Blackstone seeks $500M for London New York hotel

New York /
Oct.October 31, 2013 06:30 PM

The Blackstone Group is looking to sell its leasehold interest in the London New York hotel at 151 West 54th Street, The Real Deal has learned. Blackstone is looking for at least $500 million for the property, sources said.

The multi-national private equity giant has tapped the commercial real estate brokerage firm Eastdil Secured to market the 575,241-square-foot, 562-room hotel, which it has owned since 2004. The fee owner of the site is the estate of Sol Goldman, to which Blackstone reportedly pays some $3.7 million per year in rent. Blackstone’s lease has 123 years remaining.

The decision to sell the leasehold comes shortly after the firm announced it would sell its London West Hollywood hotel in Beverly Hills, and tapped Eastdil for the job in April.

Blackstone purchased the leasehold for the 54-story New York property from Lehman Brothers for $193 million, or $381,000 per room. Blackstone ended the hotel’s operating agreement with Marriott and struck up a new partnership shortly after with its own affiliate Luxury Resorts, which continues to run the hotel.

LXR refurbished and repositioned the property, which is located between Sixth and Seventh avenues, plowing nearly $100 million into a renovation spearheaded by designer David Collins. That renovation was completed in 2007. Chef Gordon Ramsay operates two restaurants at the hotel, Gordon Ramsey at the London and MAZE by Gordon Ramsey. The contract with LXR could be terminated upon the sale of the hotel, sources said.

While Blackstone’s global head of real estate Jonathan Gray declined to comment on the decision to sell the hotel, he told an audience at the Pierre Hotel this week that people “draw too many conclusions” from the company’s decisions to sell key assets and that those decisions are often just symptomatic of “the nature of the closed-end fund business,” which regularly sees funds sell off assets after their repositioning is complete.

Indeed, Blackstone has also been in hotel acquisition mode. Blackstone Real Estate Advisors reached an agreement with real estate investment trust Hersha Hospitality Trust to acquire 16 U.S. hotels for $217 million in September.

Blackstone is also looking to sell a 9,000-square-foot carriage house building at 154 West 55th Street, which is directly connected to the hotel. The property could be converted to for-sale residential units.

The Eastdil brokers representing the property include CEO Roy Hilton March, senior managing director Larry Wolfe, managing director Mark Schoenholtz and director Michele Mahl.


Related Articles

arrow_forward_ios
Blackstone's Jonathan Gray (Blackstone, iStock)
Blackstone: Give me your tired, your poor REITs
Blackstone: Give me your tired, your poor REITs
Prologis CEO Hamid Moghadam (Prologis, iStock)
Industrial strength: Prologis’ run unmarred by Ukraine conflict
Industrial strength: Prologis’ run unmarred by Ukraine conflict
Stephen Schwarzman, chairman, Blackstone, along with 345 Park Avenue (Getty Images, Rudin Management/Illustration by Steven Dilakian for The Real Deal)
Blackstone again weighing Manhattan HQ move, expansion
Blackstone again weighing Manhattan HQ move, expansion
Stephen Schwarzman, chairman, Blackstone, in front of 1740 Broadway (Getty Images, LoopNet, iStock/Photo Illustration by Steven Dilakian for The Real Deal)
Rare flop for Blackstone: Firm hands over keys to 1740 Broadway
Rare flop for Blackstone: Firm hands over keys to 1740 Broadway
Brookfield Properties EVP Callie Haines (Brookfield Properties, iStock)
One Manhattan West to run on renewable energy
One Manhattan West to run on renewable energy
Blackstone buys 49% stake in One Manhattan West at $2.9B valuation
Blackstone buys 49% stake in One Manhattan West at $2.9B valuation
Blackstone buys 49% stake in One Manhattan West at $2.9B valuation
From left: Jacob Werner, senior managing director, Blackstone; Joel Murphy, chief executive officer, Preferred Apartment Communities (Preferred Apartment Communities, Blackstone, iStock/Illustration by Steven Dilakian for The Real Deal)
Blackstone buying multifamily REIT in $5.8B deal
Blackstone buying multifamily REIT in $5.8B deal
Blackstone's Stephen Schwarzman and Clarion Partners's Drew Fung (LinkedIn, Getty Images, iStock, Illustration by Kevin Cifuentes for The Real Deal)
Blackstone snags $415M industrial refinancing
Blackstone snags $415M industrial refinancing
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...