Early this year, news broke that Rise on 8th, a 22-story multifamily apartment tower at 805 Nueces Street, was sold less than a month after its completion. 54 Madison Partners purchased the property from original developers Aspen Heights Partners with the rumored intent of converting the building’s units to timeshare-style vacation rentals.
Now, new city filings for the property confirm that theory, revealing Wyndham Worldwide as the previously unknown hospitality company that’s partnered with the new owners for the branding of the building’s conversion. Of course, considering that 54 Madison Partners already owns three Wyndham properties, including the Wyndham Desert Blue, Wyndham Midtown 45, and Wyndham Resort at Avon, it wasn’t so hard to guess — but now we know for sure!
Looking at the three existing Wyndham properties owned by 54 Madison gives us a pretty good idea of what to expect at the project currently known only as “Austin Wyndham.” These buildings are run as vacation properties under the Club Wyndham ownership program, which is sort of a 21st-century adaptation of the classic timeshare model with more flexibility — allowing members to accrue points each year that can then be spent on vacation rentals at any resort in the Wyndham network.
This raises some questions. When rumors first emerged about this conversion, I wondered if the building would be remarketed with units for sale, as a sort of condotel — a property that’s legally classified as a condominium, but also maintains a front desk that rents rooms to guests like any hotel. Owners at a condotel are usually provided the option of allowing the building to rent their vacation properties to guests when they’re not using the unit, generating profit for both unit owner and management.
But now that we’ve basically received confirmation that this property will use the Club Wyndham model, things get a little murky. Since these properties appear to operate entirely off this points system for members, there’s no real ownership going on — even if you wanted to, as far as I know there’s no way to just buy one of these condos outright. Non-members can rent rooms at these properties through the Wyndham Extra Holidays program, which company reps tell me is functionally a separate entity from Club Wyndham despite being owned by the same parent company.
Though the city permits describe the property as a timeshare, it sounds a bit more like what’s called a non-equity destination club, in which members don’t actually own an interest in the club’s properties and are thus not entitled to things like appreciation, but are also protected from potential market losses. It’s kind of a headache to figure out, and what I’m still not clear on is whether this building will be permitted to keep its multifamily classification even if Club Wyndham members aren’t holding equity in the property. Someone smarter than me will have to explain that whole thing.
But in the end, what does this mean? Let’s review here: 54 Madison wants Austin as the fourth entry in its Wyndham portfolio, placing our city alongside resorts in Las Vegas, Midtown Manhattan, and the slopes of one of Colorado’s most celebrated skiing destinations. I know we’re witnessing a hotel boom and frequently being called the best place to live in America, but it’s still kind of jarring to see Austin become such a global city in the eyes of developers.