Brooks Authority serves default notice over $51 million ICE office lease
The local development body claims the federal sublease violates developer terms, triggering a 60-day cure period.
By Layla Richardson ·
Fifty-one million dollars. That is the value of two 15-year federal leases for 75,000 square feet of office space at WatersEdge II, a building on the former Air Force base in San Antonio’s Southeast Side. The Brooks Development Authority (BDA) is now challenging the arrangement, alleging the sublease violates the existing contract with the property’s developer.
BDA officials confirmed Tuesday that their board authorized legal counsel to send a formal notice of default to BOZ III-WatersEdge. This entity is associated with Preston Hollow Community Capital, the Dallas-based firm that controls the building. The notice serves as a warning that the board believes Preston Hollow breached its lease terms. The company has 60 days to fix the alleged violation before BDA can pursue further remedies.
“Brooks did not negotiate or approve this sublease, and we oppose the proposed use of the property,” a BDA spokesperson said. The authority argues that housing federal immigration legal operations is not permitted under the current agreement. However, officials have not yet identified the specific lease provisions they believe are being broken.
Preston Hollow disputes the claims. A company spokesperson said Tuesday that the firm does not agree with the notice’s contentions but is considering its options in response to the action. The notice does not automatically halt the federal leases, and it is unclear what BDA will do if the dispute remains unresolved after the 60-day window closes.
Emails obtained by the San Antonio Report show BDA leadership raised concerns shortly after the leases were announced in October. On Oct. 8, Mayor Gina Ortiz Jones contacted BDA President and CEO Leo Gomez to confirm the details of the federal plans. Gomez later clarified that the agreements cover three of WatersEdge II’s four floors. The space is intended for the Office of the Principal Legal Advisor and the Executive Office for Immigration Review, both federal bodies handling immigration hearings.
Gomez wrote to the mayor that he frowned upon the uses at Brooks but emphasized that the authority was not involved in negotiating or facilitating the deals. He stated that Preston Hollow was solely responsible for the agreements with the federal government. City Council approved a resolution on Oct. 15 directing officials to explore ways to delay the leases, expanding local opposition to ICE presence in the city.
BDA officials say they are now waiting for a response from Preston Hollow or the expiration of the 60-day period. ICE currently operates two field offices in the San Antonio area.
