- Braemar put the Four Seasons Resort Scottsdale under contract for $372M, or $1.8M per key, completing nearly $1B in hotel sales to fund its exit from Ashford’s management.
- The REIT will pay a $480M termination fee, shrink to seven luxury hotels, and expects to finish the split by mid-November while cutting annual administrative costs from $42M to $15M.
- Hotel fundamentals remain firm, with Q2 RevPAR up 5.7% per CBRE, which has helped luxury assets trade above $1M per key throughout Braemar’s sales.
Braemar Hotels & Resorts has agreed to sell the Four Seasons Scottsdale at $372M ($1.8M a key), according to Bisnow. It is the last in a string of sales worth nearly $1B that pay for the REIT’s break from Ashford.
The contract was signed Sept. 29 and disclosed Thursday, and Braemar expects to finish the separation by mid-November.
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Paying to Leave Ashford
After a strategic review, Braemar chose in June to pay a $480M fee to end its contract with Ashford and manage itself. Ashford said asset sales would finance the move.
July brought the sale of the Sarasota Ritz-Carlton, Hotel Yountville and Bardessono for $437.5M, each to a separate LLC. A month later, a partnership of Sixth Street and Riller Capital paid $190M for the Key West Pier House resort, as covered in Sixth Street’s Pier House acquisition.
A Smaller Luxury Portfolio
Every sale cleared $1M per key. Braemar now holds seven hotels, including three Ritz-Carlton properties in Puerto Rico, the Virgin Islands and Lake Tahoe, plus the Capital Hilton in Washington and Sofitel Chicago Magnificent Mile. The Notary Hotel in Philadelphia and Cameo Beverly Hills round out the group.
Leadership expects annual administrative expense to fall from $42M to $15M once the agreement ends. Planned refinancings over the next six months should save close to $5M in interest.
Outlook and a Peace Deal
Braemar’s 2027 guidance at the midpoint calls for $400M of revenue, a 7.7% operating profit margin and 5.5% RevPAR growth. CEO Richard Stockton said the transition is on schedule and that sector tailwinds support the luxury strategy.
The REIT also settled with Al Shams Investments, its largest shareholder, which will pull its board nominations. In June, Al Shams had blasted the termination fee as “theft dressed in a suit,” and the settlement terms were not disclosed.
Gross prices from the July package, the Pier House and Scottsdale add up to nearly $1B, about double the $480M fee. Bisnow’s report does not say how Braemar will use the remaining proceeds.
Why It Matters
Hotels have had a strong year, Bisnow notes, helped by more business travel and a summer that included the World Cup. CBRE data shows Q2 occupancy up 80 basis points, average daily rate up 4.4% and RevPAR up 5.7%, with only four markets posting RevPAR declines.
At $372M, Scottsdale is the largest single-asset sale in the series. Occupancy is still below 2019 levels, yet buyers keep paying up, an appetite also visible in the Florida Keys rebound.
What’s Next
Watch for the Scottsdale sale to close and for the Ashford separation to wrap by mid-November. Investors will then track whether the self-managed structure delivers the projected savings.
