Peachtree Group Begins Construction on 480-Room Dual-Branded Hilton Hotel in Downtown Austin
Peachtree Group, a vertically integrated investment and asset management firm, has begun construction on a major new hospitality development in downtown Austin, Texas. The project will feature a 480-room dual-branded hotel combining Embassy Suites by Hilton and Tempo by Hilton, marking one of the most significant hotel developments undertaken by Peachtree Group.
Located at the corner of Fifth and Lavaca streets, the 30-story development is expected to open in early 2029. Peachtree Group and Merritt Development Group are co-developing the project, with DPR Construction serving as the general contractor and global design firm DLR Group responsible for architecture and interior design.
The development is designed to bring together two distinct Hilton hotel brands within one property, creating a hospitality destination intended to serve business travelers, groups, tourists and leisure guests visiting downtown Austin.
Dual-Branded Hotel Development
The project will include guestrooms across both Embassy Suites by Hilton and Tempo by Hilton. Embassy Suites is known for its full-service, all-suite accommodations, while Tempo by Hilton is a lifestyle brand developed for modern travelers seeking a contemporary hotel experience.
Combining the two brands within a single development is expected to provide different types of travelers with accommodation options while allowing the property to share selected amenities and operational infrastructure.
The development will include a range of upscale facilities designed to support both hotel guests and visitors from the surrounding downtown area. Planned amenities include an approximately two-story signature lifestyle restaurant, a rooftop bar and lounge offering views across downtown Austin, an Embassy Suites restaurant and bar, a Tempo café, meeting and event facilities, and a fitness center.
The rooftop venue is expected to become one of the property’s prominent features, taking advantage of the hotel’s 30-story height and central downtown location.
“Austin continues to distinguish itself as one of the country’s most dynamic growth markets, and we believe this is an exceptional location for a development of this scale,” said Greg Friedman, CEO and managing principal of Peachtree Group.
“Bringing Embassy Suites and Tempo together allows us to serve a broad range of business, group and leisure travelers while creating a differentiated hospitality experience in the heart of downtown. This is a significant investment in Austin and reflects our conviction in the long-term growth of the city.”
Prime Downtown Austin Location
The hotel will be positioned in the center of downtown Austin, surrounded by approximately 14 million square feet of Class A office space. Its location also places the development near several of the city’s major business, cultural, educational and entertainment destinations.
Nearby attractions and demand generators include the Texas State Capitol, the University of Texas at Austin, Sixth Street and the Red River Cultural District.
The location is expected to support a wide range of travel demand. Corporate visitors can access downtown offices and government facilities, while leisure travelers will be within convenient reach of Austin’s entertainment, dining and cultural destinations.
The proximity to the University of Texas also provides access to an important source of education-related travel, including visitors attending university events, conferences and activities.
Austin Growth Supports Hospitality Demand
The hotel development comes as Austin continues to experience population growth and significant public and private investment. The five-county Austin region is home to approximately 2.6 million people, while Opportunity Austin projects the regional population will reach 3.23 million by 2035.
Population growth and economic expansion are contributing to demand for additional infrastructure, commercial development and hospitality facilities across the region.
Major infrastructure projects are also being undertaken to accommodate Austin’s growing population and visitor activity. Among them is the approximately $1.6 billion redevelopment and expansion of the Austin Convention Center, which is expected to strengthen the city’s ability to host conventions, meetings and large-scale events.
Austin-Bergstrom International Airport is also undergoing a multibillion-dollar expansion designed to increase passenger and gate capacity. Improved air connectivity could further support business and leisure travel to the region as the city continues to expand its role as a major destination.
These investments are expected to support hospitality demand from a variety of market segments, including corporate travelers, convention attendees, government visitors, university-related travelers and tourists.
Meeting Diverse Traveler Needs
The dual-brand concept is intended to capitalize on Austin’s broad mix of travel demand. Embassy Suites by Hilton will provide an all-suite offering suited to business travelers, families and groups seeking additional space, while Tempo by Hilton will target travelers interested in a contemporary lifestyle-oriented hotel experience.
Sharing a single development allows the brands to operate alongside each other while maintaining their individual identities. Common facilities such as meeting spaces, dining venues and other amenities can help create an integrated hotel destination.
The project’s meeting and event facilities are particularly relevant to Austin’s growing convention and corporate markets. Expanded convention infrastructure could generate additional demand for hotel rooms, meeting space and dining facilities in the downtown area.
Development Team
Peachtree Group and Merritt Development Group are working together to deliver the project. The partnership combines Peachtree’s investment and hospitality expertise with Merritt Development Group’s development experience in the Austin market.
“Austin’s continued evolution as a corporate, entertainment and tourism destination makes this an exciting time to bring a project of this caliber to downtown,” said David Merritt, president and owner of Merritt Development Group.
“The location at Fifth and Lavaca puts the hotel at the center of everything that makes Austin such a compelling destination. We are pleased to once again partner with Peachtree to bring this development to life.”
DPR Construction has been selected as general contractor, while DLR Group is serving as architect and interior designer. The teams will work together through construction and design to deliver the 30-story development.
Outlook for the Austin Hospitality Market
The new hotel is being developed against a backdrop of continued investment in Austin’s transportation, convention and commercial infrastructure. As the regional population grows and the city’s business and tourism profile expands, demand for hotel accommodations is expected to come from multiple sectors.
The combination of convention expansion, airport improvements, downtown office activity, university-related travel and leisure tourism provides several potential sources of hotel demand.
With construction now underway, the 480-room Embassy Suites by Hilton and Tempo by Hilton development is expected to open in early 2029. The project will add a large-scale hospitality property to downtown Austin while introducing two Hilton brands within a single development.
For Peachtree Group and Merritt Development Group, the project represents a substantial investment in one of Texas’s growing urban markets. Its central location, broad range of amenities and dual-brand strategy are designed to serve the diverse business and leisure travel needs expected to accompany Austin’s continued economic and population growth.
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