Sam Chang in contract to sell Garment District hotel

Magna also bought a development site from McSam last year

Feb.February 06, 2019 09:01 AM

338 West 36th Street with Sam Chang (Credit: Google Maps)

Sam Chang’s McSam Hotel Group is in contract to sell its newly constructed Garment District Hotel to Magna Hospitality Group.

The price for the 570-room hotel was undisclosed, according to PincusCo. The property at 338 West 36th Street has $185 million in debt.In the unlikely scenario that it would sell for just the debt, it would be on par with the fifth priciest Manhattan hotel sale last year.

338 West 36th Street (Credit: Gene Kaufman Architect)

Last year, Magna also bought a hotel development site at 140 West 24th Street for $113 million from McSam, which is one of the most prolific hotel developers in the city.

The Garment District hotel, which stands at 26 stories, received its initial temporary certificate of occupancy last month. The top half of the building will have a Marriott SpringHill Suites while the lower half will be a Marriott Fairfield Inn & Suites. Chang signed the contract on Aug. 30, 2018 and the deal is expected to close in early March, the report said.

The hotel is designed by frequent Chang collaborator, architect Gene Kaufman, and includes a bar and dining area with both indoor and outdoor seating.

Hotel transactions are poised to rise in areas of Midtown and Brooklyn that are zoned for light manufacturing, where the city has imposed hotel development restrictions. That means existing projects and site could become more valuable.

“There is still an overhang of supply that will cause a little bit of turbulence in the market,” Jay Morrow, a director at brokerage firm Hodges Ward Elliott, said. He was not involved with the 36th Street transaction. “But on the back end, in the long term, Manhattan lodging is strong.” [PincusCo] — Meenal Vamburkar

Related Articles

From left: The Row Hotel at 700 8th Avenue, the Williamsburg Hotel at 96 Wythe Avenue, the Selina Hotel at 516-518 West 27th Street and 20 Times Square (Credit: Google Maps, Sumaida + Khurana, PBDW)

More NYC hotel loans are defaulting as room rates fall

Brookfield Asset Management CEO Bruce Flatt

“We underwrite every investment like we’re going to hit a recession”: Brookfield CEO

Cadre founder Ryan Williams and Allen Smith

Cadre brings on former Four Seasons CEO as president

AKS Capital Partners Managing Partners Aaron Appel and Walker & Dunlop CEO Willy Walker

Walker & Dunlop acquires Aaron Appel’s AKS Capital Partners

From left: Publisher and founder Amir Korangy, Editor-in-chief Stuart Elliott and VP of Corporate Development Yoav Barilan

TRD’s founders share war stories from over the years

As the years go by_A look back at 17 years of real estate history

A look back at 17 years of real estate history

The Blakely Hotel at 136 West 55th Street and Richard Born (Credit: Google Maps, iStock, Richard Born by Studio Scrivo)

Hotel owner says competition, not union deal, led to closure

The Blakely Hotel at 136 West 55th Street and Richard Born (Credit: Google Maps, Richard Born by Studio Scrivo)

Blakely Hotel may shut down, lay off 54 workers