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Texas Capital firm finds profit in making everything old, NEW again

"Fixer-upper" effect catches on in commercial property
Tecovas building
Posted at 3:00 AM, Sep 22, 2021
and last updated 2021-09-23 14:15:40-04

WACO, TX — Texas used to tear down the old and build the new.

It's how Houston traded entire neighborhoods for a new crop of shiny glass boxes.

But some Texas investors and developers have found a rush to renovate, can help preserve history, AND turn a profit."Everything's coming along okay, actually. We're almost complete with Tecovas... it's almost complete.
The mud guys start on Tuesday." Adam Kent gets a construction update more than once a day from his site supervisor, Herman Fouse. Kent's latest project at Washington and 8th Street really gives him something to sink his teeth into.

"It feels good. There's a lot of life in these old buildings. You just got to add a little bit, to spend a little bit of money where you need to, and with good designers and everything you can make these older buildings look really good," he explained.
Kent works as project manager for Brazos River Capital, the investment arm of the Clifton and Gordon Robinson family.

The firm has put it's money where it's mouth is when it comes to preserving history in a way that also benefits commerce. Brazos started with an update of the National Lloyds Building, and got notice for it's purchase and sprucing up of River Square Center, now filled with offices, restaurants, and retail. Now, the firm has put its money behind the renovation of a Washington Avenue building. "The economics work better on renovating an old building, rather than trying to build new right now. In a town like Waco, you know, we have a lot of awesome hidden gems here that we don't want to lose. We want to bring those back to life and I think this building is a perfect example," said Jed Cole, President of Brazos River Capital.

Originally known as the "Scott Building" it housed "4-C's College" which taught business students skills they needed like shorthand, using a typewriter and more. In the renovation, the pandemic put a crimp in the supply chain. A bump in the road, but not a roadblock. "Yeah, we've had some surcharges on products, longer lead time materials. In general, across the board. It affected our schedule, but didn't stop us or slow us down too much," said Kent. In fact, this crew planned so well, the new tenants still aim to move in this fall.

Anytime you have a "Fixer-upper" project, you're bound to have surprises, so this crew got prepared.
"Doing remodels and tearing down walls you don't know what you're going to find. If you find a problem, sometimes you have to think outside the box a little bit. You just have to make it work," explained Project Supervisor Herman Fouse. Workers got a pleasant surprise when, as they tore out walls and wiring... the building... appeared almost as solid as the Rock of Gibraltar.

"Particularly this building here is pretty sound, the bones of this building. Other buildings, you have issues with plumbing and different things like that but in this building we were good on everything else so we started everything new, except the outer shell and the roof of this building," said Kent. You can still see, into the rafters, that the building kept much of its original wood framing, because with no moisture, water damage or termites, wood can last forever.

Then comes the fun part.... re-imaging the space, and installing the most modern conveniences.
"I think you get some of the old look look and we have some of the new ideas. Everything ties in together so it fits real well ," said Kent.

That mix of old look and new ideas attracted the two biggest tenants. One will move into the ground floor, and another up top. The Patterson-Sheridan LLP Law firm leased the second floor, which features a big open conference area and glass enclosed offices along the perimeter.

Down below, the popular and trendy retail chain "Tecovas" will take most of the first floor, selling handmade boots and western wear. Only one vacant space remains for leasing. Those in the know believe having a Tecovas in Waco will only add to the city's popularity.

Brazos River Capital believes it's come up with an investment that helps the community AND turns a profit.
Not unlike Chip and Joanna Gaines, who have begun renovating the old Karem Shrine building at the other end of the block into a boutique hotel. What's more, Kent says the formula could work almost anywhere.
"Could this work in any city in Texas? I think so. In the right setting I believe it could, yes," he said.
"I Think it is already catching on elsewhere. I think Waco is coming to the game at the perfect time and we have a ton of projects here, in our backyard," Cole added.

So far, nobody's really talking about other trendy and highly sought-after companies Brazos might attract here.
But all predict, companies that locate in this environment may never leave.... they won't need to..
"How long will it be before this building needs another renovation? Depends how long the tenant stays I guess," Kent laughed."Once it's renovated I think the changes will be here for the life of the building, "he said.

So while a new Waco brand name makes a splash on one end of the block, Brazos River Capital works tirelessly to give Texas more variety, as it wraps up here, and starts considering its next project. "I think we're pretty much completed upstairs too except for the ceiling work," said Fouse, finishing his report to Adam.