HOUSTON – (Realty News Report) – Skanska, which recently purchased the prime southwest corner of Westheimer and Montrose for a mixed-use development, is reportedly considering acquiring the adjacent “Disco Kroger” property on Montrose Boulevard.
Last summer Skanska paid $27 million for the 2.86-acre tract at the southwest corner of Westheimer and Montrose Boulevard. Skanska USA Commercial Development plans to build high-rise residential units together with retail shops and restaurants on the site.
Just south of the Skanska parcel sits a boarded-up Kroger store awaiting redevelopment. A public street, Lovett Boulevard, separates the Skanska and Kroger properties. There has been discussion in recent years about closing that block of Lovett, which could allow the creation of a contiguous development parcel of roughly eight acres.
If Skanska acquires the Kroger site and the Lovett right-of-way, the combined Montrose land could support a substantial mixed-use project featuring retail, residential, office space, restaurants and possibly a boutique hotel.
No Comment at This Time
When asked whether Skanska had been in talks to acquire the Kroger property, a Skanska spokeswoman said the firm had “no comment at this time.”
The Kroger property is owned by Southeastern Real Estate Group, based in Augusta, Georgia. The site covers about two acres and is bounded by Lovett, Yoakum, Hawthorne and Montrose Boulevard.
The Georgia-based developer is expected to demolish the former Kroger store to make way for new development. The Kroger was a prominent retail anchor in the heart of Houston’s LGBTQ+ neighborhood and once operated 24 hours a day, earning the community nickname “Disco Kroger.”
Bulldozing for Progress
Meanwhile, Skanska — part of a large Stockholm-based development and construction firm — has begun transforming its Westheimer at Montrose property. A 44,000-square-foot shopping center anchored by Spec’s liquor store is being demolished, and demolition crews are completing the teardown this week.
“Right now, we are focusing on demolition so that we can clear the site for the upcoming activation we have planned that will provide the community with a place to engage and socialize prior to the start of construction,” the Skanska spokeswoman said in an email.
Outdoor Movies, Farmers Market or Both?
Community speculation suggests the interim use will include an outdoor movie theater. On weekends, the property could host a farmers market.
Skanska has not released specifics about these interim attractions, which the company refers to as “temporary activation.” These short-term, consumer-focused activities will occupy the site while Skanska completes any additional land assemblage — potentially including the Kroger property and Lovett street right-of-way — and finalizes design and planning for the long-term development.
A consumer-focused operator, possibly experienced in outdoor cinema and events, is collaborating with Skanska to run the pop-up activations.
“We are working with a partner on a community activation that we will be hosting on site as an interim use before we start construction. The partner is helping us execute the temporary activation, which is separate from the future development that will be built upon the site,” the Skanska spokeswoman said.
The Westheimer and Montrose intersection is experiencing a wave of new development. Within roughly 1,000 feet of the Skanska parcel, projects underway include the Montrose Collective mixed-use development by Radom Capital, new high-rise apartment towers by Hines and Hanover, and a historic renovation of the La Colombe d’Or hotel by the Zimmerman family.
When Skanska acquired the Montrose retail center from Madison Marquette last year, the company’s local leader issued a statement underscoring the market importance of the neighborhood:
“Montrose is the cultural heart and soul of the city. It illustrates Houston’s changing urban landscape and signals our ongoing commitment to the market,” said Matt Damborsky, Executive Vice President at Skanska USA Commercial Development in Houston. “Skanska is continuously looking for opportunities to diversify our Houston offerings while developing projects that reflect the strong culture and sense of community in this city.”
March 31, 2021 Realty News Report Copyright 2021
File: Skanska Adding Montrose Kroger
Caption: The Disco Kroger, 3300 Montrose Blvd., is boarded up. Photo by Ralph Bivins, Realty News Report. Copyright 2021 (Hanover residential tower in background)