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The price of urban growth in Austin

Hotel development to displace local businesses

By Scott Armand

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Published: Wednesday, October 4, 2006

Updated: Friday, January 9, 2009

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Katrina Perry

Dina Flores, owner of Escuelita Del Alma, adjusts a shoe strap for Sofia Condonosa, one of the many students at Escuelita Del Alma. Escuelita Del Alma, along with the neighboring Las Manitas, owned by Lidia and Cynthia Perez, are fearful they will lose their locations to make way for a hotel development. Las Manitas restaurant has been a pillar of the Hispanic community for 25 years. Escuelita Del Alma is the only day care downtown, and the only bilingual day care program in Austin.

At the Copa Bar & Grill on Congress Avenue Friday, a crowd of about 70 enjoyed the Tejano music of Johnny Degollado y Su Conjunto and chowed down on a complimentary meal of chips and queso and tamales. While their children danced and played, the adults clustered together to discuss the demise of two Austin landmarks.

Land development on the 200 block of Congress Avenue threatens to displace three local businesses: Las Manitas Avenue Cafe, Escuelita del Alma Learning Center and the retail arm of Tesoros Trading Company. A $185 million deal announced a few weeks ago between the landowner Finley Co. and White Lodging Services Corp. would tear down the businesses to make way for three Marriott International Inc. hotels.

"I'm so disgusted. It's more density," said Dina Flores, owner and director of Escuelita del Alma, a Spanish immersion day-care center.

As the pace of development in the downtown area increases, many residents decry what they see as the loss of Austin's unique culture. Las Manitas has served as a meeting place for local artists and politicians for the last 25 years.

"I think [Las Manitas] is a cultural institution," said Raul Salinas, a local poet, activist and long-time Las Manitas customer. "This place has made Congress Avenue. We're not just losing a building. … This is an Austin family."

City Councilman Mike Martinez said it's important to preserve Austin culture.

"These are cultural institutions that people have come to love," Martinez said. The reason that companies like White Lodging are so successful is because businesses like this exist."

Some view the issue as further evidence of gentrification in Austin, as the owners of Las Manitas and Escuelita del Alma are all Hispanic, and both businesses serve many Hispanic community members.

Gentrification is the way in which minorities are being pushed out, said Marcelo Tafoya, the Texas District 7 director of the League of United Latin American Citizens.

"Minorities should have opportunities like anybody else," he said. "But when a place develops, the prices get so high. How can you promote minority business when you put it out of their reach?"

Martinez said the city should encourage businesses owned by female minorities.

Escuelita del Alma is the only day-care center in the downtown area, and the only one in the city that offers Spanish immersion, Flores said.

"Downtown there's no day cares," said Gustavo Soto, a parent of a child enrolled at Escuelita. "We're working people. We have children. The city of Austin's mission is to have affordable child care."

"This high-rise will create jobs, but what kind of jobs? Service jobs," said Marie Saenz, another parent. "These kids are learning confidence, so that they won't have to work at this hotel."

No one offered any quick development fixes at the benefit.

"We do want Marriott to come and build their hotels," said Councilman Lee Leffingwell. "All we're asking for is a way to accommodate both interests. [Development] is going to be a constant battle, because Austin is growing so fast, so we need to pay extra attention to preserve our institutions."

However, both sides do not agree on which accommodations to make.

"These institutions have been under favorable leases for years with provisions that spell out that the block will eventually be developed," said Richard Suttle, an attorney with Armbrust & Brown, LLP who represents the Finley Co. "If the community thinks that it's something that's a piece of our fabric, then why should Finley have to bear the cost of it?"

Suttle also said White Lodging has offered the businesses a lease extension until August 2007, free rent until next August and relocation expenses.

"To date, this hasn't been accepted," he said.

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