Sanford forms new hotel partnership

Oct. 3, 2018

Sanford Health has partnered with a North Dakota hospitality group to manage a new hotel in Fargo and two existing ones in Sioux Falls.

Brandt Hospitality includes former employees of TMI Hospitality, the original co-owner and operator of the Home2 Suites connected to the Sanford USD Medical Center and the Fairfield Inn & Suites at the Sanford Sports Complex.

Texas-based Aimbridge Hospitality acquired TMI last year. Fargo-based Brandt is a diversified operations with divisions that include agriculture, industrial, real estate and entertainment in addition to hospitality.

Sanford is a minority partner in the limited liability companies that own each hotel.

Its first foray into the hospitality industry was with the Fairfield at the Sports Complex, which opened in 2014.

“It was a risky venture because nothing was out there except the Pentagon,” Sanford treasurer Bill Marlette said.

The 82-room property is “packed full on the weekends and not very full during the week, but I think that will change as there is more development,” Marlette said. “Fleet Farm might help, and if the (high) school goes out there, that would probably help. And if we can get some office buildings out there, that will help.”

Sanford convinced TMI to invest in the project after also agreeing to a hotel on the central Sioux Falls hospital campus, which became the 80-room Home2 Suites, Marlette said.

“I was a little leery about it,” he said. “It’s in the middle of a residential area, but TMI thought it would be great. And it’s been a very successful hotel. A lot of our patients and families stay there, and we hope to replicate that up in Fargo.”

The newest hotel in Sanford’s portfolio is a 110-room Courtyard by Marriott near its new Fargo medical center. It’s scheduled to open this month.

“It’s in a very commercial area, and it was a struggle with the number of beds around there, but they know our patient will gravitate toward there, and we’ll direct businesspeople to stay there,” Marlette said. “It helps having us as part owner, because we’ll direct people to them who do business with us.”

Sanford’s ownership stake is through Sanford Frontiers, which is a taxable entity.

Future hotel development could include a second property at the Sports Complex, Marlette said. A full-service hotel, for instance, would be able to house teams that come to the state to play SDSU and USD.

“And then we’d have another full-service restaurant to make a run at the NCAA basketball tournament,” he said. “But we leave it up to the people who know the industry. We’ll go where the hotel people suggest because they know what they’re doing.”

Sanford forms new hotel partnership

Sanford Health has partnered with a North Dakota hospitality group to manage a new hotel in Fargo and two existing ones in Sioux Falls.

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