Rotem Rosen to fund Hotel Indigo purchase with Tel Aviv bonds

Rosen’s MRR is in contract to buy hotel for $162M

TRD New York /
Aug.August 10, 2018 11:30 AM

From left: Rotem Rosen, Anand Mahindra, Jerry Rotonda, and Hotel Indigo at 171 Ludlow Street (Credit: IHG)

Rotem Rosen plans to raise up to $72 million in Israel to finance the purchase of a Lower East Side hotel.

Rosen’s MRR Development went into contract in June to buy the Hotel Indigo for $162.5 million from Brack Capital and InterContinental Hotels Group.

To fund the purchase, MRR filed a prospectus for a secured bond offer of up to $72 million in Tel Aviv with bondholders taking the senior position on the 294-key hotel. MRR will seek to raise up to 45 percent of the hotel’s value, and contribute the rest of the purchase price from the company’s capital, according to documents filed on the Tel Aviv Stock Exchange.

The hotel, located at 171 Ludlow Street, took a decade to build and opened in 2015. Two years later, Brack and InterContinental put it on the market for $176 million. The Indigo chain is a boutique brand under InterContinental, which has a 20-year management deal for the property.

According to the documents filed to TASE, the hotel had a net operating income of $9.1 million in 2017, up from $8.1 million in 2016. Also as of 2017, the hotel had an 80.3 percent occupancy rate, and average daily rate of $264.

Rosen is testing the Tel Aviv market’s appetite for more New York real estate at a moment when the sector is losing its luster. The Tel Bond-Global, an index which tracks foreign companies, has fallen by more than 8 percent since January, with companies like Brookland Capital, All Year Management and Starwood West trending downwards.

Rosen launched MRR with Indian billionaire Anand Mahindra and former Deutsche Bank executive Jerry Rotonda earlier this year. The hotel will be the company’s first asset.

Discount Bank advised MRR on the deal. MRR Development was not immediately available for comment.


Related Articles

arrow_forward_ios
From left: Rotem Rosen, Zina Sapir, Tamir Sapir, Bella Sapir, Elena Sapir, and Alex Sapir (Credit: Getty Images)

Alex Sapir accused of mismanaging family fortune amid feud with Rotem Rosen

Alex Sapir accused of mismanaging family fortune amid feud with Rotem Rosen
Nightingale's Elie Schwartz and Madison's Brian Shatz (Whale Square)

Nightingale buys Whale Square in Sunset Park for $84M

Nightingale buys Whale Square in Sunset Park for $84M
Investors worry that New York City’s battered commercial real estate sector is indicative of larger issues nationwide with hotels, restaurants and retail. (iStock)

New York’s CRE woes could spread nationwide: investors

New York’s CRE woes could spread nationwide: investors
Subversive CEO Richard Acosta (Photos via ICSC; iStock)

Riding high: Inception, Subversive to launch publicly traded cannabis REIT

Riding high: Inception, Subversive to launch publicly traded cannabis REIT
Gov. Andrew Cuomo announced that movie theaters in some New York counties can reopen, but NYC’s theaters are excluded for now. (Getty; iStock)

Cuomo: Movie theaters can reopen — but not in NYC

Cuomo: Movie theaters can reopen — but not in NYC
Blackstone’s Stephen Schwarzman, Roku CEO Anthony Wood and Coleman Highline in San Jose (Blackstone; Wikipedia Commons; Coleman Highline)

Blackstone buys Roku’s Silicon Valley office buildings

Blackstone buys Roku’s Silicon Valley office buildings
IKEA Chief Sustainability Officer Pia Heidenmark Cook (IKEA, iStock)

Ikea will buy back your old furniture on Black Friday

Ikea will buy back your old furniture on Black Friday
107 Chambers Street and Allison and Frederick Thompson (Google Maps, Tribeca Health & Fitness) 

Another fitness studio in Manhattan goes belly-up

Another fitness studio in Manhattan goes belly-up
arrow_forward_ios

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

Loading...