion is completed.
Where the Empanada Parlour is located -- on original city block number 39, comprised of eight lots between Fourth and Fifth, Red River and Neches -- provides a prime example of rising land values. The 1998 "market value total" of the entire block, calculated by the Travis County Appraisal District for purposes of taxation, has risen to $2,192,013, a 41% jump over the 1997 appraisal. More tellingly, that portion of value which is strictly land, and not "improvements," has jumped 57% to $1,916,613, while the appraised value of the buildings has actually gone down by some 17%. If the property sells, the existing buildings will inevitably be torn down. And what might go on that valuable property?
Corea has already been told by her landlord, the Finley Company, through property managers Harrison-Pearson, that "at this time, the property owners are not in a position to negotiate an extension [to her lease beyond Aug. 31], but should be able to respond by the second quarter of 1999." Corea suspects, "They want to put a hotel here at the front of the Convention Center. It may not be 'the Austin Convention Hotel,' but it will be another hotel." The Finley Company owns nearly all of the lots in block 39, so at least negotiations between developers and property owners would be simplified. When told by one city representative that she should be thankful that the construction is going on because in three years she would be right in front of the Convention Center, Corea was momentarily rendered speechless. Even if a hotel or restaurant is not put onto the block, the price for her 2,000-square-foot space would dramatically increase, even if land values leveled off soon, which they absolutely will not.
Although there are other sites vying for the Convention Center hotel, Andy Hinman of Graeber Simmons and Cowan architectural firm indicated that several large hotels might be built in the area rather than the much-discussed 800-room hotel, which, according to another architect, if built on one city block, would have to be in the range of 20 stories with the bottom two dedicated to the lobby, reception halls, ballrooms, and meeting rooms. Corea has heard rumors that the property owners of the Pit Barbecue site have had the glitter of $3.5 million dangled before their eyes for their one lot on Block 39, but such enticements are certainly premature until city officials, developers, architects, and hotel managers finally determine an appropriate site for the hotel(s).
Is Light Rail Next?
Other questions arise. Is the extension of the steam train tracks also the insinuation of light rail onto Fourth Street, the east-west route for the system proposed by the Austin Transportation Study in February 1998? That issue has not yet come before the voters, but it seems possible that, just as the city began buying land for the Convention Center expansion two years before the bonds were passed, the city is now making tentative steel-toed steps westward on Fourth.
So, in the midst of these massive upheavals in the landscape surrounding the Empanada Parlour, what is a one-woman business owner to do? She has beaten the odds for new businesses, especially restaurants and cafes, by surviving four years. Corea presently provides jobs to four people and pays El Galindo bakery to make the pastry disks for her empanadas. She sells empanadas wholesale to various restaurants and grocery stores, maintains a catering business and cafe, and buys food from local wholesalers. Her sales tax payments average more than $1,500 per month. In short, she is contributing to the Austin economy. Corea is tireless, like all successful small businesspeople, putting in 12- to 15-hour days virtually seven days a week. Ultimately the amount of her request for city relocation assistance -- $150,000 -- seems rather modest. It represents 1.1% of what the city has spent on two blocks of land and only 0.13% of the total $110 million allocation for the Convention Center expansion and the Waller Creek flooding alleviation project.
There is something disturbingly ironic about the City Council last December wisely allocating funds for tourism and convention sales to Asian, African-American, and Hispanic markets, while simultaneously, albeit unintentionally, destroying a viable business run by a minority woman across the street from the Convention Center. The welcome and appropriate diversity within the massive building should be equally welcome outside in the surrounding businesses.
Is the destruction of Ash Corea's business the inevitable cost of growth and improvement, or can Austin mature even farther beyond the Wild West, solely market-driven boomtown mentality of the Eighties? The new coalition of progressive developers, architects, urban planners, government officials, and voters should be able to create a joint solution to one more problem -- the dislocation of small businesses. Many residents and visitors will benefit from the new facilities under construction or discussion -- the River City Flyer excursions, a grander Convention Center, and Waller Creek shops and restaurants. But many also want to continue eating downtown at places like the Empanada Parlour. The bond proposal for expanding the Convention Center did not contain a footnote indicating that part of the cost would be running a locally owned and minority woman-operated business out of downtown or into the ground. Austin is rich because of its ethnic diversity, youthful spirit, intelligence, and compassion. Smart Growth is supposed to fill in downtown with a wide range of shopping, eating, working, living, and entertaining venues, not necessarily with "Rock" or "Planet" in their names. Clearly, more thought will have to be put into the problem of sustaining unique and diverse businesses downtown while still building large public and private facilities.
At this time the city is fortunately blessed with visionaries. Architect Juan Cotera believes that Austin can have one of the most exciting downtown areas in the nation. Charles Betts, executive director of the Downtown Austin Alliance, says that downtown Austin needs businesses like the Empanada Parlour because they add to the uniqueness and diversity of the downtown experience. Architect Andy Hinman sums up the dream and the dilemma: "We want things to be market-driven and self-supporting. On the other hand, there are these wonderful businesses that not only benefit from their quality of product and service but need visibility. If they are pushed out of the areas that have the visibility, then how do your local businesses survive? To what extent should there be public support for them other than just showing up and buying their cup of coffee or their empanadas or whatever? That's a policy issue. It'll have to be the will of the people. We keep calling it city ordinances, but the truth is that we have control over it if we are willing to get involved."