McCombs Enterprises Proposes New River North Retail and Office Development with Unique Tax Subzone in San Antonio

McCombs Enterprises is advancing plans for a significant retail and office development in San Antonio's River North, situated near the Pearl district and the San Antonio Museum of Art. The six-acre site, acquired from CPS Energy for $29.5 million in early 2023, is envisioned as an "art-focused" retail area featuring a plaza, a pedestrian bridge spanning the river, and redesigned river banks. Architectural renderings by Studio8 Architects illustrate these proposed public amenities, aiming to “weave this area together with a really thoughtful project that all of San Antonio can be proud of,” according to Jon Wiegand, managing director for McCombs Enterprises.

To finance the estimated “nine-figure” redevelopment, McCombs is employing a two-pronged strategy. State legislation passed in May 2023 made the property eligible for a municipal management district (MMD), allowing developers to direct collected tax revenue towards infrastructure costs. The City Council approved placing the MMD on the ballot in August, enabling property owners within the district to vote on its authorization. Additionally, the developer has applied to the city’s Midtown Tax Increment Reinvestment Zone (TIRZ) for funding public spaces, art, and infrastructure.

A key proposal involves creating a “subzone” within the existing Midtown City TIRZ. This mechanism would allow the project to generate its own tax increment, which would then be returned to the development over time, separating its finances from the general TIRZ. This approach, previously utilized for projects at Pearl, aims to fund public improvements without direct credit risk to the city. The project is projected to contribute over $160 million in property and sales tax revenue to San Antonio, showcasing a model for financing complex urban revitalization efforts.