The Friedrich Lofts apartment complex (right) will be located behind and next to the historic Friedrich building (left) at 1617 East Commerce Street.
The Friedrich Lofts apartment complex (right) will be located behind and next to the historic Friedrich building (left) at 1617 East Commerce Street. Credit: Courtesy / Provident Realty Advisors

San Antonio City Council approved an incentive package Thursday worth more than $2.3 million for a mixed-income housing project on the near East Side.

As part of the estimated $65 million project, much of the long-vacant, dilapidated Friedrich buildings at 1617 East Commerce St. will be demolished to make way for the 347-apartment complex and 725-spot parking garage. While the original, 1920s-era portion of the building is designated as historic by the City, it is not part of this proposal.

The Historic and Design Review Commission will weigh in on the housing redevelopment because it is receiving public incentives. Plans for the historic portion of the complex have not yet been submitted to the City.

Several entities, including the City, have tried to revitalize the former headquarters and manufacturing site of the Friedrich air conditioning company over the years, but a recent uptick in public and private development and infrastructure on the near East Side seems to have created the right environment for the current plan.

“I think this is the furthest we’ve ever gotten,” Councilman Cruz Shaw (D2) told the Rivard Report after the incentives were approved. “We’ve had ongoing communications between the property owner, developer, and the City. Everything’s moving in the right direction.”

The total $2,342,670 incentive package includes $1,745,000 from the Inner City Tax Increment Reinvestment Zone, $500,000 in SAWS impact fee waivers, and $97,670 in other fee waivers associated with the Inner City Reinvestment and Infill Policy. The latter is aimed at encouraging development in underutilized areas in the urban core. A similar incentive program, the Center City Housing Incentive Policy, is on hold temporarily as new rules are pending that would further incentivize affordable housing.

The original 1923 building and 1956 additions are listed on the National Register of Historic Places. The local designation for the later buildings was removed in 2015 by City Council at the owner’s request. The firm developing the project, Dallas-based Provident Realty Advisors, said it will seek approval from the state historic preservation office for the demolition and new construction.

Friedrich Refrigeration building located on East Commerce Street. Photo by Scott Ball.
The Friedrich building located on East Commerce Street. Credit: Scott Ball / Rivard Report

In March, Provident sought funding from the San Antonio Housing Trust Public Facility Corporation and the U.S. Department of Housing and Urban Development to ensure affordability.

Developers plan to have one- and two-bedroom units in The Friedrich Lofts, 173 of which would be market rate and 174 of which would be “affordable” – meaning some units will be priced for households earning less than 60 percent to 80 percent of the area’s median income. Rents are expected to range from $667 to $1,400.

“It’s bringing housing, it’s bringing people, it’s bringing disposable income,” Shaw said. “It’s going to ignite that entire area.”

That ignition, however, also comes with concerns about gentrification. As new development comes to the area, property values in the historically low-income area are rising.

“That’s a bigger issue than just City Council” can address, Shaw said, noting that he and other City leaders have been in touch with state representatives to try to find ways to “protect those legacy homeowners that have been there for 30, 40, 50 years and not allow them to get priced out of their homes because of good things or development happening in their communities.”

City Council recently approved a new housing policy framework and a budget that increases funding for affordable housing programs.

“We’re going to continue to have those conversations and figure out creative ways to protect those households,” Shaw said.

Iris Dimmick

Iris Dimmick

Senior reporter Iris Dimmick covers City Hall, politics, development, and more. Contact her at iris@sareport.org