UPDATED, March 8, 2022, 3 p.m.: One of New York City’s largest hotels traded hands — at a nearly $400 million loss from its last sale.
Hotel owner-operator MCR agreed to acquire the Sheraton New York Times Square from Host Hotels & Resorts for $356 million, according to research platform Green Street. The 1,780-key hotel last sold in 2006 for $738 million, more than double what it is today, according to property records.
Once closed, the deal would mark the city’s largest hotel sale in about two years, Green Street noted.
The 51-story hotel at 811 7th Avenue is the third-largest in the city by room count. The property, which opened 60 years ago, in February hosted the New York Democratic Convention.
Host attempted to sell the property in 2018 via Eastdil Secured, seeking up to $550 million on a sale, according to Green Street. Two years later, Host acknowledged the fair market value of the property had dropped to $495 million.
MCR declined a request for comment on the reported transaction.
MCR has not shied away from acquiring hotels during the pandemic, despite the staggering struggles of the sector and tourism at large.
In 2020, the company acquired the storied Royalton Hotel from hotel operator Highgate and real estate investment firm Rockpoint Group for $40.8 million. MCR was also part of a joint venture that acquired the shuttered Lexington Hotel last year for $185 million, along with Andrew Farkas’ Island Capital and Three Wall Capital.
MCR owns 140 hotels across 37 states. Other New York hotels in its portfolio include the TWA Hotel, the High Line Hotel and The New Yorker.
The hotel industry showed some signs of life in New York last month, but only after the winter slow season hit properties harder than usual.
Hotels averaged a 56.5 percent occupancy rate for the week ending Feb. 19, according to STR data. The city’s occupancy rate dipped as low as 40.3 percent in early January as Omicron and staff shortages raged.
In the week ending Dec. 11, occupancy soared as high as 81.5 percent, the best mark since the start of the pandemic.
[Green Street] — Holden Walter-Warner