A 9-mile drive is all that separates the first acquisition of one of San Antonio’s most active developers in the urban core and his most recent venture.
But the span of years between the time David Adelman purchased a rental property at age 16 to when he broke ground on the historic Creamery mixed-use project in Tobin Hill shows the measure of his passion for both his hometown and development. Today, the impact of the developer’s long career in commercial real estate can be seen across the urban core.
Adelman, 52, is founder and president of Area Real Estate, a company he founded in 2011. He oversees development and asset management for a portfolio of properties throughout downtown San Antonio, including residential developments The Maverick, The ‘68 at Hemisfair, and 1221 Broadway, and other mixed-use, industrial, and office properties, such as Midtown Station.
The developer is currently partnering with real estate investment company Embrey to repurpose the former Borden Creamery on East Ashby near the Pearl into a mixed-use office, retail, and residential development and recently acquired a 4-acre warehouse property near the Lone Star District development.
But his first purchase was a Pecan Valley home he bought while attending Lee High School. With advice from his father and money he had earned mowing lawns and refereeing soccer games, he covered the $6,000 down payment, assumed the mortgage, and posted a “for rent” sign in the front yard.
“I was a very driven kid, always trying to make some money and figure something out,” he said.
Later, as an economics student at the University of Texas at Austin, Adelman earned his real estate license and began brokering properties to investors from California. He also purchased fixer-uppers and did the work himself so he could offer them for rent at higher market rates. “So I created value,” he said.
Adelman was so successful at it, he paid his way through school and graduated with a positive net worth, he said. But the developer and equity investor prefers to talk about the work versus the money it brings.
“It’s not a big motivator for me and so I’ve never been one to have financial goals,” he said. “I just enjoy so much what I do. My one goal that I’ve always had is I want to go from my desk to my grave because I absolutely love what I do and I can’t imagine doing something else more.”
When the San Antonio native was ready to return to his hometown, he started at Trinity Asset Management, where he mastered the commercial real estate business quickly, said real estate broker Ed Cross, a partner in the firm. In 2011, Adelman split off, taking the development and property management business with him, and Cross created the real estate brokerage company Cushman & Wakefield.
“It was a win-win deal for everybody,” Cross said, adding the thing he admires most about Adelman is his patience and ability to “peel the onion.”
“He will really dive into something and really figure it out completely, before he makes decisions,” he said. Then there’s his work ethic.
Adelman said he plays a little golf, spends time with his family at a lake house, and his weekends are enjoyable up until Sunday afternoon. That’s when he’s mostly ready to get back to work.
Yet during the workweek, he spends as much time volunteering as in the office. He is currently serving as board chairman of Centro SA.
“I love to see things improve, and … while they don’t get you a paycheck, they build your relationships and network, and somewhere along the way it works itself out,” he said.
Unlike those who believe the pandemic will engender a long-term shift in the way people work, Adelman sees the outlook for commercial real estate post-pandemic as good, if uncertain. He thinks business owners and workers are ready to return to office life.
“I believe that in the end, over time, everybody will be back to work as they knew it before,” Adelman said. Why? “I don’t think that long term you’ll be able to hire talent into [a remote working] environment. Number two, I don’t think people are that efficient in their day-to-day activities [working from home].”
He wasn’t so confident a year ago, when he pressed the pause button on the Creamery project he had started in 2019. “It [was] pretty scary going into this environment; however, in the last few weeks, the phone started ringing a little more,” Adelman said.
Now it’s all-systems-go with a completion date set for July 2023. “It’s like the old saying, ‘I’m pregnant with this baby, we’re having her,’” he said.
Located in Tobin Hill in a bend of U.S. Highway 281 and along the San Antonio River, the Creamery development is classic Adelman — repurposing a historic site for modern use in a high-demand neighborhood.
Built in 1932 for Mistletoe Creamery, then sold to Borden Dairy, the 50,000-square-foot plant that was later used for climate-controlled self-storage is being transformed into office space with a restaurant and bar on the main level.
Next to it, a 338-unit residential complex with garage parking and views of the downtown skyline is also under construction. The apartments will be named the Tin Top, a reference to old milk bottle closures.
Plans show the entire 5-acre site oriented to the river, with a pedestrian bridge providing access to Brackenridge Park and public walkways leading south to the Pearl and north to the former “12th hole” of the Brackenridge Golf Course, which was cut off with construction of Highway 281.
The Tobin Hill Community Association recently met at the 12th hole to gauge residents’ interest in developing the city-owned “land that time forgot,” as Adelman calls it, into a public park. “We supported the [Creamery] development, and are excited to have new neighbors and see the historic Borden preserved and activated,” said Larkin O’Hern, association board president.
Inside the former creamery, some of the plant’s cooling equipment was left behind and will be incorporated into the building’s industrial aesthetic. Also remaining is a pole for one of four large billboards that once stood on the site facing the highway. Adelman hopes to install a decommissioned milk truck or something similar as signage for the development.
After Adelman acquired the property, he worked to have it placed on the National Register of Historic Places and is using the state’s historic tax credits program to offset preservation costs. Before that, the building could have been razed if the City and neighborhood didn’t object.
“I would never have done that,” he said. “I would say this is my opportunity to restore an Atlee B. Ayres [-designed] building.” Architect Ayres designed many of the early 20th-century homes and buildings in San Antonio, including the Tower Life Building.
But not every old building is worth saving, he believes. In fact, Adelman and partner Barclay Anthony want to demolish the 1923 Rich Book Building they own in the Cattleman Square Historic District and build a 5-story apartment building on the property, which they’ve owned for seven years. Adelman said he’s paying $500 a week for biohazard cleanup due to persistent crime and homelessness in the area.
The first floor of the former clothing store has been altered, diminishing the integrity of design and workmanship of the building, according to a 1983 report on the historic district. “Nothing of consequence happened there,” Adelman asserted. “It wasn’t consequential architecture, it’s just a very simple red-brick building that’s falling down.”
Adelman favors preservation and repurposing the buildings that make up the historic fabric of the city, but not every building can be saved, he said: There must be a balance between the needs and concerns of the neighborhood, developer, and users, and that give-and-take serves a purpose.
“If there’s no friction, there’s no traction. … And I think that sometimes the best results come from a little bit of friction,” he said.
Despite the challenge of working in historic districts with older infrastructure and other constraints that come with developing in the urban core, that’s exactly where Adelman wants to be.
“Real estate’s capital-intensive … and if you do what I consider really good solid projects, the capital is going to invest and the returns will be there,” he said. “There’s an old saying, ‘God ain’t making any more land.’ So if you think about the old tenet of economics’ supply and demand, when there’s a supply constraint is where you have an ability to make a good price.”
Though the future of office space in any part of town remains uncertain after the pandemic, people are continuing to move to San Antonio. So Adelman, who completed the stalled 1221 Broadway apartments on the now-booming Museum Reach of the River Walk in 2010, is now shifting his focus to multifamily residential development.
But even that is becoming more challenging as costs rise and wages remain stagnant, he said.
“I’m starting to study the affordable housing market a little bit to see if I can educate myself” and enter the market, he said. It’s a void he has hoped to fill, at least in part, since his friend and local affordable housing leader Dan Markson died in 2019.
“It’s not a business that I know a lot about, but it’s a business that’s generating a lot of need and consternation. That seems like a good place for me to try to do something interesting.”
Adelman served as founding chairman and remains active in the local chapter of the Urban Land Institute (ULI) in 2008, while also serving on VIA Metropolitan Transit’s Innovative Services Advisory Group. ULI recently awarded the VIA group a grant for studying locations for mobility hubs.
Cross said Adelman is known in the community as someone who gets things done – but for the right reasons: “You know his heart’s in the right place,” Cross said. “He is one of those rare people that the alternative is status quo, nothing happens, and you want somebody like him who has the vision.”