Texas Facilities Commission Requests Ideas for GJ Sutton Complex Redevelopment
Texas Construction News from Virtual Builders Exchange
At almost six acres and spanning one and a half blocks, GJ Sutton is one of the largest properties available for redevelopment on the near Eastside.
Posted: 4-12-2017, 9:11 a.m.
by Adolfo Pesquera
Austin (Travis County) - The Texas Facilities Commission is soliciting Request for Information—Market Sounding responses from developers for purposes of developing a plan to construct a new building of at least 260,000 square feet at the 6-acre site of the historic GJ Sutton Building Complex on the Eastside of San Antonio.
“This is an inquiry only,” the RFI released April 6 states. No contract will be entered into and respondents will not be considered bidders or given any preference.
However, the responses will aid TFC and the Center for Alternative Finance and Procurement (CAFP) in launching a formal project. The Facilities Commission is coordinating on this project with the CAFP, an arm of the TFC that was created in 2015 to assist public entities in launching public-private partnerships (P3s) in Texas.
It is the TFC’s intent to utilize the Texas Public and Private Facilities in Infrastructure Act to centralize as many state personnel currently working in Bexar County by procuring a design-build facility through a P3.
TFC is open to ideas on other commercial development on the site.
“TFC understands that depending on the ultimate design of the required structure and associated parking facilities, there may be excess land available for private development. TFC is interested in exploring shared site development options,” the RFI states.
As a starting point for the project, the Facilities Commission is making the following assumptions. The estimated construction cost for a new building with 260,000 square feet of office space and 840 parking stalls would be between $100-$120 million.
The State of Texas pays about $3.5 million annually in rent for leased office space at various locations around the city of San Antonio, and the state would prefer to maximize the value of the GJ Sutton site by paying future rent at “an affordability threshold similar to its current expenditure.”
In addition to centralizing Bexar County-related state operations, the project objectives take into consideration the historic significance of the site and asks respondents to identify opportunities to preserve its “unique historical aspects.”
The RFI makes several other assumptions that are intended as incentives to attract a developer. These include development rights on the property for 33 years, rent revenue from the state on a performance-based basis for 30 years, and developer rights to incrementally develop the entire site.
However, the developer would be responsible for financing, designing, building, operating and maintaining the new building. The state also expects a percentage of anticipated revenue from commercial development, either through incremental net revenues or in the form of an upfront payment.
“Residential/Mixed Use was used for the State’s analysis and is the current assumption of highest and best use,” the RFI states.
The GJ Sutton, 321 Center Street, is a massive brick and concrete complex that began in 1911-1912 as a foundry for casting metal. The state purchased the complex in 1975 to use for offices. It was vacated in 2012 when engineers determined it was no longer structurally safe.
In 2015, the Legislature approved a $132 million capital improvement bill to renovate the site, but Governor Greg Abbott used his line-item veto authority to kill the bill. That decision disappointed Mayor Ivy Taylor and others counting on the state money to redevelopment GJ Sutton, a project that would make a great impact in the near Eastside’s ongoing revitalization.
Responses are due April 24 by 3 p.m.
Adolfo Pesquera is a veteran news journalist. He has previously worked for Hearst Corp., American Lawyer Media, News Corp and Freedom Communications. His work has been published in newspapers and magazines throughout the United States. He is a communications graduate of the University of Texas-PanAmerican.
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