McSam Plans Hotel on Lower Manhattan Parcels
- May 28, 2008
The McSam Hotel Group is betting that it’s recent $56 million acquisition of two properties in Lower Manhattan–and its plans to develop a new hotel on the sites–will capitalize on a growing demand for hotel space in the area.McSam purchased 6 Water St and the adjacent 32-38 Pearl St. in February, according to the New York Post. The 8,300-square-foot site fronts on three streets and provides 125,000 build able square feet. According to Alan Miller, a senior director and principal with Eastern Consolidated, which brokered the transaction, the $56 million purchase price translates to $448 per square foot of buildable space. “That’s a record,” Miller told CPN. “The previous record price for hotel space in Manhattan was $300 per square foot of buildable space.” McSam will demolish the existing structures on the site–a five-story building with a McDonald’s on Water Street and a seven-story loft building on 32-38 Pearl Street. Sam Chang, McSam’s owner, plans to put up a 30- to 40-story hotel. McSam has been interested in the site for two years, but the McDonald’s lease caused the deal to be put off until now. According to Miller, the weak dollar is fueling international tourism in New York City, and tourism, in turn, is powering up the hotel market. “In Lower Manhattan, there are 2,200 hotel rooms, with about 3,000 under development,” he said. “Right now, it’s hard to get a hotel room.” The largest hotel developer in Manhattan, McSam is reportedly developing more than 1,500 of those rooms.