City Council members were by and large supportive of the Hemisfair redevelopment project, which has struggled for years with construction delays, during a presentation Wednesday about an upcoming search for a firm to build its newest and largest area, called Civic Park, on the corner of Market and South Alamo streets.
Zachry Corp., a local construction firm chosen through a bidding process in 2017, was supposed to finish work early this year on a $200 million development of offices, retail and a hotel around Civic Park, but it has yet to break ground.
The Hemisfair Park Area Redevelopment Corp., or HPARC, has decided to start work on Civic Park while it holds negotiations with Zachry and the city to change Zachry's construction proposal out of concern that it is no longer feasible after the pandemic upended the hotel and office markets.
"I share my colleagues' optimism," Mayor Ron Nirenberg said of Hemisfair. "We know, over the last 10 years, how many mountains have been moved to make the development of Hemisfair a reality, at least on paper… This project is much too important for us to not see through to fruition."
District 9 Councilman John Courage was one of the few to express concern.
"I just feel like it's taken a long time, and we don't have much to show for it," he said. "The biggest part of this project was the economic generation that was supposed to come out of all the development around Civic Park, and it isn't there, and I'm wondering if it's going to come there, and if we're going to have spend more money later to finish the rest of the park."
Omar Gonzalez, HPARC's director of real estate, was quick to point out to Courage that Yanaguana Garden, a playground area that opened in 2015 on Hemisfair's southern side, has become the second most visited urban park in Texas.
But Courage’s criticism was aimed at the much larger vision for Hemisfair, which includes the mixed-use Zachry buildings, that has yet to be realized.
Zachry has not met the timelines that it had agreed upon for the development, Assistant City Manager Lori Houston said at the meeting. A spokesperson for the company declined to comment.
"There were timelines, and they will need to be adjusted," Houston said. "The pandemic changed a lot with this project. It changed the financing structure for this project... We are taking a step back to take a look at the demand: Is there demand for parking as much anymore, is there demand for housing and retail? All those things are being looked at."
Zachry's project was far behind schedule even before the pandemic. In an interview last month, HPARC's leaders said that many factors led to the delays, including the holding of events related to San Antonio's tricentennial celebration and the NCAA Men's Final Four, and unforeseen problems in building a massive underground parking garage.
"I wish it was that easy to say, ‘Here's the one factor why it's delayed,' but the truth is, it's just really complicated," Gonzalez said last month. "You've got a number of different partners, a number of different types of commercial real estate development, different design teams that are coordinating, you have utilities, and how do you work with CPS (Energy) and SAWS, and how do you coordinate between a park and a (public-private partnership)."
The city's Public Works department plans to begin soliciting bids later this month to build the first phase of Civic Park, a nine-acre park with a lawn well-suited for concerts, an area of water fountains called The Shallows and other features that its planners hope will match the success of Yanaguana Garden.
The construction contract is expected to have a value of $28 million, said Razi Hosseini, director of Public Works. The city will negotiate a contract in the summer, and council will consider it in August, he said. The project is expected to be completed in April 2023.
The first phase of Civic Park will be funded with $21 million from the city's voter-approved 2017-2022 bond program and about $3.5 million of philanthropic donations, HPARC spokeswoman Thea Setterbo said in an email. The rest of the funding will come from "monetization of Hemisfair's ground leases," she said. Several retail businesses operate out of space they lease in historic buildings within the park.
Phase 1 is expected to include a large lawn, where Hemisfair and city officials envision San Antonio’s largest celebrations will be held.
Civic's Park Phase 2, which is expected to cost $20 million, will include a grand entryway on Market and South Alamo that leads visitors to the green space.
District 10 Councilman Clayton Perry raised questions about the cost of redeveloping Hemisfair, asking why so much was being spent on it compared to other parks in the city, many of which "don't even have water fountains," he said.
He said he hoped to see more of the funding for the second phase come from private sources.
"When are we going to see the end of this?" he asked. "Yes, it's downtown, but we've got a lot of other parks around this city that are very worthy… I'm just concerned that we're putting a lot of our eggs in one basket."
His concerns are not new: In 2016, when the city's 2017-2022 bond issue was being debated, representatives of some districts outside the urban core asked for some of the money being allotted to Hemisfair to be used instead for parks in their own neighborhoods.
Gonzalez said that Zachry's development probably would not look like the designs that the company released in 2018, the year after council chose it out of 11 bidders to construct the buildings around Civic Park. Those designs depicted a 14-story hotel, an eight-story office building, a food hall, and an apartment tower built in partnership with another developer, all sitting atop an 825-space underground parking garage.
Yet HPARC's leaders are insistent that whatever the company builds will bring the same amount of economic development to the area as was first envisioned.
"We did lose some time in getting started, but I think it's only been to our benefit," Gonzalez said at the Wednesday meeting. "Obviously opening a park in 2020 probably wouldn't have been for the best, but we think by the time we can get this plan underway and developed … hopefully we'll be beyond the pandemic and able to host large events."
» Hemisfair’s Civic Park construction now scheduled to begin this fall (Jan. 16, 2021)
» Hemisfair’s civic park delayed because of 'unforeseen situations' (March 6, 2020)
Richard Webner is a freelance journalist covering Austin and San Antonio, and a former San Antonio Express-News business reporter. Follow him at @RWebner on Twitter
The City of San Antonio has received $46.7 million for emergency rental assistance as a result of the CARES Act that Congress passed in late December.
In a memo to the City Council yesterday, Erik Walsh said no less than 90% of the federal stimulus dollars must be used to help San Antonians pay rent or utilities. The rest of the funding can be used for "housing stability services, including case management and other services intended to keep household stably housed, and administrative costs," Walsh wrote.
During today's City Council meeting, Walsh said details of how the funding will be incorporated into the city's emergency housing assistance program will go before the Culture and Neighborhood Services Committee in the first week of February, before returning to the full City Council for final approval.
Currently, the city has earmarked $76.7 million toward rental assistance. This morning, the City Council is discussing whether to add $13.1 million from federal and state dollars toward the total.
To date, $54.7 million has been distributed toward residents for rental and mortgage assistance. Another $6 million has gone toward helping San Antonians pay utilities, and $7.4 million in direct cash assistance has also been awarded.
This is a developing story that will be updated after the vote.