Blackstone is the latest investor in Chicago’s hot hotel market

The Blackstone Group is getting in on Chicago’s hot hotel market, with the purchase of a 337-room River North Marriott.

The New York-based private equity giant paid $40.9 million for the Courtyard by Marriott Downtown/River North, at 30 East Hubbard Street, Cook County property records show. The hotel also has 5,000 square feet of conference space.

Maryland-based Host Hotels & Resorts was the seller. It is seeking to offload a number of other Chicago-area Mariotts. This spring, it listed the 256-key Marriott Suites O’Hare and the 254-key Chicago Marriott Suites Downers Grove. The hotels were put on the market as part of a portfolio sale that included four other properties in Arizona, California and Georgia. The Chicago-area hotels do not appear to have been sold.

Blackstone is investing in a strong Downtown hotel market. Record tourism helped the hotel industry increase revenue in 2018 by 10 percent, to about $2.7 billion. Despite 3,000 new deliveries last year, average daily room rate jumped by 5 percent, to $210.54.

The strong performance of Downtown hotels has lured plenty of investors. In May, Spanish billionaire Amancio Ortega spent $72.5 million for the 216-key Dana Hotel and Spa in River North.

Representatives for both Blackstone and Host Hotels did not immediately return a request for comment.

Last year, Blackstone sold its majority stake in the Hilton hotel chain for $1.3 billion, ending an 11-year ownership that netted Blackstone $14 billion in profit. In 2012, the firm paid $1.9 billion for the Motel 6 chain.

Blackstone is also looking to offload its Oakbrook Terrace office complex, seeking $50 million for the 320,000-square-foot property.