Pandox, a publicly traded Swedish hotel chain with operations in 12 countries, has agreed to sell its second Montreal hotel in as many years as hotel bookings have stagnated before the upcoming tourism season in Canada’s second-largest city.

Montreal-based Artifact Group has agreed to purchase Pandox’s 10-floor, 595-room DoubleTree by Hilton Montreal at 1255 Jeanne-Mance for approximately $58.1 million (80 million Canadian.) The downtown spot overlooks many summertime tourist activities.

The two sides initially agreed on a price of about $70 million (95 million Canadian dollars) but Pandox agreed to adjust the price to help the new owner pay for required work on the building's facade. The hotel has an annual revenue of around $36 million (50 million Canadian), and the deal should close in the second quarter, according to a statement on the Pandox website.

The deal took about a year to hammer out, according to Artifact CEO Gaurav Gupta, who said the purchase allows his firm to offer a bigger variety of lodgings in the city, he said.

“This asset rounds out our portfolio and our ability to offer five-, four- and three-and-a-half star accommodations and allows us to reach every style of clientele that comes into the city,” he said in an interview.

Pandox has owned the hotel since 2008. With its sale, the firm will have only one hotel left in its Montreal portfolio after it sold its 26-floor InterContinental Hotel at 360 St. Antoine St. West to Groupe Mach early last year.

Pandox is selling the Doubletree ahead of what could be a challenging year for tourism in Montreal, according to early forecasts.

“Overall, downtown Montreal has had a slower start to 2024, with demand contracting while supply is increasing," Laura Baxter, director of hospitality analytics for Canada at CoStar Group, said in an email. "Business on the books for the coming 90 days as of April 8th is down 1% compared to the same time last year,”

Montreal's tourism prospects recently took a hit with the cancellation of the Just for Laughs comedy festival, considered the third-largest annual tourism attraction to the city behind the Grand Prix Formula One race in June and the Jazz Festival planned for late June.

Some economists have forecast a strong year for tourism in Canada, as they assume that the Bank of Canada will lower the lending rate while the United States keeps its interest rate steady. The higher American rate, combined with the lower Canadian rate, would likely lead to a lower Canadian dollar and create bargains for American tourists visiting Canada.

Gupta is aware of trends and believes that all will fall into place for the Montreal tourism scene.

“We are constantly forecasting the market and I would say that the country as a whole has been a bit softer in terms of demand this year, which is understandable given the interest rate hikes,” he said. “Montreal’s tourism market has always been resilient and we hope that the market settles and ramps up again.”