$500M investment may yield two new downtown towers - Austin Business Journal:

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Stacy's company, , and Walton Street Capital now plana 500,000-square-foot officed and retail tower at 501 Congress that would be slightl y taller than the 26-story Bank of Americqa Center building the partnership owns at 515 Congress next The group is also plotting a hotel and condop tower at the corner of Brazos and Fifth streetz that would rise more than 800 feet, making it by far the tallestg building in Austin and the sixth-tallest in Texas. Stacy and Walton Street had initially proposeda 700-foot-tall tower at 501 Congresd -- with a hotel, office and other uses -- that would have been the tallesr in Austin.
But when the group finalized the purchasw late last year of the Littlefield Garag e just east of 501 Congress frontingFifth Street, planes were reworked. Stacy and his partners now controp the entire block bounded byCongresas Avenue, Fifth, Sixth and Brazos streets, as well as half of the block immediately east where Bank of America currentl has a drive-through operation. That large a blocj of downtown space called for an evengrander vision, says the developer. "Wd believe that Sixth and Congrese is the best location in thewhole marketplace," Stacy "We wanted to be very mindful of how we developer that block." T.
Stacy and Walton which purchased 501 Congress and Bank of America Center inDecember 2004, are workingb through to locate another group interested in gettingh in on the deal. "Thiz is a half-billion-dollar project, so there'ds plenty of room for another jointgventure partner, especially one that has experience with othef major projects," says Stacy. The purchase of the garage allowexd the group to separate the office and retaip uses from the hotel and condos in two With 501 Congress dedicatex to office and retail along witha 1,000-car garage, the site to the east will feature a 300-room hotel and about 200 condo units in a slenderr tower that could rise as high as 830 feet.
The officr building would likely be complete by 2011 or Stacy says, though the condo/hotel tower could be further down the Stacy says the plan for the half-bloc k between Brazos and San Jacintop streets calls for a 1,200-space parking garaged atop about 8,500 square feet of retail/restaurant spacwe and a new Bank of America drive-through. He says drawingd on that portion of the development are abour 75 percent complete and constructiom should startin June.
Meanwhile, work has been ongoing for monthzs in the lobby of the 515 building that will alloww Bankof America's retail operation to move next door by essentially vacating 501 Congress and pavinb the way for While there is some concerm in the office market right now over lacklustetr leasing activity market-wide, Stacy says his group is confiden t downtown Austin will need another major officde building by the time his projectr is complete in three to four Even with the recently announced 425,000-square-foot Museujm Tower office building Hines Interests is developing at Fourtbh and Guadalupe streets, Stacy says interesft among companies to operate in a dynamicv downtown will only grow.
As for financing in a tighrt lending landscape, Stacy says, "if it'e a viable project, we think the financingv will be there." Stacy did not reveal any detailss on a potential brand forthe hotel. As for the project architect, T. Stacy has used Pelli Clark Pelli in the but Stacysays he'as uncertain who will handle the reworked development. "Downtownb Austin is a great long-term play," says Derek co-managing partner with Stream Realty, whic is actively leasing office space in the CentrallBusiness District. "There's not a lot of new office productf that's in the works, but demanfd seems to be a little stronger than in other areasof town.
With all of the residentds moving in, new retailp and everything happening there, it's dynamic." With aboug 4,000 condo units set to hit downtown in the next two there is concern over what some see as an approachincondo glut. But several developers whosw projects are being marketed say saleesare strong. Experts say demand for downtown is only goinyg to increase incoming years.