The (Incomplete) Houston Street Story

City downtowns are important. They really “shape the personality of the destination.”
By Deborah Lohse

When Federal Realty Investment Trust bought a dozen properties on Houston Street in 1998, hopes were high that the mega-developer could do in San Antonio what it had done in so many other urban downtowns across America: Create a thriving, refurbished urban center with a robust mix of residences, businesses, restaurants and retail stores.

It would reverse the devastation that suburbanization of the 1970s and 1980s had wreaked on the historic Houston Street district — once the center of life for San Antonians looking for a night out, a high-end shopping excursion, a soda-fountain date, or just an air-conditioned movie theater on a hot summer night.

Houston Street for many years after the turn of the century through World War II was the primary retailing street in San Antonio,” said Jan Sweetnam, Vice President and Director of Asset Management-West Coast for Federal Realty. “Its architecture is so beautiful and so wonderful and so enchanting, we believed that if the buildings were artfully recrafted and retenanted, they themselves would be part of the draw’’ to a revitalized downtown.

But nearly a decade later, despite tens of millions of dollars in tax incentives, publicly financed street upgrades, facade improvements and the much-ballyhooed stairway linking the River Walk to Houston Street, the revitalization of the historic street has met with only tepid success.
Far from a pulsing hive of life and retail, Houston Street today is an incohesive hodgepodge of hotels, entertainment and commerce.

Architects, lawyers and business people file out of their Houston Street offices at night, making way for a nightclub crowd that’s a fraction of the River Walk overflow developers had hoped to capture.

A successful and swanky new Hotel Valencia sits a block from the restored historic Frost Brothers department store building – but it’s insurance brokers, not clothing shoppers, who spend their day there because no retailer can afford the space.

Despite grandiose plans for high-rise condos that would be tucked into buildings like the Vogue, there have been no new residences on Houston Street.

No major national or specialty retailers have settled on Houston Street. And shoppers to the area’s few retail shops have to drive up five flights to park in one of the area’s major parking garages, the Mid-City Parking Garage, because San Antonio leaders shortsightedly leased much of the lower floors to the Watermark Hotel for 25 years.

So far “it has not been the success we had all hoped in the community,’’ said former San Antonio Economic Development director Ramiro Cavazos, now director of research and economic development at the University of Texas Health Science Center.

To be sure, Federal’s investment has revived Houston Street from the boarded-up ghost town it was little more than a decade ago. Federal’s upgrade of many buildings it purchased has ”given neighboring property owners some confidence that this area has new activity, new tenants,’’ said Ben Brewer, president of the Downtown Alliance San Antonio. That persuades neighboring property own-ers that “it makes sense for them to make an investment in their own properties,’’ he said.

Federal’s hefty investment gave downtown residents hope, said Kirk Feldman, general manager of Arts Center Enterprises, which manages the Majestic and Empire theaters ”Everyone was very excited. There had been some changes – Southwestern Bell had relocated its headquarters from St. Louis to right here on Houston Street,’’ he said. “That was a major boost to the downtown area and our streets specifically. When Federal came in, what was exciting was that there was a single entity that had a vision and the capital behind it to organize disparate properties under one concept,’’ he added.

In addition to Federal’s own investment of about $63 million, other property owners have invested hundreds of millions more in the greater downtown area, said Cavazos and others. That includes Silver Ventures’ upgrade of the Pearl Brewery, which now houses an upscale culinary institute, the Center for Foods of the Americas; the construction, now underway, of a $285 million Grand Hyatt hotel near the convention center; and the creation of the new Museum of the Americas and Alameda theaters.

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