A
historic conversion project in downtown San Antonio's Hedrick Building may be on the verge of collapse. The 10-story building at 601 North St. Mary's Street is set to go up for auction next month, potentially derailing plans to turn it into a 72-key extended-stay hotel. The adjacent Voss Building, spanning 20,400 square feet, will also be auctioned off.

    Bright Lakes Real Estate took out a $2.8 million loan in 2018 to support redevelopment, but the debt has ballooned to $15.2 million after multiple amendments. Co-managing partner Craig Glendenning is trying to negotiate with Ready Capital to prevent the auction, but details are scarce.

    The Hedrick Building, built in 1928 and once owned by Fort Worth architect Wyatt Hedrick, had fallen into disrepair before Bright Lakes purchased it. Renovation efforts began in 2017, but plans shifted after the collapse of short-term rental company Stay Alfred. The building is valued at $7.7 million, while the Voss Building is appraised at under $700,000.

    The properties are located on a block backing up to the River Walk, about half a mile from the Alamo. Ready Capital and Bright Lakes have worked together on other projects, including a prime development site listed earlier this summer. Other adaptive reuse projects in San Antonio include converting historic buildings into apartments, hotels, and mixed-use developments.