Developer Plans to Convert Church Parking Lot Into Modern Apartments

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A street view rendering of St. John’s Square.

Courtesy / Mark Odom Studio

A street view rendering of St. John’s Square.

With a name inspired by a neighboring church, a contemporary multifamily housing development destined for a corner in the oldest neighborhood in San Antonio won conceptual approval in recent weeks.

The Historic and Design Review Commission approved on March 20 plans brought by Weal Development and Mark Odom Studio for St. John’s Square. The eight-story, 250-unit apartment building will be constructed on property owned by St. John’s Lutheran Church, which can trace its history to early German settlers in 1851.

Currently used as a parking lot, the property bordered by South St. Mary’s, East Nueva, and Presa streets in the La Villita Historic District was the focus of negotiations between the local developer and St. John’s that began six years ago. The talks resulted in a 99-year ground lease that will bring the church steady revenues and much-needed workforce housing to downtown, said Dennis McDaniel, CEO of Weal Development.

“It worked out well for the church,” he said. “Right now, the income from the parking lot is seasonal. So now they can plan.”

The church’s congregation president, Ron Stinson, has been attending St. John’s for more than 50 years and is excited to see the development finally coming to pass. The church recently hired a new pastor, James Dew, and Stinson thinks the development will serve to showcase the church. “This will be the downtown San Antonio church to belong to and attend,” he said.

Stinson represented the church in negotiations with McDaniel after reviewing offers from several other developers. He said the project will be “huge” for the church – in providing revenues for programming, building attendance at the church, and removing the eyesore of a parking lot, while still making parking available to church-goers and the public.

Fifty of the units at St. John’s Square will be offered to those who earn less than 50 percent of the area median income ($50,044 in 2017), and the rest at market rate. Most of the 250 units will be one-bedroom apartments, but there also are studio apartments and “brownstone-style” walkups, and three two-bedroom units on each of the above-ground floors.

McDaniel believes St. John’s Square will make life better for people who work in the city’s dozens of hotels and many more restaurants downtown but who can’t afford to live there. Even though such center-city development projects are costlier to do than those in the suburbs, McDaniel said it’s worth it.

“I’ve been very fortunate in my career, and at this stage, I get to work on projects that are meaningful to me – it’s not just about making money,” he said. “With this project on the edge of the hospitality district … we get to make a difference in a lot of people’s lives. I’m not going or fix the problem [of affordable housing], but in my own little way, I get to help.”

St. John’s Square qualified for over $625,000 in fee waivers and $3.2 million in incentives through the Center City Housing Incentive Policy.

McDaniel said he expects to receive a construction permit this fall and break ground before the end of the year. “By end of 2021, we should have people moving in there,” he said.

The general contractor is Cadence McShane, the same company working to complete Area Real Estate’s 151-unit property known as The ’68 Apartments, which is just blocks away from the St. John’s Square site at Hemisfair.

A rendering of St. John’s Square next to St. John’s Lutheran Church.

Courtesy / Mark Odom Studio

A rendering of St. John’s Square next to St. John’s Lutheran Church.

The St. John’s development will feature ground-level restaurants and retail, and though McDaniel has already secured one restaurant that will be operated by a chef trained at the Culinary Institute of America, he said he can’t reveal the name yet. He’s also hoping to bring in a co-working space and a fitness studio. The building wraps around a parking garage.

McDaniel is the developer behind Steel House Lofts, a historic building turned into 67 condos in the Lone Star District in 2012. Initially offered as rentals, the apartments were converted to for-sale properties in 2017. McDaniel splits his time between a condo he owns there and a residence near his grandchildren in Austin.

15 thoughts on “Developer Plans to Convert Church Parking Lot Into Modern Apartments

  1. This is a creative use of church property and a good partnership between the city and church. Will the church pay property taxes on the parking lot since they are using it to build a commercial unit that will generate revenue or will the building serve as the rectory where the pastor and church staff will reside?

    • Thanks for the question, Fran. According to an Arlington-based board-certified specialist in tax law we asked, the property became taxable when the ground lease was signed. Religious exemptions only cover property used for religious worship. Whether the church pays those taxes, or the tenant, is determined by the terms in the agreement between the two. “If I’m doing the lease, it’s always going to be the tenant paying the taxes,” said attorney Frank Sommerville. “But I can’t speak for how other lawyers might be structuring the lease. They may be charging extra on the lease to cover the taxes. There’s no wrong way – it’s just risk-shifting between the tenant and the church.”

  2. It’s nice to see a multi-use building go up. Does San Antonio have parking minimums for new residential building?

    • St. John’s Square will have 335 parking spaces in an eight-story parking structure wrapped by the building’s residential units. According to the City’s Unified Development Code, areas zoned “D” for the downtown district are exempt from the off-street parking facilities provisions which typically require 1.5 to 2 parking spaces per unit in residential districts.

  3. You might check your dates on Steel Lofts being turned into condos in 2006. I moved across the alley in 2011 and the abandon Peden Steel building was vacant for a couple years after, with a homeless guy living on the loading dock till the development began.

  4. You are correct. The developer purchased the property in 2006 but did not begin renovation until 2011. The story has been corrected.

  5. This project is HDRC garbage. Every project the HDRC touches looks the same. I can drive around town and pick out every project that the HDRC has modified.

    The affordable housing component is a hoax.

    You said, “Fifty of the units at St. John’s Square will be offered to those who earn less than 50 percent of the area median income ($50,044 in 2017), and the rest at market rate.”

    Have you thought this through? This is another non-profit scam just like the PFC. Not a single unit in this scam becomes affordable housing and it makes me sick that Rivard Report won’t write about it. Let me explain.

    A person making less than 50% of $50,044 makes $25,022/year or $12/hour. The housing criteria is that rent should not be more than 33% of your income.
    Never mind that gross pay and take-home pay are two very different numbers.
    So 33% of $25,022 is $8,257 or $688/month for rent. This will never happen and it never does. There is no way this developer will lower these rents to $688 mainly because they don’t have to and they wont. So affordable housing never happens and the developer pays no taxes at all: no sales tax, no property tax, no income tax, no capital gains tax. Wow! I’d like to be a pig at that trough. How can the Rivard Report or anyone else keep falling for this crap? Are you reporters or panderers.

    This exact same non-profit scenario is also the number one source of gentrification. It’s not the developer its our local government that allows this to happen. It should anger everyone that the home values all around this development will go up because of this project. They will pay increased property taxes and this developer will pay none. Shame on all of you. I can’t believe nobody has the guts to write about this.

    • You are correct. But, it’s not about affordable housing, it’s about gentrifying downtown. Same reason SASD is looking to give control of their schools to outsiders to turn them into academies, etc….to appeal the people the city wants to live in a gentrified downtown and those people don’t want to send their kids to SASD schools as they currently are.

      Do away with city non-profits related to housing…go to a meeting and you will see why.

      • Amen, but it’s about both because both are interconnected. The irony is that the city is the main culprit in gentrification and despite the platitudes of “affordable housing”, none is being delivered. A perfect example is when a few weeks ago the city was able to cough up $1,000,000 to appease the gentrification issue. First of all, a lot of that money will be wasted but the real injustice is that the money will go to help people “leave” their neighborhood or help people that have already left. Go figure that out. The only true provider of affordable housing in San Antonio is SAHA. I’m baffled as to why we can’t get this right.

    • Mitch, units that are reserved for families/households at 50% AMI would mean rents of no more than $585 for a studio, $626 for a 1-bedroom, and $752 for a 2-bedroom. These rents are designed to keep people from paying more than 30% of their gross income on housing, and they’ll be legally required to keep those units affordable for decades to come. It doesn’t fix all the problems, sure, but when HUD has been pulling housing authorities out of the housing production business since the 1990s, this is the primary means to providing housing that isn’t $2,000-4,000 a month like it is in most other downtowns. And, how can you call this gentrification when this development is in the heart of downtown, will be replacing an ugly surface parking lot, and will actually generate revenue for a struggling church to better serve the community?

      • Ray, I’d love to sit down and meet with you. I just posted a response but it looks like the Rivard Report wants to read it first. There is a big difference between making these units available and making them mandatory. Call any of the projects that have partnered with a non-profit and ask where the affordable units are. They don’t exist. I will debate this all day long and win. I know what I’m talking about and have done the research. If all the money that you’re (I’m assuming you work for the developer) not paying in taxes can be justified in affordable rents then I’ll eat my hat, but it doesn’t, and you know it doesn’t. You are not providing a service, you’re part of the problem. Let’s visit. I’m easy to find. Mitch

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