W Hotel & Residences in Austin Bags $165M Loan
- Jun 04, 2008
Austin-based Stratus Properties Inc. and the Canyon-Johnson Urban Fund have obtained a $165 million construction loan for a new development in Austin, W Austin Hotel & Residences. The $295 million mixed-use project (pictured), located in Downtown Austin’s 2nd Street District near Lady Bird Lake, is seeking LEED certification and is slated for completion in early 2011. The construction loan is from Corus Bank, and was arranged by the Dallas office of Holliday Fenoglio Fowler L.P. Though the market for condos has declined nationwide since the beginning of the credit crunch, the W project is nevertheless selling. In the roughly six months since the project was announced, about 40 percent of the project’s residential units have been put under contract, with another 20 percent in the process of being converted to contract. According to a recent study by Capitol Market Research, commissioned by the Downtown Austin Alliance, Austin continues to defy national real estate trends, particularly in its urban core. The study found that condo demand in the market is matching the increase in supply, and that 68 percent of condo buyers are local, with more than two-thirds relocating from within Austin. The study also showed that 70 percent of condo buyers do not work Downtown, but are instead making a lifestyle choice to move to the area. Initially designed with 198 residential units, the W project’s final count is expected to be closer to 165 units, as demand has been strongest for larger floorplans, and a number of buyers have opted to purchase multiple units in order to combine them, according to Stratus Properties.