A nearly $47 million economic incentive agreement for an undisclosed development at The Square at Lakeway is up for discussion in Lakeway at the upcoming Jan. 14 Special City Council meeting.

The meeting will be held at Lakeway City Hall at 6:30 p.m.

Diving in deeper

The economic incentive is known as a Chapter 380 agreement, a tool cities can use to incentivize certain developers or tenants to build in a city to support economic growth, per agenda documents.

The developer, unspecified by city documents, is requesting $46.9 million in grants over a period of 35 years. The grants would be provided by rebates from the city to the developer in annual payments from property and sales taxes received from the project, according to city documents.


The developer has proposed the following rebate percentage schedule:
  • Year 1-15: 95% rebate for property and sales tax
  • Year 16-25: 75% rebate for property and sales tax
  • Year 26-35: 60% rebate for property and sales tax
According to financial analysis provided by the developer, the city would pay $10.6 million in costs through the agreement, but the project would yield a revenue of about $25.4 million over the same term.

Baked into the proposal are performance standards requiring the developer to meet certain goals. These include:
  • The assessed value of the property being at least $250 million on the 15th anniversary of the agreement
  • The assessed value of the property being at least $400 million on the 25th anniversary of the agreement
  • Limits on the rebate amount if the project does not generate at least $300,000 in totals sales tax by the 15 anniversary of the agreement
  • Limits on the rebate amount if the project does not generate at least $500,000 in totals sales tax by the 25 anniversary of the agreement
If these thresholds are not met, the agreement will terminate, according to agenda documents.

What else?

Additional public improvements included as part of the proposal include:
  • $27 million for parking garages
  • $28 million for a park within The Square at Lakeway
  • $57 million for building costs
  • $13.5 for leasing incentives
  • $3.8 million for engineering costs
Plans for The Square at Lakeway include retail, parking structures, townhomes and more. (Courtesy city of Lakeway)
The background


At the Jan. 7 Zoning and Planning Commission meeting, commission officials approved a motion 6-1 to increase the amount of retail/commercial space at the development, alongside other updates, such as changing the name from "The Square at Lohmans" to "The Square at Lakeway."

The measure included increasing the amount of retail/commercial space within The Square from 175,000 square feet to 247,000 square feet. Additionally the item decreased the amount of office space from 155,000 square feet to 145,000 square feet and increased the number of residential dwelling units.

A condition of the motion was that the number of parking spaces at the development be increased. The item will still need to go before council for final approval, but was not included on the Jan. 14 agenda as of press time.