Although original estimates put a price tag of $100 million to $120 million on CPS Energy’s new headquarters on the San Antonio River, the final maximum number the public utility and Sundt Construction settled on Monday was $150 million.
“You always start [request for proposals] with a low number,” said John Benedict, CPS Energy vice president of real estate and master planning.
The construction company was awarded the contract in June, and the board unanimously approved the maximum cost Monday of $145 million from Sundt and a $5 million contingency fund from CPS Energy. Construction is expected to start in the coming weeks once paperwork from the utility, Sundt, and subcontractors is complete.
“It’s a major milestone,” Benedict said. “Now we have the dollars locked in.”
CPS Energy will start moving its employees into the renovated former AT&T headquarters during the first half of 2020, Benedict said. Initial estimates placed move-in during 2019.
The utility’s contingency fund will provide some flexibility to accommodate new technology, regulatory changes, services, or other updates to the building design, Benedict said. The design was approved by the Historic and Design Review Commission in late 2016.
The search for a new headquarters began more than six years ago when the utility’s leadership was considering building a new structure or renovating an existing building near downtown. Its current two-tower campus at 145 Navarro St. provides less than 300,000 square feet of office space and will be sold to offset the costs of the new 430,000-square-foot space. CPS Energy has yet to select a real estate broker to handle the sale. The buildings, which overlook the River Walk, were valued at $35.3 million in 2016 by the Bexar County Appraisal District.
“All said and done,” CPS Energy Board Chair Ed Kelly said, the project that includes two office towers, retail space, a 1,200-car parking garage, and connection to the River Walk will cost approximately $350 per square foot.
A lot of the savings in this project have already occurred, Kelly said. “We got the structure for nothing and the land for market value.”
CPS Energy paid $25.2 million for the land and building, which were appraised at $8.8 million and $11.4 million respectively by the Bexar County Appraisal District in 2016 and 2017. Appraisal value does not typically match market value.
The new, energy-efficient headquarters are expected to save the utility on operating, maintenance, and commuting costs as it relocates its more than 3,100 employees from various facilities in the city.
The cost of the building has been budgeted into the utility’s annual budgets and will not result in increased rates for customers, Benedict said.
Ridiculous, is this why I pay 400 month electric? Why should we have to pay for them to have luxury headquarters when we are all struggling. Why can’t they move the headquarters out in the country on cheap land……?????
$400 per month sounds like a gross exaggeration, unless you live in a McMansion and make no effort to conserve. We live in a 2400 square foot home and have averaged a monthly electric and gas bill of $84.14 for the January through October period. Of course, we have replaced light bulbs with LED lighting, air conditioning is set moderately at 77 degrees and heater is set to start at 70 degrees. We do leave lights on all night outside and timers in various rooms through out the evening.
Maybe you should invest in some solar panels to provide some of your own electricity.
As for moving to the burbs, where the land is cheap (is it really?), the decision to stay downtown will contribute to the vibrancy of the city.
What was finally decided about the river side of the complex? I know there were criticisms of original plans for a parking lot on that side. I thought they should make it like a park attached to the river. But I don’t recall ever seeing a follow-up story. Did they decide on making their complex look pretty or ugly on the River Walk side?
I was going to write a long response to Bert’s comment, but the more I thought about it, the more I thought why should I waste my time on stupidity. It’s people like Bert who continue to try to keep this City a one-horse cowtown. Bert, try moving into the 20th Century, maybe eventually you’ll catch up to us living in the 21st Century.
And if you are paying $400/month in utilities, you are clearly wasting energy, and your house is energy inefficient. Do something about it.
Not to mention, why shouldn’t all those employees who work hard at CPS have a nice environment to work in. And I agree with the comment about keeping corporate headquarters downtown – they (all of them) should not be anywhere else.