Gehr completes acquisition of second Times Square hotel

Gehr Development, which owns the 33-story Fairfield Inn hotel by
Marriott Times Square at 330 West 40th Street, has completed an acquisition of the adjacent Four Points
by Sheraton Times Square, at 326 West 40th Street, for $112 million,
or approximately $460,000 per room, Gehr’s representative in the deal, Cushman &
Wakefield, said today.

The transaction closed late yesterday with Tom McConnell, Jared Kelso
and Ernest Lee of Cushman & Wakefield Sonnenblick Goldman’s U.S.
hospitality group representing Gehr in arranging a $170 million
portfolio financing secured by both hotels.

“We wanted the adjacent hotel because we like the strong brand, the
location and we also own the rooftop lounge, Sky Room Times Square,
which straddles the 33rd and 34th floors of both hotels,” said Gehr
president David Lifschitz, who also confirmed that the company would
not be joining the two hotels, which sit between Eighth and Ninth

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“There continues to be a very strong demand for well located, high
quality hotel assets in New York City,” Kelso said. “[Gehr] recognized
an opportunity to capitalize on the strength of the market to leverage
an existing asset in order to expand its New York portfolio.”

The acquisition brings Gehr’s total Manhattan hotel room count to 488.

In 2009, The Real Deal reported that Lam Group, one of the most active
developers of economy hotels in the city, had sold the
recently-completed Fairfield Inn to Gehr for $99.5
million, or $407,787 per room.