A 206-key Hyatt Rosemont hit the market, the latest example of the coronavirus-effect on Chicago-area hotels, and in particular the O’Hare submarket.
Prominence Hospitality hired a broker to sell the property at 6350 N. River Road, according to Crain’s. Scott Kaniewski of Hospitality Real Estate Counselors is doing the marketing.
The O’Hare hotel submarket had been riding high until the pandemic and ensuing lockdown decimated the industry. Occupancy rates have slowly begun to pick up and Chicago on Wednesday reopened businesses at reduced capacity.
But Prominence is still listing the Hyatt, which it bought in 2017 for $7.5 million, according to Crain’s. The company has not offered a price.
In January, the massive O’Hare Airport expansion project received final approval. That years-long undertaking has an estimated cost of $8.5 billion and will expand the airport by about 60 percent. While the submarket had been performing well, last July a joint venture led by Prudential Insurance’s real estate investment arm sold two Rosemont hotels at a deep discount. Industry pros said at the time that price cuts indicated costly improvements were needed at those properties.
Prominence principal Rana Rehan Zaid told Crain’s that the Hyatt didn’t fit with the company’s preference for limited-service hotels like its Holiday Inn Express & Suites in Des Plaines or the Hampton Inn & Suites in Burr Ridge.
But Covid-19 has also created enormous financial stress on hotel operators in the Chicago area. Nearly a third of those hotels that have CMBS loans are at risk of default, the outlet recently reported. [Crain’s] — Alexi Friedman