AT A GLANCE
- City action: The San Antonio City Council unanimously approved submitting a $30 million offer to purchase federal property near Hemisfair, with all funds provided by the Spurs.
- What’s being bought: The deal covers one federal office building on East Cesar Chavez Boulevard and two nearby parking lots, viewed as critical to the arena financing plan.
- Why it matters: The properties would be redeveloped into mixed-use projects, generating property tax revenue to help cover the city’s $489 million share of a proposed $1.3 billion arena.
- Next hurdles: The federal government must accept the offer; if approved, the city expects to close by June or July 2026.
- Arena site still pending: San Antonio must still acquire the Hemisfair arena site from the University of Texas System, estimated at $60 million.
Federal Properties Are Central to Arena Funding Strategy, Protections in Place if Deal Collapses
San Antonio moved a key piece of its downtown arena strategy forward Thursday after the San Antonio City Council unanimously approved submitting a $30 million offer to acquire federal property near Hemisfair—an offer fully financed by the San Antonio Spurs.
The proposal targets three parcels: a federal office building along East Cesar Chavez Boulevard and two parking lots directly across the street. In addition to the purchase price, the Spurs would cover roughly $120,000 in closing costs, according to city documents.
The acquisition is central to the city’s financing model for a proposed $1.3 billion downtown arena. Under the plan, San Antonio would take ownership of the properties and later lease them to private developers for a mixed-use project that could include hotel, retail, housing, hospitality, and office space. Property tax revenue generated from that development would be used to help pay the city’s projected $489 million share of arena costs.
The federal government must still decide whether to accept the offer. If approved, city officials anticipate closing the deal in June or July. Federal agencies currently housed in the building would remain as tenants for up to five years, vacating space gradually as alternative offices become available.
City staff emphasized that safeguards are built into the agreement. Should the arena deal collapse, San Antonio would be required to reimburse the Spurs for the land purchase or transfer ownership of the properties to the team.
Attention is now turning to the arena’s actual footprint at the southeast corner of Hemisfair, where a former cultural venue once stood. That land is owned by the University of Texas System, though the city holds an exclusive right to purchase it. The site is valued at approximately $60 million, and officials hope to complete that transaction before year’s end.
City staff told council members they are evaluating funding options for the Hemisfair parcel, including the Midtown Tax Increment Reinvestment Zone, as well as potential land swaps involving the University of Texas at San Antonio.
Both land purchases were outlined in a non-binding term sheet approved by the council last August in a 7–4 vote. The framework allocates up to $489 million from the city, up to $311 million from Bexar County, and at least $500 million from the Spurs. County voters authorized their portion of the funding in November.
While the term sheet is not legally binding, city officials view it as the roadmap for negotiating final contracts, with most agreements expected to be completed by the end of 2026. Mayor Gina Ortiz Jones has signaled the city may still push for improved terms as negotiations continue.
If finalized, the new arena is projected to open in the summer of 2032—coinciding with the expiration of the Spurs’ current lease at the Frost Bank Center.
