Emerald Suites Tropicana Trading for $20M
October 30, 2007
By Brian K. Miller
LAS VEGAS – The Emerald Suites Tropicana, a 225-key hotel is changing hands today for $20.25 million, according to the buyer, The Siegel Group Inc. of Los Angeles, which is making its third acquisition in the market in as many weeks. Situated on 4.13 acres adjacent to Tropicana Avenue, just west of Interstate 15, the hotel will become the 11th member of the company’s two-year-old regional chain of extended-stay properties known as Siegel Suites.
Built in 2003 as a combination of apartment and extended-stay units, Emerald Suites Tropicana has most recently been operated as a daily hotel and has experienced a high average vacancy rate. Michael Crandall of the Siegel Group tells GlobeSt.com that under the Siegel Suites formula approximately 10% of the units will remain in a daily rental program and the remainder will be marketed to longer-term tenants. SASCO Properties, an affiliate of the Siegel Group, will operate the property.
“It’s tucked between two Budget Suites properties, which is basically our competition in the extended-stay market,” Crandall says. “We will be able to offer a newer property with nicer amenities for the same price.”
Earlier this month, the Siegel Group acquired the Falls apartment complex near the University of Nevada here for $14.75 million. The 230-unit, 4.8-acre property is located on South Cambridge Street. Also in October, the company paid $13.75 million for Coliseum Villas, a 186-unit, 3.64-acre property near the corner of Paradise Road and Twain Avenue, across the street from the Wynn Las Vegas golf course and about one mile from the Falls apartments.
The Siegel Group president/CEO Stephen Siegel told GlobeSt.com earlier this month that most of the properties it acquires for its Siegel Suites portfolio are at least 20 years old and are suffering from deferred maintenance and poor management. Once acquired, the properties are quickly rebranded and renovated. Siegel says he is typically able to make the properties cash-flow positive within 90 days.
The brand’s room count currently stands at about 2,700. Crandall says the company expects to close on additional properties in the Vegas area either shortly before or shortly after the end of the year. The company wants to become the largest provider of flexible-stay accommodations in the Vegas Valley market.