Southstar, a development firm based in New Braunfels, has acquired the 32-acre Lone Star Brewery property at 600 Lone Star Boulevard in San Antonio. The site had been owned by GrayStreet Partners of San Antonio and Midway of Houston since 2020. They purchased it for about $14.5 million and later proposed a $709 million mixed-use project called the Lone Star District, but rising interest rates, construction costs, and slowing rent growth caused delays.
The terms of Southstar’s acquisition were not disclosed. According to the Bexar Central Appraisal District, the property was last valued at $18.6 million.
Thad Rutherford, CEO of Southstar, described the purchase as both an effort to redevelop and preserve the site. He highlighted its iconic smokestack and importance to San Antonio’s working class history. Company leaders emphasized that future progress would require significant public engagement and coordination with government agencies.
The area is located near other major public investments including VIA Metropolitan Transit’s plans for transit-oriented development and river improvements overseen by the San Antonio River Authority. Southstar stated it intends to align its redevelopment plans with these ongoing projects, indicating that any changes will likely be large-scale, mixed-use developments carried out over several years.
In 2021, the city awarded $24 million in public incentives to support redevelopment at the site. However, when GrayStreet began looking for buyers for the property, officials said this incentive package would not transfer if ownership changed hands.
Southstar is also negotiating to buy additional nearby parcels from local owners such as the Newell family and CPS Energy. These deals could give Southstar control over more than 70 acres on both sides of a section of river near downtown San Antonio.
Kevin Covey, managing partner at GrayStreet Partners, said last month that his company and Midway would stay on as financial partners in future development efforts and that Southstar was expected to build upon existing plans for the site. A spokesperson from Southstar confirmed that GrayStreet provided seller financing for this transaction.
The brewery closed operations in 1996 after decades as part of San Antonio’s industrial base. At least five previous attempts at redevelopment have failed due to environmental concerns, funding issues or bankruptcies. The original brewery facility opened in 1940 when commercial brewing outgrew its first location at 200 West Jones Avenue—a building now occupied by the San Antonio Museum of Art.
