By Richard Webner | @RWebner | Heron contributor
In the heart of Southtown, on the intersection of South Alamo and South St. Mary’s streets, one can find proof of how great it can be when Kevin Covey manages to achieve his vision for a construction project.
Shortly after founding his development firm, GrayStreet Partners, in 2013, he led it to buy the closed-down Texas Highway Patrol Museum, 812 S. Alamo St., and a blank-looking warehouse behind it. He then launched a painstaking renovation with the aim of turning the buildings into a retail strip hosting a curated selection of independent businesses.
Since the renovations wrapped up in 2017, the strip has had some hiccups—a paleta shop closed down, and a concept by chef Andrew Weissman didn’t work out. Nonetheless, it has emerged as one of the most vibrant retail destinations in urban San Antonio, home to Southtown anchors such as Pharm Table, Mixtli and Brown Coffee Co.
On Nov. 16, GrayStreet sold the 1.1-acre property, county deed records show. The firm first transferred ownership to Covey and a partner, Christopher Grossman, who sold it to Southtown Junction LP, a partnership formed in September led by executives of Ironwood Real Estate, a commercial real estate firm from Austin that owns the Olmos Park retail strip at 3910 McCullough Ave. Southtown Junction also shares an address with Ironwood.
Southtown Junction took out a $6.96 million loan from the State Life Insurance Company of Indiana to make the purchase, according to records from the Bexar County Clerk. The Bexar Appraisal District assessed the property at $2.6 million this year.
Peter French, GrayStreet’s development director, declined to comment when reached by text message. Executives at Ironwood didn’t respond to requests for comment.
It isn’t unusual for GrayStreet to sell its completed projects, to raise money as it embarks on new ones. That’s what it did with Travis Park Plaza, just north of East Houston Street. The firm still owns the Light building on Broadway, which is filling up with new tenants after undergoing renovations that dragged on for years.
“We have limited capital,” Covey told the Heron in early 2021, in an email. “I recapitalize projects that we complete so that I can go do more.”
Several of GrayStreet’s ambitious development plans—which often involved revitalizing historic buildings or neglected neighborhoods in urban San Antonio—have fallen through or been delayed, while others have been successful. Earlier this year, it put the old Lone Star Brewery up for sale, abandoning plans to redevelop it at a cost of $596 million in partnership with Houston mega-developer Midway.
[ Heron: GrayStreet Partners’ big dream for Houston Street that never materialized | Jan. 20, 2022 ]
Others, such as the renovation of the Vogue building on East Houston and a commercial building on East Grayson, home to furniture store West Elm, have been renovated and sold.
GrayStreet continues to tackle new projects. In May, it bought the seven-story Tower Life parking garage, just as the 31-story Tower Life itself was sold to a group led by the McCombs family, which plans to rehab it with apartments.
That same month, a shell company linked with the firm bought the 56-story Renaissance Tower in Dallas, an iconic part of the city’s skyline, Dallas County deed records show. The transaction was first reported by the San Antonio Business Journal. The firm said in a press release that it planned to “invest in, update, reimagine and reinvigorate” the 48-year-old tower.
Richard Webner is a freelance journalist covering Austin and San Antonio, and a former San Antonio Express-News business reporter.