Urban Redevelopment Comes to San Marcos

An update on Springtown: It was foreclosed upon, which means for the time being that and economic development incentive there is pretty-much on hold until an new ownership group emerges. On the positive side though, Mayor Narvaiz has held and plans to continue holding public meetings to discuss economic development efforts. Also, the last version of the Springtown incentives discussed was a $3 million cap to be issued to the Springtown developer based on its increased tax value (no up-front cost to the city). This is a better approach, though it really needs to be tied to a comprehensive redevelopment proposal for the site indicating the development will achieve some level of long-term viability and gets the developer ‘on the hook’ for something.

Another incentive deal has been hovering under the radar; at $610,000, it is not especially glamorous. However, it is unique in that this is the first economic development incentive tied to revitalization rather than job creation. It has received a fair amount of criticism, having passed only on a 4-3 vote. This project will be the second major urban residential project in the downtown area, placing about 257 new residential units in downtown. Some have questioned whether this project would have been built on its own without assistance. I must admit that I have trouble understanding how $610,000 could make/break a nearly $29 million project, but real estate finance is a mess right now and the developer may have gotten surprised by a lender requirement for increased capitalization. I know this took out the initial developer of the project two years ago, so the developer may be on target with his request. Some folks are simply philosophically opposed to multifamily incentives. Regardless, I am actually supportive of this incentive for several reasons:

• It will replace the derelict Balcones Apartments with a new project more consistent with the type of urban development appropriate for the downtown/west campus area, increasing the property value by about 2.5 times.
• The project includes reconstruction of all of the surrounding roads, which are all currently in poor condition with significant drainage issues, including extension of bicycle facilities.
• The project includes enhanced streetscape/sidewalks and underground utilities that will compliment efforts San Marcos is undertaking elsewhere in the downtown area, saving the city capital costs down the road.
• The project ‘recycles’ land—the cost to redevelop a piece of property is significantly higher than purchasing unimproved property further from downtown, but it reduces sprawl.
• The project puts the students where they SHOULD be, near the university. So much of the traffic problem in San Marcos comes from off-campus student housing being located so far from the campus.
• This will be the first LEED-certified (green building standard) multifamily or commercial building in San Marcos.
• The project is well-designed, reflecting the principles of new urbanist development.
• The ground level portions of the building are designed to convert to commercial space with demand.
• The project adds 257 residential units to the downtown area, which helps increase the vitality of downtown
• The project is the first major private development proposed in downtown expected to break ground that meets a substantial number of the Downtown Master Plan’s recommendations.

In my opinion, the city is trading a small sum–$ 610,000—for millions of dollars invested in a project to make it vastly superior to San Marcos’ minimum codes and the existing development.  While it is indeed possible that this project would have occurred without help, enacting these incentives sends a clear message to the private development sector that San Marcos means business when it comes to enhancing the downtown and expecting higher-quality development. The best part is, the project has good performance measures between the incentive agreement and the Planned Development District regulations it has to operate under.

Before I go, I need to address a comment I received via email. Apparently some think that I’m not as impartial as I say regarding local politicians. The truth is, I’m pretty equal opportunity and that opportunity to ding ‘the other side’ just simply hasn’t come up on a topic that I think is interesting to write about (until today). In particular, someone asked whether I was targeting Mayor Narvaiz. The simple answer to that is no. In fact, Mayor Narvaiz and I get along quite well and had a positive working relationship. Sure, I have some policy disagreements with her and don’t always like her approach, just like I do with every one of the Council members. Narvaiz certainly earns a bit of criticism, but a lot of that comes from her having mastered the ‘bully pulpit’ of the mayor’s office. There’s a reason she became the Chair of the Capital Area Council of Government Board of Directors. This certainly isn’t an endorsement of her, nor is it an endorsement of any other member of the Council.

The next topic for this blog will probably discuss either the Austin Community College District or the economic impact of college sports on the local economy in light of ‘The Drive.’

Chance Sparks

chance@bobcatfans.com