Houston Chronicle | 12.19.2016
Developer Jonathan Brinsden remembers when hundreds of new apartment units replaced the old rice silos along South Heights Boulevard in the mid-1990s.
Despite its prime location nearly under the shadow of the downtown skyline, the area was considered blighted. Building apartments there was, back then, "a gutsy play," said Brinsden, CEO of Midway.
Today the area couldn't be more different and Midway is about to bring it even more change.
The local real estate firm is planning a wholesale redevelopment of the 19-acre multifamily site.
The proposed project, to be built in phases, will start with a mid-rise mixed-use building of luxury rentals, high-end office space and an H-E-B grocery store at the southeast corner of Washington Avenue and South Heights. Ultimately more new buildings will be added to create a "district" similar to Midway's CityCentre on the west side.
The project name, Buffalo Heights, plays off the nearby Buffalo Bayou and the revamped park alongside it.
"Buffalo Bayou Park has been a game changer for the city," Brinsden said.
The $58 million park project has spurred a number of high-end real estate developments, including high-rise apartments, luxury condominium buildings and restaurants.
So-called "trail-oriented development" has been a growing movement across the country as urban development includes more "people-friendly design," according to a report from the Urban Land Institute that looked at transportation and real estate.
The report noted studies showing access to trails, bike-sharing systems and bike lanes can have a positive impact on property values: "Developers have benefited from the ability to build in sought-after locations that are close to publicly financed active transportation routes."
Midway was hired to develop the apartment site by owners Russell and Glenda Gordy.
The Gordy family owns interests in real estate, oil and gas and other natural resources, as well as ranching operations in Texas, Colorado, New Mexico, Montana, Wyoming and elsewhere. The family owns several properties in the area that eventually could become part of a greater redevelopment.
"There is no location like this one in Houston," Russell Gordy said in a statement. He declined to be interviewed.
Scott McClelland, president of H-E-B Houston, also noted the area's unique position.
"The transformation since the turn of the century to now in that area has been maybe unlike any part of the city," he said. "Now you're going to see it change again."
The new H-E-B, unlike the traditional single-story, suburban-style design, will have a cafe with outdoor seating and two-levels of parking with escalators carrying customers and their grocery carts to and from their cars. There will be an emphasis on younger shoppers who typically buy more prepared food and organic items.
"You'll see things like a poke bar, a coffee bar, pizza, different things we haven't tried in other stores that we think will appeal to the urban shopper," McClelland said.
At nearly 100,000 square feet, the store will be larger than the H-E-B on West Alabama in Montrose. It will be integrated into the larger mixed-use building, which also will have 37,000 square feet of office space, 232 apartments, parking and a small amount of additional retail space.
Ziegler Cooper Architects designed the project and Houston-based Lionstone Investments is an adviser.
Midway hopes to start construction by mid-2017 and have the property open by early 2019.
The company has been managing the existing Memorial Heights apartment complex since the Gordys bought it a couple of years ago. It stopped renewing leases and the tenants have been notified of the redevelopment plans.
The first phase will affect 120 units.
A construction loan will be required to begin the project, but the Gordy family is providing all of the equity.
Brinsden said the company isn't deterred by the energy downturn, in part because of the long-term nature of the development.
"It's markets like this that highlight why unique, differentiated, high-quality mixed-use development has real value," Brinsden said.
Midway's other projects include Kirby Grove, downtown's GreenStreet and the planned redevelopment of the former KBR headquarters east of downtown.