Jennifer S. CowleySan Antonio Counties Bexar Comal Guadalupe Wilson S an Antonio is the eighth largest city in the United States and one of the fastest growing metropoli-tan areas

Jennifer S. CowleyAssistant Research Scientist

Texas A&M University

June 2001

© 2001, Real Estate Center. All rights reserved.

Real Estate Market Overview

San AntonioReal Estate Market Overview

San Antonio


San Antonio

Population

Employment

Job Market

Major IndustriesBusiness Climate

Education

Transportation and Infrastructure Issues

Public FacilitiesUrban Growth PatternsMap 1. Growth Areas

Housing

Multifamily

Map 2. Multifamily Building Permits

Manufactured Housing

Seniors Housing

Retail Market

Map 3. Retail Building Permits

Office Market

Map 4. Office Building Permits

Industrial Market

Map 5. Industrial Building PermitsConclusion

Contents

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5

9

8

11


San Antonio

1314

151920

2223

2426

27

21

28

29

1

China Grove

Kirby

Converse

SchertzLive Oak

Selma

Cibolo

Castle Hills

Leon Valley

Helotes

San Antonio

Alamo Heights

Hill Country Village

Loop

410

Interstate 35

Interstate 35

Interstate 10

Interstate 37

Interstate 10

I35

US Hwy 90

State Hwy 13

State Hw

y 421

US

Hw

y 28

1

Jennifer S. CowleyAssistant Research Scientist


San AntonioReal Estate Market Overview

San Antonio

CountiesBexarComal

GuadalupeWilson

San Antonio is the eighth largestcity in the United States and oneof the fastest growing metropoli-

tan areas in the country. It is located insouth central Texas in the I-35 corri-

dor, the fastest growing region of thestate. San Antonio offers proximity toother major Texas population centersand is midway between the nation’seast and west coasts. The San Antonio

Area Cities and TownsSan Antonio

New BraunfelsSeguinSchertz

Universal CityConverseLive Oak

Leon Valley

Land Area of San Antonio MSA3,356 square miles

Population Density (2000)474 people per square mile

Metropolitan Statistical Area (MSA)consists of Bexar (pronounced “bear”),Comal, Guadalupe and Wilsoncounties.

2

Kelly Air Force Base, San AntonioPOPULATION

San Antonio MSA Population

Year Population

1990 1,327,3781991 1,348,1421992 1,375,4551993 1,403,7491994 1,426,8381995 1,455,7581996 1,480,9361997 1,514,2611998 1,540,1131999 1,564,9492000 1,592,383

Source: U.S. Census Bureau

County Population Growth

Growth 1990–2000County 2000 Population (in percent)

Bexar 1,392,931 17.5Comal 78,021 50.5Guadalupe 89,032 37.2Wilson 32,408 43.1


Area Cities With 10,000 or More Residents

Growth 1990–2000City 2000 Population (in percent)

San Antonio 1,114,646 14.8

New Braunfels 36,494 31.5

Seguin 22,011 5.3

Schertz 18,694 75.8

Universal City 14,849 11.2

Converse 11,508 28.6


3

The population of the San AntonioMSA increased at an averagerate of 2 percent per year during

the past decade. San Antonio’s growth

rate mirrors that of the state as a wholeduring the 1990s. Population projec-tions forecast an average growth rate ofslightly less than 1 percent per year

through 2020, according to the TexasState Data Center. The Texas WaterDevelopment Board predicts a growthrate of 2.7 percent per year.

Texas Metropolitan Area Population Change, 1990–2000 (in percent)

McAllen-Edinburg-Mission 48.5 Galveston-Texas City 15.1Austin-San Marcos 48.2 Tyler 15.5Laredo 44.9 El Paso 14.9Dallas 31.5 Corpus Christi 14.3Brownsville-Harlingen-San Benito 28.9 Victoria 13.1Brazoria County 26.1 Waco 12.9Houston 25.8 Texarkana 9.4Fort Worth-Arlington 25.1 Lubbock 9.0Bryan-College Station 25.1 Wichita Falls 7.8Texas 22.8 Longview-Marshall 7.7Killeen-Temple 22.6 Beaumont-Port Arthur 6.6San Antonio 20.2 Abilene 5.8Sherman-Denison 16.4 San Angelo 5.6Amarillo 16.2 Odessa-Midland 5.1


San Antonio MSAProjected Population

Texas State Texas WaterYear Data Center Development Board

2005 1,787,667 —

2010 1,948,741 2,037,198

2015 2,089,053 —

2020 2,227,399 2,465,501

Sources: Texas State Data Center and Texas Water Development Board

4

Overall, the Hispanic popula-tion was the fastest growing,with an increase of 5.4

percentage points between 1990 and2000. Residents of the San AntonioMSA had a $24,716 per capita

personal income in 1999, according tothe U.S. Bureau of Economic Analysis.The state average was $26,834.

Household Composition

Bexar County Texas

Median household size (1990) 2.81 2.73

Population younger than 18(1999; in percent) 29.4 28.5

Population 65 and older(1999; in percent) 10.6 10.1


Ethnic Distribution (in percent)

Bexar County TexasEthnicity 1990 2000 1990 2000

White 42.0 35.6 60.8 52.4Hispanic 48.9 54.3 25.3 32.0Black 7.2 6.9 11.7 12.2Asian 1.4 1.6 0.3 3.2American Indian 0.4 0.3 1.8 0.3Other 0.1 0.1 0.1 0.2

Two or more races* — 1.2 — 1.1

* For the 2000 Census, the Census Bureau changed the “race” options, allowing people toreport their race as “other” or as two or more races.


Projected Population Growth, 2000–2020(in percent)

Source: Texas State Data Center

14.3

40.2

0

10

20

30

40

50

San Antonio MSA Texas

5

EMPLOYMENT

San Antonio MSA Unemployment Rate(in percent)

Source: U.S. Bureau of Labor Statistics

San Antonio MSA Employment

Source: U.S. Bureau of Labor Statistics

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,00019

90

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

0

1

2

3

4

5

6

Jan

uar

y-95

May

Sep

t

Jan

uar

y-96

May

Sep

t

Jan

uar

y-97

May

Sep

t

Jan

uar

y-98

May

Sep

t

Jan

uar

y-99

May

Sep

t

Jan

uar

y-00

May

Sep

t

Jan

uar

y-01

6

Bergstrom Air Force Base, AustinCompany Business Employees

USAA Insurance 17,069H-E-B Grocery 17,805SBC Communications Telecommunications 8,000Frost National Bank Financial Services 3,541Taco Cabana Fast-food chain 3,000West Telemarketing Outbound telemarketing 2,850Southwest Research Institute Research and development 2,733QVC Order center 2,034Ultramar Diamond Shamrock Petroleum refining 2,008Boeing Aerospace Support Center Aircraft maintenance 2,000

Source: San Antonio Economic Development Foundation, 2001

Top Ten Private Employers

Employment Growth by Industry San Antonio MSA Texas

Employment growth, 2000 (in percent) 2.5 3.2Unemployment rate (in percent) 3.4 3.4New jobs in 2000 17,400 288,900Employment growth by sector (in percent)

Services 3.6 4.7 Trade 2.7 3.1 Manufacturing 1.5 0.1 Mining 0.0 2.3 Finance, insurance and real estate 3.1 1.3 Construction 2.9 6.2 Government –1.0 1.7 Transportation, communications and public utilities 7.8 5.1

Sources: Texas Workforce Commission

7

Texas Metropolitan Area Employment Change, 1990–2000(in percent)

Austin-San Marcos 58.8 El Paso 15.4Laredo 40.3 Waco 14.3McAllen-Edinburg-Mission 35.8 Lubbock 14.0Dallas 30.4 Sherman-Denison 12.5Brownsville-Harlingen-San Benito 30.1 Longview-Marshall 12.2Bryan-College Station 29.2 Abilene 11.4Killeen-Temple 28.7 San Angelo 10.7San Antonio 28.6 Corpus Christi 10.3Fort Worth-Arlington 23.7 Galveston-Texas City 8.2Texas 23.3 Wichita Falls 7.8Tyler 22.9 Odessa-Midland 6.5Victoria 22.4 Texarkana 4.5Houston 22.1 Beaumont-Port Arthur 3.5Amarillo 18.6 Brazoria County 2.3

Source: U.S. Bureau of Labor Statistics, February 2001

Nonagricultural employmentincreased 2.5 percent during2000, compared with 2.8

percent in 1999, according to theTexas Workforce Commission.Employment growth in the area issimilar to employment growth acrossthe state. Unemployment rose slightly

to 3.4 percent in 2000, compared with3.1 percent in 1999. The Bureau ofLabor Statistics reports that civilianemployment was at 755,705 for 2000,up 1.8 percent from 1999.

Health care makes up the largestportion of employment in the San

Antonio area. USAA, a major insur-ance company, expanded by con-structing new headquarters buildings.The military has a strong presence inSan Antonio, with four Air Force basesand Fort Sam Houston employing67,896 people.

8

JOB MARKET

A pplied Solutions Technologywill open a manufacturingplant near Brooks Air Force

Base employing 100. SouthwestConcrete Products announced inJanuary 2001 that they will open aconcrete block manufacturing plantthat will employ 40. Telecom willopen an operations center by the endof 2001 that will employ 500. Nation-wide Insurance opened a 300-employee call center in March 2001.

SecureInfo Corporation plans to hire25 security analysts in 2001 becauseof new U.S. Department of Defensecontracts. Nova Consulting groupplans to hire 20 engineers for its SanAntonio office in 2001. Laredo CoachWorks Automotive, a limousinemanufacturer, plans to open a facilityin 2001 and add 10 employees.

Chase Manhattan Corporationopened a customer service operationemploying 850 in 2000 and plans togrow to 1,800 employees. QwestCommunications opened a customerservice center employing 700 in April2000 but will close the center in 2001.Allconnect.com opened a regionalcustomer service center employing250. Billserv.com opened a customerservice center in summer 2000,employing 60. Moveforfree.comrelocated its corporate headquarters toSan Antonio. The company employs30.

Mikron Infocom TechnologyHolding opened a cellphone produc-tion plant employing 400 in 2000.Frost and Sullivan is moving its HVAC

division to San Antonio, employing150. TEFTEC Corporation is moving itswheelchair manufacturing facility toSan Antonio, employing 100. RoosterProducts, a leather and tool manufac-turer, added 30 jobs. Coil Plus, acustom steel manufacturer, added 75jobs. Alcatel added 20 jobs.

Travelocity.com added 750 employ-ees to its call center. CaremarkPrescription Service added 400employees, and OnPoint added 300 toits call center. Providian FinancialCorporation added 250 employees toits customer service center. GrandeCommunications added 250 employ-ees, and SBC Communications added200.

PacifiCare of the Southwest plans tobuild an office building in NorthwestSan Antonio and will hire 200 employ-ees. Amtek Engineering added 185employees, Fairchild AerospaceCorporation added 27 and SanminaCorporation added 150.

In Seguin, Auto Recyclers added 20employees. Story Communications isrelocating its printing facilities fromDallas to Seguin, employing 115.Millennium Teleservices is planning toopen a 200-employee call center in2001. In Schertz, Graebel Moversadded 45 employees.

Christus Santa Rosa Healthcare laidoff 388 employees in 2000. BaptistHealth System cut 6 percent of itsworkforce, laying off 290 employees. Itpreviously laid off 100 employees inJanuary 2000. PhyCor laid off 100

employees from its diagnostic clinic.Covenant Behavioral Health Systemclosed its inpatient psychiatric facilityin November 2000, laying off 165employees.

USAA laid off 151 people in itsinformation technology divisionbecause of restructuring. EG&GTechnical Services cut half itsworkforce at Kelly Distribution Center,laying off 126 employees in 2000.

Sitel Corporation is closing its SanAntonio call center in 2001, laying off350 employees. Qwest Communica-tions is closing its San Antonio callcenter and laying off 108 employees.El Paso Energy Corporation is closingits regional office in San Antonio andmoving to Houston, resulting in 250people losing their jobs in 2001. USAAwill cut 250 San Antonio jobs bySeptember 2001. Phillips Semiconduc-tors shut down operations for 90 daysin May 2001.

Neuman Distribution Companyclosed in 2000 after it was acquired byanother company, resulting in 100jobs lost. Sol Frank Uniform closed,laying off 139 employees. PearlBrewery closed in June 2000, layingoff 161 employees. McKesson HBOCshut down its pharmaceutical distribu-tion center in December 2000. A totalof 50 jobs were lost. Kelly Air ForceBase has been phasing out over the lastseveral years with 1,100 jobs cut inApril 2001. Marketing Specialistsclosed its San Antonio office in June2001, laying off 90 employees.

9

MAJOR INDUSTRIES

The services sector added themost jobs — 7,900 — to theSan Antonio economy in 2000,

and accounts for the largest share ofSan Antonio’s workforce — 32percent. Trade follows closely at 25percent of area employment. The tradesector added 4,600 jobs in 2000.Government is the third largest sector,accounting for 19 percent of areaemployment.

The large concentration of govern-ment workers stems from the fivemilitary bases located in the area. A

decline in government employmenthas occurred over the past yearbecause of Kelly AFB’s closing andlayoffs at Brooks AFB. The governmentsector lost 1,300 jobs during 2000.

San Antonio’s diversified manufac-turing sector, which makes up 8percent of local employment, includesaircraft, apparel, electronics, food andother manufacturing. Manufacturingadded 800 jobs in 2000.

San Antonio’s highly regardedmedical industry includes more than

30 hospitals. Tourism is a multibilliondollar industry, making the city one ofthe top tourist destinations in Texas.

In Bexar County, nursery productsand beef represent 59 percent and 14percent, respectively, of agriculturalreceipts, according to the TexasAgricultural Extension Service. Beefand nursery products are the topagricultural products in Guadalupeand Comal counties. In WilsonCounty, 49 percent of agriculturalreceipts came from beef.

Projected 2001County Total Agricultural Receipts

Bexar $68,478,000Comal 11,164,980Guadalupe 45,809,000Wilson 39,851,600

BUSINESS CLIMATE

Tax Rates, 2000

Tax Rate per $100Taxing Entity Valuation

City of San Antonio $0.58San Antonio ISD 1.72Community College 0.11Hospital District 0.24Bexar County 0.34Total $2.99

Source: Bexar County Appraisal District

10

Exports to Selected Destinations – San Antonio MSA (in thousands)

Market 1997 1998 1999 Percent of Trade

Canada 113,703 131,940 214,263 10.7Mexico 772,330 1,097,303 1,270,394 63.4Caribbean & Central America 15,471 11,048 26,152 1.3South America 35,266 70,928 88,210 4.4Europe 120,012 105,306 171,889 8.6Asia 250,805 195,362 210,068 10.5Africa 8,311 3,355 3,597 0.2Near East 13,918 16,714 11,736 0.6Australia 13,006 8,877 7,421 0.4Total all Countries 1,342,965 1,640,833 2,003,729 100.0

Source: Office of Trade and Economic Analysis, International Trade Administration

San Antonio MSA Retail Sales

Year Total Sales Sales per Capita

1990 $9,496,331,428 $7,1541991 11,039,356,979 8,1891992 12,105,945,320 8,8011993 14,705,151,145 10,4761994 15,369,980,292 10,7721995 15,906,173,646 10,9261996 16,490,712,367 11,1351997 15,617,073,662 10,3131998 16,309,977,475 10,5901999 20,261,552,390 12,9472000 21,312,825,574 13,384

2000 State Average $12,612

Source: Texas Comptroller’s Office

Exports were up 255 percentbetween 1993 and 1999. SinceNAFTA was put in place in

January 1994, exports to Canada haveincreased 192 percent, while exportsto Mexico are up 397 percent. Mexicois the country to which San Antonioexports the most products. Exports toBrazil were up the most during the1993 to 1999 period, rising 2,253percent from $2 million to $47million.

San Antonio is a business-friendlycity. Economic development incen-tives include expedited permitting, taxphase-in, job training and property taxreductions. The city is the eighthlargest exporter in the state and is amajor export sales location. In 1998,the area had $1.6 billion in exports,and the figure grew to $2 billion in1999.

The North American Free TradeAgreement (NAFTA) is fostering

growth in the San Antonio economy.International trade access from SanAntonio occurs via the U.S. borderwith Mexico at Laredo, the ports ofCorpus Christi and Houston. SanAntonio is also home to a new Interna-tional Center for Trade and Interna-tional Relations. The center works withthe North American DevelopmentBank (created under NAFTA), theInternational Affairs Department, theFree Trade Alliance, the Trade Com-

11

mission of Mexico, the Conventionand Visitors Bureau, as well as tradeand tourism offices for several Mexi-can states. The center, along withKellyUSA’s existing and plannedNAFTA facilities, will ensure that SanAntonio continues to be a hub ofinternational trade.

Increased spending by a growingpopulation as well as by tourists and

shoppers continues to boost SanAntonio retail sales. The city hostsmore than seven million visitors eachyear. The San Antonio Riverwalk, theAlamo, Six Flags Fiesta Texas and SeaWorld are popular attractions. Inaddition, the San Antonio Spurs, aNational Basketball Association team,play in San Antonio. San Antonio alsohas a minor league baseball team, the

Missions. These attractions contributeto the area’s high retail sales percapita.

The City of San Antonio has a 15percent hotel-motel tax rate, whilesurrounding areas have a rate of 13percent. The sales tax rate in SanAntonio is 7.75 percent. The sales taxrate in the surrounding area rangesfrom 7.75 to 8.25 percent.

EDUCATION

Educational Level, Persons Age 25 and Older(in percent)

Level of Education San Antonio MSA Texas

High school graduate 25.1 25.6Some college, no degree 22.6 21.1Associate’s degree 5.6 5.2Bachelor’s degree 12.5 13.9Graduate or professional degree 6.9 6.5

Source: U.S. Census Bureau, 1990

Local College and University Enrollment

Fall 2005 2010School 1999 (estimated) (estimated)

University of Texas at San Antonio 18,830 20,076 21,751Alamo Community College District 39,878 41,983 44,932St. Mary’s University 4,137 N/A N/AUniversity of the Incarnate Word 3,702 N/A N/AOur Lady of the Lake University 3,474 N/A N/ATrinity University 2,622 N/A N/AUniversity of Texas Health Science Center 2,543 N/A N/ATexas Lutheran University 1,486 N/A N/ATexas A&M-Kingsville at Palo Alto 150 N/A N/A

Sources: Educational institutions and the Texas Higher Education Coordinating Board, January 2001

12

A t the University of Texas-SanAntonio (UTSA), a new engi-neering and biotechnology

building is planned. The City of SanAntonio has contributed $1 milliontowards the building, which will beconstructed on the Loop 1604 campus.Proposals for the $26 million projectare expected in 2002. A $4.3 millionbuilding is planned as part of the phasethree addition downtown.

The UTSA Institute for EconomicDevelopment received a $1.75 milliongrant from the U.S. Department ofCommerce in December 2000 toconstruct new facilities for the instituteat the downtown campus. The TexasHigher Education Coordinating Boardapproved a $52 million academicbuilding in October 2000. Thebuilding will serve as a front door tothe campus. The new academicbuilding will be one of three newfacilities to be built in 2001. The boardalso approved plans for a recreationand wellness center and a child carefacility.

In April 2000, construction began ona third building on the UTSA down-town campus along with a $5 millionunderground parking garage.

UTSA is initiating a doctoral pro-gram in culture, literacy and language.

At the UT Health Science Center inSan Antonio, a $14.8 million center forlongevity and aging studies is plannedwith construction to begin in 2002.The Sam and Ann Barshop Center forLongevity and Aging Studies will behoused in the Texas Research Park inwestern Bexar County. A constructiondate has not been set for the $20million project. A $49.5 millionChildren’s Cancer Research Centeralso is planned.

In November 2000, two newbuildings were added to Texas

Research Park. The $19 million SouthTexas Center for Biology and Medicineis an 87,000-square-foot building withlaboratories and offices. The SBCTeleconference Center provides a linkto the South Texas Medical Center.The University will add a bachelor’sdegree in emergency health sciencesstarting in fall 2001.

The Alamo Community CollegeDistrict consists of four colleges:Northwest Vista, Palo Alto, St. Phillip’sand San Antonio College. St. Phillip’sCollege began offering a real estatelicense program in January 2001. Theschool is also offering a certificate inrailroad operations.

The Alamo Community CollegeDistrict and the Edgewood Indepen-dent School District opened theWestside Community TechnologyCenter in February 2001. The center isat Southwest 40th Street and OldHighway 90 West. The district willbegin the Alamo Area AerospaceAcademy in summer 2001 at St.Philip’s College Southwest Campus.Alamo Community College Districtwill open a training center at KellyUSAin summer 2001.

Trinity University is ranked numberone among Western universitiesaccording to U.S. News and WorldReport. A $23 million administrationand academic building is planned forthe university. The facility will be thecenterpiece of the 177-acre campusjust north of downtown. The newbuilding will replace Northrup Hallbut will retain the Northrup name.Construction of the four-story, 85,000-square-foot building is expected tobegin in May 2002, with completiontaking 18 to 24 months.

U.S. News and World Report ranksSt. Mary’s University as one of the bestuniversities in the West Region for

2001. St. Mary’s received a $2.1million grant from the U.S. Departmentof Education to fund high-tech class-rooms. In November 2000, the $22million alumni athletics and convoca-tion center opened. The 130,000-square-foot center seats 3,500.

The University of the IncarnateWord opened a branch campus inGuangzhou, China in fall 2000. TheChina Incarnate Word EducationCenter was created in conjunctionwith South China Normal University.The center will offer intensive Englishstudy.

The university opened a newlocation at Judson High School inConverse. The Adult Degree Comple-tion Program started in January 2001.

Texas A&M University-Kingsvillerecently opened a branch on the PaloAlto College Campus. The Palo Altocenter enrolled about 150 students infall 2000.

The San Antonio IndependentSchool District has $500 million inconstruction projects planned or underway that will affect 92 schools.Currently, 53 schools have projectsunder construction. The district isbuilding a $5 million elementaryschool on West Quill Drive.

New gyms are under construction atHerff, Lamar, Cotton, Highland Park,Franklin, Knox, Pershing, Steele,Rogers Elementary, Stewart, White,Wilson, Woodlawn Hills, Miller,Smith and Washington schools.

The Northside Independent SchoolDistrict is building a central schoolplant on Military Drive at a cost of$495,000. At the same site, twobuildings are being constructed at acost of $9.4 million and $30 million.The school district has proposed $495million in bond projects, includingnine new schools.

13

TRANSPORTATION AND INFRASTRUCTURE ISSUES

San Antonio Airline Boardings

1997 1998 1999 2000

San Antonio International Airport 3,484,141 3,505,372 3,538,243 3,647,094

Source: San Antonio International Airport

San Antonio Cargo Enplaned (Pounds)

1997 1998 1999 2000

San Antonio International Airport 79,409,742 92,958,859 87,736,109 83,103,078

Source: San Antonio International Airport

The San Antonio area is served byfour Interstate highways: I-10,I-35, I-37 and Loop 410. U.S.

highways servicing the area are U.S.281, U.S. 90, U.S. 80 and U.S. 181.

The Texas Department of Transpor-tation is widening Loop 1604 fromCulebra Road to U.S. 90. The projectwill begin in summer 2001 and becompleted by the beginning of 2003.The two-lane undivided highway willbe turned into a four-lane dividedhighway.

U.S. 281 will be expanded innorthern Bexar and Comal counties.When completed the highway willlook similar to an interstate highway.Construction on the first section, fromLoop 1604 and moving northward, isexpected to begin within five years.

The San Antonio InternationalAirport, a full-service airport with aninternational port of entry, has directservice to all major hubs. Boardingshave continued to increase over thepast three years. Twelve airlinesprovide service out of two terminals,and 14 airlines provide cargo service.

FlightSafety International added twoflight-training programs and built a $1million addition to its training center atSan Antonio International Airport. Theaddition was completed in November2000.

Union Pacific-Southern Pacificrailroad provides rail service to San

Antonio from the U.S. coasts and citiesalong the U.S.-Mexico border.

Currently, San Antonio’s sole watersource is the Edwards Aquifer. Be-cause of limits on how much water canbe drawn from the aquifer, SanAntonio is looking for other waterresources to meet the needs of thegrowing area.

Water needs in San Antonio areexpected to double in the next 50years. At that time, the EdwardsAquifer is expected to supply slightlyless than half of the water San Antoniowill need for homes and businesses.

In November 1998, the San AntonioCity Council approved a 50-year waterplan, recommending a dual track tofollow in acquiring large amounts ofwater, including sharing 4,000 acres ofCanyon Lake and building a new watertreatment plant. The San AntonioWater Authority assesses impact feesfor water and sewage service.

The San Antonio Water Systemobtains water from the Edwards-Balcones Fault Zone Aquifer. Thewater system is evaluating othersupply alternatives, including develop-ment of reservoirs. The Cibolo Reser-voir is proposed for development by2015.

By 2003 an aquifer storage andrecovery project will be completed.The $215.8 million project will allowthe San Antonio Water System to store

excess water from the Edwards Aquiferor other source in a sandy aquifer in farSouth Bexar County for use duringdroughts or to meet peak summerdemand.

The San Antonio Water System(SAWS) signed a water supply agree-ment with the Guadalupe-Blanco RiverAuthority and the Lower ColoradoRiver Authority (LCRA). The LCRA willsell almost 49 billion gallons of waterto San Antonio every year for the next50 years. San Antonio will pay the costof building four 20-foot-deep, 1,200-acre storage ponds. In addition, a 132-mile pipeline will be constructed totransport water to Bexar County after itis diverted from the mouth of theGuadalupe River. The water is ex-pected to start arriving in San Antoniono later than 2010. SAWS opened achilled water plant in downtown inMay 2001.

The Bexar Metropolitan WaterDistrict opened a $30 million watertreatment plant in southwest SanAntonio in December 2000. The planttreats water from the Medina River.

City Public Service is planning tobuild a substation northwest of SanAntonio. The Van Raub electricsubstation will serve the growing areain northwestern Bexar County and willbe located at Ralph Fair and Dietz-Elkhorn roads.

14

Map 1. Growth Areas

Source: Real Estate Center at Texas A&M University

San Antonio, TexasCensus PlaceWater AreaHighwayInterstate Highway

I 35

I 10

I 410

I 37

US 90

I 35

I 410

SH 1604

I 10

US 281Retail

Retail

Retail

Retail

Retail

Retail

Office

Industrial

Industrial

Industrial

OfficeMultifamily

SH 1604

Single Family

SingleFamily

PUBLIC FACILITIES

In March 2001, the conventioncenter completed the second phaseof its expansion, which included

updates of the building's infrastruc-ture, interior improvements andseating and carpeting. Phase one wascompleted in 1999 and added 800,000square feet to the center. The thirdphase, which will start in 2001, willextend the River Walk through theconvention center to HemisFair Park.The $215 million expansion projectwill be funded by the hotel occupancytax.

The city council approved $6.65million to purchase 1,034 acres of parkspace at Windgate Ranch near theGovernment Canyon State NaturalArea. The project is being paid forthrough a one-eighth-cent sales taxapproved by voters in May 2000 toprotect San Antonio’s water source.

The sales tax will raise $65 million. Ofthat, $45 million will be spent toacquire between 6,000 and 9,000acres of park space located over therecharge zone.

In September 2000, constructionbegan on the Milam Park MemorialFountain at 500 West CommerceStreet. Along the River Walk, severalimprovement projects are underway.Additional walkways are being added,and walls are being replaced. The$12.5 million project is fundedthrough county flood-control taxes andthe city budget.

Bexar County is planning a largearena next to the old coliseum. Therodeo will move to the new facilityalong with the San Antonio Spurs andthe San Antonio Iguanas ice hockeyteam. The $175 million SCB Centerwill be located on East Houston Street.

Ground broke on the project in August2000 with construction expected to becompleted for the start of the 2002–03NBA season.

Bexar County purchased a 71,000-square-foot building downtown atIowa Street and Hoefgen Avenue. Thebuilding, after undergoing $600,000 inrenovations, will house Bexar Countyrecords.

The Texas A&M University Systemplans to construct a $20 million Centerfor Irrigation Technology on 500 acresin south San Antonio. The facility willhelp farmers and residents save water.

The Salvation Army is planning tobuild a $4 million community center atKellyUSA. The 40,000-square-footcenter will offer affordable child care,job-placement and after-schoolprograms.

URBAN GROWTH PATTERNS

14

15

HOUSING

Housing Affordability – Fourth Quarter 2000

Percent ofHouseholds THAI for

That Can Afford First-timeMedian-priced Home THAI* Homebuyers

San Antonio MSA 64 1.38 1.03

*The THAI is the ratio of median household income to the income required to buy the median-priced home using currently available mortgagefinancing. Standard financing is a 30-year loan covering 80 percent of the cost of the home. A THAI of 1.00 indicates that the median householdincome is just enough to qualify for a loan sufficient to purchase the median-priced home.


Map 1 shows the major growthcorridors within San Antonio.Residential expansion has

been occurring on the outer northwestand west portions of the city. Officeexpansion has occurred on thenorthwest side of San Antonio and newoffice development is occurring onLoop 410.

Industrial expansion has beenoccurring on the north and northwestside of San Antonio. Retail expansionhas occurred on both the north andsouth sides of the city.

Single-family residential growth hasbeen strong since 1993 and willcontinue to be strong in the northwestarea. Residential growth in the north

central area is expected to be strongerin the future.

The downtown area continues toserve the tourism industry with a mixof hotels and retail.

San Antonio MSA Single-family Permits


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

16

Average Sales Price of Single-familyHome, San Antonio Area


$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

0200400600800

1,0001,2001,4001,6001,800

Jan

uar

y

Feb

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y

Mar

ch

Ap

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May

Jun

e

July

Au

gu

st

Sep

tem

ber

Oct

ob

er

No

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ber

Dec

emb

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1998 1999 2000

Single-family Home Sales Volume, San Antonio Area


17

San Antonio Plats Approved, 2000

Number Patio and Garden NumberSingle-Family Subdivisions of Lots Home Subdivisions of Lots

Bridgewood, Units 2B, 3, 6, 7, 8, 11 596 Sunset, Units 3,4,5,7 440Caracol Creek, Units 3A, 3B 163 Mirasol Homes 118Green Mountain Road, Unit 1 162 Woodthorn, Unit 1 111Sunset, Units 2, 8A 162 Park Place, Unit 3 110Raintree, Units 8, 9B 154 Highland Farms Two, Unit 1 103Churchill Estates Phase B 151 Caracol Creek, Unit 4 94Stonefield Units 6, 8 150 Blue Ridge 83Tara West 144 Bridgewood, Units 4, 5 136Hickory Hollow Unit 4 140 Villa Del Sol, Units 2, 3 135French Creek Village 137 Marbach Gardens, Unit 4 62El Sendero/Westlakes Unit 4 122 Candlewood Park, Unit 15 60Spring Vistas, Units 9, 10 122 Villas of Fortuna 47Dover Unit 3 120 Springview Unit 3, Phase 1 26Sundance, Units 3, 4 105 Sunflower 17Pinon Creek, Unit 1 89 Palm Lake 13Villas Del Sol, Unit 1 70Caterbury, Unit 1 70 Large Lot SubdivisionLos Cedros East, Unit 2 70 Trails of Briggs Ranch, Unit 1 66Becker Ranch Estates, Unit 2 60 Copper Ridge, Unit 1A 55Las Lomas Phase IIIB 59 Fossil Ridge, Unit 1 45Highland Farms, Unit 3 59 Windgate Ranch, Section 1 40Moss Brook Estates North, Unit 1 58 Retablo Ranch, Unit 3 24Promontory Pointe II, Unit 2 56 Champions Ridge, Unit 2A 19Highland Farms, Unit 2 53 Chapala 10Los Cerdos West, Unit 2A 48San Pedro Hills, Unit 6B 44 Attached TownhomesParklands, Unit 1 44 Carlson Park, Phase II 40The Heights at Stone Oak, Unit 1 40 Historic Garden, Unit 2 24Hunters Bend 40 DSGN Limited Townhouse 8Century Oaks Estates, Unit 1A 35Hills at West Creek, Unit 2 34Hidden Oasis 33Braunig Ranch Estates, Unit 1 28Northampton, Unit 7A 28Dellwood 25Dell-Oak, Phase III 21

Source: City of San Antonio, Planning Department

18

Price Distribution of MLS Homes Sold, San Antonio Area(in percent)


1997 1998 1999 2000

Less than $60,000 22.7 23.2 21.5 19.560,000–79,999 19.9 19.8 20.2 18.880,000–99,999 16.1 16.2 16.4 16.4100,000–119,999 10.3 10.5 10.8 10.4120,000–139,999 8.6 8.8 8.6 9.1140,000–159,999 5.7 5.6 5.8 6.2160,000–179,999 4.1 3.9 3.9 4.4180,000–199,999 2.7 2.9 2.8 3.4200,000–249,999 3.2 3.8 4.5 4.8250,000–299,999 2.2 1.9 2.1 2.6

300,000 or more 2.9 3.2 3.4 4.4

In 2000, 8,407 single-family build-ing permits were issued, down from8,678 permits in 1999. The average

price of new home construction in1999 was $86,200. In 2000, theaverage price of a new home was$93,300.

Within the City of San Antonio,5,494 new homes were permitted in2000, down from 5,771 in 1999.During 2000, 9,149 lots were platted,up from 7,783. In the first quarter of2001, 2,065 new homes were permit-ted in the MSA.

A total of 15,392 existing homeswere reported sold through the localMultiple Listing Service (MLS) during2000, up from 15,083 in 1999. Theaverage sales price for homes soldthrough the MLS in 2000 was $119,300,with an average of five months ofinventory available. The average salesprice in 1999 was $112,300.

At Fortuna Street and HorenciaDrive, a 35-home subdivision isplanned with homes priced from$65,000 to $75,000.

Lago Vista is a 650-home subdivi-sion under construction in south San

Antonio. The project at SouthZarzamora Street and I-35 will havehomes priced from $75,000 to $130,000.

Mirasol Homes is a 179-homeplanned development at GeneralMcMullen Drive and Old CastrovilleRoad. The project is being developedby the San Antonio Housing Authorityand will be completed in February2002.

At Ingram and Culebra roads, a 23-acre mixed residential development isplanned by the San Antonio HousingAuthority. The site will have 51 single-family homes and 192 townhomes.Thirty-eight of the townhomes will befor low-income families.

An 86-lot, affordable-housingsubdivision is expected to breakground in summer 2001 at Loop 410and Pearsall Road.

In west San Antonio, several newsubdivisions are planned. The Trails ofBriggs Ranch is a planned 2,500-acresubdivision. The first phase, the Estatesat Briggs Ranch, will have 66 lotsaveraging 2.5 acres in size. Construc-tion on homes in the project began inearly 2001. The subdivision will

surround the Briggs Ranch Golf Club,with lots priced from $70,000 to$250,000.

On the northeast side at WoodlakeParkway and Eisenhauer Road,Northeast Crossing is a planned 1,499home development. Homes will bepriced from $70,000 to $100,000.

In north central San Antonio, TheHeights at Stone Oak is a 500-acremaster-planned community at HardyOak and Wilderness Oak. Inside thedevelopment, Waterford Heights is a50-lot development with one-acre lots.

In west Bexar County, Carlson Parkis under construction. The 200-townhome and condominium devel-opment will have homes priced from$250,000 to $450,000.

Near Schertz, construction started inthe first quarter of 2001 on a 236-homesubdivision that will include an 18-hole golf course. The project is locatedon I-35.

In Boerne, several new subdivisionsare under construction. Since 1996, adozen high-end subdivisions havebeen built in Kendall County.

19

MULTIFAMILY

San Antonio MSA Multifamily Building Permits


San Antonio Apartment Statistics, March 2001

Texas MetroSan Antonio Average

Average rent per square foot $0.70 $0.76Average rent for units built since 1990 $0.83 $0.97Average occupancy (in percent) 94.1 95.7Average occupancy for units built since 1990 (in percent) 92.5 95.6

Source: Apartment MarketData Research

0

2,000

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8,000

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1980

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20

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Source: San Antonio Building Permit Office

San Antonio, TexasCensus PlaceHighwayInterstate Highway

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San Antonio Multifamily Plats Approved, 2000

Apartments With Ten or MoreUnits Per Building Number of Acres

Springview, Units 1, 2 37.44Mansion at Canyon Spring 32.43Sendero Ridge Apartments 23.85Costa Brava, Unit 1 23.69Bristol Park at Encino Commons 21.10Janar Westcreek 20.01Summer City 19.87Lodge at Sonterra 16.88Ravinia 15.45University Estates, Unit 17A 10.91O’Keefe 3.97Vista Verde, Unit 7A 1.68


In 1999, new apartment constructionin the area made a major jump,with 5,027 building permits issued.

This number fell to 2,063 in 2000. SanAntonio was one of many Texas citiesaffected by apartment overbuilding inthe 1980s; the oversupply resulted in

minimal construction for several years.San Antonio began to see an increasein apartment construction in 1993. Inthe first quarter of 2001, 1,153 newmultifamily units were permitted in theMSA.

Within the city in 2000, 1,978multifamily units were permitted,compared with 4,352 in 1999, and262 acres were platted for multifamilydevelopment, up from 242 in 1999.Rents and occupancy rates were

21

MANUFACTURED HOUSING

San Antonio MSA Manufactured Home Sales

Proportion of NewManufactured Single-family HomesHomes Sold (in percent)

1997 2,433 26.5

1998 2,674 24.7

1999 2,945 26.2

2000* 1,818 22.9

unchanged from January 2000 toMarch 2001 in San Antonio. Map 2shows areas where multifamily permitswere issued.

According to Grubb and Ellis, morethan half of the city’s new constructionis occurring on the city’s north side,between Bandera Road and U.S. 281.In mid-2000, more than 5,000 unitswere under construction. During2000, 4,000 apartment units came online, according to the San AntonioApartment Association.

The Villas of Westover Hills is aplanned multifamily project at MilitaryDrive near Highway 151. Ground-breaking on the first 196 units wasscheduled in spring 2001. The secondphase would add 200 units, but noconstruction date has been set.

A 175-unit apartment project isplanned along the San Antonio River atNueva Street. The $18 million project

would include a four-story building anda parking garage. A construction datehas not been set.

Encino Commons is planned at U.S.281 and Evans Road. The complex willhave 324 units with completion of thefirst units expected at the end ofsummer 2001.

In southwest San Antonio at Loop410 and Pearsall Road a 250-unitapartment complex is planned. Ground-breaking is expected in summer 2001.

In far west San Antonio at GardenBrook a 78-unit apartment complex isplanned for seniors and the disabled.Completion is expected in summer2002. Construction began in November2000 on a 268-unit apartment complexon Ingram Road.

In north central San Antonio, apart-ments will be developed at SonterraBoulevard and Stone Oak Parkway. The

Lodge at Sonterra will have 326 units,a clubhouse with a fitness center, a36-seat theater and a billiard parlor.An $11 million, 229-unit apartmentcomplex broke ground in August2000 on Huebner Road.

Downtown, the San AntonioHousing Authority is planning twoprojects. Rex Apartments will have200 units and Victoria Courts, 850units. Existing complexes at the siteshave been demolished.

The Friedrich Building on EastCommerce Street will be convertedinto residential lofts that are expectedto open in 2001. In central San Antonio,construction on a $13 million, 150-unit apartment complex began inJanuary 2000 on Tree Line Park.

A 240-unit apartment complexbroke ground in October 2000 onPrue Road.

*Through third quarter 2000Source: Texas Manufactured Housing Association

22

SENIORS HOUSING

Independence Hill RetirementResort Community opened a $9million assisted-living complex in

November 2000. The complex has 64suites.

The Village At Rosillo Creek is an84-unit seniors housing project to bebuilt at Eisenhauer Road and WalzemRoad. Construction is expected tobegin on the $10 million project insummer 2001.

St. Francis Nursing Home brokeground in September 2000 on a $4million addition at Woodlawn Avenue

and Flores Street. The 22,000-square-foot addition will have 42 beds.

Incarnate Word Retirement Commu-nity completed a 60,000-square-footaddition that includes 19 assisted-living units and 24 Alzheimer’s units inspring 2001.

The San Antonio Freedom Housewill begin a $3 million, 27-bedexpansion during fall 2001.

On El Camino Real, construction ona 51-unit seniors apartment complexbegan in February 2000. In east San

Antonio on Eisenhauer Road, con-struction on a $29 million nursinghome began in May 2000.

A 20,000-square-foot assisted-livingcenter opened in January 2000 inSeguin. The Seguin Assisted LivingCenter has 30 units and cost $2million.

The Lillian Hudspeth Nursing Homeclosed in Sonora in September 2000.

San Antonio Plats Approved, 2000


A 319-lot manufactured homesubdivision is planned atSouthcross Boulevard near

Loop 410 in southeast San Antonio.Infrastructure improvements began in

March 2001. Woodlake, a 451-unitcommunity in northeast San Antonio,completed phase two in spring 2000.

In Boerne, a manufactured homesubdivision is planned at John’s Road

and I-10. A total of 140 homes areplanned. Construction started in spring2001.

Manufactured Home Subdivision Number of Lots

Foster Meadows Units 9, 14A 165

Honey Homes-Lackland City 77

23

Retail Property Statistics

2000Power Centers Total Square Feet 4,914,950

Occupancy (in percent) 88.34

Neighborhood service Total Square Feet 14,854,087 Occupancy (in percent) 85.14

Community centers Total Square Feet 3,132,739 Occupancy (in percent) 83.52

Regional mall Total Square Feet 8,341,014 Occupancy (in percent) 84.27

Source: The Weitzman Group

Hotel Occupancy and Rental Rates

1999 2000San Antonio Texas San Antonio Texas

Occupancy rate (in percent) 66.2 65.0 66.2 65.7Average daily rental rate $85.56 $85.67 $86.74 $86.45

Source: PKF Consulting

RETAIL MARKET

Submarket Property Statistics, 4th Quarter 2000

Source: The Weitzman Group

Total Vacancy Rate Net AverageSubmarket Square Feet (in percent) Absorption Rent

North Central 8,857,492 9.67 –20,852 $13.88

North East 7,798,917 22.96 209,113 10.63

North West 9,204,967 12.49 –144,308 10.95

South Central 1,876,431 13.24 –18,999 9.82

South East 1,135,502 11.68 1,464 9.96

South West 2,069,481 19.09 –15,093 9.51

Total 30,942,790 14.86 11,325 $10.79

24

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Hotel Occupancy and Rental Rates, Submarkets, 2000

Occupancy Average DailyLocation (in percent) Rental Rate

Central business district 69.8 $105.84

North—airport 68.5 79.13

Northeast 58.0 52.58

Northwest—Fiesta 62.0 70.32

South San Antonio 56.5 48.24

Source: PKF Consulting

Map 3 shows the locations ofretail building permits issuedin San Antonio during 2000.

The Weitzman Group reports thatvacancy rates increased 1.7 percentduring 2000. Rental rates increased 19cents. Rents were up the most in thenorth central sector, rising 49 cents.

A total of 2.5 million square feet isexpected to enter the market in 2001,including more than 1.9 million squarefeet of space that was under construc-tion at the end of 2000.

Loop 1604 is seeing major retailconstruction activity. Four shopping

centers are under construction on theLoop, two at Blanco and two more atBandera. The Forum, a new powercenter at the northeast corner of I-35and 1604, added 1.2 million squarefeet to the market.

RestaurantsSan Antonio is expected to be the

fourth largest restaurant market in thestate, with $3 billion in sales for 2001,according to the Texas RestaurantAssociation. Restaurant sales areexpected to grow 10.1 percent duringthe year.

On the River Walk, Manducasopened in November 2000. During2001, Gallagher’s Steakhouse andGrand Central Oyster Bar will open.Roly Poly Rolled Sandwiches opened astore in the food court at MethodistHospital in September 2000. Thecompany plans to add several loca-tions in San Antonio.

Palm Restaurant, a steak and lobsterrestaurant, opened in October 2000.Chili’s began construction on a newrestaurant on Bandera Road in October2000. A Red Lobster broke ground inAugust 2000 on North U.S. 281.

25

Hotels-MotelsA $230 million Sheraton Convention

Center Hotel is planned for occupancyby late 2003.

The San Antonio Marriott NorthwestHotel opened in December 2000. The11-story hotel has 296 rooms and islocated on Loop 410. A Marriott Resort500-room hotel is planned at Bulverdeand Evans roads. The resort will havetwo golf courses, a 25-acre teachingcenter and shops, in addition to 40,000square feet of meeting space and a spa.The project is expected to cost morethan $500 million when completed by2004.

La Quinta Inns is planning to teardown two San Antonio hotels near theairport to build a 270-room high-risereplacement. The hotel will open inDecember 2001 at Loop 410 at U.S.281.

Budget Suites of America added 858rooms in San Antonio in 2000. A $12.6million Budget Suites broke ground inMarch 2001 at Fredericksburg andCallaghan Roads. The hotel will have360 rooms.

The Alamo National buildingdowntown will be converted into a300-room hotel within three years. The24-story building is located on SouthSt. Mary’s Street. The Riverwalk Vistais a 17-room bed and breakfast plannedfor the Dullnig Building at Losoya andCommerce streets.

By fall 2001, the Aztec Theater onthe River Walk will become a 96-roomspa hotel. The project is at Crockettand Commerce streets.

Construction on the Alamo SuitesHotel began December 2000. The$1.8 million, 65-room hotel is on ElPaso Street in central San Antonio.

In southwest San Antonio, construc-tion began in April 2000 on a newmotel on Military Drive Southwest atNew Laredo Highway. In northeastSan Antonio, construction began inJanuary 2000 on a $12 million hotel onNacogdoches Road. A 121-unit hotelbroke ground on Culebra Avenue inJanuary 2000. The northwest SanAntonio hotel will cost $12 million.

The Omni Hotel completed a $3.5million renovation in June 2001.Microtel Inn & Suites opened in June2001 on I-35 near Splashtown.

Other RetailIngram Ridge Theaters opened an

18-screen theater, Live Oak Crossing,

at the southeast corner of I-35 and PatBooker Road.

Home Depot opened a store in 2000at the northeast corner of U.S. 281 andSunset. Home Depot plans to open astore in Encino Park Shopping Centerat Evans Road and U.S. 281. HomeDepot also plans a store at BanderaTrails Shopping Center at BanderaRoad and Loop 1604. Lowe’s HomeImprovement is planning a store at I-10and Callaghan Road.

Wal-Mart is planning a 200,000-square-foot center at Loop 410 andRigsby Avenue, as well as an expan-sion to its supercenter at U.S. 281 andLoop 1604.

A 700,000-square-foot shoppingcenter called Bandera Point will openin 2001 at Bandera Road and Loop1604. The center will include aLowe’s, SuperTarget, Ross Dress forLess, Marshall’s, Old Navy, Barnes &Noble and Linens n’ Things.

In north central San Antonio, phasethree of the Northwoods ShoppingCenter broke ground in March 2001 atU.S. 281 and Loop 1604. Anchorsinclude Bed Bath & Beyond andMarshalls. The addition will add116,000 square feet.

Vineyard Shopping Center, a700,000-square-foot development atBlanco Road and Loop 1604, willinclude a SuperTarget.

The Strand shopping center willhave 80,000 square feet of space atHuebner and I-10 when it opens in2001. Rector Shopping Center is a38,000-square-foot center across fromNorth Star Mall on Rector Street.Huebner Commons is an 82,000-square-foot retail center under con-struction at Huebner and VanceJackson.

Culebra Market Shopping Centerwill have a 75,000-square-foot H-E-Band an additional 85,000 square feetof shopping space at Loop 1604 andCulebra Road. The center will becompleted in fourth quarter 2001.

The Shops at La Cantera is a 1.2-million-square-foot mall planned atLoop 1604 and La Cantera Parkway.The mall will have 150 stores includ-ing Foleys, Dillard’s, Nordstrom’s andNeiman Marcus.

Foley’s opened a department store inSouth Park Mall in November 2000.Burlington Coat Factory opened at I-35and Southwest Military Drive in spring2001.

Haverty’s Furniture plans to opentwo stores in San Antonio during fall2001. One will be at DeZavala Roadand I-10 West. Groundbreakingoccurred in April 2001 on an 8,000-square-foot retail site at U.S. 281 andEmbassy Oaks.

The Forum, a $100 million shoppingcenter, is planned for Selma at I-35 andLoop 1604. Retailers include Best Buy,Target, Ross Dress for Less, OfficeMax, Chili’s, Dress Barn, Super Cutsand Payless Shoes. The center com-pleted its 700,000-square-foot firstphase in mid-2000.

Encino Park Center is a 400,000-square-foot project at U.S. 281 andEast Evans Road. The first phase wascompleted in late 2000 and includes200,000 square feet of space.

On lower Broadway, a new self-storage project was developed on aformer Ford dealership site. Anotherself-storage project was developed onthe northeast side at Loop 1604 andRedland Road. Shurgard opened athree-story ministorage facility on thenorthwest side of San Antonio and atwo-story complex in Helotes in 2000.

Construction began in spring 2001on a 62,000-square-foot fitness facilityin north central San Antonio. TheSpectrum Club at Rogers Ranch isexpected to open by the end of 2001 atLoop 1604 and Rogers Ranch Parkway.

In north central San Antonio,Academy Sports and Outdoors willbuild a store in the NorthwoodsShopping Center on Loop 1604.

At U.S. 281 and Evans Road ashopping center is planned at StoneOak.

At Loop 1604 and U.S. 281 an icerink project is under development. The$10 million project will have two NHLregulation size ice rinks. The 85,000-square-foot skating and entertainmentcomplex is scheduled to open in spring2002.

On the west side, a 24-acre retailcenter is planned at Callaghan Roadand West Commerce Street. Down-town, Goodwill opened a bargaincenter on West Commerce Street inSeptember 2000.

On the northwest side at Loop 410and Highway 151, construction on the200,000-square-foot phase II ofWestside Commons is expected tostart in early 2002.

In Boerne, Oak Park Village is a19,300-square-foot shopping center

26

OFFICE MARKET

Office Property Statistics

1998 1999San Antonio central business district

Total space (in square feet) 4,486,876 4,800,942Average rental rate $13.55–$19.86 $14.21–$22.31Occupancy (in percent) 87.8 85.9

North centralTotal space (in square feet) 6,657,654 7,220,232Average rental rate $16.50–$20.10 $16.74–$20.00Occupancy (in percent) 90.7 86.5

NortheastTotal space (in square feet) 1,265,587 1,265,587Average rental rate $14.42–$18.57 $14.25–$20.00Occupancy (in percent) 88.9 87.9

NorthwestTotal space (in square feet) 5,930,271 6,377,589Average rental rate $14.90–$20.28 $15.59–$20.51Occupancy (in percent) 88.5 85.8

SouthTotal space (in square feet) 126,753 126,753Average rental rate $14.12 $14.12Occupancy (in percent) 93.7 100.0

TotalTotal space (in square feet) 18,827,141 19,554,103Average rental rate $15.40–$20.07 $15.18–$20.53Occupancy (in percent) 89.2 86.3

Source: Grubb & Ellis

on Bandera. The first shops opened inspring 2001. Tenants include Block-buster Video, Wells Fargo Bank, MailBoxes Etc. and Pro-Cuts.

Pedro Towne Center will breakground in summer 2002 at San Pedro

Avenue and Ramport Drive. The centerwill have 130,000 square feet.

During 2000, Beall’s closed at theWindsor Park Mall in addition to twoother locations. Handy Andy closedfour stores in San Antonio during

Map 4 shows the locations ofoffice permits issued in theCity of San Antonio in 2000.

San Antonio absorbed more than800,000 square feet of office space in2000, according to Grubb and Ellis.

The citywide vacancy rate fell from14.2 percent at the end of 1999 to 11.6

percent at the end of 2000. Class Aspace vacancy fell from 12.9 percentto 8.4 percent, according to Grubb andEllis.

During 2001, Class A vacancy ratesare expected to fall and rental rates areexpected to climb as fewer speculativeconstruction projects come on line.

Medical OfficeAt the University of Texas Health

Science Center, construction on a $60million children’s cancer researchcenter is expected to begin in spring2001. The facility will be on Floyd CurlDrive next to the ongoing $20 millionexpansion of the Cancer Therapy and

2000. Weiner’s closed one store in SanAntonio. Montgomery Ward closedfour San Antonio locations. TwoHomePlace stores in San Antonio wereto close in spring 2001.

27

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Research Center, which includes twonew buildings with 70,000 square feet.

A three-story medical office buildingbroke ground in September 2000 atEwing Halsell and Medical drives inthe South Texas Medical Center. Partof the 105,000-square-foot buildingwill be leased to the Cardiology Clinicof San Antonio.

Christus Santa Rosa opened the five-story David Christopher GoldsburyCenter for Children and Families inDecember 2000. The $19 millionbuilding includes a 17,500-square-footeducation conference center. ChristusSanta Rosa’s downtown surgical toweropened in January 2001. The 158,000-square-foot addition cost $25 million.

A 30,000-square-foot medical officebuilding is planned at Erie and Elmira.The project was expected to breakground in early 2001.

South Texas OB/GYN completed amedical facility on McCullough at theend of 2000. The building has 10,000square feet.

Ground breaking on a 48,000-square-foot surgical center for SanAntonio Orthopedic Group took placein January 2001. The building will becalled 400 Concord Plaza.

Methodist Health Care System willbegin construction in summer 2001 on

a $3 million ambulatory care canter atLoop 1604. The center is expected tobe completed in February 2002.

A 15,000-square-foot medical clinicwas expected to open at KellyUSA inJune 2001. The KellyUSA MedicalCenter will offer family, pediatrics,OB/GYN and occupational healthservices.

Covenant Behavioral Health Systemon Huebner Road closed in November2000. North Central Baptist Hospitalclosed its pediatric intensive care unitin August 2000.

Office ProjectsHarcourt Inc. is building a new

corporate campus. The project is justnorth of Loop 1604. The three-building, 558,000-square-foot com-plex will be completed in early 2001.The building will house 700 employ-ees.

In Northwest San Antonio, phaseone of Tech Park broke ground at I-10and De Zavala. The first building willhave 70,000 square feet. Phase twowill consist of 60,000 square feet.Phase one is expected to be completedin September 2001 with the secondphase of construction following.

University Heights Tech Center islocated at De Zavala Road and

University Heights Boulevard. Theproject will have two buildings with atotal of 126,365 square feet. Construc-tion was expected to begin in spring2001.

At University Park and De ZavalaRoad, two flex-space buildings areunder construction. The buildings areadjacent to University Park TechCenters III and IV and total 165,000square feet.

In North Central San Antonio atLoop 1604 and Stone Oak Parkway,four buildings totaling 100,800 squarefeet were started in January 2001.

In north central San Antonio, LaPlaza Office Park will have buildingsranging from 5,000 to 40,000 squarefeet. Ground breaking was set to occurin the first quarter of 2001.

Huebner Commons is a plannedoffice and retail development at VanceJackson and Huebner roads. Theproject broke ground in spring 2001and will have 75,000 square feet ofoffice space.

The Nakoma Theater is beingconverted to a 75,000-square-footoffice building called Cinema Plaza.The project is located at U.S. 281 andNakoma Street.

The Abbey is a planned 18,000-square-foot office building in Alamo

27

28

INDUSTRIAL MARKET

Industrial Property Statistics

1999 2000

Standard IndustrialTotal space (square feet) 12,987,298 18,785,000Average rental rate $4.08 $3.75Occupancy (in percent) 85.0 83.4

R&D-FlexTotal space (square feet) 7,875,272 3,977,000Average rental rate $5.52 $7.10Occupancy (in percent) 85.7 88.9

TotalsTotal space (square feet) 21,862,570 22,762,000Average rental rate $4.08–$5.52 $5.52Occupancy (in percent) 85.3 84.4

Source: Grubb & Ellis

Heights on Austin Highway. Construc-tion will begin during summer 2001.

SBC Communications will move theheadquarters of its high-speed Internetservice subsidiary into the 206,000-square-foot building that was once thecorporate offices of Builders Square.

The building is downtown on CoventStreet.

McCombs Plaza, a 107,000-square-foot office building, is planned in northcentral San Antonio at East MulberryAvenue and St. Mary’s Street. Con-

struction began in September 2000and is expected to take a year tocomplete.

At KellyUSA, a 77,100-square-footoffice building was completed inAugust 2000.

Map 5 shows the locations ofindustrial building permitsissued in San Antonio. The

citywide vacancy rate is 15.6 percent,according to Grubb and Ellis. In thefourth quarter of 2000, 1.3 millionsquare feet of industrial space wasunder construction, compared with673,000 square feet at the same timein 1999. Rental rates for flex space arepredicted to increase 5 percent in2001.

Major construction projects underway at the end of 2000 included558,000 square feet for Harcourt innorth central San Antonio, 374,000square feet by Block Distributing in

the Tri-County Business Park and200,000 square feet by Zee Manufac-turing in the west submarket.

R.L. Worth and Associates hasbroken ground on a fourth flex build-ing in University Park Business Center.The building will have 42,000 squarefeet.

At Loop 1604 and Highway 151, theVistas Business Park at Westover Hillsis planned. The 250-acre campus willhave industrial, light office andcorporate users.

Green Mountain Business Park hastwo buildings under construction, onewith 72,726 square feet and a secondwith 38,951 square feet. The park is

located at Loop 1604 and GreenMountain Road.

Tristar Corporation plans to con-struct a $2 million, 60,000-square-footaddition to its perfume manufacturingfacility in Pleasanton.

An 800-megawatt power plant isbeing constructed in Seguin. Constel-lation Power Source expects the $340million plant to be completed in June2002.

Two industrial buildings are underconstruction in the Arion BusinessPark. The park is located north of theSan Antonio International Airport onU.S. 281. Arion 16 will have 51,200square feet, and Arion 17 will have

29

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Map 5. Industrial Building Permits, 2000



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39,120 square feet. Arion 13 and Arion15 were completed during 2000.

A new steel factory is being devel-oped in northeast San Antonio. The68,500-square-foot facility is locatedin the Woodlake Business Park.

BudCo is developing a 288,000-square-foot headquarters and ware-house facility just north of KellyUSA.The facility is expected to be com-pleted by November 2001.

CONCLUSION

601-50-1482

San Antonio’s population isexpected to continue to grow.Most new job growth will come

from the services sector. The conver-sion of Kelly AFB to private uses is

expected to expand job creation andincrease growth in the industrialsector.

NAFTA is expected to continue tohave a positive impact on the San

Antonio MSA’s economy. Construc-tion activity is expected to remainstrong in the multifamily and industrialsectors as many planned projectsbegin.

Southwest Concrete Productsopened a concrete-block manufactur-ing plant in northeast San Antonio. The30,000-square-foot facility is onAckerman Road.

Documents

Jennifer S. CowleySan Antonio Counties Bexar Comal Guadalupe Wilson S an Antonio is the eighth largest city in the United States and one of the fastest growing metropoli-tan areas