If the Alamo was in Houston, Houstonians would’ve torn it down to build something else. So says Ori Batagower, new development and acquisitions director for The Deal Co., one of several panelists at Bisnow’s Houston State of the Market event April 27 to proclaim that razing is out and a new era of adaptive reuse is in.

Bisnow’s event was held in a raw space at 1512 Center St., the original 1927 Bosworth Paper Co. building that The Deal Co. is redeveloping — a fitting symbol of changing mindsets in a city known for no hesitation when it comes to chucking out the old and making way for the new.

“Every single step that seems to be pretty typical for different classes of real estate is not [for adaptive reuse],” said Andrew Nurcahya, who is developing The Dryer in Katy. The Dryer is a 177-foot-tall former rice dryer along Interstate 10 in Katy, built in 1943 and abandoned for more than three decades.

Adaptive reuse projects like The Dryer are difficult due to numerous challenges, including unexpected construction costs and a lack of permitting guidance for one-of-a-kind projects. Layered on top of that are the conditions looming over all of Houston’s commercial real estate market: high interest rates, a lack of ideal inventory for tenants, and a disconnect between sellers and buyers.

“Underwriters don’t look at the cool, fun factor that we first look at, they look at the fear factor,” Nurcahya said. “Bankers are risk-averse, engineers are risk-averse, city permitting is definitely risk-averse,” Rosenberg of Buffalo Bayou Partnership agreed.

Figuring out how to finance projects is a major hurdle for both developers of older buildings and commercial real estate writ large. Options include EB-5 financing, Property Assessed Clean Energy (PACE) financing and crowdfunding.

In the multifamily market, options to get deals across the finish line include accepting lower returns and lowering sale prices. “Leaders don’t get paid a lot of money to do nothing. They get paid to make the important decisions that drive them toward the future,” said CBRE Vice Chairman Lucian Bukowski.