Sixth Street paid $372 million for the Four Seasons Scottsdale, its third Braemar resort

Sixth Street and its partner Riller Capital bought the Four Seasons Resort Scottsdale at Troon North from Braemar Hotels & Resorts for $372 million, Hotels magazine reported Oct. 29 ^[1]. Braemar's 8-K shows the sale closed Oct. 28 for cash, to a buyer named Evergreen Acquisitions LLC ^[2].

The resort has 210 rooms on about 38 acres, with roughly 13 more acres that can be developed ^[1]. Aman Gupta, a principal at Sixth Street, cited “continued conviction in the long-term fundamentals of luxury travel” ^[1]. The property sits in the Phoenix metro.

Sixth Street has now bought three resorts from Braemar for $738 million

Scottsdale follows the $176 million purchase of the 193-key Park Hyatt Beaver Creek in Colorado in May and the $190 million purchase of the 142-key Pier House Resort & Spa in Key West in August, both with Riller ^[4][5]. Sixth Street manages more than $130 billion in assets and committed capital ^[5].

We calculate that the price per room rose with each deal, and that Scottsdale cost nearly twice as much per room as Beaver Creek.

Braemar is selling hotels on its way to becoming a self-managed REIT

Braemar is separating from its external manager, Ashford Inc., and expects to be independent by mid-November, Hotel Dive reported ^[3]. It sold the Ritz-Carlton Sarasota, Hotel Yountville and Bardessono Hotel and Spa for $437.5 million in July, and the sales plus planned refinancings are expected to cover the fees it still owes Ashford ^[3].

CEO Richard Stockton described what remains as a “focused portfolio of seven irreplaceable hotels” ^[3].

Family office money bought Miami's InterContinental a day after the Scottsdale report

On Oct. 30, Gencom and Miami-based White Bridge Capital announced they had bought the 652-room InterContinental Miami, with White Bridge and its international family office partners putting up a significant share of the equity ^[7]. Commercial Observer put the price at about $300 million and named the seller as Dajia Insurance Group ^[6]. By our math, that is roughly $460,000 a room in Miami.

How to use this

For hotel owners weighing a sale

1. Price a luxury resort per room against these trades before you hire a broker. Sixth Street paid between about $912,000 and $1.77 million a room for Braemar's three resorts, based on reported prices and room counts ^[1][4][5].
2. Put a separate value on any land you could still build on. The Scottsdale sale included about 13 developable acres beyond the resort's footprint on a 38-acre site ^[1].
3. Call repeat buyers first when you sell more than one asset. Sixth Street and Riller bought from the same seller three times between May and October ^[1][4][5], which suggests a buyer that already knows a seller's portfolio can move quickly.

For investors in hotel REITs and private hotel funds

1. Read the next quarterly filing for where sale money went. Braemar's sales and planned refinancings are expected to cover the fees it owes Ashford ^[3], so compare the amount paid in fees with the amount used to repay debt.
2. Ask a sponsor raising money for hotels who else is in the equity. White Bridge's family office partners supplied a significant share of the InterContinental Miami equity ^[7], and knowing the co-investors tells you who sits beside you if the hotel needs more capital.