Marshall Stewman, a Baylor graduate and developer based in Dallas, is busy renovating the former Morrison Supply Co. building at 300 South Sixth Street into a retail and dining hotspot. Along with his business partner, Peter Thyen, the two are developing the 11,000 square foot structure into “Mary Avenue Market,” a family-friendly project with an outdoor focus that looks to put five to six retailers in the space at 6th and Mary.
Austin Meek of Waco Business News spoke with Stewman, who was recently featured in The Wacoan’s “Movers and Shakers,” on Tuesday, October 3, shortly before he met with local leaders to seek funding for streetscape improvements. According to the Waco Tribune-Herald, the council approved $294,000 in Tax Increment Financing Zone funds for the Market.
A portion of our conversation with Stewman is posted below.
Marshall Stewman: [Streetscape improvements] should help out a ton, and even help out the walking traffic, cause it’s—some of the folks that we’ve talked to from Dallas and Austin, just as potential tenants, know about Downtown Waco, know about Magnolia, but they don’t really have an idea of what’s actually going on down there in terms of just pedestrian traffic. So it’s always fun to bring them down there and let them see everybody walking around and kind of crawling. It’s going to be exciting to get some patios—raised patios—so you can kind of sit there and be above everybody walking out down there on the street and see what’s going on.
What are the biggest surprises for you in Downtown Waco, something that you didn’t necessarily expect before you got here? And something that you think “Mary Avenue Market” can provide that doesn’t exist currently?
One thing that we didn’t expect—I guess we did expect—we knew we were going to be kind of the leading edge of it, but rents in Waco are really inexpensive. So, one thing that we were wanting to do and were kind of forced to do because the property values are going up is ask for higher rents. We’ve been able to get that, so I’m excited about that. And, truly, I think that’s kind of like anything else, that, once it happened, the whole market kind of goes up, which, to be totally fair, I think it needs to. I think rents are artificially low in Waco. Just, I really don’t know. I think just nothing down there’s happened yet.
So you’ve seen a fluctuation [in rents] even in the last twelve months?
Absolutely...I think our biggest unexpected challenge was, when we first bought the property, we had an overall vision. We didn’t necessarily know who was going to be the tenant. I don’t know if I told you this previously or not, but I spoke to some national names like Starbucks and folks like that. And, I met with Starbucks. Starbucks actually liked it, but then, on the plane flight home, I started thinking that that’s completely against the initial vision I had with the property of being kind of local, local business owners growing what’s already happening in Waco. So, we shied away from any name brands, you know, Chili’s or things like that, even though, honestly, that may make more sense. The challenge with that, which we didn’t expect, was—there’s a ton of folks with fantastic ideas that could ultimately pay the rent, they just can’t pay for the upfront capital costs involved with building out a space. So, that’s where we kind of having to walk a fine line of what we provide from a landlord’s perspective, and also, you know, amortize over the rent. So, that’s the biggest challenge so far, just getting past the upfront capital costs.
That’s fodder that our readers are going to love. I mean, obviously, everyone here wants to promote local and stay as organic as they possibly can. So, that’s a mentality, just as a developer, that’s attractive for someone like me, just thinking as a citizen and somebody who lives in Downtown.
Absolutely. And it all came up because my true W-2 job is I develop for a national kidney dialysis company [DaVita]. We’re headquartered in Denver, and there’s a place called “The Source” that’s in Denver that has just a really eclectic mix of tenants—there’s a florist, there’s a butcher, there’s a couple restaurants, there’s a bank in there. So you can really kind of go and get whatever you want at this one location. I love that, and I love the idea of how you just walk in Downtown Denver, you can be there for three weeks, and, y’know, hit three or four different restaurants or bars a night and still not hit them all. So, it’s just all kind of little small shops, so I just wanted to bring something similar to that to Waco.
Marshall Stewman is a Waco native who attended Texas A&M University, graduating with a BS in Construction Engineering in 2004. In 2013, he graduated from Baylor's Hankamer School of Business with an MBA. After living in Dallas for a few years, he returns home to Waco as a developer, focusing on the 300 block of 6th Street, converting the old Morrison Supply building. He and his family are hoping to invest in and revitalize Waco, especially in the downtown area.