More Surface Deals Surface

From Abc13’s Wayne Dolcefino:

To get the winning hand, it helps to have the luck of the draw. Maybe that’s what Michael Surface has.

In January of 2005, one of his corporations buys an old H-E-B store on Antoine. The appraised value — $1. 2 million.

Two months later, Harris County announces it’s looking for a big building to replace Commissioner Lee’s Annex A in the same neighborhood that Michael Surface now owned his old H-E-B.

Maybe it was just a lucky hand for Mr. Surface. But years earlier, he was the guy in charge of Harris County’s building department.

(Hey, isn’t this the same guy who brought in the proposal to redevelop the Astrodome into a hotel? Good thing he’s outta there, so that deal can go forward!)

. . . tax records show [Surface] sold the [H-E-B] building and land to a corporation called HC5815 for $2.2 million. That corporation, in turn, got the winning hand months later. The head of that corporation was David Blumhardt from Dallas, who we’ve learned got the winning hand in at least nine Harris County real estate deals. His local representative on the Antoine project was the guy whose name we found on a worn out real estate sign — Jason G. Hall, Weston Partners, Ltd.

Where have I heard that name before?

Jason Hall used to work for Michael Surface at Harris County. Now, his real estate operation is located in Michael Surface’s offices.

When Jason Hall worked for the county, one of the projects he evaluated was 2525 Murworth. It’s now the home of Children’s Protective Services, part of a $35 million county real estate deal developed by Michael Surface just months after he left county government.

After the jump: a longer view!


Sure, all these deals might look a little funny, but the real game is saving money for county taxpayers. The Chronicle‘s Chase Davis sums it up:

Schatte and Surface developed a reputation as lease/purchase evangelists who often brought solid deals to the table, even in the face of questions about the federal investigations.

“It comes back to the smell test … When it comes out, it looks bad,” said county Purchasing Agent Jack McCown, who oversaw public bidding on many of the deals. “But (Schatte and Surface) always seem to have the better deal.”

Several officials also raised concerns that only a small core of developers, including Schatte, Surface and Blumhardt, were involved in nearly every major county real estate lease/purchase over the past decade.

“It certainly doesn’t look like the public got fleeced,” said Art Storey, Harris County director of public infrastructure, which includes facilities and other departments. “But there is a very small number of players involved in all these deals.”