Midtown Motel Property Sold, Redevelopment Likely

Another prominent midtown Sacramento property has sold, and a redevelopment looks likely for its future.

The defunct Desert Sand Inn/Motel at 623 16th St. sold for $1.225 million in a courthouse steps auction, said Jon Lang of Turton Commercial Real Estate, who handled the sale with Aaron Marchand of Turton.

Since the property became available through a bankruptcy proceeding, Lang said it hasn’t been hard to draw attention.

“We were getting at least 50 calls a day for several days straight, and I’d say one solid offer per week,” Lang said. He added many potential buyers, including domestic and foreign investors, thought the $1 million asking price was a steal to get what they thought would be a turn-key hotel or motel in the city core. “A lot of people didn’t realize this was a redevelopment property.”

Marchand said most of the serious bids envisioned either a hotel or multifamily use on the property, which does not include a Goodwill drop-off site on the corner of 16th and G streets.

He said the strong interest in the property — inquiries were in the thousands, he said — could be attributed to its availability, fair price and location in the midtown submarket, where there’s strong investor and development interest.

“It’s a total project for the right buyer,” he said, describing how significant investment will be necessary to make the site active again.

Though the winning bidder, a Berkeley development company Lang didn’t name, hasn’t announced future plans yet, the property would make the most sense as a boutique hotel, given its relative proximity to the Sacramento Convention Center, Memorial Auditorium and other destinations.

“There’s a lot of preliminary work that has to be done,” Lang said. His firm isn’t sure how long it’s been since the property’s been actively used or when it was last improved. “My guess is it will stay in the same vein as a hotel, but it’s so rough it may need to be taken down to the studs.”

Turton represented the bankruptcy trustee in the sale, which was not the result of a foreclosure, Lang said.

The total property site is about 21,000 square feet, with more than 40 separate units in the motel.