Amstar Relies Upon Scottsdale's Strength to Push Resort Sale

SCOTTSDALE, AZ-The resilient Scottsdale hospitality and leisure market is hoped to power the sale of the 210-room SunBurst Resort at 4925 N. Scottsdale Rd. The property is the only resort property up for sale in the Denver-based Amstar Group Ltd.’s portfolio.

“The time horizon on the investment has run its course,” John Strauss, vice president of Jones Lang LaSalle’s hotel group in Los Angeles, tells GlobeSt.com. He says the 1961-vintage resort does not have an official asking price. The starting point for talks will be market driven, but he’s expecting offers to range in the mid-$20 million to mid-$30 million pricing.

Strauss says Scottsdale has weathered the storms of terrorist attacks and a generally weakened economy better than most as have San Diego and other “drive-to destinations.” Strauss believes buyers will be attracted to Sunburst’s universal appeal for leisure, business travelers as well as the social and business meeting trade that books events at the facility.

Arthur Buser, managing director and head of West Coast operations for Jones Lang LaSalle Hotels says “the trend lines are moving upward for this hotel, its submarket and the metro area. In spite of the recent recession, Scottsdale remains a very powerful growth story.”

Still, the property is being marketed with “value-add” opportunities. Strauss says the resort’s historical occupancy has been in the low 70% range with its present-day reading in the low 60%. The value-add comes in the form of branding opportunities, renovation and repositioning options.

Amstar Group purchased the resort in 1995, pumping an immediate $10 million into renovations. Additional upgrades were made in the past seven years, says Strauss. The resort has 14,000 sf of meeting space along with the usual amenities. But the real hook is its positioning just 20 minutes from Sky Harbor International Airport and walking distance to retail, championship golf courses and historic properties.

Amstar’s real estate holdings are valued in excess of $700 million. Its hotel and resort properties are the San Diego Courtyard Downtown and the historic Georgian Terrace Hotel, Washington Terrace Hotel in Washington DC, Doubletree in the Gardens in Palm Beach Gardens, FL and Franz Klammer Lodge, an exclusive private residence Club, in Telluride, CO. It also is developing a four-star resort and hotel complex just 12 miles from Chicago’s O’Hare International Airport.