KSG Grabs Hidrock’s SpringHill Suites New York for $82M
- Jul 31, 2014
Malaysian company KSG Enterprises Ltd. is expanding its presence in the U.S. with the purchase of SpringHill Suites New York Midtown Manhattan/Fifth Avenue.
The subsidiary of Hong Kong-based Keck Seng Berhad, which mainly owns hotels and offices, has made its debut into the Big Apple by snapping up the Midtown Manhattan hotel asset for $82 million from Hidrock Realty and Robert Finvarb Cos. JLL’s Hotel & Hospitality Group closed the deal on behalf of the seller. Managing Director Jeffrey Davis and Executive Vice President Gilda Perez-Alvarado led the JLL team on the transaction. Senior Director of Hotel Management Miochael Powlen and CFO Daniela Trudel handled the deal on behalf of ownership.
The 19-story, 173-key hotel, located at 25 W. 37th St., was developed from the ground up by Hidrock and Robert Finvarb and opened last year while imminently achieving 90 percent occupancy.
“Our business plan when we made the acquisition was to replace the two derelict buildings on the site with a beautiful hotel, and sell it once the hotel was open and operating, ” Abraham Hidary, president of Hidrock Realty told CPE. “We are very pleased that we were able to execute and accomplish our goal.”
The property, located near Times Square, Grand Central and Herald Square is close to office properties, cultural attractions and shopping, dining and entertainment venues,according to the news release.
“After 22 months of construction, we opened SpringHill Suites just over a year ago and were extremely impressed with its performance,” said Powlen in the news release. “The hotel ramped up very quickly and was number one in its competitive set for the average daily rate within five months.”
According to JLL’s April 2014 hotel research, Manhattan’s transaction volume is predicted to reach up to $2.8 billion in 2014 and all signs show that investors continue to place their confidence and capital in that market.
“Hotel demand is at all-time high; however, RevPAR growth will be more tepid in 2014 due to 6,400 additional rooms slated to enter the market,” per the JLL hotel report.