SUPERNEWS

Real Estate

UTSA Buys $7.7M Property for Downtown Campus, Aims for 10,000 Students by 2028

UTSA acquires 1.5-acre property for $7.7M to expand downtown campus, aiming for 10,000 students by 2028.

5/22, 17:33 EDT
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Key Takeaway

  • UTSA plans to acquire 68,500 sq. ft. of buildings and a parking lot valued at $7.7 million for downtown campus expansion.
  • The acquisition supports UTSA's goal to house 10,000 students across a 32-acre downtown campus by 2028.
  • GrayStreet Partners continues selling assets, possibly to fund large-scale projects like the $600 million Lone Star Brewery redevelopment.

UTSA's Downtown Expansion

The University of Texas at San Antonio (UTSA) is set to significantly expand its downtown footprint by acquiring a 1.5-acre property adjacent to its $90 million School of Data Science and National Security Collaboration Center. This acquisition, which includes dilapidated buildings totaling 68,500 square feet and a parking lot with 125 spaces, is valued at $7.7 million by the Bexar Appraisal District. This move is part of UTSA's broader plan to house 10,000 students across a 32-acre downtown campus by 2028, underscoring the university's commitment to growth and innovation in the heart of San Antonio.

Strategic Real Estate Acquisition

The planned acquisition by UTSA is not just a real estate transaction but a strategic move to bolster its expansion goals. The university's associate vice president of real estate, construction, and planning, Corrina Green, emphasized the importance of this purchase in achieving UTSA's long-term objectives. The property, bounded by South Flores, Nueva, and Dolorosa streets, will complement the existing School of Data Science and the upcoming $131 million Innovation, Entrepreneurship, and Careers building, set to open in January 2026. This expansion aligns with UTSA's vision to establish a college dedicated to cutting-edge fields like artificial intelligence, cybersecurity, computing, and data science.

GrayStreet Partners' Selling Spree

While UTSA is expanding, GrayStreet Partners is actively offloading parts of its downtown portfolio. The firm recently sold the La Villita Assembly Building, a 245,000-square-foot riverfront event venue, to MLSA Ventures and listed low-rise retail buildings at 100 and 108 Soledad Street. These sales are likely part of GrayStreet's strategy to raise capital for its large-scale projects, including the 15-acre BESA District and the $600 million redevelopment of San Antonio's old Lone Star Brewery. This mixed-use hub will transform the 32-acre site, reflecting GrayStreet's focus on ambitious urban redevelopment projects.

Rising Development Costs in San Antonio

The expansion efforts by UTSA and the selling spree by GrayStreet Partners come at a time when development costs in San Antonio are rising. The San Antonio City Council recently approved a 23% increase in utility connection fees, effective in July. These fees, which range from $7,343 to $11,528 per home, are intended to fund $2.3 billion in necessary water and wastewater system improvements due to projected population growth. This increase adds to the financial burden on developers, who are already facing high interest rates and tight lending standards, potentially slowing down new developments.

My Perspective on Market Dynamics

The developments in San Antonio highlight a complex interplay between expansion and rising costs. UTSA's strategic acquisition and GrayStreet's capital-raising efforts are indicative of a city in transition, aiming to balance growth with financial sustainability. However, the increased utility fees could pose challenges for developers, potentially stalling new projects and exacerbating housing shortages. This situation mirrors broader trends in other high-growth areas, where rising costs are impacting the pace of development. While necessary for infrastructure improvements, these financial pressures could have long-term implications for San Antonio's real estate market.

Management Quotes

  • Corrina Green, Associate Vice President of Real Estate, Construction and Planning at UTSA:

    "It makes sense as a real estate transaction, but it really helps us with our goals as we look at expanding our footprints around all three of our campuses downtown."