The developer of the W Austin Hotel and Residences said Thursday that it has taken advantage of lower interest rates to refinance its debt on the prominent downtown high-rise.
Austin-based Stratus Properties took out a $100 million loan from Bank of America that it used to pay off an earlier loan from Beal Bank Nevada, Chairman and CEO Beau Armstrong said.
The loan Stratus paid off wasn’t due for a few more years, Armstrong said. The new Bank of America loan comes due in 2016, but can be extended for up to three additional one-year terms.
“It’s a good day for us,” Armstrong said. “The building has performed incredibly well and that’s something the capital markets love to hear.”
This year, Stratus had considered selling the 37-story, $300 million tower, Armstrong said, but that’s no longer the case.
“We’re not selling,” he told the American-Statesman. “We plan to hold onto it for the foreseeable future.”
In addition to the high-end W Austin Hotel and the luxury condos that sit atop it, the building is also home to the ACL Live at the Moody Theater concert venue, offices and a mix of shops and restaurants.
Since the hotel opened in December 2010, it has reported steady increases in occupancy and average nightly room rates. Revenue per available room averaged $264 for the first six months of 2013, according to the most recent Stratus Properties quarterly filing, up from $232 during the same span of time in 2012.
Even with more than 4,000 new hotel rooms on their way to the Austin area — most of them in the downtown area, not far from the W — Armstrong says he’s still bullish on his company’s most high profile asset.
“This is exactly what happens in good, strong cities,” he said. “People show up and want a piece of the action.”
Other Stratus Properties projects include the new Parkside Village shopping center in Southwest Austin. Tenants there include Austin-based Alamo Drafthouse.