Ryman Hospitality to Purchase Block 21 Mixed-Use Campus in Downtown Austin from Stratus for $275M
AUSTIN, TEXAS — Ryman Hospitality Properties Inc. (NYSE: RHP) has reached an agreement with Stratus Properties Inc. (Nasdaq: STRS) to purchase Block 21, a mixed-use and entertainment development occupying a full city block in downtown Austin. Ryman has agreed to purchase the property from Stratus for $275 million, including a debt assumption of $142 million.
Block 21 houses Austin City Limits Live at the Moody Theater, a 2,750-seat venue that hosts America’s longest running music series, Austin City Limits. Past artists that have played the annual concert series include Dave Matthews Band, Lauryn Hill, Beck, Elvis Costello, Coldplay, Robert Plant, Cyndi Lauper and B.B. King.
The project also features W Austin Hotel & Residences, 3TEN ACL Live club, 40,000 square feet of Class A office space and 18,000 square feet of retail and restaurants, including Starbucks and Urban Outfitters. Built in 2010, Block 21 anchors downtown Austin’s 2nd Street District.
“Ryman Hospitality Properties’ expertise in both hospitality and live entertainment, plus their demonstrated stewardship of the iconic Ryman Auditorium and Grand Ole Opry, make them the ideal company to usher Block 21 and ACL Live into their next decade,” says William Armstrong III, president, CEO and chairman of the board at Stratus.
Colin Reed, chairman and CEO of Ryman Hospitality, says that the company will use Block 21 as a country music venue to create content for its new TV platform Circle, which is set to launch early next year.
Ryman plans to finance the transaction using cash raised from its recent offering of 3 million shares of its common stock priced at $85.60 per share. The offering is expected to close at the end of the week.
The Block 21 sale is expected to close in the first quarter of 2020, subject to the consent of the loan servicer to Ryman’s assumption of the existing mortgage loan and the consent of the W Hotel property manager, an affiliate of Marriott International, to Ryman’s assumption of the hotel operating agreement. Ryman will deposit $15 million in earnest money to secure its performance under the agreements governing the sale.
The Austin American-Statesman reports that Stratus is selling Block 21 as part of its development strategy to sell off its developments post-stabilization.
Ryman Hospitality Properties is a Nashville-based REIT that owns four upscale meetings-focused resorts around the country operating under Marriott’s Gaylord brand, in addition to its media and entertainment holdings. The company’s stock price closed on Monday, Dec. 9 at $85 per share, up from $72.82 a year ago.
Stratus Properties is an Austin-based owner, developer and manager of commercial and residential properties in Texas. The company’s stock price closed on Monday at $29.95 per share, up from $26.49 a year ago.
— John Nelson