City Council pulled the trigger on consolidating its planning and development services under one roof, voting to issue $122M in certificates of obligation last week to build a multipurpose building on Austin Community College’s Highland campus.

This adds the City of Austin to the ongoing public-private partnership between the Austin Community College District and RedLeaf Properties/Ryan Cos., which is redeveloping the former Highland Mall. The city purchased 5.1 acres on a pad site outside of Highland Mall to construct a 264K SF office building with a six-level garage and related site amenities.

“We would welcome the City to Highland and the opportunity to collaborate with them in innovative new ways,” ACC President Richard Rhodes said when the deal was announced earlier this year. “ACC is proud to be part of the Highland revitalization project, and we see strong possibilities with the city for career development, workforce training partnerships, and other collaborations that could greatly benefit our students and community.”

Lauraine Rizer of Austin’s real estate services division told City Council Thursday the ability to move development services to Highland Mall and consolidate other offices at One Texas Center will save the city about $43M in lease payments. Being able to roll the project into the Highland Mall plans also will shave two to three years off the bid and construction process.

City leaders praised the innovative partnership, although Mayor Pro Tem Kathie Tovo expressed concerns at a public meeting last week about the lack of a day care center, an early goal of the plan. Rizer said a pad site for amenities was being added to the property, although ACC appeared to be leaning toward offering vouchers for day care services, given the number of existing providers in the area.

Stuart Hersh, a former employee and frequent observer at Council, raised concerns about the city using its short-term debt for construction when it could be used to provide flood plain buyouts or affordable housing incentives.

“It looks very pretty, but sometimes the price of pretty is something homeowners and renters can’t afford,” Hersh said. “As homeowners and renters, we’ve made sacrifices to get where we are today, and we’d really appreciate that you do so as well.”

The city retained CBRE in early 2016 for a facility space assessment. City officials said payment on the construction debt, which will begin in 2020, will come from fees for services in the development division. City leaders said the deal also locks in rental rates that are more reasonable, and more stable, than the current private market.

The building will be ready to open in 2019.