Investors look to build in thriving economy
With residential and commercial building on the upswing in western Travis County, area towns are preparing for an influx of travelers seeking lake activities, shopping and dining options.
'The next great boom'
Sales tax revenue and residential sales are increasing in the Lake Travis area, Bee Cave and Lakeway, city staffers said during the Lake Travis Chamber of Commerce economic forecast luncheon July 17.
The region has recently drawn the interest of hotel builders who are planning to dot the hilly landscape with a number of brand-name hotels and a renovated resort.
"[Hotel investors] see [the area] as having a thriving economy, and they want the opportunity to capitalize on it," said Robert Kisker, Lakeway Resort and Spa general manager. "Most of the office space in Austin has been bought up and people see Lakeway and Spicewood as the next place where industry will come out—the next great boom."
One of the oldest lodging sites in the area, Lakeway Resort and Spa began in 1963 as the Lakeway Inn, Marketing Manager Erin Randell said.
Since November, the resort has undergone a $5 million renovation, including a remodeling of its 168 rooms to be completed in 2014, opening the Masterson's Steakhouse restaurant on-site and updating the meeting spaces and kitchen, Kisker said. A new air-conditioning system was installed, and heating was added to two of the hotel's three pools, he said.
A new town center proposed for Lakeway's Glen Heather Drive area may house a hotel in addition to retail, restaurants and senior housing, Lakeway City Manager Steve Jones said.
The Lakeway Regional Medical Center campus is also set to include a hotel, said Joel Canfield, KGP Holdings Inc. vice president of business development. KGP is the developer for the LRMC campus.
"The deal is about to come to the surface," Canfield said about the hotel project Aug. 27. "A hotel is being planned for the site, but information about its [name], rooms and type of product will be disclosed in 60 to 90 days."
On June 12, Omni Hotels and Resorts announced it had purchased the 309-room Barton Creek Resort and Spa, located at 8212 Barton Club Drive, as one of the five properties that comprise its Resort Collection.
"We have been looking to strategically expand our resort portfolio for quite a while," said Anne Tramer Brownlee, Omni Hotels and Resorts vice president of corporate communications.
At the time of the Barton Creek purchase from KSL Capital Partners LLC, the Omni hotel chain did not own a resort hotel in Texas, she said. The company currently owns 57 hotels and resorts, she said.
Brownlee said Barton Creek Resort and Spa's reputation as a world-class golf destination was a factor in the acquisition.
She said plans are underway to remodel the Barton Creek Resort and Spa but did not include what specifically would be renovated at the hotel or the purchase price of the facility. However, she said the renovation would be more of an enhancement than a complete change.
Omni conducts a large amount of business in Austin at its downtown and Southpark locations, Brownlee said. The international company is headquartered in Texas and counts three hotels each in San Antonio, Austin and Dallas, with two hotels in Houston and one apiece in Corpus Christi and Fort Worth, she said.
"We don't have any two hotels that are alike," Brownlee said. "Our hotels are unique to the local flavor of where they're found."
Tim Coffey, president of the Westlake Chamber of Commerce, said he is optimistic that Omni Hotels and Resorts' purchase of The Barton Creek Resort and Spa will lead to an increase in visitors to the Westlake area.
"Barton Creek [Resort and Spa] isn't hidden away, but if the Omni, a big name, is putting a branding campaign behind it, I expect it will add money to the local community without, hopefully, adding much congestion," Coffey said. "We've had a lot of growth in the west—Bee Cave and Lakeway. I think it's a good thing for everybody as long as it's done well."
Mountain Star Lodge, located in Bee Cave's extraterritorial jurisdiction on RR 620, is the only hotel in the Bee Cave area, City Manager Frank Salvato said.
Bee Cave's current status as a one-lodge town is set to change in the near future: A 195-room hotel is currently in the permitting process for a Hill Country Galleria site, Bee Cave City Councilwoman Zelda Auslander said.
Todd Runkle, managing director of global design firm Gensler, the project's architect, said the multistory Sonesta Hotel will boast a rooftop lounge with a restaurant, 8,000 square feet of meeting space, a pool and views of the Balcones Canyon Preserve. The facility, made of limestone, stucco, stained wood and metal panels, is set to open in early 2015, he said.
Still in the planning stages, the Park at Bee Cave retail site could house another hotel, said project developer Bill Walters, owner of commercial real estate firm Walters Southwest. He said his team submitted a concept site plan with a hotel to Bee Cave on June 4. However, the hotel placement was to maximize flexibility within the project, he said.
"We don't have a hotel in tow with us at the moment, and we're not presently marketing for a hotel," Walters said.
Four Points, two new hotels
The Four Points community will soon be home to two new hotels—the Holiday Inn Express at the Trails at 620 Shopping Center and the Residence Inn Riverplace at
RR 2222, which broke ground in August.
Four Points Lodging Inc.'s Holiday Inn Express is scheduled to start construction by the end of 2013 with a projected opening at the end of 2014, said Riyaz Bhaiwala, a registered agent for Four Points Lodging.
The three-story, 45,000-square-foot hotel will include 82 rooms, he said. About 900 square feet of flexible meeting space, a fitness room and a swimming pool will round out the facility, he said.
The four-story all-suite Residence Inn is planned to have 100 rooms, said Sushil Israni, managing partner for developer Pacifica Host Hotels. Similar to other Residence Inns, the hotel will offer guests free Wi-Fi and a hot breakfast, manager's receptions, full kitchenettes and an on-site market, he said. The exterior of the $12 million hotel will be stone and stucco, he said.
Hotel Occupancy Tax
With the additional hotel rooms to entice vacationers, the local economy could get a boost as well.
"More tourism in the area means stimulation to our economy and business community," said Laura Mitchell, president of the Lake Travis Chamber of Commerce.
Lakeway Communications Coordinator Devin Monk said the city's HOT went into effect July 1, 2012. The tax revenue is used to support qualified events, activities and facilities that directly promote the tourism industry in Lakeway.
The current 5 percent tax is collected by each short-term rental property, such as a hotel, doing business in the city.
On Aug. 19, Lakeway City Council authorized Jones to contract with North Star Destination Strategies Inc. to create a Lakeway brand for the purposes of defining the city's assets and enticing visitors to the area, Jones said. The $70,000 contract was paid with HOT funds.
The city is also planning to develop a convention center using HOT funds, Jones said.
Bee Cave City Council does not charge HOT in the ETJ so the city does not have a HOT at this time, Salvato said.