The 189-room hotel located at East Sixth and Brazos was acquired by Hyatt Hotel Corporation for $85 million. According to the Travis Central Appraisal District, the hotel appraised for $23.2 million last year. Hyatt is planning an $8 million renovation that will take two years to complete. Hyatt will continue to market it as the Driskell Hotel.
The sale appeared to be forthcoming based on the evidence from Hyatt’s postings and discussions among employees and the local real estate community. Randy McCaslin, vice president for Texas & Louisiana markets of PFK (a hospitality industry consulting firm) said, “Merging the quality of service and reservation system of Hyatt with a classic historic hotel with the reputation of the Driskill makes a lot of sense. The Driskill will bring a very loyal clientele to the Hyatt upscale frequent traveler program. How can you miss?”
Investment fund, Lowe Enterprises the previous owners, bought the hotel in 2005. The property, which was built in 1886, changed ownership 14 times, with Hyatt being the 14th owner. David Tarr, senior vice president of Hyatt’s North American development said, “Our investment in this hotel, which has a highly visible and long-standing presence in a vibrant market, is a great example of Hyatt’s willingness and ability to apply our capital to increase our brand presence in key locations for our guests. Austin has a diverse economy driven by technology, the state capitol, and the University of Texas, and is a rapidly growing tourism and convention market.”
In 1969 the Driskill was designated as a national historic landmark. The hotel has hosted American presidents, Texas governors, and Hollywood celebrities over the years. Destination Hotels and Resorts managed the property since 2005. Lowe Enterprises called the hotel “an irreplaceable property in an ideal location” when it purchased the property.
Hyatt’s purchase of the Driskill expands its growing presence in downtown Austin. The company operates other hotels, including a 296-room Hyatt Place at Third and Brazos, which opened last Tuesday. This is the largest Hyatt Place Hotel in the country. John Cantele, senior vice president of field operations for Hyatt, said that Hyatt is commanding the downtown Austin hotel market.
Cantele told the American-Statesman, that with occupancy at approximately 80 percent and room rates averaging $160 to $170, “whenever you can get that kind of demand in the market, and it sustains itself, there’s going to be room for additional supply.
Call us today for more information or contact us for a free business review.