Queensgate Investments’ $400M US Expansion
- Oct 15, 2019
British private equity firm Queensgate Investments has purchased Freehand Hotels, a collection of four lifestyle hotels in the U.S., for around $400 million. The acquisition totals 918 keys across Manhattan, Miami Beach, Fla., Los Angeles and Chicago.
The seller was a consortium including billionaire Ron Burkle’s investment firm The Yucaipa Cos. and hotel developer Sydell Group. Hotel brokerage Hodges Ward Elliott represented the seller in the deal, via a team composed of President Mark Elliott, Managing Director Rudy Reudelhuber and Managing Director Jay Morrow.
Generator, a boutique hostel chain acquired by Queensgate in 2017, will manage Freehand Hotels while preserving the brand’s distinct identity. The transaction, which also includes the Broken Shaker food and beverage bar that operates in each property, creates a combined portfolio of 19 hotels in 17 gateway cities around the world.
The properties in the sale include:
- Freehand Chicago at 19 E. Ohio St., Chicago (217 guestrooms)
- Freehand Los Angeles at 416 W. 8th, Los Angeles (226 guestrooms)
- Freehand Miami at 2727 Indian Creek Drive, Miami Beach, Fla. (80 guestrooms)
- Freehand New York at 23 Lexington Ave., New York City (395 guestrooms)
All the hotels feature a mix of private and shared guestrooms, with a hostel-like social environment that includes daily housekeeping, events and programming. Each property also includes Broken Shaker cocktail bars.
Freehand Chicago, located in the city’s River North area, opened in 2015. Freehand Los Angeles, housed in a former vintage office building in Downtown Los Angeles, opened its doors in 2017. The Miami Beach property is a 5-minute walk from the famous beach in Miami-Dade County and launched in 2012. Freehand New York opened last year in Manhattan’s Flatiron District.
UK firm grows in US
Queensgate noted in a statement that it is currently looking at opportunities to expand in gateway European cities including London, Edinburgh, Milan and Amsterdam. The company paid $54.1 million to acquire the Courtyard by Marriott Washington, D.C., in October 2018, shortly after opening its first U.S. location in South Beach, Miami. The 148-key hotel in the nation’s capital will be rebranded as part of the Generator hospitality platform.
In March of this year, Queensgate scooped up four London hotels with 1,345 guestrooms from Grange Hotels for £1 billion ($1.3 billion).