The long-vacant landfill off southbound IH-35 in Buda is finally getting a second act. City leaders and H‑E‑B have laid out a plan to turn the site on the access road north of Main Street into a new H‑E‑B store, bundled with environmental cleanup, new road work, and a long-term incentive package meant to make the tricky property buildable after decades of sitting idle. H‑E‑B says construction is expected to start in 2026 and that the project will add at least 50 full-time equivalent jobs in its first year. Once the new location opens, the company plans to redevelop its existing Buda store.
Money and partners
In a joint City of Buda release, the City of Buda, the Buda Economic Development Corporation, Hays County, and Hays County Emergency Services District No. 8 said they have agreed to a combined $20.1 million incentive package spread over 30 years. They also agreed to reimburse up to two-thirds of remediation expenses, capped at $12.1 million, while Hays County and the ESD will each contribute up to $4 million. The release describes the arrangement as a Chapter 380/381 economic development and performance agreement funded by projected sales and property tax rebates. “We’re transforming the site into a thriving retail hub,” Hays County Precinct 4 Commissioner Walt Smith said in the release.
What the incentives will pay for
The incentives are aimed at offsetting land remediation costs officials peg at about $30 million and at funding H‑E‑B’s planned environmental cleanup and roadway work. MySA reports the company expects to remove contaminated soil from the building footprint, digging roughly 20 feet deep in some areas, then replace it with clean fill. Landscaping would be concentrated along the parcel perimeter to meet state requirements. The agreement also links roadway improvements to a traffic impact analysis that will guide upgrades along the IH-35 and Main Street corridor.
Site, size and store plan
The project centers on a roughly 21-acre parcel between Old San Antonio Road and IH-35, identified in public documents as 15000 N. IH-35. H‑E‑B’s preliminary plan calls for an approximately 135,000-square-foot supermarket with a drive-thru True Texas BBQ, a pharmacy drive-thru, and a garden center, according to Community Impact. Rezoning needed to clear the way for the development went through the city’s planning process late last year, city records show.
Officials praise the partnership
Local leaders are treating the deal as a milestone for a fast-growing stretch of the corridor. “This is a defining moment for our community,” Mayor Lee Urbanovsky said in the joint release. Buda EDC CEO Jennifer Storm framed the agreement as a rare chance to turn underused land into a long-term opportunity. The release stresses that safety and extensive environmental review were central concerns given the property’s history as a landfill.
Timing and local impact
Construction is slated to begin in 2026, and H‑E‑B has pledged to create at least 50 full-time equivalent jobs within the first year of opening, per reporting by MySA. The company has also committed to redeveloping its existing Buda store at 15300 S. IH-35 and to repurposing at least 60 percent of that former footprint for sales-tax-generating businesses within 18 months after the new store opens. Officials say H‑E‑B will look to source construction materials locally where possible to keep more of the spending in the regional economy.
Why Buda is the target
Buda sits on the busy I-35 corridor between Austin and San Antonio, and the town has been drawing logistics and retail projects as population and housing growth continue pushing development south of Austin. Coverage in the San Antonio Express-News and other outlets has tracked nearby projects, including a major US Foods expansion, that help explain why retailers are increasingly betting on the area. City and county officials say the H‑E‑B project should bring in sales tax revenue, create jobs, and build momentum for more retail in Buda.
Next steps
The agreement now moves into the implementation phase. That includes design and permitting tied to the traffic impact analysis, construction sequencing for cleanup and road work, and final contract execution by the participating entities. City documents and the joint release spell out reimbursement caps and timelines, and MySA reported that officials have said the parties plan to move quickly now that the framework is in place.
