Owners of two LGBTQ bars in downtown Austin’s Warehouse District are pushing back on plans to grant historic designation to the buildings where the businesses are currently housed.

Those buildings are supposed to be razed to make way for a 43-story apartment tower that would incorporate a relocated Oilcan Harry’s, one of the gay bars affected by the project. But the Austin Historic Preservation Commission voted unanimously on Thursday, May 5 to give historic designation to the buildings that would be demolished. The designation would be based on the presence of several historic masonry façades.

Granting the historic designation would deal a blow to the proposed high-rise. The commission’s vote does not represent a final recommendation, though. Commission staffers are putting together more information to be presented at the panel’s June 1 meeting. If the historic designation moves forward after that meeting, the Planning Commission and the Austin City Council would need to consider it.

When plans for the high-rise recently started circulating on social media, many members of the local LGBTQ community voiced concerns that the project could force the closure of gay bars in the Warehouse District. The district serves as a hub for the LGBTQ community. But the developer, Houston-based The Hanover Co., says it wants to preserve as much of the heart of the LGBTQ hub as possible.

Ahead of the commission’s May 4 meeting, owners of Oilcan Harry’s and a neighboring LGBTQ bar, Coconut Club, blasted the proposed historic designation for their current homes.

Scott Neal, managing member of Oilcan Harry’s ownership group, says in a statement that a historic designation for the building that now houses Oilcan Harry’s would push the bar out of its Warehouse District block. Oilcan Harry’s is at 211 W. Fourth St.

The plan for the apartment tower includes ground-floor space for a relocated Oilcan Harry’s.

“The full details of our [Fourth Street] block situation are complicated and not publicly well known, but we want everyone to understand that the designation of our building as historic will result in Oilcan Harry’s being forced out of the block in less than 10 years by individuals and factors outside of our control,” Neal says. “The building would remain, but we will have been forced out and what fills the space would not be LGBTQ owned. The block’s character would completely change. We are not OK with that.”

Neal says Oilcan Harry’s is using its current lease as leverage to negotiate a deal that would keep Fourth Street an LGBTQ hub for more than 25 years. Putting a historic designation on the bar’s current home would take away that leverage, Neal insists.

In a separate statement, owners of the LGBTQ bar Coconut Club say the business will remain at its current space at least through SXSW 2023, with the possibility of its lease being extended beyond that. The club is at 310 Colorado St.

“There are still steps on the developer’s side that need to be handled before the demolition can begin,” the Coconut Club statement says, “and our landlord is working on our behalf to ensure that we can operate as long as is possible before closing our doors.”

With at least 11 months’ notice to find a new location, owners of Coconut Club say they have “sufficient time” to plan their next step.

“We love our performers. We love our community,” the club’s statement says. “We want to remain here in Austin to provide a home for you all to do your thing.”

The location of another gay bar in the Warehouse District, Neon Grotto, would also face the wrecking ball to make way for the apartment high-rise. But the neighboring Rain on 4th, which also serves an LGBTQ clientele, would not be affected.