By Sterling Real Estate Partners
Sterling Real Estate Partners recently acquired Hotel Tucson City Center in an off-market transaction with plans to convert the hotel into market-rate apartments. Originally built in the 1960s, the 278-unit downtown hotel will be transformed into a modern, 210-unit apartment complex with approvals to develop an additional 154 units. This acquisition marks the first adaptive reuse project undertaken by Sterling.
Sterling had the property under contract since January of 2021 while it underwent the rezoning process for residential use. Sterling collaborated with the neighbors throughout the process to receive zoning approval without opposition. Upon acquisition, Sterling will become a Choice Hotel franchisee and has engaged Ledgestone Hospitality to operate the four-story building as a hotel while the adjacent buildings are converted to apartments. Additionally, the site was approved for an additional 154 units that will be developed later.
The seven building, 10-acre site is located adjacent to the historic El Presidio neighborhood of downtown Tucson. Residences will consist of luxury studio and one-bedroom units ranging from 300SF-700SF. Site amenities will be updated during the conversion, with upgrades budgeted for the pool area, fitness room, clubhouse, conference room, dog park, and outdoor lounge.
Upon completion, the apartments will offer low gross rents with luxury interior finishes to support the high demand for quality and affordable housing in the Downtown submarket.
