After years of false starts and fizzled plans, Southstar now takes the reins for potential development of San Antonio’s long vacated and crumbling Lone Star Brewery site, as the developer acquired the 32-acre property near Southtown.
The New Braunfels-based firm confirmed the acquisition Friday, purchasing the property at 600 Lone Star Boulevard from San Antonio-based GrayStreet Partners and Houston-based Midway, the San Antonio Business Journal reported.
The sellers bought the site in 2020 for about $14.5 million and later pitched a sweeping $709 million mixed-use proposal dubbed the Lone Star District. That plan stalled amid rising interest rates, construction costs and cooling rent growth. Terms of Southstar’s purchase were not disclosed, though the property was last assessed at $18.6 million by the Bexar Central Appraisal District.
Southstar CEO Thad Rutherford framed the acquisition as both a redevelopment move and a preservation effort, pointing to the site’s iconic smokestack and its deep roots in San Antonio’s working class history. Company leaders stressed that progress will depend on extensive public engagement and coordination with public agencies.
The Lone Star site sits near several major public investments already in the pipeline, including VIA Metropolitan Transit’s transit-oriented development plans, the San Antonio River Authority’s long-term river improvements, and ongoing development downtown and south of downtown. Southstar said it intends to align its plans with those initiatives, a signal that any redevelopment will likely be large, mixed-use and phased over several years.
In 2021, the city granted $24 million in public incentives to help fund the project, though when news came that GrayStreet was shopping the property, officials asserted that the $24 million incentive package wouldn’t apply if a new developer took over, as previously reported by The Real Deal.
Southstar is also seeking to buy nearby parcels owned by the Newell family that operated as a recycling facility and CPS Energy, including a defunct power plant across the river on Mission Road, the Express-News reported. If those deals close, Southstar could control more than 70 acres on both sides of a quiet stretch of the river.
GrayStreet managing partner Kevin Covey said last month that his firm and Midway would remain financial partners in the project and that Southstar would likely build off existing plans. A Southstar spokesperson confirmed to the Express-News that GrayStreet provided seller financing, effectively acting as the lender on the deal.
The brewery closed in 1996 and has since cycled through at least five failed redevelopment attempts, derailed by environmental issues, capital constraints and bankruptcies. According to the city’s website, the facility opened in 1940 as commercial brewing operations outgrew the historic Lone Star Brewery site at 200 West Jones Avenue. That building was constructed between 1895 and 1904 and now houses the San Antonio Museum of Art.
— Eric Weilbacher
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