Local Investor Purchases Property with Plans to Improve Operations in Dynamic Market
Phoenix, Arizona – A private investor in Scottsdale has purchased the Comfort Suites Old Town Scottsdale at 3275 N. Drinkwater Blvd. for $7.25 million ($120,833 per key).
The investor, who specializes in hospitality properties, plans to update the operations of the hotel and take advantage of quality market conditions in the Old Town Scottsdale hotel industry.
The Comfort Suites Old Town Scottsdale is situated on 1.32 acres of land an includes 32,436-square-feet of space. The 60-room suites hotel was constructed in 1995.
The Scottsdale investor purchased the property from Colony North Star REIT, with offices in Los Angeles and New York. James Meng and Jon Grantham of Colliers International in Greater Phoenix negotiated the purchase on behalf of the buyer. Colony North Star represented itself in the transaction.
“This is a great example of the Colliers International Hotel team working with institutional ownership to provide an otherwise unobtainable opportunity to the private capital pool,” says Meng.
According to Meng, Phoenix is experiencing pressure from both fronts for pricing of assets. We have an expanding 10-year bond rate on one side and cap rates compressing from out of state buyers seeking higher spreads than what they would receive in west coast gateway cities.
“Utilizing our institutional connections and experience in operations, we were able to connect the bridge by providing Colony North Star a great price and the private investor the opportunity to capitalize on a newly renovated hotel in one of Phoenix’ hottest submarkets,” says Grantham.
Colony North Star currently has assets under management of $43 billion and manages capital on behalf of stockholders, as well as institutional and retail investors in private funds, non-traded and traded real estate investment trusts and registered investment companies. In addition, the company owns North Star Securities, LLC, a captive broker-dealer platform which raises capital in the retail market. The firm maintains principal offices in Los Angeles and New York, with more than 500 employees in offices located across 18 cities in 10 countries.