A Central Texas town known for pine forests and barbecue is at the center of an ambitious real estate play, along with Elon Musk’s latest tunneling experiment.
Bastrop officials are weighing plans for a 390-acre mixed-use development dubbed Bastrop West that would pack in a regional hospital, hotel and convention center, entertainment venues, retail and multifamily space. Meanwhile, Musk’s Boring Company, headquartered just outside city limits, is in talks with the city about digging three pedestrian tunnels to link up Bastrop’s expanding trail system, the Austin Business Journal reported.
Kazem Khonshari’s Palms Properties owns the mixed-use development site, spanning two parcels off Highway 21 between FM 20 and Bear Hunter Drive. Khonshari has previous projects in Bastrop and is assembling partners for components like a hotel operator and convention center developer. A master developer hasn’t been chosen.
The project is pitched as a game-changer for the 13,000-person town 30 miles east of Austin. A domed sports facility is being discussed for the recreation parcel, while the entertainment area could attract a big-box user such as TopGolf.
The vision includes a 41-acre hotel and convention center site, a 25-acre medical mall anchored by a regional hospital, a 37-acre education hub, a 28-acre sports and recreation complex, 25 acres of entertainment space, nearly 100 acres of commercial parcels and 58 acres of multifamily and retail.
Meanwhile, Boring Company is exploring three tunnel alignments: one from a Buc-ee’s under Highway 95 to Martin Luther King Jr. Drive, another from Mayfest Park to Bastrop State Park, and a possible extension to Ferry Park along the Colorado River. If built, it would be the company’s first Austin-area project.
The Bastrop West plan will require annexation, zoning changes and significant infrastructure financing. Developers are expected to seek a public improvement district and tax increment reinvestment zone, while the city may tap Bastrop’s economic development arm and state transportation approvals for funding.
The project comes as Boring Company looks for momentum beyond its Las Vegas tunnel, where it has operated since 2021. The company has since struggled to win deals elsewhere, facing fines and stalled proposals, including in Kyle just south of Austin. But its Bastrop R&D campus — an 80,000-square-foot facility on 73 acres — signals Musk’s tunneling outfit isn’t leaving Texas anytime soon.
Elsewhere in Bastrop, a $100 million, 75-acre “non-woke” film studio dubbed Wyldwood Studios is in the works by actor Zachary Levi.
— Eric Weilbacher
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