The 224-room Courtyard Times Square West has a new owner, and it paid a hefty price. The hotel sold for $95 million, which equates to roughly $425,000 per key, demonstrating the unbelievable strength of the Manhattan market and its ability to generate exorbitant real-estate prices.
The hotel, at 307 West 37th Street in the Times Square area, was acquired by the non-traded real estate investment trust Carey Watermark Investors. The acquisition was financed with $56 million of debt.
Michael Medzigian, CEO of Carey Watermark, said of the purchase: "The acquisition of the Courtyard Times Square West represented the opportunity to invest in a newly built, high quality, select-service property with strong brand affiliation in one of the strongest domestic hotel markets. Given these attributes, we believe that the investment will be a solid cash flow-generating addition to our growing portfolio."
New York continues to benefit from strong demand and stunted supply, a great combination for investors. New York City occupancy averaged 78.3 percent from 1991 to 2013 as compared to 61.8 percent nationally over the same period, a press release said. Year-to-date through March, New York City achieved revenue per available room of $161, outperforming the U.S. by 142 percent.
The Courtyard Times Square West is a brand-new property, having been built in 2013. It has 655 square feet of meeting space and a Bistro restaurant, which serves breakfast and dinner.
Carey Watermark continues its streak of acquiring branded and unbranded properties in both gateway, secondary and resort markets. Its latest prior to this announcement was the acquisition of the 296-room Hyatt Place Austin Downtown, one block from the Austin Convention Center, for $87 million.
Also, in late 2013, CWI acquired the 553-room Renaissance Chicago Downtown Hotel for $139 million. It also purchased a Marriott in Raleigh, N.C., in August, for $83 million. In the resort market, it bought the 144-room Hawks Cay Resort, in the Florida Keys, for a total investment of $149.4 million, including a $133.8 million purchase price and $15.6 million of planned capital improvements and other acquisition-related costs.