Stratus Properties Inc. Announces Agreement to Sell Block 21 for $275 Million to Ryman Hospitality Properties, Inc.
Stratus Properties Inc.(NASDAQ: STRS) announced today that it has agreed to sell Block 21 to Ryman Hospitality Properties, Inc. for $275 million, which includes the purchaser’s assumption of approximately $142 million of existing mortgage debt. The remainder of the purchase price will be paid in cash.
Block 21 is Stratus’ wholly owned mixed-use real estate development and entertainment business in downtown Austin, Texas that contains the 251-room W Austin Hotel and is home to Austin City Limits Live at the Moody Theater, a 2,750-seat entertainment venue that serves as the location for the filming of Austin City Limits, the longest running music series in American television history. Block 21 also includes Class A office space, retail space and the 3TEN ACL Live entertainment venue and business.
Stratus is currently considering options for the use of the net proceeds of the sale and for its future real estate development and leasing operations, and expects to engage a nationally recognized financial advisor to assist in its evaluation of its options after the sale of Block 21.
William H. Armstrong III, Chairman of the Board, President and Chief Executive Officer of Stratus, said, “Ryman Hospitality Properties is a great company that understands and respects the strong connection that exists between Austin and its music scene. We think Ryman Hospitality Properties’ expertise in both hospitality and live entertainment, plus their demonstrated stewardship of the iconic Ryman Auditorium and Grand Ole Opry make them the ideal company to usher Block 21 and ACL Live into their next decade.”
The transaction is expected to close in the first quarter of 2020, subject to the satisfaction of closing conditions including the consent of the loan servicer to the purchaser’s assumption of the existing mortgage loan, the consent of the property manager, an affiliate of Marriott, to the purchaser’s assumption of the hotel operating agreement, and other customary closing conditions. The Block 21 purchase agreement will terminate if all conditions to closing are not satisfied or waived by the parties. Ryman Hospitality Properties will deposit $15 million in earnest money to secure its performance under the agreements governing the sale.
Colin Reed, chairman and CEO of Ryman Hospitality Properties, said, “The Stratus team has done a remarkable job realizing Stratus’ vision for Block 21 with high-quality brands, like W Hotels, and entertainment choices, like Austin City Limits. We believe Block 21 is an ideal addition to our existing portfolio of entertainment and hospitality assets.”
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