Stratus Properties Acquires Land in Downtown Austin for 300-Unit Luxury Apartment Tower
AUSTIN, TEXAS — Stratus Properties Inc. (NASDAQ: STRS) has acquired land near the Texas State Capitol in downtown Austin with plans to develop Block 150, a 300-unit luxury apartment tower.
Rising 400 feet at the corner of 12th and San Antonio streets, the project will span 420,000 gross square feet and include ground-floor retail space. Development costs are estimated at $185 million, according to the Austin American-Statesman.
The scope of the project includes the historic A.O. Watson house, which will be renovated and expanded to offer resident amenities such as a restaurant, pool and garden. Built in 1894, the house was the personal residence of architect Arthur Osborn Watson.
Construction on Block 150 is expected to begin in early 2023 with completion slated for mid-2025.
Stratus Block 150 LP, a Texas limited partnership, will own the development. Financing for the land purchase and predevelopment is in place and includes a land acquisition loan in the amount of $14 million. The remaining predevelopment costs will be funded by approximately $21 million in equity contributed to the limited partnership by Stratus and private equity investors. Stratus will receive 25 percent of the limited partnership’s equity, in exchange for development costs to date and cash, and will manage the project.
Upcoming key milestones for the project include completing design and engineering, securing final site development and building permits, obtaining downtown density bonus approvals and raising the balance of the development capital, which Stratus expects to take 12 to 18 months. Stratus says the size, scope and cost of the project could change materially.
“Unlike the surrounding properties, Block 150 will not be impacted by Capitol view height restrictions and will have unobstructed 360-degree views of the Capitol, downtown Austin, the University of Texas campus and West Austin,” says William Armstrong III, chairman of the board and CEO of Stratus. “This project is also eligible for Austin’s downtown density bonus, which would enhance its development potential. Block 150 takes advantage of the booming residential real estate market in Austin.”
Stratus is engaged primarily in the acquisition, entitlement, development, management and sale of commercial, multifamily and single-family properties; leasing; and the operation of hotel and entertainment businesses within Austin and other fast-growing markets of Texas. The company’s stock price opened at $30.30 per share on Wednesday, Sept. 8, up from $20.40 per share one year ago.
— Kristin Hiller