News Summary
Magna Hospitality has successfully sold a portfolio of four hotels in New York for a total of $489.8 million, marking the largest hotel sale in the city since the introduction of the Safe Hotels Act. The sale involved notable properties including Hilton Garden Inn and Motto by Hilton, reflecting confidence in the New York hotel market amidst strong demand and increased average daily rates. This significant transaction highlights a trend of revitalization and investment within the city’s hospitality sector as operators adapt to new regulations.
New York City – Magna Hospitality has successfully sold a portfolio of four hotels in New York for a significant total of $489.8 million. This major transaction was managed by JLL Hotels & Hospitality and recorded by CoStar. The deal marks the largest hotel sale in New York following changes introduced by the city’s Safe Hotels Act in May, which requires special licenses for hotel operators.
The sale involved a fund managed by Magna Hospitality, specifically the Magna Hotel Fund VI, which is a $250 million fund that was closed in 2018. The transaction was structured between this fund and several unnamed large institutional owners. Additionally, a separate Magna fund will maintain partial ownership of the hotel portfolio.
This portfolio includes a variety of hotels, with notable details on each property as follows:
– Hilton Garden Inn New York Times Square North:
– Sold for $115,555,188, translating to $589,567 per room.
– Magna purchased this hotel in September 2021 for $88.5 million, or $451,531 per room.
– The property features 196 rooms.
– Motto by Hilton New York City Chelsea:
– Sold for $222,160,351, which equals $594,012 per room.
– This hotel opened in December 2021 and includes 374 rooms.
– DoubleTree by Hilton New York Times Square South:
– Its leasehold interest was sold for $99,764,256, or $311,763 per room.
– This hotel opened in 2019, and Magna acquired it in June 2021 for $47.4 million, with a total of 320 rooms.
– Fairfield Inn & Suites New York Midtown Manhattan Penn Station:
– Its leasehold interest sold for $52,298,288, or $218,821 per room.
– Magna acquired this property in December 2020 for $57.4 million and it consists of 239 rooms.
Several lenders were involved in the deal, but their identities have not been disclosed. The recent sale reflects the increasing market activity in New York’s hotel sector, bolstered by robust demand fundamentals and pricing power.
The hospitality market in New York City has shown strong performance this year, with a reported 4.7% increase in average daily rates through August. This rise has been attributed to a sustained pricing power in the market, which has made hotel assets increasingly attractive for investment. The transaction signals confidence in the New York hotel market and the potential for future growth.
As hotel operators adapt to new regulations and seek to capitalize on market dynamics, the recent sale by Magna Hospitality highlights a broader trend of revitalization and investment within the hospitality sector in New York City.
This successful sale is not only a significant financial event but also a reflection of the ongoing recovery and growth potential of the hotel market in one of the world’s major travel hubs.
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Additional Resources
- CoStar: Magna Sells Portfolio of Four New York Hotels for $490 Million
- Wikipedia: New York City
- NY Post: NYC’s Roosevelt Hotel May Fetch $1B in Sale
- Google Search: NYC Roosevelt Hotel sale
- Boutique Hotelier: New York Hotel with Ties to Bob Dylan Sells for $2.3M
- Google Scholar: New York hotel sales
- Hotel Investment Today: Will NYC’s Pierre Sell?
- Encyclopedia Britannica: New York hotel market
- Skift: Taj May Lose New York’s Pierre Hotel in $2 Billion Sale
- Google News: Taj Pierre Hotel sale
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