Investors and Developers Boost Hospitality Sector in New York City
- Feb 10, 2012
By Veronica Grecu, Associate Editor
According to Crain’s New York Business, South Carolina-based OTO Development is set to build a new hotel in midtown Manhattan. The company has reached an agreement with the multi-millionaire Brach family to pay $36 million for the property, located at 220-246 West 41st St.
Projected to serve tourists and business travelers, the limited-service hotel will be located right next to the Nederlander Theatre. In August 2010, the developer paid $21.9 million for the site and broke ground on its first hotel in Manhattan — a Fairfield Inn & Suites — one year after closing the deal. The transaction is scheduled to close by June, and further details on the construction could be announced by mid-2012.
This transaction appears to continue the positive trend that marked New York City’s hospitality sector in 2011. With 38 hotel deals worth a combined $3.2 billion closed, the volume of sales almost doubled compared to 2010, according to the PropertyShark Blog Center. 78 percent of the $2.3-billion total sales volume accounted for transactions that exceeded $100 million.
The iconic New York Palace at 451 Madison Ave., featuring 813 guest rooms and 86 suites, sold for $377 million, or $419,000 per room, while The Radisson at 509 Lexington Ave. changed hands for almost $334 million, or $468,000 per room. The third largest transaction closed for $319.5 million and involved The Carlyle, a Rosewood Hotel, which was bought by the Hong Kong-based billionaire Cheng Yu-tung family. The Top 5 2011 hospitality transactions in New York City can be found here.
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