Stratus Properties Inc. Obtains Construction Financing for Kingwood Place
December 12 2018 - 8:30AM
Business Wire
Stratus Properties Inc. (NASDAQ: STRS) announced today that on
December 6, 2018, Stratus Kingwood Place, L.P., a subsidiary of
Stratus, entered into a construction loan agreement with Comerica
Bank, which supersedes and replaces the land acquisition loan
agreement and related documents dated August 6, 2018 and provides
for a loan in the amount of approximately $32.9 million to finance
nearly 70 percent of the costs associated with construction of
Kingwood Place, an approximately $48 million H-E-B, L.P.
(HEB)-anchored mixed-use development project in Kingwood, Texas.
The remaining 30 percent of the project’s costs (totaling
approximately $15 million) is being funded by borrower equity,
contributed by Stratus and private equity investors. The loan also
provides that the maturity date of the loan is December 6, 2022,
with the possibility of two twelve-month extensions, subject to
satisfying specified conditions.
The development plan for Kingwood Place includes a
103,000-square-foot HEB grocery store, 41,000 square feet of retail
space, 6 retail pads and an approximate 10-acre parcel planned for
approximately 300 multi-family units. Stratus has engaged an agent
to market and sell, subject to market conditions, the multi-family
parcel to a third party developer.
William H. Armstrong III, Chairman of the Board, President
and Chief Executive Officer of Stratus stated, “We are pleased to
announce that we have secured financing for the construction of
Kingwood Place, a new development project in the Houston area. We
value our longstanding relationship with Comerica and appreciate
their confidence in our strategy as we continue to expand our
portfolio of development projects beyond Austin to other select,
fast-growing Texas markets. We look forward to enhancing the value
of this property and creating value for our shareholders.”
Construction of Kingwood Place is expected to begin in
mid-December. The HEB grocery store is anticipated to open in
third-quarter 2019.
Stratus is a diversified real estate company engaged primarily
in the acquisition, entitlement, development, management, operation
and sale of commercial, hotel, entertainment, and multi- and
single-family residential real estate properties, primarily located
in the Austin, Texas area, but including projects in certain other
select markets in Texas.
Cautionary Statement Regarding Forward-Looking
Statements. This press release contains forward-looking
statements in which Stratus discusses factors it believes may
affect its future performance. Forward-looking statements are all
statements other than statements of historical fact, such as
statements regarding the implementation, projections or
expectations related to the future development, construction and
completion of Stratus' projects, financing and regulatory matters,
development plans and sales of properties, including, but not
limited to, exploring opportunities to sell the parcel planned for
the multi-family site, timeframes for development, and other plans
and objectives of management for future operations and activities.
The words “anticipates,” “may,” “can,” “plans,” “believes,”
“potential,” “estimates,” “expects,” “projects,” “intends,”
“likely,” “will,” “should,” “to be” and any similar expressions
and/or statements that are not historical fact are intended to
identify those assertions as forward-looking statements. Nothing
contained in this press release should be construed as an offer to
sell or the solicitation of an offer to buy any securities.
Stratus cautions readers that forward-looking statements are not
guarantees of future performance, and its actual results may differ
materially from those anticipated, expected, projected or assumed
in the forward-looking statements. Important factors that can cause
Stratus' actual results to differ materially from those anticipated
in the forward-looking statements include, but are not limited to
the availability of financing for development projects and other
corporate purposes, Stratus’ ability to sell properties at prices
its Board considers acceptable, a decrease in the demand for real
estate in the Austin, Texas area and other select Texas markets
where Stratus operates, changes in economic and business
conditions, reductions in discretionary spending by consumers and
corporations, competition from other real estate developers,
Stratus’ ability to attract tenants and customers for its
developments, increases in interest rates, declines in the market
value of Stratus’ assets, increases in operating costs, including
real estate taxes and the cost of construction materials, changes
in consumer preferences, changes in laws, regulations or the
regulatory environment affecting the development of real estate,
opposition from special interest groups with respect to development
projects, and other factors described in more detail under the
heading “Risk Factors” in Stratus’ Annual Report on Form 10-K for
the year ended December 31, 2017, filed with the U.S. Securities
and Exchange Commission (SEC) as updated by Stratus' subsequent
filings with the SEC.
Investors are cautioned that many of the assumptions upon which
Stratus’ forward-looking statements are based are likely to change
after the forward-looking statements are made. Further, Stratus may
make changes to its business plans that could affect its results.
Stratus cautions investors that it does not intend to update its
forward-looking statements more frequently than quarterly
notwithstanding any changes in its assumptions, business plans,
actual experience, or other changes, and Stratus undertakes no
obligation to update any forward-looking statements.
A copy of this release is available on Stratus'
website, www.stratusproperties.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20181212005413/en/
Financial and Media Contact:William H. Armstrong III(512)
478-5788
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