Raising the Dead

[IMGCAP(1)]SAN ANTONIO-The Windsor Park Mall had seen some better days. The down-and-out retail center was once a thriving hub of sales anchored by five big box retailers including Montgomery Wards and Mervyns. The slow, aching death of the mall began in 2001 as Montgomery Wards Corp. filed for bankruptcy. The closure metastasized and spread infectiously through the rest of the mall eventually leading to its doors locking up in 2005. Simon Malls built a new destination just down the block at the next intersection and the Windsor Park’s fate was sealed.

In early 2007 Rackspace, a major hosting and cloud-computing company, had hit its stride and was expanding exponentially. According to Randy Smith, Rackspace’s director of real estate, the company was hiring between 80 and 100 employees per month and its space needs were getting serious. The company embarked with two guiding criteria for a new space:

1. The site had to create a competitive advantage; and
2. It had to foster the Rackspace culture rather than frustrate it.

Rackspace’s model required integrated teams of 20 to 25 people with incentives and support for collaboration. This model dictated a “massive open space,” explains Smith, “with the flexibility to manipulate adjacencies was key.” But as importantly, Rackspace had not gone public yet (they held an IPO later in 2008), so there wasn’t a large chunk of cash to create their own space from scratch.

“We could not afford to do the big company thing,” Smith jokes. “Go up I-35, buy 20 acres and build a monument to ourselves. ” This led to searches in North Carolina and Austin, but the solution was closer to home.

“The city, county and state officials put together a phenomenal effort to keep us here in terms of tax incentives, and that played a huge role in the affordability of this project,” Smith explains. “Mostly we felt like San Antonio, for our first nine years of our corporate existence, had really invested a lot in us and we felt like we wanted to stay and that we owed the city.” The old Windsor Park Mall, at 1.2 million square feet on 70 acres, was the only space that matched their size requirements.