Projects could transform towns near Hays-Caldwell county line

A Canadian conglomerate is laying groundwork for the suburban transformation of more than 8,000 acres along the Hays and Caldwell county line.

Walton Development and Management, a real estate company with interests throughout North America, is betting that Hwy. 21 will be one of the Austin metro area's next corridors for major growth. Walton is negotiating development agreements for several projects between I-35 and SH 130, and officials in small towns such as Uhland and Niederwald say they are preparing for the kind of population surges that have already occurred in communities closer to Austin.

"This is probably the biggest thing to ever happen to Niederwald and may be the biggest thing that will ever happen," Niederwald Mayor Reynell Smith said.

Although Smith said she could not estimate how many residents the project would attract, she said that Walton's planned 1,460-acre Camino Real development will eventually dwarf all the other neighborhoods in the city, whose population was estimated at 565 in the 2010 census.

Uhland 'culture shock'

In Uhland, a town of 1,014 about 5 miles south of Niederwald, Mayor Glenn Smith said the city is trying to maintain its "rural atmosphere" as it reaches the final stage of more than 2 1/2 years of negotiations with Walton. The company plans to build on more than 3,630 acres, or 5.6 square miles, much of it in the city's extraterritorial jurisdiction.

Glenn Smith estimated the Uhland area's population could swell by 1,500 percent if Walton is able to bring its project to fruition.

"It's going to be a culture shock, I'm sure," he said. "I'm told Uhland will be the next Kyle, and I hadn't really thought of it in that perspective. It makes you take pause."

From 2000 to 2010, the city of Kyle grew from 5,314 to 28,016 people, according to census data.

Glenn Smith said Uhland officials are angling for a mix of larger and smaller single-family homes and apartments, with room for parks and schools. The city has also tried to ensure that Walton pays for its own infrastructure improvements.

"It's been a real learning curve. We've had no development at all, so we had nothing to learn from," he said. "It's going to be a big job for the city to grow that much that fast. This is a very small city, and it has absolutely no debt and never has had any, to my knowledge. That's all going to have to change. [The project] is just too big to handle without there being some kind of debt, I'm sure. None of us are used to it."

Both mayors said they hope their cities will reach a final agreement with Walton this summer.

Gas Lamp District

In San Marcos, Walton is also proposing the 495-acre Gas Lamp District, a mixed-use development of homes, offices, commercial properties and other features in the northwestern corner of Old Bastrop Highway and Centerpoint Road, near San Marcos Premium Outlets.

On June 4, however, city of San Marcos officials said the company had withdrawn its request to create a public improvement district, or PID, which would have required the city to issue bonds to help the company recoup project expenses. The bond debt would have been repaid by a special assessment on future property owners.

Walton wanted the city to issue debt of $39 million, but city officials countered with an offer of $7.35 million, saying they did not feel comfortable guaranteeing such a large amount.

"The city of San Marcos has never been a banker for a developer, and that's what we're being asked to do," Councilwoman Kim Porterfield said.

City Manager Jim Nuse said Walton intends to continue with the development and could return with a new funding request.

"At this point, their requirements and our comfort with those requirements weren't quite aligned yet, and everybody has a little more work to try and get that resolved if indeed they do move forward with some sort of request for a funding mechanism," he said.

City Council members said they want to encourage the project because the Gas Lamp District would be the first large-scale project in the city to follow new SmartCode architectural standards. Walton would also dedicate right of way to build part of a desired Hwy. 21 extension, which would connect Hwy. 80 with I-35.

Walton's strategy

Walton officials did not respond to requests for comment. The privately owned company was founded in Calgary, Alberta, in 1979 and has an office in Austin. According to the company's website, Walton manages more than 74,000 acres throughout North America and targets land in the path of major urban growth.

In Hays County, Precinct 2 Commissioner Mark Jones said the Commissioners Court is nearing a development agreement for Walton's lands that are situated in unincorporated areas. He said the county is preparing for the expected growth by realigning

FM 2001 from Buda to Niederwald, a project that is set to begin in fall 2016. The county's transportation master plan also calls for the widening of Hwy. 21 to be a continuous four-lane thoroughfare.

He said the success of Walton's vision for its Central Texas properties might hinge on the availability of one resource.

"The biggest issue is if they can get enough water to do what they want," he said. "That's the biggest obstacle right now."

In March 2012, Walton and the Guadalupe-Blanco River Authority announced a letter of intent to bring a combination of surface water and groundwater to the fast-developing region. Under the agreement, Walton would take a substantial amount of the 25,000-acre feet of water delivered by the project, which is being reviewed by the Texas Water Development Board.

"We're working on some interim options that could serve Walton tracts on a temporary basis until this project materializes," GBRA General Manager Bill West said.