The iconic Phoenician Resort in Scottsdale has sold for $400 million ($622,000 per room) to Bethesda-based Host Hotels & Resorts (NYSE: HST). The 643-room resort overlooks 300 acres at the base of Camelback Mountain and will be refreshed and updated by the new owner.
The resort features nine food and beverage outlets, approximately 83,500-square-feet of indoor meeting space, and world-class recreation facilities, including a 27-hole championship golf course, seven outdoor pools and a 25,000-square-foot spa and fitness center.
While the current hotel site allows for future residential development and up to 40 additional rooms, the purchase also includes two adjacent parcels of land totaling over nine acres zoned for residential development.
In 1985, Charles H. Keating had a vision to build a multi-million dollar, Five Diamond resort that would display the elegance and sophistication of Europe, standing out as a sparkling gem in the Sonoran Desert. Keating purchased the land at the base of Camelback Mountain, as it was the most recognizable location in the Valley, providing dramatic views of the city skyline. To build his special palace, no expense was spared and no detail was overlooked.
It was not Keating’s intent to make The Phoenician indigenous to its environment, white marble was imported from Carrera, Italy for the lobby; the ceiling was etched in 24-karat gold, and 11 rare Steinway pianos, grace the hallways. In addition, workers from the Island Kingdom of Tonga were hired to create a lush tropical landscape to complement the resort’s Sonoran Desert backdrop.
Over the years, The Phoenician has changed ownership several times. Most notorious was the seizure of the property by federal regulators in November 1989, after fraud and racketeering charges were filed against Charles H. Keating. (During the ensuing years, the resort was facetiously referred to as “Club Fed”). In 1991, The Phoenician was sold to the Kuwaiti Investment Office. The resort ran “business as usual” under that management model until 1994, when it was purchased by ITT Sheraton. Four years later, Starwood Hotels & Resorts completed the acquisition of Sheraton and rebranded it a member of Starwood’s exclusive Luxury Collection.
The hotel is one of only a handful of luxury destination resorts in the country that caters to both high-end transient and group customers.
The AAA Five-Diamond, Forbes Four-Star rated property is ideally located in one of the premium resort markets in the southwest, within close proximity of the nightlife, galleries, museums and businesses of downtown Scottsdale.
Host has plans to undertake a comprehensive renovation that will strategically occur during the hotel's seasonal, low-occupancy summer periods to minimize disruption.
Starwood will continue to operate the hotel under The Luxury Collection® brand flag. The Company believes the Phoenician will benefit from synergies with its Westin Kierland Resort, which is also operated by Starwood.
Host Hotels & Resorts, Inc. is an S&P 500 and Fortune 500 company and is the largest lodging real estate investment trust and one of the largest owners of luxury and upper-upscale hotels. The Company currently owns 97 properties in the United States and 16 properties internationally totaling approximately 59,000 rooms. The Company also holds non-controlling interests in five joint ventures, including one in Europe that owns 18 hotels with approximately 6,200 rooms and one in Asia that has interests in four hotels in Australia and India.
The Company partners with premium brands such as Marriott®, Ritz-Carlton®, Westin®, Sheraton®, W®, St. Regis®, Le Meridien®, The Luxury Collection®, Hyatt®, Fairmont®, Hilton®, Swissotel®, ibis®, Pullman®, and Novotel® as well as independent brands in the operation of properties in over 50 major markets worldwide. For additional information, please visit the Company's website at www.hosthotels.com.
