An unexpected gust of good news blew into downtown San Antonio on Oct. 31, a Halloween treat in the form of a new national study on downtown revival trends in 26 U.S. cities post-pandemic.
San Antonio ranks No. 1 in the recovery rate of nonresident workers in its downtown, with current activity standing at 85% of pre-COVID levels. Nashville, Tennessee, finished second with 80% and Midtown Manhattan in New York third at 78%. That surprising finish for San Antonio is bound to animate downtown advocates and city officials while triggering doubters to dive deep into the study’s underlying data.
The five big metros in Texas all placed in the top 15 of the 26 cities in the nonresident worker measure. While San Antonio had the highest overall rate of recovery, Fort Worth was sixth, Houston 10th, Dallas was 13th and Austin 15th. San Antonio also finished ahead of San Diego, California, and Memphis, Tennessee.
The study comparing the 26 cities and their downtown business and residential activity in 2019 and 2023 was commissioned by Philadelphia’s Center City District, a nonprofit organization in the City of Brotherly Love akin to Centro San Antonio. Researchers at Placer.ai, a Santa Cruz, California-based location analytics firm, used cellphone data to track trends in each of the markets.
For the Center City District study, activity patterns were tracked for workers who commute to downtown offices, out-of-town visitors such as conventioneers, residents who live downtown and locals who travel downtown to enjoy cultural and entertainment amenities.
The study was prominently reported by economist Richard Florida on the Bloomberg CityMap website last week.
San Antonio fared less impressively in other areas of the study, as noted below.
All but a few cities, including San Antonio, still report significant office vacancy compared with 2019 and pre-pandemic occupancy levels, with hybrid work reducing the number of days workers commute from home to their offices. In some cities, rising residential occupancy and a steady return of downtown visitors have helped reduce the gap created by lost office workers.
Houston, for example, finished second only to Portland, Oregon, for downtown residential growth between 2019 and 2023. The two cities reported current residential populations at 134% and 122% of 2019 levels, respectively. Los Angeles finished third and Dallas finished fourth, posting 118% and 117%, respectively. Austin ranked 20th in this category, finishing at 108%. Demographers will be sure to take note that all of the cities studied, except Phoenix, have grown the number of downtown residents post-COVID. Even San Antonio, which finished next to last in the category, showed 101%. Clearly, demand for downtown residential living post-pandemic is high. Producing new units and undertaking office-to-residential conversions are the challenges.
Residential density remains lacking in San Antonio’s downtown, long geared to the convention and tourism industry and dominated by hotels with few residential towers. That will start to change in 2024 when Weston Urban, San Antonio’s most ambitious downtown developer, opens 300 Main, its upscale 354-unit tower, which will be the city’s tallest residential tower. A few blocks south in the Zona Cultural, Weston Urban has started construction on the Continental Block, with 250 units planned. The firm, which entered into a historic public-private partnership agreement with the City of San Antonio and Frost Bank in 2014 in which it promised 300 new residential units downtown, is now on track to at least triple that number, including its recent acquisition of the affordable Soap Factory Apartments on North Santa Rosa Avenue west of the San Pedro Creek Culture Park.
That public-private partnership led to development of the new Frost Tower, the city’s acquisition of the former bank tower, now known as City Tower, and the firm’s acquisition of Legacy Park. Renovations to the historic Rand Building, home to Geekdom, and the Savoy, home to ScaleWorks, complete that impressive Weston Urban office cluster.
San Antonio trails the other Texas cities when it comes to attracting nonresident visitors, with Austin and Dallas drawing about 82% of the visitors they received pre-COVID. That number falls to 76% for San Antonio, about the same measure when talking about the recovery of this city’s convention business.
The recent opening of Civic Park in Hemisfair, the continuing redevelopment of Alamo Plaza, and the prospect of UTSA’s Institute of Texan Cultures (ITC) considering a permanent move to a parcel just east of the Alamo have helped enliven the downtown conversation and will attract more people to come downtown, both residents and nonresidents. An ITC relocation would open up what many developers regard as the most valuable piece of downtown property primed for redevelopment: the southwestern corner of Hemisfair, where city officials are said to be considering a new professional sports and entertainment district.
The biggest public player downtown today is UTSA, its downtown campus redefined by its growing footprint in the urban core. University and city leaders recently broke ground on San Pedro II, the School of Business’ Innovation, Entrepreneurship and Careers Building at 622 Dolorosa St. on the creek’s west side across from San Pedro I, UTSA’s School of Data Science and National Security Collaboration Center. With less fanfare, UTSA has assumed control of the former Southwest School of Art, now the UTSA School of Art, as well as adjacent undeveloped properties.
The bottom line is that downtown will see university students in higher numbers than ever before in the coming years, and many are going to want to live within proximity of their classes.
So can these analytic numbers interpreted by AI be trusted? Time will tell, but Philadelphia isn’t the only city turning to such measures.
“Placer.ai and their work got a lot of attention at the International Downtown Association convention in Chicago this month,” said Trish DeBerry, president and CEO of Centro San Antonio. “San Antonio does rate high in return-to-downtown measures, in part because we have had a strong hospitality rebound. Now we’d like to see higher numbers in the private sector. Downtowns do have to become less about occupation and more about destination. We have to activate downtown for more than work. We need to lean into hospitality and tourism.”
Downtown recovery in San Antonio, and in every U.S. city in the study, remains a work in progress. Significant events like UTSA home football games or a major concert at the Alamodome can bring downtown alive for a day or night, but those of us who work downtown know we are far from where we were before COVID.
There are other studies that rank San Antonio lower in downtown recovery and business activity. An October report released by the University of Toronto, also based on cellphone analytics, ranked San Antonio 33rd among 66 cities in North America.
The data does suggest a more positive picture and trendline than many have portrayed post-COVID. Is San Antonio’s downtown on the rebound? That’s how it looks to some researchers and downtown advocates in other cities. Perception, often enough, drives reality.
