Hotel developer Sam Chang borrowed nearly $42 million in loans for his 35-story Holiday Inn project in Midtown West, according to property records filed with the city last night.
Chang received the mortgages from Dallas, Texas-based Bank of the Ozarks, and then proceeded to pay off $11.4 million to the New York Community Bank. The 85,000-square-foot hotel at 585-587 Eighth Avenue near 39th Street is slated to hold 271 rooms, more than 199 rooms previously planned for the site. Chang’s Great Neck, N.Y.-based McSam Hotel Group acquired the site from Philadelphia-based hotel real estate investment trust Hersha Hospitality Trust for $19.25 million in 2012, records show.
Chang had been developing the site as a hotel with Hersha before buying it. A three-story property was demolished to make way for the Holiday Inn.
The hotel, designed by frequent Chang collaborator Gene Kaufman, is slated to open on May 1, 2015, said Chang.
McSam and Hersha were hit with a lawsuit in 2010 when Olmstead claimed a demolition company hired by Hersha damaged the nearby 24-story building at 575 Eighth Avenue.
Chang sold the 85,000-square-foot Hilton Garden Inn Midtown East to Hersha for $85.3 million in June, as The Real Deal reported. That deal has been in contract for about two years, and the closing was set to be timed with the official launch of the 205-room hotel on East 52nd Street.