Austin's State Theatre to undergo big makeover thanks to downtown hotel neighbor

Thanks to an ongoing partnership between an Austin arts group and developers of a hotel next door, the State Theatre on Congress Avenue is set to undergo a comprehensive makeover. Construction is expected to start in early 2025, and the reimagined theater is expected to open in early 2026.

The Austin Theatre Alliance, which operates the Paramount and State theatres, and the Denver-based McWhinney real estate firm, which owns the Hyatt Centric, are planning to transform the State, built as a movie theater by the Dallas-based Interstate chain in 1935, into a first-class performing arts venue. The theater and the hotel share a foundation constructed in the late 1920s.

"It's a complicated build," said Jim Ritts, executive director and CEO of the Theatre Alliance. "It encompasses two buildings while keeping the State's historic façade. The Austin Theatre Alliance will be funding the complete re-imagining of the State and it will be funded through a capital campaign."

Renderings of the renewed State by the design firm Clayton Korte show four art-deco-inspired levels behind the historic façade, connected by a spiral staircase. Three lobbies with attendant bars — one of them outside, overlooking the avenue — lead to three sets of seats, while a fourth lobby will unfurl into an underground "speakeasy."

The seats on two levels will be fixed on risers, but the lowest level will be "telescoped" for flexible seating, including movable cabaret tables placed around the performance area.

The hotel’s restaurant will provide catering services when the State hosts daytime corporate events.

At its maximum capacity, the State, previously closed and renovated twice, once because of flood damage, could hold about 500 people. More often it will seat 425-450. Currently, it seats closer to 300.

Along with the four bars, the State will increase the number of restrooms.

As for the restored façade, the old vertical sign might be replaced by a replica, like the Paramount's current vertical sign. "It's under serious consideration," said Emily Little, restoration architect with Clayton Korte.

"The reconfiguring of the State will give us the flexibility to partner with arts companies that don't have a venue," said Ritts, "but that do good work and have a season to present."

State Theatre, Hyatt Centric 'joined at the hip'

The builders of Hyatt Centric could not have raised the hotel tower without altering the State at the same time. The State could not be reconfigured without a partner on the corner. The two properties at the northern end of the 700 block of Congress Avenue were originally developed on the same pan-like structural foundation from the late 1920s.

"We're not just neighbors," Ritts said. 'We're joined at the hip, for goodness' sake. Both the hotel and the State Theatre projects were enabled by each other."

Ritts sought partners for years to replace what was once a low, long-empty building on the corner. When he came on as the Theatre Alliance's leader 13 years ago, he tried to buy the property.

After many attempts and designs — "I was very young when this project began," Ritts joked — a partnership with Congress Development Partners and Brad Nelsen went forward with a garage-less condo project. That transitioned into a hotel with just 10 rooms per floor, along with a sidewalk-level restaurant, Luminaire; an upstairs bar, La Bis; and check-in area that opens onto a rooftop lounge.

More: A populist palace, the Paramount has hosted top acts for 100 years

The hotel was designed and decorated with theatrical themes that include old posters in each room and references to the State and Paramount throughout.

The Theatre Alliance has already moved half of its more than 60 full-time employees into offices in the Hyatt Centric's "pencil tower" at Congress and East Eighth Street. The nonprofit will pay a nominal fee of $1 a year for the up-to-date offices as part of a 99-year-lease deal to exploit the basement shell that the theater and the hotel share.

The Theatre Alliance has already completed funding and building of the new dressing rooms, green room and production areas that are in the basement of 721 Congress, the site of the Hyatt Centric Hotel.

'It's nice to see very progressive things like this happen'

The joint project, which has attracted more foot traffic and nightlife outlets to the 700 block of Congress since the hotel opened earlier this year, mirrors what is happening with the Austin Symphony at the new mixed-use Symphony Square towers off Red River Street.

The Symphony Square complex's developer, Greystar, which used the symphony's long-term land leases and its existing brand to develop its project, will provide the nonprofit with a stand-alone, two-story office building behind the historic Symphony Square. It is due to be completed in early 2024.

"We'll have state-of-the-art offices that will make us more efficient and effective in what we do," said symphony CEO and Executive Director David Pratt. "There's no way we'd have the cash to do this previously."

The theater and symphony deals echo three current partnerships between arts nonprofits and the owners of former religious venues, as well as a collaboration between the nonprofit Waterloo Conservancy and for-profit music promoter C3 Presents at the Moody Amphitheater, which has been made available for a multitude of arts and music groups of all sizes.

More: The Mystery of the Missing Paramount Theatre Sign

Ten years ago, headlines somberly repeated the story that arts and music venues were disappearing because of soaring real estate values and new development in the central city. Some were lost, but others are taking their places.

A good example is Inn Cahoots, a hotel-and-nightlife complex on East Sixth Street that added three small music stages as part of its attached Austin Garden & Studio, recently opened to the public.

Several new art galleries have been added in East Austin, including a "forever home" for Women & Their Work. Larger venues, such as the Blanton Museum of Art, have added exterior design elements to connect the University of Texas campus with outside entities, such as parts of the new Capitol Mall.

More: Tour the more than 30 structures lining the 'Mall of Texas' Capitol Complex

The current trend mirrors somewhat the scene in New York City during the 1970s when developers were demolishing old Broadway theaters to throw up new towers. The city offered to loosen height restrictions on the condition that fresh building projects would include new theaters. Some of those venues now house nonprofit theatrical companies, others for-profit Broadway shows.

"The arts community does not exist in a bubble from the rest of the world," Ritts said about the new leading-edge partnerships around the city. "It's nice to see very progressive things like this happen."

This article originally appeared on Austin American-Statesman: Austin's State Theatre getting makeover with Hyatt Centric partnership