could help commercial real
EL PASO, TX-The so-called “quality of life” propositions that passed Nov. 6 will do a number of things to help the city, ranging from downtown revitalization to development of a triple-A baseball park. As such, experts tell GlobeSt.com that the bonds, in excess of half a billion dollars, are the next step in bringing El Paso to another level, so it can better compete with other Texas metropolitan centers to the east.
“What these propositions will do is help make us more competitive with other Texas cities,” comments William Blaziek, general manager with the El Paso Convention and Visitors Bureau. “Much of our history isn’t so much what we haven’t done, but what those other cities have done. We’d fallen behind.” Giancarlo Da Prato with local commercial and residential real estate company GDP Realty puts it another way. “The basic question comes down to, what is there to do on the weekends,” he notes. “What is the culture, the restaurants, and where to shop. It sounds crazy, but those are the basic fundamentals that had been preventing employers from coming to El Paso.”
So the way to catch up and be a regional player was to focus on increasing quality of life. And the way to do that was to put three quality-of-life bonds on the ballot. The model used for the referendums was taken from Oklahoma City and its Metropolitan Area Projects quality of life initiative – or MAPS, as it’s known. MAPS was initially approved by Oklahoma City voters in 1993, allowing sales tax to be increased by one cent over five years. The end result was $363 million raised for a variety of projects including Bricktown Ballpark, which eventually led to the nearby mixed use Bricktown entertainment/restaurant development nearby. Over the years, additional Oklahoma City bonds, such as a $180 million bond, have also been passed to improve everything from schools to infrastructure and public buildings such as museums.
“The compelling story taken away from Oklahoma City was that you can’t be attractive to companies growing in a region or those looking to relocate if you don’t offer a good quality of life,” explains El Paso Deputy Director, Planning and Economic Development Mathew McElroy. Because of this, the passage of the three propositions ends up being “the first time there was public comment and approval of specific issues and development that will take place over the next ten years,” says Christian Perez Giese SVP-Director CBRE‘s El Paso/Juarez office.
Quality of life is fine, but what effect does this have on commercial real estate? Blaziek is upfront by saying that he hopes to see developers building quality hotels in downtown El Paso in proximity to the city’s 225,000-square-foot convention center. He also wants to see commercial attractions, such as amusement parks and water parks. Da Prato says quality of life initiatives shows El Paso as pro-business, meaning CRE developers are more likely to be receptive to the environment.
There is also hope that the triple-A baseball stadium will bring its own share of commercial real estate development. Though the jury is out on the direct connection between sports arenas and commercial real estate building, Blaziek points out that the ballpark, which will be adjacent to the convention center, offers something else that’s just as important. “I can lure conventions and meeting planners who believe we roll up the streets at 5 p.m., and point out that there are 72 home games at this ballpark, and that there’s plenty going on after 5 p.m.,” he remarks.
The experts are unanimous in stating, however, that the bonds passage isn’t geared toward jump-starting El Paso commercial real estate development. That’s been going on for awhile, both in the CBD and the outskirts. Giese explains that Union Plaza’s renovation project, which turned the historic relic into an entertainment area, and the renovation of Anson Mills Building, an office building at 303 N. Oregon St. have worked out fairly well. A new CVS is moving into the CBD, El Paso’s first one. Giese points out that, on the industrial side, other factors, such as proximity to a booming Mexico, are driving interest in development and leasing.
“Texas, as a whole, has been performing well, so well that major core markets have been picked over from an investment perspective,” Giese says. As a result investors are taking a serious look at El Paso, partly because it’s a city in Texas and partly because it sits right on the Mexican border. “We’ve seen more investors becoming knowledgeable about this market; a market that wouldn’t have been on their radar screens three years ago,” Giese observes.
Da Prato comments that, as important an influx of more than half a billion dollars into infrastructure and stadiums might be, just as important is the psychological impact of overwhelming voter support for the packages. “What this says to the rest of the world is that El Paso is willing to spend money on itself to get to that next level and the voters are on board with it,” he comments.