ArizAnon,
The builders put balconies facing an adjacent lot that they either never owned or have since sold knowing that such a prime lot only 40 yards from Congress would lure another structure of similar scale. If it were intended to have unobstructed views in perpetuity, they would have retained that land. I know the subsidized renters can't pool enough to buy it, but that's life as a tenant.
Also, if nobody were losing something they have grown accustomed to (sunrise on the balcony) it would be seen as a bonus.
People here point to Mediterranean cities with narrow streets that are always in the shade, and the buildings stay cool, and maybe you know the person in the neighboring balcony and think "that must be nice". What's the difference here? The buildings are modern looking, we probably won't be hanging our laundry in the streets, and that's about it.
And the bar has to follow the same liquor laws as every other bar down there. It sounds more like an after hours club rather than 24/7 booze. Maybe it will keep some of the shouting, urinating and vomiting off the streets!
Tangentially, I think it will be great when other projects put more height on avenues such as Arizona and Herbert. Once shaded, and power/garbage relocated, those would be great pedestrian only retail. A sort of trial balloon for the people who want to remove the cars from Congress.