In an exciting development for the San Marcos area, Texas State University has announced plans for a $40 million hotel project designed to enhance the university’s presence and stimulate local economic growth. On July 7, 2025, the university revealed details about the project, called “Project Cat Tree,” which will bring a much-needed hospitality option to the city while providing high-quality accommodations for university visitors, athletes, and tourists.
Project Overview: A New Hub for San Marcos
The proposed hotel will feature 130 rooms along with a rooftop bar, restaurant, meeting spaces, and an outdoor amphitheater. The inclusion of a rooftop bar and amphitheater aims to make the space a destination venue for both university events and public gatherings, adding a new layer of vibrancy to downtown San Marcos. The hotel’s design will reflect the university’s modern aesthetic and commitment to sustainability, offering an upscale yet accessible lodging experience.
The hotel will be located on Texas State University-owned land near downtown San Marcos, strategically positioned to attract both university-related visitors and tourists coming to explore the city. The university’s proximity to Central Texas and the Hill Country makes it a prime location for a project like this, offering visitors a blend of academic culture and natural beauty.
Economic Impact: Jobs and Growth for the Region
The hotel project is not just a win for Texas State University, but for the entire San Marcos community. The city council has approved a performance-based incentive package worth $9.1 million, which will help facilitate the hotel’s construction. This package includes rebates on hotel occupancy taxes and sales taxes, which are contingent on meeting the $40 million investment target and creating hundreds of jobs in the process.
Construction of the hotel is slated to begin by the end of 2026, with completion expected within 30 months. The hotel will create between 207 and 256 jobs, including positions in hospitality, management, and construction. Furthermore, the project is expected to generate an estimated $2.4 million in property taxes over the next decade, contributing significantly to the local economy.
A Strategic Move for Texas State University
As Texas State University continues to expand its role as a key academic institution in the region, this hotel project aligns with its broader vision of enhancing student life and supporting university events. The addition of high-quality accommodations will be a major asset for university programs, conferences, and sports teams, particularly as Texas State joins the Pac-12 athletic conference.
The hotel will provide visitors, alumni, and parents with a comfortable and convenient place to stay during events, while also supporting the university’s athletics department by providing lodging for sports teams during away games. With increased attendance at university events, the hotel could become a major asset for Texas State, boosting campus life and generating additional revenue for university programs.
Transforming San Marcos into a Premier Destination
In addition to benefiting the university, Project Cat Tree is poised to make San Marcos a more prominent destination for both tourists and business travelers. The project will help draw more people to the area, contributing to a booming tourism economy in Central Texas. Visitors will enjoy easy access to local attractions, including the San Marcos River, the Historic Downtown District, and The Meadows Center for Water and the Environment. The hotel will create a synergy between the university and the local community, benefiting both sectors.
As the university continues to grow and attract more students, faculty, and visitors, the hotel will be a vital part of the city’s infrastructure, helping San Marcos become a dynamic, thriving community that blends academics, tourism, and local culture.
