2 Tempe hotels get new owners; makeovers planned

Tempe tourism is getting a boost with two big hotel makeovers in the works. The Sheraton Phoenix Airport Hotel, a 210-room property at 1600 S. 52nd St., was purchased by JER Partners, a McLean, Va.-based real estate investment trust, for $25.5 million, said Molinaro Koger broker Bill Murney.

The company plans “a comprehensive renovation of the hotel’s guest rooms, corridors, (meeting) space and lobby,” said Devin Chen, JER vice president. The hotel also is slated to get a new exterior paint job and new management, he said.

The new general manager is to arrive next week to get the project in gear, but Chen said detailed designs are already in the works.

The company, which also owns the Legend Trail golf course in Scottsdale “really likes the market,” Chen said.

“JER looks for opportunities to reflag or redevelop properties,” he said. “We are not going to reflag this property, but we are going to spend $5.5 million in renovation capital within the first year.”

The 190-room Holiday Inn Phoenix-Tempe ASU also gets new owners and a new look. The hotel and a couple of adjoining acres cost Newport Beach, Calif.-based Dolce Hotels $9 million, Murney said.

A reported rebranding is just a future possibility, not a done deal. For now, the 190-room hotel on the eastern edge of Arizona State University campus will remain a Holiday Inn, said Gene Conklin, Dolce’s corporate director of operations.

But Conklin confirmed that his company, which also owns Tempe’s Comfort Inn and Suites, plans to spend more than $5 million enhancing its new purchase.

“It will be thoroughly renovated,” he said.

Conklin said Dolce also is looking for more fixer-upper properties in the area. Tempe is especially hot now. The two deals follow recent purchases and renovations of two other full-service Tempe hotels — Fiesta Inn and The Buttes, which became a Marriott in the process. And just a month ago, upscale European hotel brand Le Meridien landed plans to build at Tempe Town Lake.

“We are on the radar screen for hotel owners and developers,” said Michael Martin, executive vice president of the Tempe Convention and Visitors Bureau. “It’s really good news for us.”

Martin said Tempe’s burgeoning occupancy rates — the percentage of available rooms actually booked — and average daily room rates have caused several hotel companies to take notice.

He’s especially pleased that the tired-and-dated Holiday Inn will get a makeover suited to the city’s upscale standards.

“The Holiday Inn has one of the best locations in Tempe because of its proximity to ASU,” Martin said.