THE CUETO BUILDING SHELL GAME: WHO BENEFITS HERE?

By Juan Montoya

Let's do the math on the Cueto Building "lease" just approved unanimously by the Brownsville City Commission with the University of Texas System for use as office space for UT-Brownsville.

In October, 2011, the The Texas Southmost College Board of Trustees  voted to sell the school’s historic
Cueto building to the city for $500,000.

When it was sold, the  UTB-TSC Center for Civic Engagement was housed – and still is – in the building at 1301 E. Madison. So was the adjacent Lucena House situated on the same property.

However, the building did not include parking space, so some bright boy decided that acquiring the 18,000-foot lot next to it at 1335 E. Madison would fit the bill. On June 27,2012, an appraisal company was hired to determine the cost of the property that included lots 10, 11, and 12 of Block #119 of the Original Townsite. The appraiser – using some rather questionable "comps," or comparable real-estate properties – said the property was worth $155,000.

However, the seller, who was renting three dilapidated buildings and a ramshackle trailer house wanted more. The city was pliant and suggested a solution; rent the unimproved lot for $2,500 a month, demolish the buildings, and after three years exercise the option to buy for the market price ($155,000). After receiving the $90,000 in rent for three years, the seller would have his asking price of $250,000.

Now, with the new lease approved by the city to rent the Cueto building to UTB for four years (at $92,580), all the city wants is for the UTB to make parking lot improvement in return. It is doubtful that the improvements of laying a base of caliche and a coat of asphalt is going to cost $92,580. But either way, the city is still going to continue paying the land owner (Oscar Muñoz) the $250,000 after three years and UTB will get four years of dirt-free rent in return for the parking lot.

Which also makes us wonder where the descendants of Charles Stillman are going to move their ancestor's "Love Shack" which was moved to the lot to be paved by UTB from outside Corpus Christi where it had been relegated to a weed-
overgrown lot after no one wanted it? 

The City Commission (with outgoing commissioner Melissa Zamora) unanimously approved the arrangement. The lease will not only include the Cueto Building where the Center for Civic Engagement is housed, but also the Lucena House next to it where the offices of United Brownsville has its offices.

The lease, officials said, will allow UTB to utilize downtown building space for its offices and runs for four years,with four one-year options.

Deals like these that make one wonder whether the city commissioners do, as they have claimed in the past, their "due diligence."

In her swan song, Zamora voiced concerns about "how the improvements could affect the tax value of the property and how that may impact future transactions."

What?

And, now that she no longer has to weather any political fallout from going publicly against her former landlord Tony Martinez, she added that while she greatly respected Da Mayor, she had misgivings about the way the city has gotten involved in real estate outside of simply investing in buildings.

“I don’t think the city should be in the real estate business,” she said.

Well, as the man said, that's a day late and a dollar short after sitting on a city commission that approved the issuance of a $13.056 million in Certificates of Obligation that – while it did not include the Cueto Building – did include the $2.3 million for the Casa del Nylon which belonged to Abraham Golonsky, a close ally of Hizzonner.

Perhaps Zamora did not agree with the purchase and may have even voted against it, but none of us can recall her – or any other commissioner for that matter – using their bully pulpits and calling a press conference to denounce the deal. Like it nor not, that real-estate speculation that happened during her watch will remain part of her legacy on the  city commission.