Maxwelle Real Estate buys majority stake in Raffaello Hotel

A Miami-based company took majority ownership of the Raffaello Hotel in Streeterville by buying most of its rooms from a mishmash of investors.

Maxwelle Real Estate Group bought 140 rooms in the 175-key boutique hotel, according to Crain’s. The property at 201 East Delaware Place is a so-called condo-hotel, in which investors split ownership by laying claim to specific rooms.

The sale price is unknown, but Maxwelle followed up its purchase by taking out a $29.3 million loan, records show. The company plans to overhaul the building, which was last renovated in 2010.

An affiliate of Miami-based Crescent Heights managed the hotel and offered in 2016 to buy the entire building for $34.5 million, but the deal never went through, Crain’s reported.

Many of the hotel’s smaller investors bought rooms before the recession and were forced to sell at a loss afterward. Maxwelle bought one room for $106,000 that had sold for $230,000 in 2006, according to property records.

Record levels of tourism made 2018 a banner year for hotel operators, but the 2,000 combined rooms set to come online Downtown this year could make it harder to raise room rates.

At least five Chicago-area hotels changed hands last year at prices of $20 million or more, adding up to some $200 million in sales. [Crain’s] — Alex Nitkin