A developer group’s plan for a luxury boutique hotel in downtown San Antonio was only the start of a dream that’s now closer to reality.
Universal Services Group, the developer behind the recently completed Thompson Hotel and Arts Residences, reached an agreement in December with the City of San Antonio that paves the way for a $400 million development in the center city.
Encompassing five parcels of land on both sides of the San Antonio River Walk, the Riverplace development will include a multi-family residential property, a condominium, and an office building, all about 20 stories in height, with retail components and garage parking. The development will be anchored by a Dream Hotel, a project announced by the privately held New York hotel group in January 2020.
“That’s where a lot of the energy will be derived from,” said Chuck Brehm of Universal Services Group. “It’s our desire to not only create a destination area for out-of-town travelers, but also a destination area for the local community as well.”
In January, the developer obtained a Center City Housing Policy Incentive Agreement for the residential part of the development, a tower of between 250 and 300 units to be located within a city block at 500 N. Main Ave. near the San Antonio Main Library.
Worth $4.4 million, the agreement provides a 75% rebate on city property taxes over 15 years, with the developer paying 25% of its property taxes toward the City’s affordable housing fund. Per the agreement, the project is expected to be complete by March 2023.
Brehm said the investor group is in the midst of raising capital for the project but noted that the property is within a federal Opportunity Zone, which will help attract investors eager for the tax break on capital gains. Once that phase is complete, construction would start within six to eight months.
The residential tower is the kind of development that’s only recently been proposed in San Antonio, with one planned by Weston Urban for a parcel near the Frost Tower, Brehm said. He anticipates residents will work in the downtown area and perhaps within the Riverplace development itself.
A tech-oriented office building is also planned along with a condominium and another hotel designed for business travelers. The project will be developed in phases.
“Being native to San Antonio, we have an appreciation for the fact that we are on both sides of the River Walk, which is highly unusual in San Antonio,” Brehm said. “We understand what the needs and desires of downtown are as far as walkability, getting people on and off the River Walk, [and] making it just as attractive above the River Walk as it is on the River Walk.”
Earlier this year, Universal Services Group completed the luxury Thompson Hotel and adjacent residential tower located near the Tobin Center for the Performing Arts at the corner of Lexington Avenue and North St. Mary’s Street. Condo units there were nearly sold out when the Arts Residences opened.
At the time that project began, others warned Brehm not to invest in a condo development in downtown San Antonio, saying it was too risky or that he would be forced to find buyers from out of town.
“I felt that the biggest issue in San Antonio is that we didn’t have enough product to really choose from, and the right type of product,” he said, and he’s proven to be right, with most of the buyers being San Antonio residents.
“We feel like we’re really coming of age as a downtown,” Brehm said. “Our downtown is becoming very vibrant.”
A Miami-based team of architects with Cube 3 designed the development, and an Austin investment group, Real International, is also participating in the project. Edmund Beck is the landowner for several parcels and an investor in Riverplace.
Despite uncertain economic times wrought by the COVID-19 pandemic, the development team is moving forward on what will be a massive undertaking in downtown San Antonio.
“There are some things that you can predict and you can control, other things that you can’t,” Brehm said. “At the same time, look at the energy that the city has today. Look at the influx of people and companies that are finding San Antonio to be desirable and moving here. If we have good steady growth, that’s what we look for, and I think that’s what we’re seeing in San Antonio right now and, and I don’t see that slowing down anytime soon.”