Sutton Co. and partners will resume construction on La Vista on Lavaca's condos, offices and more.
By Shonda Novak
AMERICAN-STATESMAN STAFF
http://www.statesman.com/news/content/business/stories/realestate/11/11//1111downtown.html
Ralph Barrera/AMERICAN-STATESMAN
La Vista on Lavaca, a 66-unit, mixed-use project in downtown Austin where construction was halted earlier this year, has new owners who say they plan to resume work on the $30 million development soon.
The Sutton Co. and two undisclosed local investors have purchased the partnership interests in the eight-story project at 17th and Lavaca streets, said Mac Pike Jr., a partner in the Sutton Co. with Wally Scott III.
Mary Guerrero-McDonald, one of the original partners, will be a partner and principal in the new project, Pike said.
Dallas-based Precept Builders will remain on the job to finish the project, which is about 30 percent complete, he said.
Pike declined to disclose terms of the purchase. He said the building will probably be renamed the Fondren Building, after one of the original investors, Gene Fondren, a longtime lobbyist for the Texas Automobile Dealers Association.
Construction is expected to restart early next year or possibly a little sooner, Pike said. The owners are targeting a late 2009 completion.
In addition to luxury condominiums, the project will include office condominiums, a restaurant, a bar and a rooftop entertainment area.
Original plans called for 31 condos and 32 office units. Pike said the newly configured project might include more offices.
Buyers of the condos are expected to include lobbyists, University of Texas alumni, legislators and state government workers.
The new owners are proceeding because downtown's overall market has remained healthy despite a national housing downturn, Pike said, and the outlook is expected to remain positive in 2009.
"With the national downturn, obviously the absorption has slowed down (downtown), but pricing appears to have remained relatively stable," Pike said.
He said Central Texas is holding up much better in the downturn, in part because "our job creation overall continues to be strong," Pike said.
"It's certainly not what it's been, but it's still positive, unlike many other areas of the country," Pike said. "And in downturns, there's always a flight to quality, and Austin is very much considered a quality city in this country."
Based on the closings this year at three new condo projects — 360, Bridges on the Park and the Shore — more than 90 percent of the completed units were sold, said Charles Heimsath, a real estate consultant. More than half of the units in projects under construction are under contract with nonrefundable deposits, he said.
However, Heimsath said there had been a slowdown in new sales downtown.
La Vista was announced in 2000 but was delayed after the 2001 terrorist attacks. Construction started in early 2007 but was halted earlier this year after Fondren became ill.
The stoppage created headaches for many downtown workers because West 17th Street and part of Lavaca's right lane remained closed even after construction had stopped.
Pike said 17th Street will remain closed for several months. However, he said, "it's a top priority for us to get 17th Street back open again."
The project will be resuming as the Legislature convenes in January. "The session will bring a significant number of the potential buyers from that market to Austin," Pike said.
The Sutton Co. has developed projects in Central Texas for more than 20 years and was a principal in the Plaza at West Fifth and Guadalupe streets, as well as the Brazos Lofts and the Avenue Lofts.
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