Peachtree Group and Merritt Development Group Break Ground on 480-Room Dual-Branded Hotel in Downtown Austin

Peachtree Group and Merritt Development Group have broken ground on a 480-room dual-branded hotel tower in downtown Austin, the firms announced Sept. 18, marking one of Peachtree Group's most significant hotel developments to date.

The 30-story tower at 415 Lavaca Street — at the corner of West Fifth Street and Lavaca Street — will house both an Embassy Suites by Hilton and a Tempo by Hilton under one roof. The project spans approximately 336,800 square feet and is scheduled to open in early 2029. DPR Construction is serving as general contractor, and DLR Group is serving as both architect and interior designer.

Dual-Brand Strategy Targets Distinct Guest Segments

The development pairs two distinct Hilton brands under a shared operating structure. Embassy Suites by Hilton will offer a full-service, all-suite format oriented toward extended-stay and group travelers, while Tempo by Hilton — Hilton's lifestyle brand — is designed for modern travelers. The two brands will share amenities and operating infrastructure, a configuration intended to improve operating efficiency while serving different demand segments.

Amenities will include an approximately two-story signature lifestyle restaurant at the podium level, a rooftop bar and lounge with views of the downtown Austin skyline, an Embassy Suites restaurant and bar, a Tempo café, meeting and event space, and a fitness center. Meeting facilities are expected to include a ballroom and conference center with pre-function space, private meeting rooms, and an outdoor terrace at the 28th floor level.

"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."

David Merritt, president and owner of Merritt Development Group, echoed that view. "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," he said. "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."

Site Positioned at Core of Downtown Austin's Demand Base

The 415 Lavaca Street site sits within the central business district, surrounded by approximately 14 million square feet of Class A office space. The property is within walking distance of the Texas State Capitol, the University of Texas at Austin, Sixth Street, and the Red River Cultural District — a concentration of corporate, government, education, and entertainment demand generators that Peachtree cited as central to its investment thesis.

The five-county Austin region is home to approximately 2.6 million people, with Opportunity Austin projecting that figure to reach 3.23 million by 2035. That population growth has been accompanied by sustained corporate in-migration and rising hotel demand across business, leisure, and group travel segments.

Infrastructure Expansions Frame the Development Timeline

The project's early-2029 opening is timed to align with two major public infrastructure investments that are expected to reshape Austin's hospitality demand profile. The Austin Convention Center is undergoing a $1.6 billion redevelopment and expansion anticipated to come online around the same period, materially increasing the city's capacity to host large conventions and trade events. Austin-Bergstrom International Airport is also undergoing a multibillion-dollar expansion aimed at significantly increasing passenger and gate capacity.

Demolition at the 415 Lavaca Street site began earlier in 2026 ahead of the formal groundbreaking. With limited new hotel supply expected to deliver in downtown Austin in the years ahead, Peachtree and Merritt Development Group are positioning the property to capture demand from an expanding convention calendar, growing air connectivity, and the city's established base of corporate and leisure travelers.

Sources

Peachtree Group — Peachtree Begins Construction on 480-Room Dual-Branded Austin Hotel