Historic Hotel Near Northwestern U. Sells for $60M
- Dec 22, 2015
Olshan Properties, of New York, has bought the historic Hilton Orrington Hotel in Evanston, Ill., for approximately $60 million from a joint venture of The Carlyle Group and Dow Hotel Co., Olshan announced Monday.
“Not only does this newly renovated property boast a fantastic location in one of Chicago’s hottest submarkets, but it also is the market leader and hotel of choice for visitors to prestigious Northwestern University,” Andrea Olshan, CEO of Olshan Properties, commented in a prepared statement.
She added that the Evanston property is both Olshan’s third full-service Hilton under management and its first Chicagoland property. Olshan Properties now owns and manages six hotels in total.
First opened in 1928, the AAA-Four Diamond Hilton Orrington/Evanston is only one block from Northwestern University and is Evanston’s only full-service hotel. Earlier this year it completed a $5.1 million renovation that included upgrades to guestrooms, the lobby and select meeting areas. The hotel features a 5,800-square-foot grand ballroom with a 2,300-square-foot promenade overlooking Lake Michigan, as well as a 12,000-square-foot conference center.
JLL represented Carlyle and Dow in their sale of the hotel.
“The Chicago North Shore submarkets have experienced some disruption with corporate relocations over the last two years; however, as office occupancies rebound, the lodging markets will continue to perform well,” Stacey E. Nadolny, managing director and senior partner in Consulting & Valuation at HVS, told Commercial Property Executive.
“The limited new supply in the North Shore areas as compared to the rest of Chicagoland bodes well for the markets,” she added. “In particular, Evanston is expected to remain very strong given the high barriers to entry for new development.”
“The Evanston market is getting one new hotel, and the Best Western is expected to be renovated and converted to a Holiday Inn, which will bring up the rate floor in the market,” Nadolny continued. “The proposed Hyatt House [scheduled to open June 2016] will accommodate surplus demand in the market area, especially during event weekends such as graduation and home football games. The market rate growth has been very strong, and is expected to continue to grow.”
Based on RevPAR growth, Chicago North ranks second out of eight Chicago-area hotel submarkets, according to a new report from PKF Hospitality Research/CBRE Hotels. Average RevPAR among higher-priced hotels in the submarket hit $92.55 in the third quarter, a year-over-year increase of 9.6 percent. Average occupancy over that period among the same group of properties rose 4.1 percent, to 71.2 percent.