Brookfield buys Phoenix’s largest hotel from Blackstone

PHOENIX — Brookfield Hotel Properties has acquired the 1,003-key Sheraton Phoenix Downtown, the largest hotel in the city, from Blackstone for an undisclosed amount.

The property last sold in January 2020 for $268 million when Blackstone purchased the hotel from Marriott International. Marriott had purchased the hotel 18 months earlier from the city of Phoenix.

The hotel opened during the height of the Great Recession in 2008, and a report in the Arizona Republic in April 2015 said it had lost about $38 million since opening. In 2015, the city was refinancing the property’s debt, which would eventually pave the way for the sale to Marriott. The report said at the time, the city owed about $330 million in property. 

The hotel underwent $45 million in renovations in 2020. It has over 112,000 sq. ft. of flexible event and meeting space, including 27,200 sq. ft. and 14,000 sq. ft. ballrooms. The property sits just two blocks from the Phoenix Convention Center.

JLL represented Blackstone in this latest deal.

“The Sheraton Phoenix Downtown represents the rare combination of institutional quality, strategic location and significant scale that attracts best-in-class capital,” said JLL senior director Matt Riley, who led the transaction. “Phoenix has established itself as one of the most dynamic lodging markets in the United States… [and] this transaction validates the strength of the market fundamentals and the appeal of irreplaceable urban assets.”

Earlier this year, Trinity Investments sold the 950-key JW Marriott Phoenix Desert Ridge Resort & Spa, the largest resort in the city, for $865 million to Ryman Hospitality Properties. Trinity Investments acquired the asset in 2019 for $602 million and completed a nearly $100 million renovation project for the property, including the addition of a water park complex.