Sixth Street Buys Key West Pier House Resort for $190M

Sixth Street has expanded its hospitality portfolio with the acquisition of the Pier House Resort & Spa in Key West, Florida, for $190 million. The deal, executed in collaboration with Riller Capital, brings a prime oceanfront property into Sixth Street’s growing real estate division.

The 142-room luxury resort, strategically positioned at 1 Duval Street, occupies five acres and boasts direct access to one of Key West's limited private beaches. Its location offers guests unparalleled views of the Gulf and immediate proximity to the vibrant energy of Duval Street. The property features extensive amenities, including two waterfront dining establishments, a full-service spa, a fitness center, and a pool overlooking the ocean, alongside approximately 3,000 square feet dedicated to meetings and events.

This acquisition underscores Sixth Street's strategy of targeting high-quality hospitality assets in markets characterized by significant barriers to entry and robust leisure demand. Aman Gupta, Principal at Sixth Street, highlighted the resort's unique appeal, noting its historic nature, prime beachfront, and unobstructed sunset vistas as key differentiators. He emphasized that the investment aligns with Sixth Street’s objective to identify and enhance the long-term value of premium hospitality properties.

The U.S. luxury hotel sector continues to demonstrate resilience and attract significant investor interest, driven by pent-up travel demand and a preference for unique, high-end experiences. Key West, in particular, remains a coveted destination due to its limited developable land and consistent appeal to affluent travelers. The acquisition of Pier House aligns with broader market trends favoring well-located, amenity-rich properties that can command premium rates and offer differentiated guest experiences.

Sixth Street’s real estate arm actively invests across various property types, providing flexible capital solutions that range from equity and preferred equity to debt. The firm partners with specialized operating businesses to optimize asset performance. This transaction saw Latham & Watkins, Smith, Hawks, P.L., and CBRE advising Sixth Street, while The Plasencia Group represented the seller, Braemar Hotels & Resorts. Starwood Property Trust provided financing for the deal.

Braemar Hotels & Resorts, a REIT focused on high-growth luxury hotels, divested the property as part of its strategic asset management. The sale represents a significant transaction within the luxury resort segment, reflecting ongoing consolidation and strategic repositioning by institutional investors seeking to capitalize on market dynamics. Sixth Street, with over $135 billion in assets under management, continues to deploy capital across diverse sectors, leveraging its data-driven approach and flexible investment mandate.