USAA’s presence in downtown San Antonio diminished further last week when Affinius Capital, formerly known as USAA Real Estate Co., sold a Depression-era office building beside the two skyscrapers where the financial services company recently moved out the last of its employees.
A shell company managed by Douglas Jaffe Jr., CEO of the company that owns the Horseshoe Bay Resort northwest of Austin, bought the building, at 1012 Navarro St. on April 3, county deed records show. Jaffe is a member of a longtime San Antonio family that has been active in Texas politics for decades.
Affinius remains the owner, with Patrinely Group of Houston, of the two skyscrapers: One Riverwalk Place and 300 Convent, formerly Bank of America Plaza.
USAA Real Estate spun off from USAA in April 2020 when its president and CEO, Len O’Donnell — now CEO and chairman at Affinius — and other executives and investors bought a controlling stake. It rebranded itself as Affinius last month after merging with the real estate investment firm Square Mile Capital, which it had purchased in 2021.
“Our name change brings with it no change in our relationship with USAA, which remains a client, an investment partner and a partner in Affinius Capital,” O’Donnell said in a statement last month.
It’s unclear how much Jaffe’s shell company, 1012 Navarro LLC, paid for the 5,809-square-foot building. The Bexar Appraisal District assessed the 0.1487-acre property at $1.1 million this year.
Efforts to reach Jaffe through Horseshoe Bay Resort — including by calling the resort’s managing director, Bryan Woodward — were unsuccessful. Executives at Affinius didn’t respond to an email seeking comment.
The city of San Antonio’s survey of historic landmarks identifies the 1012 Navarro building as the “Naylor Trophy Room.” The city’s Office of Historic Preservation estimates the building — just off the River Walk, across from the Tobin Center for the Performing Arts — was constructed in 1930.
USAA Real Estate had purchased it in 2015 as it gathered office space in the blocks north of Travis Park with plans to relocate some of USAA’s workforce there.
In 2013, the firm purchased the 18-story One Riverwalk Place; USAA soon moved about 200 employees into the building. Four years later, USAA Real Estate bought the 28-story 300 Convent across the street, with Patrinely as a minority partner.
USAA’s investment was seen at the time as a “game changer” in the local effort to grow downtown into a more complete neighborhood where local residents could live and work. City Council approved a $6 million incentive package for the company in exchange for a promise to move up to 2,000 workers into the district.
In December, USAA announced that it would move the 500 employees who worked in its downtown offices back to its headquarters in Northwest San Antonio by the end of the year.
The COVID-19 pandemic and a cultural shift toward remote work had “changed our real estate need as we have ample space for current and future employees” in the headquarters, CEO Wayne Peacock said.
USAA’s withdrawal from downtown has dealt a blow to the district’s office market as it continues — like many markets across the U.S. — to struggle in its recovery from the impact of the pandemic and a trend toward remote working. In the fourth quarter of last year, the market had a negative 12-month absorption rate of 396,194 square feet — meaning that the amount of occupied office space was 396,194 square feet less than a year earlier, according to a report from Transwestern, a real estate firm.
“The absorption outlook for the next 12 months could be challenged due to companies reducing overhead and resizing their footprint,” the report said, speaking of the San Antonio office market generally.
The Jaffe family has owned a controlling interest in the Horseshoe Bay Resort, on the shore of Lake Lyndon B. Johnson, since 1995, according to the resort’s website. In 2020, the resort underwent a $100 million renovation.
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