Sixth Street Capital is Buyer of Dallas Fairmont Hotel

The buyer of the Fairmont Dallas, who brought a 11.3 percent rate of return to seller Xenia Hotels & Resorts last month, has been revealed.

An affiliate of investment giant Sixth Street Partners bought the landmark hotel for $111 million, the Dallas Business Journal reported.

Public records show that San Francisco- and New York-based Sixth Street closed on the 545-key property at 1717 North Akard Street on April 11.

The transaction, which breaks down to roughly $203,700 per key, brought a tidy return for Xenia, which acquired the hotel in 2011 for $69 million.

But the sale also reflected mounting capital demands at the aging property and underwhelming financials compared to the REIT’s broader portfolio. Xenia cited upcoming “significant and disruptive” renovations and concerns about downtown Dallas’ hotel market as reasons for offloading it.

The Fairmont, built in 1969, has long been a staple of Dallas’ central business district, known for its rooftop pool, public art, and historic social ties — including a Neiman Marcus storefront in the lobby and celebrity performances at the Venetian Room. The hotel last received exterior and public space upgrades in 2023, but larger interior overhauls were deferred.

Sixth Street’s acquisition adds to its growing real estate footprint. The global alternative investment manager oversees more than $100 billion in assets and has recently expanded its Dallas office, its largest outside New York. The firm has invested in a range of hotel ventures, including a five-property portfolio in Spain acquired in 2021. Sixth Street has not commented on its plans for the Fairmont.

The Fairmont joins a slate of major hospitality and redevelopment efforts underway in downtown Dallas, including the $2 billion revamp of the adjacent Kay Bailey Hutchison Convention Center. That project is expected to strain short-term hotel demand but may ultimately reposition the district for future growth.

Other hotel plans tied to the Convention Center District and nearby towers, such as a planned residential and hotel conversion of the Bank of America Plaza, point to renewed investor interest in the area so long as operators are willing to bet on the timing.

— Judah Duke