Austin Business Journal

Rainey Street reinventors shift focus to E. Cesar Chavez

By Jan Buchholz

Two real estate visionaries who played a vital role in the evolution of Rainey Street into a trendy strip of restaurants and bars are at it again — this time on East Cesar Chavez Street. Jesse Lunsford and Dale Glover have formed Rainey Ventures LLC to leverage their collective clout in boutique development.

One of their first joint ventures has been the development of a quirky commercial property that was transformed into the charming Jacoby’s Restaurant and Mercantile at 3235 E. Cesar Chavez St.

“This is such a complicated site with more than half of it in the flood plain. But this building is so special and it has parking,” Glover said.

Kanetzky Electric owned the building and land that looked like just another rundown commercial property along an unmemorable stretch of road, but Glover — a seasoned real estate broker with experience on city commissions and boards — knew it could be something special.

He remembered how Lunsford had transformed a decrepit bungalow on Rainey Street into Lustre Pearl, a perennial bar-hopping favorite.

“When I went in there I thought it was just magical,” Glover said.

So, it’s no surprise that when considering who might be able to convert an unremarkable 1980s building on the south side of Cesar Chavez into something broadly appealing that he turned to Lunsford — a former software guy harboring a lifelong fascination with real estate and creating interesting places.

His grandfather was an itinerant Baptist preacher and something about place making resonated in Lunsford’s soul.

His first endeavor in the mid-2000s was purchasing and renovating the 1889 house at 97 Rainey St. that would eventually be known as Lustre Pearl — somewhat of a template for modern Austin bars.

“It was in really bad shape but I could see the downtown skyline,” Lunsford said.

Joining up with Bridget Dunlap

The neighborhood is as close to downtown as they come and Lunsford could see that much of it was highly underutilized. Today he can hardly believe what’s happened with the number of high-rise apartments and condos already built or under construction. The 16-story Hotel Van Zandt is due this fall. Numerous restaurants and bars have opened there and Rainey Street is barely passable for all the construction, people and traffic.

But when Lunsford landed there, no one had caught the vision. As soon as he started working on the place, Lunsford met budding bar maven Bridget Dunlap.

“She knew right away she wanted to be there,” Lunsford said.

Lustre Pearl was born. Lunsford handled all the heavy infrastructure construction and Dunlap created the ambiance and marketing. It opened around the time of South By Southwest in 2009 and was an immediate hit.

Lunsford then purchased and redeveloped other old houses along the street. At one point, Lunsford and Dunlap became the victims of their own success when a Houston developer began assembling property around Lustre Pearl to build a high-rise apartment building. The pressure to sell became intense and Lunsford agreed to the deal and then arranged to move the Lustre Pearl building to a site on East Cesar Chavez — not far from what would become Jacoby’s.

Lustre Pearl East — which will be operated by Dunlap — is on its new foundation with an additional building and expanded grounds. It will open this fall. Nearby, Rainey Ventures remodeled a warehouse into offices for FloSports, a provider of on-demand content and live streaming in the sports realm.

During the past 18 months, Lunsford and Glover selected Adam Jacoby, a young entrepreneur with restaurant roots in Melvin, Texas, to occupy the building at 3235 E. Cesar Chavez St. Jacoby’s has been open about 11 months.

Food and drinks are served in a cozy rustic interior or on grounds overlooking the Colorado River. A quaint attached shop sells candles and pillows and other items.

It was an immediate success.

“I have not had one tenant leave me or fail,” Lunsford said.

The duo hopes their track record will convince more investors to come on board with Rainey Ventures as they scout out other special places that will appeal to creative tenants.

“It’s just been amazing how quickly 10 years has gone by,” Lunsford said.