After years of delays, McAllen City Center finally goes vertical with first $13M building

After years of delays, the McAllen City Center project is moving forward with a $13 million building and a groundbreaking ceremony set for next week.

A new filing with the Texas Department of Licensing and Regulation shows a 32,500-square-foot multi-tenant building has been registered for construction at the former McAllen Civic Center site at 1300 S. 10th St.

The structure is planned as a shell building prepared for future tenant buildouts.

And a groundbreaking ceremony is scheduled for April 16.

First sign of vertical progress

The filing marks the first clear signal of vertical construction on the 13-acre site, which has sat largely vacant for years following the demolition of the former civic center.

The property changed hands in 2023 to McAllen CityCenter Ltd, an entity affiliated with McAllen-based Castle Hospitality and led by developer Michael Fallek.

Since then, the project has moved slowly, with developers citing economic conditions, tenant recruitment challenges, and deed restrictions tied to the property.

“I think the market is waiting for something there to go vertical before they believe the project is real,” Fallek previously told the Rio Grande Valley Business Journal. “It’s complicated and difficult.”

Project scaled as timeline shifts

Earlier plans for the development included a boutique hotel, structured parking, and multiple commercial components.

Some of those elements have been delayed or placed on hold.

Plans for an $18 million Courtyard by Marriott hotel have stalled, and a previously proposed parking structure is expected to be replaced with surface parking in the interim.

Fallek has said lease negotiations are ongoing, though no tenants have been formally announced for the first building.

Incentive deal under review

In 2024, the developer entered into an economic incentive agreement with the city of McAllen, committing to invest $50 million into the project by Jan. 1, 2026.

In exchange, the city agreed to share a portion of sales tax revenue generated by the project and provide property tax reimbursements over multiple years.

It remains unclear whether those terms have been met, and city officials have indicated they may revisit the agreement as the project evolves.

Narrow path forward

The site remains constrained by deed restrictions tied to prior ownership, limiting which retailers and restaurants can operate there.

Those restrictions, combined with broader economic uncertainty, have narrowed the pool of potential tenants.

For now, the first building is expected to serve as a starting point — a visible step forward on a project that has struggled to gain traction for more than a decade.