Downtown Kissimmee’s commercial real estate market is on fire. The city received three proposals from developers eager to transform a blighted Kmart and Big Lots site on W. Vine Street into a vibrant, urban neighborhood.

The three developers — Skyview Companies, Wendover Housing Partners and Capstrata/Hedrick Brothers — all proposed a mixed-use district on the 22-acre site with commercial uses fronting on Vine and a large pond on the north end of the site. The similarities end there. The two groups that shared their master plans with GrowthSpotter offered divergent views on how much density is feasible in today’s market, though all are high on the opportunity.

The Kmart redevelopment is just the latest in a series of promising efforts by city leaders to draw private investment in downtown Kissimmee. Most prominent has been the hot competition to bring a hotel to the urban center, which led the city to choose two developers building separate projects after years of market indifference.

In the latest competition, Skyview partnered with Baker Barrios and Kimley-Horn for a concept plan for the Kmart/Big Lots site, which includes a multi-phased proposal that would convert the sea of asphalt into a walkable, waterfront community with over 900 residential units, 84,000 square feet of commercial and structured parking. The interior streets would be lined with majestic palm trees, wide sidewalks and bike lanes. Skyview COO Stephen Liberty told GrowthSpotter the total project budget is estimated at $325 million.

“This master plan creates a livable, economically resilient, and community-focused environment, positioning the site as a catalyst for transformation along the entire corridor,” the document reads.

The first phase would have a mixed-use apartment building with 280 units above 9,800 square feet of ground-level retail. The bulk of retail construction is planned for phase 2, which calls for 56,600 square feet of shopping, dining and offices, plus 285 apartments — including some live-work units. Phase 3 would add another 336 residential units plus 17,500 square feet of retail, including a flagship waterfront restaurant. The last phase would add 31 townhomes in the northeast and northwest corners of the site, overlooking the lake. Liberty said Skyview would reserve 10% of the units for residents earning no more than 80% of the area median income, and that those units would be interspersed throughout the project.

Wendover Housing Partners has proposed a $140.77 million mixed-use community that leans in on its history as one of the region’s largest developers of affordable housing. The team includes Crossmark Services as the commercial partner, Slocum Platts as the architect, and RVi Planning + Landscape Architecture/AVCON. Lowndes is the legal advisor.

Wendover COO Ryan von Weller told GrowthSpotter the company’s recent success with its transit-friendly apartment community in downtown Kissimmee encouraged them to compete for the Kmart site. “So we have a property very close by, with Weston 4Hundred, that leased up very rapidly and worked very well for our investors,” von Weller said. “And so we’re looking for more opportunities within the Kissimmee corridor, and this opportunity presented itself, which was fantastic.”

While the size of the Kmart site is comparable to Wendover’s Catchlight Crossings project on Universal Boulevard, the Kissimmee concept calls for a less intensive project with a total of 328 residential units plus 66,000 square feet of commercial and retail space. The project would be constructed over three phases with phase 1 anticipated to begin Q4 2026.

The third bidder is Capstrata (fka Capstack) and co-developer Hedrick Brothers Development. The team declined to share their proposal with GrowthSpotter, but Capstrata Principal Veronica Malolos said it would be responsive to the detailed requirements outlined in the bid documents. They enlisted Cormia Design Group as the project architect.

“Our team has a bold vision that’s primarily focused on Kissimmee’s community needs coupled with market responsiveness,” she said.

Hedrick Brothers recently broke ground on a new market-rate apartment community near Orlando’s Baldwin Park community, and will start construction this year on another in Kissimmee on Lake Toho.

President Burk Hedrick said their goal is to create something iconic with a lasting impact. “We’re believers in Kissimmee, and we’re excited about what we put together,” he said. “We put a lot of effort into it, but hopefully it’s what the city asked for and what we believe we will be able to deliver.”

Other notable efforts to invigorate downtown Kissimmee include a public-private partnership with Mosaic Development that led to the completion of Mosaic Apartments at Lakefront Park and the Toho Square parking garage.

In 2021, the city partnered with Skyview Companies to redevelop the Beaumont site, which it acquired from Osceola County in a land swap. The Allen Apartments opened in the spring, and Skyview is prepping to break ground on Phase 2, a 100,000-square-foot medical office building, later this year.

The city also chose Skyview as one of its downtown hotel partners to complete the buildout of the Toho Square site with a full-service boutique hotel and condo-loft development. The company is also planning a mixed-use apartment tower with a grocery store and craft brewery downtown.

Development Services Director Craig Holland told members of the Osceola County Association of Realtors that the interest from hoteliers is a new phenomenon. “For years, we tried to get a hotel downtown, a hotel at the airport, and we couldn’t beg, borrow or steal to get a hotel to look at us seriously. Then all of a sudden, we have three.”

Kissimmee Place Development Group broke ground last week on a new extended-stay Hyatt Place at the airport industrial park, and Azure Hotels International is moving quickly on its plan for a luxury, 200-room hotel and convention center at the Kissimmee Civic Center site. Holland said Azure plans to demolish the current civic center in early 2026. “We’re taking a very used building, but it’s an aging building, and replacing it with something really nice.”

Have a tip about Central Florida development? Contact me at lkinsler@GrowthSpotter.com or (407) 420-6261. Follow GrowthSpotter on Facebook and LinkedIn.