NYC’s Helmsley Hotel Bought by Host for $313.5 Million
Host Hotels & Resorts Inc., owner of luxury hotels including Ritz-Carltons in San Francisco and Phoenix, agreed to buy the 775-room New York Helmsley Hotel in midtown Manhattan for $313.5 million.
Starwood Hotels and Resorts Worldwide Inc. will initially manage the property, located on 42nd Street, and run it as an unbranded hotel until it’s turned into a Westin in early to mid-2012, the Bethesda, Maryland-based company said in a statement today. The deal is expected to close in March.
Host Hotels, the largest U.S. lodging real estate investment trust by market value, has been looking to acquire high-end properties in such primary markets as New York, where it agreed to buy the W New York Union Square in July with partners including Istithmar World PJSC.
“There are great opportunities to buy assets at a discount right now,” Edward Walter, Host’s president and chief executive officer, said in a panel discussion at the Americas Lodging & Investment Summit in San Diego this week. “We’re in buy mode.”
During the third quarter, Host completed the acquisition of three hotels in New York, Chicago and London for about $430 million, including $166 million of assumed debt. Host also bought the 245-room JW Marriott Hotel Rio de Janeiro for about $48 million.
In 2010, 666 hotels were sold in the U.S. for a total of $11.6 billion, according to preliminary figures from Real Capital Analytics Inc. in New York. That’s a jump of more than fourfold from 157 hotels sold for $2.5 billion in 2009. Hotel transactions in the Americas probably will increase as much as 25 percent this year, buoyed by REITs seeking to deploy cash, Jones Lang LaSalle Hotels said on Jan. 4.
The Helmsley will undergo improvements, including room renovations and upgrades to meeting space, Host said.
Host climbed 41 cents, or 2.3 percent, to $18.52 in New York Stock Exchange composite trading. The stock has climbed 69 percent in the past year.
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