News Summary
The City of Memphis plans to acquire the Downtown Sheraton Hotel for $22 million to enhance tourism infrastructure. A City Council vote on this resolution is scheduled for October 1. The 600-room hotel is viewed as critical for economic growth. The purchase will be financed through municipal bonds and is managed by Capstone Development. The hotel has not been updated since 2004, and significant renovations are needed. City officials highlight this acquisition as a key development for the city’s future tourism and economic landscape.
Memphis – The City of Memphis is set to move forward with plans to purchase the Downtown Sheraton Hotel for $22 million, a deal announced by Mayor Paul Young’s administration. City Council members will be voting on a resolution to authorize the acquisition during their meeting scheduled for October 1.
The Sheraton Downtown Hotel, located at 250 N. Main St., is a 600-room facility that city leaders deem crucial for boosting tourism infrastructure and development efforts in Memphis. The city plans to finance the acquisition using 501(c) bonds, and municipal bonds will be issued by the Center City Revenue Finance Corporation, part of the Downtown Memphis Commission.
The urgency comes as the current ownership group is looking to sell the property by December 31 of this year. If a deal cannot be finalized in time, there is a possibility that the hotel may be put up for public auction before the yearโs end.
In preparation for the purchase, the City has engaged Capstone Development as an advisor, signing a contract that will cost $4,000 per month. This advisory service agreement was made prior to finalizing the formal deal with the hotel. The redevelopment of the Sheraton carries notable risks for Memphis taxpayers, with officials emphasizing the financial implications of the investment.
Once the city acquires the hotel, it intends to hold onto the property for a period of two years. After that time, the hotel will be transferred to a nonprofit organization specializing in municipal redevelopment. During the interim, a local ownership group led by Chance Carlisle, Carolyn Hardy, and Tyrone Burroughs will manage the hotel. The group recently initiated the River City Momentum Fund to enhance economic development in Memphis.
Significant renovations will be necessary for the Sheraton, which has not seen major updates since 2004. The hotel has been on the market since February 2024, but the previous owners, Memphis Hotel LP, opted against pursuing their planned expansion. In October 2022, the Center City Revenue Finance Corp. had approved a 30-year payment-in-lieu-of-taxes (PILOT) for a projected $226 million renovation of the Downtown Sheraton, which included plans for an additional 300-room expansion.
Additionally, the city expects to receive $1.5 million from tourism surcharge revenue funds that will be utilized as โearnest moneyโ for the purchase. Local officials have articulated the need for further development in the area, noting that an additional 500- to 600-room hotel may be necessary to support the existing establishment adequately.
Dean Dennis, senior vice president of the Renasant Convention Center, highlighted the importance of preventing underperformance at the hotel to derive expected economic benefits for the community. With plans set in motion and substantial renovations anticipated, the acquisition of the Downtown Sheraton Hotel signifies a critical move for Memphis in bolstering its future tourism and economic landscape.
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Author: STAFF HERE MEMPHIS WRITER
The MEMPHIS STAFF WRITER represents the experienced team at HEREMemphis.com, your go-to source for actionable local news and information in Memphis, Shelby County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the areaโwith deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Beale Street Music Festival, Elvis Week, and Memphis in May International Festival. Our coverage extends to key organizations like the Greater Memphis Chamber and the Memphis Convention & Visitors Bureau, plus leading businesses in logistics, healthcare, and music that power the local economy such as FedEx, St. Jude Children's Research Hospital, and AutoZone. As part of the broader HERE network, including HEREBristol.com, HEREChattanooga.com, HEREKnoxville.com, and HERENashville.com, we provide comprehensive, credible insights into Tennessee's dynamic landscape.
