Meet the Denny’s Condo Tower, Rising 18 Floors Near Downtown Austin


A view of the Denny’s site near I-35 and East MLK Jr. Boulevard planning a condo redevelopment. 

Austin’s late-night dining scene ain’t what it once was. In a post-pandemic world where usual suspects like Kerbey Lane and Magnolia Cafe shutter up tight at 10 p.m., Ken’s Donuts pushes daisies, and 24 Diner is more like 16 Diner, your options past closing time have recently turned less local — so the question becomes whether you’re an IHOP or a Denny’s kind of person. (Visit the IHOP near Rainey Street after the bars close on a weekend and you’ll come away with the impression that everyone in the building deserves to be paid at least $100 an hour and issued a stun gun.

Anyway, if you happen to be a Denny’s fan, please take this next item sitting down — the fairly unsung location near downtown, situated next door to the DoubleTree hotel at the corner of East 16th Street and the I-35 Frontage Road not far from the East MLK Jr. Boulevard intersection, will soon be redeveloped into an 18-story condo tower. Recent city permit activity shows a rezoning case is currently pending for the 1.28-acre tract at 1601 North I-35, seeking a planned development agreement allowing denser residential use from the current limitation of no more than 170 units per acre.

Permit documents describing the project, which use the amusing placeholder name “Denny’s Condos,” indicate a 250-unit condo building in the works by real estate firm Ledgestone Development Group, which has already kicked off a number of interesting local residential projects including the Station at St. Elmo community in South Austin — you can see some snazzy renderings of that development below:

The tower will contain 178 one-bedroom and 72 two-bedroom residences, with 10 percent of the total units designated as income-restricted — providing a total of 25 affordable units, 18 one-bedroom and seven two-bedroom. Although there’s no telling where the local real estate market’s going to go by the time this building’s finished, these rezoning documents include an estimated sales price of $400,000 to $750,000 for residences in the building, with floor plans ranging from 550 to 1,100 square feet.

While you might not be overwhelmingly enthused by the prospect of living directly adjacent to the highway, we’re bullish on these kinds of projects for several reasons. The success of buildings like the Tyndall and the Avenir indicates that there’s demand for these communities, especially since their location — outside downtown but directly adjacent to it, like literally seconds away — allows for notably lower unit prices compared with new-build tower projects in downtown proper.

Thinking longer-term, there’s a good chance that various “cap and stitch” modifications to I-35 over the next few decades will improve the pedestrian environment around these parts — the presence of the emerging Innovation District across the highway from the Denny’s site along with the new Moody Center makes us fairly confident that the highway crossing at MLK Jr. Boulevard will someday be substantially upgraded, at least “stitched” if not fully capped.

In our vision of Austin’s future, we’d like to see infill projects on this side of the highway eventually meaningfully connected with the rest of downtown, perhaps not fully erasing but at least blurring the arbitrary barrier of I-35 between East Austin and the central city — and projects like this, replacing a chain restaurant and parking lot with dense housing, make that future easier to imagine. Anyway, if you consider yourself a Denny’s enthusiast, better go get that Grand Slam while you can.


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