TUCSON, AZ –Joint-development partners PEG Companies [“PEG”], a vertically integrated commercial real estate investment firm known for their innovative projects, and The Gadsden Company [“Gadsden”], a family-owned real estate investment and development company with a core focus on community development including Tucson’s Mercado District, came together alongside the community, Wednesday, to celebrate the ceremonial groundbreaking ofThe Bautista Apartments, an upscale transit-oriented mixed-use development located along the historic Santa Cruz River.
Just under 500,000 total square feet, the $110 million Bautista development consists of 256 spacious residential units—each one boasting a large balcony and vast living space. The development also includes ground-level retail and restaurant space, parking, interior courtyards, and a plethora of leading-edge amenities including a resort-inspired pool and spa and an enhanced river park element with a public walkway that will run through the center of the project, connecting the rest of the Mercado District to the Santa Cruz River.
“This project represents a collaborative public/private partnership,” said Trevor Ellis, Acquisition and Development Manager at PEG. “The Bautista is the product of a creative process starting back in 2018, between us as private developers, the City of Tucson, and Rio Nuevo which provided a $2.8 million investment split between cash and sales tax rebates,” Ellis explained.
The development also leverages a significant portion of private equity from investors who will benefit from tax breaks through the federal government with the property being inside a Qualified Opportunity Zone [QOZ].
“This is a federal designation for certain census tracts in each state to spur economic development and job creation,” said Adam Weinstein, Gadsden’s President/Chief Executive Officer. “The designated QOZ overlays the entirety of our Mercado District properties. Bautista is in that zone,” he explained, adding that The Bautista Apartments have become the first QOZ-leveraged investment of their kind within the Rio Nuevo District.
The Bautista Apartments, which will be divided between two five-story buildings connected with a bridge, are on track for an August 2025 completion date.
