AUSTIN (KXAN) — People “overwhelmingly” want to see more affordable housing – with the priority given to people working in the healthcare, hospitality and service industries, according to a community impact survey referenced in a new City of Austin memo.

In response, the City Manager’s Office had made an official recommended to convert at least part of the former HealthSouth property into affordable housing. The land is on the corner of Red River and 12th Streets, walking distance from Dell Seton and the heart of downtown.

This is rooted in the Austin City Council’s priority for “mixed-income housing affordable to households at or below 60% Median Family Income,” according to the memo.

Below are the results from a survey of 396 people, where city staff asked “What three community uses would you be excited to see on this site?

“Current market conditions present unique challenges to the immediate redevelopment of the site,” the memo reads. “In addition to increasing development costs (e.g., labor, materials, and financing), there is a large pipeline of market residential units in the downtown area.”

City staff said there are currently more than 3,000 multifamily units under construction downtown.

“In comparison, there are relatively few affordable housing opportunities in downtown Austin,
the memo continued.

Regarding the rest of the property, staff recommended waiting to make a decision “while closely monitoring market conditions.” One of the parcels has fewer restrictions, so there are more options when it comes to what the city can build there.

The memo also states “there are a variety of planned and future construction projects in the immediate surrounding neighborhood that could impact access, property value, and connectivity with respect to the 606 E. 12th Street parcel.”