Intracorp Secures $194M for Condo, One of Few Underway in Downtown Austin

AUSTIN, TX—Construction financing to the tune of $194 million has been secured for 44 East Ave., Intracorp’s first Austin development, provided by MSD Partners LP and Bank OZK. The 49-story condominium high-rise located in the Rainey Street district at 44 East Ave. is scheduled for completion in 2022 with homes available for purchase now.

“Austin’s resilience, like its dynamism, makes the city so enticing, and it’s one of the many reasons Intracorp chose to develop here,” says Don Forsgren, Intracorp president and CEO, North America. “It’s also why capital investment in this city continues to make sense even today. We are excited to complete this new financing from MSD and Bank OZK, allowing Intracorp to take an important step forward in delivering an extraordinary new residential tower to downtown Austin.”

Since breaking ground in October of last year, 44 East Ave. remains the only one planned for completion in 2022. A selection of homes available range from less than $400,000 to more than $4 million.

“One of the things that makes this project stand out is that it’s one of the only condo projects currently under construction in downtown Austin,” Brad Stein, Intracorp senior vice president, managing director, tells GlobeSt.com. “Also, we’ve experienced an unusually high volume of pre-sales in a short amount of time. Pre-sales commenced in fall 2019 and we now are at almost 50% sold.”

Residences in the tower will include one- to four-bedroom homes ranging from just under 500 square feet to more than 3,500 square feet.

“We are pleased to commit to 44 East Ave., a unique condo project being developed by a highly experienced partner in Intracorp. We believe the Austin market will again demonstrate its resilience, as the city and region continue to benefit from the relocation of large numbers of people and companies,” said Adam Piekarski, co-head of real estate credit at MSD Partners.

The property is located on the edge of Rainey Street and Lady Bird Lake, with views of the Austin skyline, and access to running and biking trails.

“This project embodies the high standards Bank OZK consistently seeks in its project financings–marquee real estate, strong market fundamentals and top-tier sponsorship,” says Victor Reynoso, executive vice president/originations for Bank OZK’s Real Estate Specialties Group.

Bank OZK was the senior secured lender on the loan.

“Bank OZK has recently financed several Austin condo projects, and MSD’s deep roots in and understanding of the Austin market is unparalleled,” says Stein. “44 East Ave. will benefit greatly from the involvement of these experienced partners in this project. Their confidence in the Austin condo market, as well as their assurance in Intracorp’s ability to deliver an iconic tower to downtown Austin, is exciting for everyone. Closing this $194 million construction loan is another major milestone for this project, and we’re looking forward to welcoming our homeowners in 2022.”

Stein points to some of the unique features of 44 East Ave., including the natural setting and the team assembled on the project.

“Rising 49 stories on the shore of Lady Bird Lake, 44 East Ave. will offer incredible views of the lake, Austin skyline and the Hill Country. The natural beauty of Austin will be right at your front door,” Stein tells GlobeSt.com. “Intracorp is working with some of the top firms in Austin on the project: Page, Michael Hsu Office of Architecture, Flintco LLC and Urbanspace. And the result will be the most intentionally designed residential experience in Austin.”

Page is the lead architect for the development and lead interior designer for the residences, with Michael Hsu Office of Architecture handling interior design for common areas and amenity spaces. Flintco LLC is the general contractor and Urbanspace is handling project sales and marketing.

At the very least, Austin’s broad-based economy is built to withstand the COVID-19 crisis in the short term due to its growing tech sector. Leading up to the pandemic, the sector was one of the fastest growing in the market with Apple and Google expanding local presences.

Since the start of the pandemic, approximately one out of every five workers is out of work, according to a recent Berkadia report. For businesses and individuals facing economic hardship because of the pandemic, the Austin City Council passed an emergency ordinance instating a 60-day grace period allowing renters to come up with the funds to pay rent or set up a payment plan with landlords before being evicted. And, many in this workforce have the flexibility to work from home and have the income to seek the abundance of class-A stock coming online once the stay-at-home order is lifted, says Berkadia.

First quarter multifamily deliveries totaled 2,611 and the occupancy rate was 94.9%, according to the report.