Ready Capital to Foreclose on Historic San Antonio Buildings

24 October 2024

A stalled historic conversion effort in downtown San Antonio may be on the verge of unraveling altogether.

The Hedrick Building, at 601 North St. Mary’s Street, is set to hit the Bexar County foreclosure auction block next month, potentially upending plans to convert the 10-story, 42,000-square-foot building into an extended-stay hotel, the San Antonio Express News reported. The adjacent Voss Building, spanning 20,400 square feet at 617 North St. Mary’s, is also included in the auction.

Bright Lakes Real Estate took out a $2.8 million loan from New York-based Broadmark Realty Capital to support redevelopment in 2018. Since then, the loan has ballooned to $15.2 million following multiple amendments.

Ready Capital merged with Broadmark last year. The exact amount Bright Lakes still owes is not clear, though similar foreclosure proceedings were initiated last December before being canceled.

Bright Lakes’ co-managing partner Craig Glendenning confirmed he is attempting to work out a deal with Ready Capital to prevent the auction but declined to provide details.

Built in 1928 and later owned by Fort Worth architect Wyatt Hedrick, it had fallen into disrepair by the time Bright Lakes purchased it. The office property was once slated to become apartments before plans shifted toward a 72-key extended-stay hotel.

Glendenning’s renovation efforts began in 2017 and involved removing metal cladding that had covered the building’s historic facade, along with other cleanup efforts. The project took another turn after the collapse of short-term rental company Stay Alfred, which had expressed interest in the property before the pandemic.

Valued at $7.7 million by the Bexar Appraisal District, the Hedrick Building is still partially boarded up. The Voss building is appraised at under $700,000. The smaller property was slated for redevelopment — office, retail and a few apartments have been considered over the years. They are set on a block that backs up to the River Walk about half a mile from the Alamo.

Ready Capital and Glendenning’s working relationship extends beyond the Hedrick Building.

Earlier this summer, Ready Capital listed a prime 2-acre development site in downtown San Antonio, at 1008 and 1012 Hoefgen Avenue. The property, owned by Glendenning, who planned to turn it into a luxury RV park and eventually a mixed-use development with apartments and a hotel. However, Glendenning’s request for RV park zoning was denied by the city council.

Other adaptive reuse projects in San Antonio include Harris Bay converting the Travis Building at 405 North St. Mary’s Street into apartments, InnJoy Hospitality converting the former Nix Medical Center at 414 Navarro Street into apartments, Blueprint Hospitality converting CPS Energy’s former headquarters at 145 Navarro Street into El Portal, a 243-room hotel part of Marriott’s Autograph Collection.

— Andrew Terrell