Sam Chang is joining the jam packed Long Island City hotel market.
The developer’s McSam Hotel Group has closed on the $7.8 million purchase of 38-04 11th Street, where he is planning to build a 142-key hotel spanning 43,458 square feet, The Real Deal has learned. The site already has approved plans and a foundation in place, allowing Chang to start construction almost immediately.
Chang purchased the site from Greenwich Street Equities‘ Alec Shtromandel, who could not be reached for comment.
A recent analysis by The Real Deal found that Long Island City was the most popular outer-borough neighborhood for hotels by a long shot, with 45 projects planned for the area dating back to 2010. The standout incoming project is the 50-story Toyoko Inn coming to 24-09 Jackson Avenue, which will have 1,260 hotel rooms and be the largest hotel in the outer boroughs.
Stephen Preuss
A Cushman & Wakefield team led by Stephen Preuss and Winfield Clifford brokered the deal for the buyer and the seller, and Preuss said it demonstrated that there was still demand for hotels in the neighborhood.
“Despite the large upcoming influx of hotels in LIC, there is still strategic demand for these types of assets shown here by Sam’s acquisition,” he said.
This will be Chang’s only hotel in Long Island City, although the developer said he had previously built hotels in the neighborhood that he sold, including a Comfort Inn at 42-24 Crescent Street.
Chang is also planning a 172,640-square-foot hotel in Chelsea at 140-146 West 24th Street, and he landed an $83 million refinancing package for his hotel at 585 Eighth Avenue earlier this year.
“The price is right,” Chang said. “I don’t think it’s going to have a really high occupancy rate, but I think I can do well with my costs.”