Larger portion of CPS Energy’s Jones Avenue property now for sale

Note: This article has been updated with a more thorough timeline of the property at 326 W. Jones Ave. Nothing from the original article was deleted.

By Ben Olivo | @rbolivo | Heron editor

Since hiring a Los Angeles-based international real estate brokerage firm in 2018, CPS Energy still has not sold its former Jones Avenue Service Center at 326 W. Jones Ave., which abuts the Museum Reach stretch of the River Walk. It recently placed a much larger portion of it on the market.

In recent years, CPS Energy has sold other properties, including its former headquarters and an adjacent office building at 145 and 146 Navarro St., respectively. They are part of seven properties the utility put on the market more than three years ago to help offset the cost of its $210 million headquarters on McCullough Avenue. It moved into its new digs in November 2020.

In 2015, CPS Energy board of trustees declared the property, which totals nearly 7 acres, as surplus, and also agreed to donate half of the land to the San Antonio Museum of Art, which sits just south, where restaurants are beginning to sprout nearby. The two sides had until 2019 to make final the transfer of land.

[ Related: San Antonio Express-News: CPS Energy to give piece of downtown land to San Antonio Museum of Art and sell the rest | Nov. 15, 2021 ]

In that year, there was interest from “several buyers,” CPS Energy said in an email exchange after this article was first published.

But the agreement between CPS Energy and the museum was never made final. When asked why, a CPS Energy spokesperson said, “We were not able to finalize the terms and conditions in the documents that would convey the property before our agreement expired.”

On Nov. 15, 2021, CPS Energy board of trustees voted to give 1 acre of the property to the museum “for them to expand cultural offerings to residents and visitors,” CPS Energy Interim President & CEO Rudy D. Garza said in a press release. CBRE, in late May, began marketing the other six acres.

Of the utility’s latest effort to sell the land (albeit, a larger portion), a spokesperson said, “There are several potential buyers interested in the property. It is too early in the process to determine how many potential buyers there will be.”

The West Jones property is prime real estate, acting as a gateway between the Museum Reach-Pearl area, one of the hottest housing submarket in San Antonio, and the St. Mary’s Strip.

To its north, up the Museum Reach, is the Pearl and its retail shops and restaurants myriad. Rents here hover around $2.50 per square foot, based on a quick online survey of five apartments in the area.

Across West Jones is the Museum Reach Lofts, an affordable housing development by nonprofit developer Alamo Community Group that opened in late 2020. Across Camden Street is a 0.6-acre lot, which Houston developer Urban Genesis recently purchased to add to its North St. Mary’s Street lot collection on which it plans to build 180 apartments.

Justin Luera, a senior corporate communications specialist with CBRE, did not respond to an email requesting the list price. The broker with CBRE was not listed on the press release.

Editor’s note: Luera called this reporter after this article was published to correct his title at CBRE, which was incorrect.

The property—which is technically two pieces in county records—was assessed at $21.9 million this year by the Bexar Appraisal District.

Last week, CPS Energy sent a press release to local media announcing it had “retained” CBRE to market the West Jones property, even though the utility’s board of trustees hired the company back in 2018, the San Antonio Express-News reported then.

The property is mostly vacant save for a two-story office building and a “light industrial” building, the press release states.

The release also mentions that the West Jones property rests inside the Midtown Tax Increment Reinvestment Zone, or TIRZ, an incentive tool the city has used to spur development in the area. CBRE says the designation “permits integrated development including high-density multifamily, residential and mixed-use office/retail. It is zoned RIO-2 and FBZ T6-2.”

However, the Midtown TIRZ doesn’t regulate development. In a TIRZ, the rise in revenue as property taxes grow is collected and spent back within the zone in the form of public upgrades.

From 2010 to 2021, the Midtown TIRZ has reimbursed developers to the tune of $21.8 million for upgrades tied to their housing or mixed-use projects. It has also helped fund office rehabilitation and new parks, such as the Maverick Dog Park down Jones on Broadway. However, in February, the City Council voted to devote future Midtown TIRZ dollars to the San Antonio Zoo, the Witte Museum, San Antonio Botanical Garden and Brackenridge Park.

Therefore, any development build on the West Jones property would not be eligible for Midtown TIRZ funding. The future developer of the property could still seek an incentive package from the city, but it would have to be approved by the City Council.

Earlier this year, CPS Energy sold its surface lot at 211 Villita St., next to the Mexican Consulate, to local developer GreyStreet Partners.

It has yet to sell the Villita Assembly Building at La Villita, nor its former Northside Customer Service Center at 7000 San Pedro Ave.

[ » Archive: CPS Energy selling six downtown properties | Sept. 25, 2018 ]

This article originally misstated the title of Justin Luera of CBRE. He is a a senior corporate communications specialist with the firm.

Heron Editor Ben Olivo has been writing about downtown San Antonio since 2008, first for mySA.com, then for the San Antonio Express-News. He co-founded the Heron in 2018, and can be reached at 210-421-3932 | ben@saheron.com | @rbolivo on Twitter

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