An Austin-based developer is seeking $14.3 million in incentives to build a 45-acre mixed-use development in Kyle that could bring a wealth of amenities, including a hotel, beer garden, amphitheater, dog park, pickleball courts and ponds with paddleboarding and kayaking.
Capella Commercial LLC presented the initial plans for "Project Two Step" during a Dec. 19 Kyle City Council meeting for two parcels that straddle a curved area of Farm to Market Road 150 East near I-35. The presentation was discussion-only and the project will be brought back for formal zoning, development and incentives agreements in the next few months.
Todd Dailey, managing partner at Capella, said during the meeting the company has spent the last two years trying to "do something special" and promote community in the fast-growing suburb south of Austin. That's coincided with the plans for the development, which is split into two tracts on the east and west sides of FM 150.
Plans for the 15-acre tract on the west side include an outdoor amphitheater surrounded by restaurants, retail outlets, office spaces, a hotel, town homes, residential flats and two small ponds. Plans for the roughly 31-acre tract on the east side include a multifamily project with retail, encompassing a beer garden, rooftop pickleball courts and a large pond. The larger pond includes will allow kayaking and paddleboarding, and the site also includes a dog park and parking structure.
He said the project is really focused on everything "local," whether that be restaurants and retail, performers at the amphitheater and those who can get to the development by walking, biking or carting off of the city's Vybe Trail. Aesthetically, they're trying to model it based on other city developments. For example, a silo at the front of the project that would advertise future entertainment options.
"The idea was to create a place that was a destination that brought people in... and make it something really special instead of just the typical retail slash mixed-use development," Dailey said during the Dec. 19 meeting, noting they turned down a McDonald's proposal to build on the property.
Developers are seeking incentives for the project – codenamed "Project Two Step" in economic development discussions – in the form of a 15-year 50% property and sales tax rebate that is estimated to equal $14.3 million. City officials estimated that the project would bring $62 million in sales and property tax revenues to the city over a 20-year period.
"This project is very exciting to me because for many years I've been a resident of the area and have seen this land vacant and been excited to see who wants to take it on and what they can do with this property," Kyle's economic development director Victoria Vargas said during the meeting.
While there was no vote taken, Kyle council members proposed smaller tweaks to the project plan before it's brought back for formal votes, such as looking into reusable water options to account for the region's drought and shade for the dog park.
Should the project move forward, it would mark another important one for Kyle, which is located about 20 miles south of Austin and had an estimated 2022 population of about 57,500 — about 11% year-over-year growth that ranked it the third-fastest city in the country among those with a population of at least 50,000.
That population growth has attracted a host of new employers and large-scale development. Other notable companies that are opening in the space include Sovereign Flavors Inc. and Tesla Inc. Other retail projects include Costco Wholesale Corp., Sprouts Farmers Market and the $240 million Vybe Park.
Capella, a brokerage and development firm, has experience in a wide range of developments, including office, retail, multifamily and industrial projects. That includes Arena Tower near the Domain, River Place Medical Center, Pflugerville Crossing and more, according to its website.