Harlingen touts big drainage investment, retail sales bump, and a new boutique hotel at ‘State of the City’

City of Harlingen leaders were bullish that several key projects, which promise to turn the tide in the city’s favor, are on the horizon, they said during the State of the City address on Thursday night at the Harlingen Convention Center. 

The city adopted a new comprehensive master plan to improve the quality of life by adding more walking trails and reviving its downtown core through events and new businesses. 

That includes the renovation of the former Olympus Gym into The Centennial — a mixed-use development expected to include a grocery store, arcade, bowling alley, billiards hall, and indoor restaurants. 

Details were scarce about a new nature-themed boutique hotel planned for Harlingen, known as Nido, the Spanish word for nest. 

The cost and location of the hotel were not disclosed. But it’s expected to have private suites designed for families, exercise spaces for Pilates, yoga, and meditation, and be surrounded by gardens next to a commercial development with fine dining and healthy brunch spots. 

“A place where you don’t have to leave Harlingen to feel like you’ve stepped into something new. This is what it looks like when vision meets investment,” Harlingen Mayor Norma Sepulveda said  about the new hotel during her State of the City address. 

One of the city’s major investments was the $70 million the city used to fund drainage projects in collaboration with county drainage districts to address years of flooding that have inundated the community several times. About $12.9 million was funded by grants. 

That includes the completion of a 14-acre detention pond, which can hold 10 million gallons of water during a storm. A second 9-acre drainage pond is under construction, and a third drainage pond is being expanded to 13 acres. 

In 2025, the city of Harlingen saw $1.8 billion in retail sales, generating more than $36 million in sales tax payments to the city’s coffers, up from $34 million in 2024 — a 6.6% bump. 

“We’re trying to recruit other businesses that fit into our strategic plan. We want to grow in our community. We want partners that want to contribute to our quality of life,” Sepulveda told the Rio Grande Valley Business Journal. “There’s lots of momentum. We’ve got a sales tax increase from the year before, which means people are shopping local.” 

The Harlingen Economic Development Corporation estimates that it has a manufacturing project pipeline of more than $700 million in potential development. In 2025, the EDC approved $27 million in economic development projects that will create 180 new jobs. 

That includes 200 new jobs at Harlingen Medical Center, which is adding 25,000 square feet to its back-office operations and investing $5 million in the project. Tropical Texas Behavioral Health is investing more than $20 million and will grow to 240 employees.