A few days ago, San Antonio’s Historic Design and Review Commission approved the request of Federal Realty Investment Trust to demolish two buildings on downtown Houston Street. Federal argued that the Walgreen’s and Stuart buildings had deteriorated so much that rehabilitation was unthinkable, and Walgreen’s said it would leave if it couldn’t be housed in a new building. Although the San Antonio Conservation Society opposed the demolition request, the HDRC was willing to go along.
For the Express-News editorial board, the choice was obvious. Noting that the buildings suffered “numerous problems, such as insufficient load-bearing beams, water damage, and dangerously bowing walls,” the E-N editorial argued that failing to grant Federal’s request would force out Walgreen’s and doom the structures to “fall into further disrepair; damaging Houston Street’s economic health in the process.”
How far Federal Realty has come.
When Federal burst onto the San Antonio scene with its purchase of 12 buildings on Houston Street in 1998, grand promises were made. They painted a picture of turning Houston Street into a retail, dining, and entertainment district, restoring old structures and developing two hotels, with visions of hundreds of millions of dollars of new, private investment that might transform empty upper floors into offices and apartments. And above all there was the pledge that Houston Street would re-emerge as a major retail destination.
In an interview I did years ago on KLRN-TV, Federal’s John Tschiderer said major national retailers would be coming to Houston Street. He mentioned Barnes and Noble and Bath and Body Works as prime examples, and possibly boutiques and specialty retailers, including the famed Marti’s of Nuevo Laredo.
But first, Federal needed money — public money. Houston Street needed doctoring up (bring in the big trees), and the hotel that Federal planned at Houston and St. Mary’s streets required a parking garage, one that the City would build and pay for.
To lure the tourists from the River Walk to Federal’s major new retail and entertainment district, there needed to be a series of walkways, elevators, and pedestrian connections to the river. Federal reassured San Antonio officials that the City could pay for all that painlessly, with $10 million in bonds secured by the growing property values of the area itself. So we pumped more public dollars into Houston Street.
The promise of national retailers was never fully fulfilled. Nor was there a proliferation of boutiques. The new Hotel Valencia was built, but the second promised hotel, at Presa and Houston streets, never happened.
The new City-owned parking garage on St. Mary’s was completed, with a design that was supposed to break up its mass and provide plenty of lively ground-floor retail space — a quick look at the lovely garage reveals a Quizno’s sandwich shop and a parade of empty storefronts with “For Information … ” signs.
Then Federal concluded it needed to shift its strategy. No longer would retailers save Houston Street. It would now largely be an entertainment mecca, enlivened by clubs like Banana Joe’s and Tabu. Then those failed.
There were more promises. There would be “Houston Street Live,” a complex of five different clubs, including a Cheers bar, a Mardi Gras karaoke room, and the Midnight Rodeo dance hall. In August 2003, Federal Realty was reported to be planning to renovate the Walgreen’s building in order to lease the upper stories, and an Express-News story quoted one local real-estate agent pronouncing “the match has been struck … and everything is going tssssss!”
That was actually the sound of “Houston Street Live” fizzling. Federal did succeed in renewing some older office buildings, filling them with San Antonio firms that were already downtown. There are some new restaurants and bars. Yet the grand promises of a booming, revitalized Houston Street have petered out, too. If the Walgreen’s and Stuart buildings that Federal wants to tear down have deteriorated over the last seven years, it has been on their watch, while they owned them and were responsible for their upkeep.
An out-of-town developer came to San Antonio with the reputation for turning around downtowns. They promised big things — which local boosters turned into grander expectations — and they asked the City and other local governments to pick up the tab. Then they didn’t deliver year after year; and so we gave them more.
On Thursday, City Council is poised to approve a tax-increment district for the “River North” area on the northern edge of downtown, “so it can draw more private investments for housing, retail, and offices.” The promise is that $67 million in public dollars will yield 500,000-square-feet of new office space, new retail, and 5,500 apartments.