McAllen begins bid search for Boeye Reservoir development

MCALLEN, Texas (ValleyCentral) — McAllen city leaders have officially unveiled plans for a major mixed-use development at the former Boeye Reservoir site, which is a project that has been discussed for decades and is now moving forward.

The 67-acre area, located near Bicentennial Boulevard and 23rd Street, will be transformed into a multi-million dollar district featuring hotels, residential units, shops, and entertainment spaces. City officials say this project will reshape the area and bring long-term economic benefits.

Mayor Javier Villalobos said the city is moving away from a previously planned recreational area with water features and instead focusing on creating a walkable, mixed-use development that combines residential, commercial, and retail spaces.

“We're going a different route,” said Villalobos. “This is what we're looking for — this is the future of McAllen.”

Estimates show the project could generate $330 million in economic output, support 900 permanent jobs, and create 2,200 more during construction. It is also expected to bring in $35.6 million in visitor spending and raise the city’s tax base by $400 million. A final cost estimate has not been released, and the project is expected to be completed after Villalobos finishes his term.

“This is a project that has been in the works for twenty to thirty years,” said Michael Fallek, president of Castle Hospitality. “It's an important new development for McAllen, and it is something that will benefit the community at large.”

Fallek says his company is reviewing the city’s plans and may explore investment opportunities. Castle Hospitality already operates several hotels and an industrial park in McAllen.

City officials say bids are being received for the development, which are open through mid-December. The land has been drained, and crews are working to level the ground in preparation for future construction.

While city leaders and developers are optimistic, some local business owners near the site have raised concerns about increased traffic and noise from the nearby airport, which they fear could impact the success of the area.

Still, many see the project as a step forward. Omar Guevara, Vice Chair of the McAllen Chamber of Commerce Board of Directors, said the development would boost the local economy and improve the quality of life across the region.

“Just because people visit and go to a particular establishment, that dollar gets spread out through our community,” said Guevara. “It creates employment and work that trickles down and improves the lives of many people.”

Guevara added that seeing McAllen embrace large-scale developments similar to those in other parts of the U.S. and Mexico puts the city “right at the top of destinations in the country.”

City leaders expect to have a clearer timeline and cost estimate by the end of the year as bids are submitted to the city.