How an Austin developer overcame racist deed restrictions to create a thriving retail space

DaiDueShop1From today’s Austin Business Journal:

Renovating an ugly commercial building takes guts. Shalou Barth believes she’s proved her mettle by turning an aging, ugly strip center into a cool East Austin retail project at 2406 Manor Road.

“It was a dump. It had been on the market for over a year. It had temporarily been Obama’s [campaign] headquarters,” Barth said. “I had a vision of totally re-imaging this place.”

Three years after Barth put a contract on the property, which reportedly had been a grocery store and rehab facility in a previous life, it’s now a thriving, fully-leased gold mine of a retail center boasting the likes of Dai Due restaurant and butcher shop and Raven + Lily boutique.

When Barth put in the contract In December 2012, however, the daughter of Indian immigrants couldn’t believe what she discovered in the antiquated deed restrictions: Only caucasians could own the property and only certain types of alcohol could be served.

She also discovered that the property next door — leased by restaurant and bar Haymaker — was also under the same restrictions. But changing deeds isn’t an easy fix.

Barth, 37, met with about 10 stakeholders, including her broker Jon Switzer, to come up with a solution. She was undaunted by the all-male phalanx involved considering that, for several years, Barth worked for General Motors, gamely assisting dealership owners about how to improve their sales.

“I had the responsibility of telling 50- and 60-year-old men how to run their business,” Barth said. “It actually taught me a lot about different ways of thinking.”

The legal requirement to change the deed mandated that all 15 owners of 21 surrounding land parcels approve those changes.

“Who can get 100 percent of anything, especially since many of them are rental properties?” Barth said. “It was all pretty discouraging.”

Doors were slammed on her. Phone calls disconnected. Barth was disconsolate, until she woke up one morning and started researching information about deed restriction legislation.

It became apparent that she wouldn’t need 100 percent buy-in, but she would need one more person to sign off on the changes. She was at day 28 of a 30-day extention she received to meet the deed deadline.

“My only hope was this one last property owner — and I got it done,” Barth said.

The fun part was yet to come: Finding cool tenants and designing the space. It helped that Barth’s husband, Eric Barth, is co-principal of A Parallel Architecture, the firm that designed Paul Qui’s signature restaurant and a host of contemporary Austin homes.

Pretty quickly, Dai Due, Sugar Mama’s Bakeshop and Raven + Lily all came on board.

“I had a target list of who I’d like to see and what would succeed here,” Barth said.

She couldn’t believe how intense the interest was and how many other people insisted that they had tried to buy the property.

“It was funny because I know it sat on the market for at least a year,” Barth said.

The fortunes of Barth and her husband turned again when another retailer signed a letter of intent for the remaining space in the 6,500-square-foot building but it fell through.

The Barths considered the possibilities over a bottle of wine and pizza.

“We penciled out some ideas on a napkin,” Barth said.

They decided they would open Unit D Pizzeria, a wood-fired Neopolitan style pizza joint and wine bar, in the remaining 1,600 square feet.

Finding the right oven was crucial — and expensive. So how would she pay for a $10,500 piece of equipment? By being a contestant on “The Price Is Right.”

It wasn’t part of the business plan, but the trip to California and appearance on the TV game show just happened when family members took one of their own on a vacation — to forget about the pain of a relative’s bout with cancer and just to enjoy each other’s company.

Barth was the last contestant of the day and won.

“It was hilarious. Drew Carey was so funny. And my husband was crying,” Barth said.

The episode ran on April 10, 2015. Unit D Pizzeria opened July 23.

Barth didn’t disclose the amount of her investment in the property but it appears to have been a wise acquisition. When she purchased the property, it was valued at $451,002, according to the Travis Central Appraisal District. Last year, the appraisal had jumped to more than $1.9 million, county records show.

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