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Broadway living: hot commodity, high prices

San Antonio's apartment rates keep rising

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A proliferation of apartment complexes and living units along Broadway is aimed at attracting young professionals to a downtown resurgence. Photos by Collette Orquiz

Former New York City resident Jonathan Stokes lives two blocks from his work at Pearl off Broadway, doesn’t own a car and rarely leaves the area except to buy groceries.

“I’ve made this my own little Manhattan,” Stokes said. The bartender added he is an exception because most people in the thriving service industry downtown and in the rapidly developing area around Pearl are being priced out of the housing market.

His apartment is in a nice but older building where he pays what he considers a reasonable rent for someone with few other expenses.

“I expect rents will climb to meet what is happening in the area,” he added.

Fueled by the rapidly growing population of San Antonio and years of city incentives to promote growth in the urban core, lower Broadway has become a hotbed of development with some of the highest rents in the city.  The earliest developments included The Mosaic on Broadway and 1800 Broadway apartments on opposite sides of the street, the Can Plant Residences at Pearl and the 1221 Broadway Lofts.

More recent additions are the high-end Cellars at Pearl and River House Apartments. Several more are in the works, including Brewery South Apartments on Newell Avenue and the Broadway Jones Apartments.

In the 78215 ZIP code, which includes the lower Broadway corridor, 15 apartment complexes have openings ranging from about $800 a month for a studio unit to more than $3,000 a month for larger and swankier lodgings, according to Realtor.com.

It is unclear how many units are available in each.

Attempts to talk with property managers proved difficult. There has been a circling of the wagons as some city officials and the public have voiced opinions about the lack of affordable housing among most of the projects, including many that received tax breaks or other city incentives to build.

Since 2012, San Antonio’s Center City Housing Incentive Policy has provided perks to developers for 64 projects in the downtown area, including many of the housing projects in the south Broadway area.

Because most of those apartment projects have been for market-rate apartments, they have tended to be high middle- to high-end projects that demand a hefty monthly layout, helping energize the city’s core by attracting well-paid professionals. That has been especially true of young professionals who want to live near where they work and play, eschewing the suburbs, lawn care and mortgages.

“They want to be there. They want to be near the action,” said Jordan Peña, who has those residents as bar clients at the Still Golden Social House, 1900 Broadway. Not needing a car on a regular basis and enjoying a host of amenities from night life to restaurants is a major draw for those looking for the urban lifestyle, she said.

For some, the issue is affordability, especially as the value of existing residential properties around these newer developments increases, creating higher property taxes. That can push some homeowners out of the area and once-affordable older apartments feel pressure to upgrade their units and raise rents.

RentCafė, an apartment search website, issued a nationwide report in mid-December showing San Antonio’s average apartment rate rose to $1,016 in December, a 3.5 percent increase over the same month in 2017.

San Antonio, after a yearlong moratorium on its incentive programs for inner-city housing, restarted the plan, which allows fee waivers of up to $1 million and a 75 percent tax rebate for 15 years for higher-density projects. Lower-density projects can get lesser fees and tax breaks if they have a specific percentage of units considered affordable instead of market-rate.

Critics say the policy favors developers and does not bode well for a good mixed-income downtown and near-downtown.

The rationale presented by the city to support the incentives, said Beacon Hill resident Cynthia Spielman in a Dec. 13 address to City Council members, “is to house all the new employees coming to USAA (new downtown office) and the faculty and students of the expanded (University of Texas at San Antonio) campus. Or it’s for the new college graduates.”

Spielman argues not many in that target audience, such as mid-level corporate employees and recent graduates, could afford a one-bedroom apartment at $2,500 a month.

“Do you honestly think college graduates with their burden of debt could afford to live downtown, never mind the teachers, city staff, nurses, artists, chefs, architects and other working people that make our neighborhood so vibrant and that you claim to want to make a vibrant downtown for?” she asked.

Developer representatives praised the reinstatement of the policy, even with changes.

Brad McMurray, vice president of property development for Prospera Housing Community Services, said the changes will bring positive results and encourage policies to bring more affordable housing.

Bill Shown, managing director for real estate for Pearl owner Silver Ventures, expressed general support, but warned that with the new restrictions in the plan “there may be a chilling effect and the program may be somewhat ineffective in spurring additional housing in the downtown area.”

He urged an annual review.

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