320,000-SF San Antonio Retail Project's On the Way

In recent back-to-back transactions, Provident has purchased 32 acres from several landowners and sold 14 acres to Wilkesboro, NC-based Lowe's, Kim Wise, Provident's development partner, tells GlobeSt.com. The project, excluding land, will cost about $15 million to develop, he says.

The bulk of the acreage has been bought from Richard Landsman of San Antonio, GlobeSt.com has learned. The land is at the intersection of Harry Wurzbach and Austin Highway near Interstate 35, in a submarket that carries the city's highest retail vacancy, 23%. Up to four big boxes could come out of the ground, says Wise. The plan is still on the drawing boards as to how many big boxes will be courted versus developing the property for other retail uses. Delivery is anticipated in fall 2002, if all goes well.

Wise estimates it will be year's end before infrastructure work can begin. Standing in the way is the relocation of a handful of businesses, including the Coachman Mobile Home Park at 1462 Austin Highway. The park's tenants already have notices to move, says Wise.

Also in the way is Frontier Meat & Food Service, located at 1462 Austin Highway. Not to worry, says Jimmy Hasslocher, Frontier Meat & Food Services president and Frontier Enterprises' vice president, because he's already scouting relocation sites in the 50,000-sf range. A decision will be made in 30 to 45 days, he tells GlobeSt.com.

The existing three-acre site, which holds a 24,000-sf building, had been bought in 1968 to use as a central food supply location for the World's Fair, Hasslocher says. The food service business is a subsidiary of Frontier Enterprises, also the parent firm for the locally popular Jim's Family Restaurant chain.

The first for Provident and Lowe's has been a result of the home center chain's aggressive plan to beef up its Central Texas presence. There are two stores in Austin and one in San Marcos, but there's been months of talk about the retailer's search for suitable big box sites. Lowe's is mum about its development plans.

According to Wise, it had been Lowe's that found the area "and wanted a developer to help." The two have teamed before.

The Austin Highway corridor is a good choice, says Cale Hahn, the Weitzman Group's research director in San Antonio. The former premier shopping area had fallen on hard times in the early 1970s and it's been going downhill ever since, he tells GlobeSt.com. About a half mile away sits the 1.05-million sf Windsor Park Mall, which has had its occupancy erode from nearly 100% to 30%. "It's been losing altitude consistently but slowly over the last decade," says Hahn. "And, Austin Highway has suffered the same malaise."

There have been some successful redevelopments, specifically the 1.2-million sf Forum, a retail project just north of Provident's site. The Forum, which opened last year, actually had saved the submarket from racking up a retail vacancy in excess of 23%.