Denver’s Historic Brown Palace Hotel Listed For Sale

The Texas owner of the Brown Palace Hotel and Spa, as well as the adjacent Holiday Inn Express, is putting both properties up for sale after they ran up a bigger tab than expected and stayed around longer than desired.

Crescent Real Estate, based in Fort Worth, Texas, has retained the commercial real estate brokerage firm Newmark to market the two properties, according to a report by BusinessDen, a news partner of The Denver Post.

Troy Furbay, Crescent managing director and head of hospitality, told BusinessDen that Crescent typically holds properties for five years, but that the COVID years had “disrupted everyone’s business plans.”

Crescent purchased the two hotels in 2018 from Dallas-based Crow Holdings, a subsidiary of Trammel Crow, for $125 million, and the investment fund holding the purchase is winding down. Crow Holdings had purchased the hotels in March 2014 for $103 million.

The Brown Palace was in the middle of a $10.5 million renovation when Crescent acquired it. Denver’s hospitality market was seeing strong growth. Crescent described the purchase as a “rare opportunity to own and operate a timeless and iconic hotel asset.”

But that was before the pandemic crushed bookings and sent the hospitality industry into a deep spiral. The Brown Palace, which is Denver’s second-oldest hotel after the Oxford Hotel, began showing its age in more profound ways, especially in late 2022.

In November of that year, a basement chimney fire knocked the hotel’s boilers out of commission, forcing a closure during Thanksgiving week. Not long after, a pipe on the sixth floor burst, flooding a dozen rooms, a second-floor meeting room and Ellyngton’s, the hotel’s biggest restaurant.

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A damaged front door required customized repairs and allowed cold winter air to infiltrate the lobby for weeks. Another broken pipe flooded the ballroom, which is located in the tower that hosts the Holiday Inn.

To cope with rising repair and maintenance costs, employees reported that hotel management began cutting staffing and service levels, replacing many of the hotel’s long-time bellhops with third-party valets. Hotel fares were cut to boost bookings, resulting in problems with drug use on the property.

The hotel lost its star ratings over time and fell in the ranking of Colorado hotels, and the upper Downtown neighborhood has continued to struggle with high office vacancy rates and lower foot traffic.

Crescent refinanced the property in early 2024 with $84 million in loans backed by Benefit Street Partners, LCP Group and Ares Management Real Estate. It also replaced HEI Hotel & Resorts as the property manager of the 234-room Brown and the 231-room Holiday Inn Express.

Crescent continues to hold onto the Kimpton Hotel Monaco Denver, which is part of a different fund than the unwinding GP Invitation Fund that held the Brown Palace and Holiday Inn Express.

This story will be updated.

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