Market Square Businesses Worry About Future With Shorter Lease Agreements Looming

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Guests walk through the historic Market Square building.

Scott Ball / Rivard Report

Guests walk through the historic Market Square building.

Gabriella Albright runs La Boutique International at Historic Market Square. The business has been in the family for 42 years; her parents Alvaro and Carmen Munevar started it in 1977. Though the store has changed its offerings somewhat since it opened, the place – and the El Mercado building – looks largely the same, she said.

“Back in the ’70s when the City reopened Market Square, [El Mercado] was still open-air,” she reminisced. “We had to cover everything with plastic bags because of the pigeons.”

Today, El Mercado has skylights on the roof and air conditioning for hot summer days. Albright is one of more than 100 local merchants that conduct business at City-owned Market Square properties and whose leases expire at the end of June. The City has offered the businesses new contracts, but the terms give local Market Square business owners pause.

The City offered the Market Square tenants a four-plus-one contract, which means after four years, there’s an option to continue operating for another year. Market Square tenants requested a 10-year contract, which City officials refused. The business owners are currently at the end of an eight-year contract.

Yvette Ramirez is president of the Farmers Market Plaza Association, made up of the businesses who call the City-owned Farmers Market Plaza, across from El Mercado, their home. Ramirez said the Farmers Market Plaza Association and the El Mercado Merchants Association both met with City Councilman Roberto Treviño (D1) and City staff last Thursday to discuss the future of the local businesses at Market Square. They left feeling their fears had not been resolved.

“That’s my biggest concern – [Treviño] wasn’t willing to budge,” said Ramirez, who owns and operates Tejano Lou’s a gift shop in the Farmers Market Building. “He couldn’t give us any assurances other than the four-one contract.”

One of the associations’ main worries stems from construction planned for the streets adjacent to Market Square over the next three years. Commerce, Santa Rosa, and San Saba streets have upcoming improvements funded by the 2017 bond program. Ramirez said she worries about the impact that closing off streets would have on the local businesses of Market Square.

“We’re going into four years of construction, and across the street there will be major construction with UTSA,” Ramirez said. “All around us there will be construction. And then after four years, they can kick us out.”

Albright, a board member of the El Mercado Merchants Association, said longer-term contracts give businesses more stability and security and make it easier for business owners to acquire loans as needed.

“If we wanted to make shop improvements and go to a lender, a lender wants to see we have a long-term lease to give us money before they enter into a loan with a small business,” she said. “Having a four-plus-one, depending on the magnitude of improvements, it doesn’t fare well with the small-business owner.”

Other City tenants have been able to receive longer leases, she argued. For example, the recently signed airport concessions contract gives Paradies Lagardère at least seven years.

“What seems really unfair is they can clearly make longer-term leases with people,” she said. “They are choosing not to in this instance.”

Treviño said contracts are specific to each site. He noted that the four-plus-one contracts give Market Square tenants more time than the one-year contracts City staff originally wanted to offer. The contract length also ensures that business owners can help shape Market Square’s future, he added.

Councilman Roberto Treviño (D1)

Bonnie Arbittier / Rivard Report

Councilman Roberto Treviño (D1)

“We know that over the next five years, there are opportunities to change Market Square,” Treviño said. “How that occurs is important.”

Veronica Garcia serves as assistant director of the Center City Development and Operations Department, which manages the Market Square properties. She said that the new contract allows the City and stakeholders the time to prepare for the future of Market Square and participate in the “visioning process.”

“We recognize that Market Square is a special place with rich history and traditions,” Garcia said. “We know the local businesses and the retail shops there help contribute to the cultural authenticity of what is Market Square.”

Market Square businesses consistently increase the resources available in the Market Square enterprise fund, Treviño acknowledged. In 2017, the fund ended with a $1.35 million balance. The 2019 ending balance is projected to be $1.6 million. But Market Square hasn’t seen change in a long time, and it’s time to plan for its future, Treviño said.

“We want to create a sustainable plan that creates growth and opportunity. … What we hear constantly is how we want to create public spaces that are inclusive of both locals and visitors,” he said.

Treviño said he hopes to start the visioning process in July. He said the City will convene all stakeholders – including the University of Texas at San Antonio, as it prepares to expand its downtown campus – to discuss what change they want to see, as well as gather public comment.

Garcia said she hopes the visioning process will yield a report for Market Square’s future in three to six months. She said without going through the process, tenants, neighboring entities such as the Children’s Hospital of San Antonio, and other stakeholders can’t know what changes need to happen at Market Square.

“We may determine that we just scratched the surface and we need a phase two to narrow in on certain areas,” Garcia said. “Or [we may say] here are some short-term things we can implement right away. If the changes are larger, capital projects, then it’s something we can look at for recommendations in a future bond package.”

The City has pledged to preserve the popular tourist spot as a cultural public space, Treviño said.

“We understand Market Square plays a very unique role in the fabric of our history in San Antonio and we want to be sensitive to that,” Treviño said.

The El Mercado Snack Bar

Scott Ball / Rivard Report

The El Mercado Snack Bar

Ramirez said she was encouraged by the City’s dedication to preserving the cultural aspects of Market Square but disappointed that officials did not offer a longer lease. The business owners feel they have no other option but to agree to the City’s terms, she said.

“We go on a month-to-month [lease] if we don’t sign it,” Ramirez said. “It’s not what mom-and-pop businesses want to do, because they’re too afraid to get kicked out. They’ll sign, but they’ll sign under duress.”

City officials plan to bring the contracts before City Council by the end of June for approval.

8 thoughts on “Market Square Businesses Worry About Future With Shorter Lease Agreements Looming

  1. The city doesn’t need to change anything about El Mercado! It’s already a place for locals and tourists alike, and is a treasure trove of Mexican craft.

    Like these small business owners, I suspect the city will throw them out after four years in the name of (misguided) “progress”.

  2. Trevino’s vision? Wait! Whose Market Square are we talking about? Get over yourself, Mr. T!
    Work with these businesses who know what they are doing. Listen to them, give longer leaves, so they can be part of the general “gentrification” of downtown.
    Market Square is a fun place to shop and hang out!

  3. As a tenant at Market Square, what the city is not saying is that small business take a back seat to the big investors like UTSA. Stake holders and tenants have invested in Market Square to make it a self sustaining enterprise. This is a clear example of a city that claims to support small businesses (mom and pops) is willing to push them aside for what they want people to believe is progress! Remember their PROGRESS at La Villita! Yeah no.

  4. Several years ago, around 2010, I was a representative from a local organization to the city’s committee to put Market Square under a “management company,” rather than be managed by the city. Representatives from different groups were members of this committee, including businesses in the area. It was hoped it could be updated so that more local people would visit it. It was disclosed at that time that the tenants were still paying 1977 rental rates and that many of the booths were being passed down in the families and some were occupied by several members of the same families. Also, the tenants did not pay into any fund for police protection, nor clean up after the many activities allowed to occur there. It was all done by the city. Unlike other areas where organizations hold activities on city property and pay for police protection, clean up, recycling, fire dept, etc. I sincerely hope the tenants are now paying 2019 rental rates at least, and that the booths are now more diversified. That seemed to be a major problem in that the merchandise from booth to booth was pretty similar. The consensus of the group was that the city should hire a management firm for Market Square. So far as I know, it has never happened. Or maybe it has?

    • Evelyn. email me anytime if you want to see the Market Square Budget. You will see clearly that we are self-sustaining. As the article mentioned the Councilman clearly stated that the Market Square budget ended the year 2017 with 1.35 million and the projection for 2019 will be 1.6 million. And if your speaking of the 2010 Quintanilla study that is what the city is pushing forward with the visioning ideas. Not sure what that study cost our enterprise fund, but now they are spending upwards of 100K to an organization from New York (Project for Public Spaces) as well as two different Architect firms to revision the market square again. Like Linda Grace so eloquently put it, (misguided) “progress”.

  5. Citizens need to understand the city dose not have a policy for lease terms. The terms are recommended by staff but ultimately its the councilman the makes the final decision to support the recommendation. Our previous councilman awarded the tenants an 8 year contract divided as follows 3+3+2 ending June 30th, 2019. the tenants pervious contracts have all been different, some have been a straight 8, others have been 1 year and some have been month to month. Clearly this new contract may seem equitable but it is clearly not fair. The tenants are being offered a hollow contract with amendments that have not been discussed with the tenants, and yes they are offering a Right of First Refusal but with no explanation of what that refusal will be. I have personally been told that after the city passes this agenda item on June 20th, 2019 the tenants will be informed of the amendments and they can exercise their extension or they can move out. As I see it there is no meeting of the minds on this contract and as our representative Councilman Trevino should stand up for these businesses or table the issue until the city and tenants have come to a true understanding.

  6. As a white right leaning transplant to San Antonio but yet here for 17 years now, I say that El Mercado needs to be protected as a historical and cultural icon of the city. You can’t keep forcing everyone out and lose the uniqueness that is San Antonio. Once the cronies sanitize San Antonio’s history, what will be left?

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