The Austin Chronicle

2nd Street District

What's up with the management?

By Richard Whittaker, February 1, 2008, News

AMLI Management Co., the development and management group responsible for the 2nd Street District, has said its decision to directly manage the ground-floor retail component should help the area's growth. In December, the district's retail management firm, Dallas-based Urban Partners, was replaced by AMLI after allegations of poor management and overbilling from the district's retail tenants. AMLI CEO Steve Hallsey called this a natural progression, saying, "If you think that AMLI has $100 million invested into this core, having AMLI manage the retail component certainly aligns everyone's interests, from development to the corporate office to how each of the business owners sees management taking place."

After repeated complaints from retail tenants that Urban Partners was unresponsive to complaints and requests, AMLI has hired permanent on-site management and a full-time marketing manager. Hallsey stressed, "Rather than directing a third-party manager, it's what we want done in what I like to think is a timely manner." However, retailers in the district noted that, while AMLI has said it will re-examine contested, outstanding utility bills, there has been no real movement on this issue, and several were still in default.

While this is the first time AMLI has done direct management of retail, Hallsey stressed his 15 years of experience in the field, including his time at Glenboro Realty Trust, where he was responsible for 33 million square feet of commercial and office space in 43 states. He also noted that, while there had been undeniable issues in the past, the district had more than doubled its retail sales from $26 million in 2006 to $54 million in 2007. Hallsey also emphasized the value of the city's Great Streets beautification program for opening the area up and attracting existing businesses like tapas bar Málaga, which plans to move from its current site on Fourth Street on April 1. Chef and owner Alejandro Duran said the move was partially because he had outgrown the kitchen at his old site. But comparing the district to growing up in Spain and spending time in San Diego's Gaslamp Quarter, he said, "The walker-friendly environment is a must and turns it into an immediate attraction."

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