Hotel investment and ownership company MCR and real estate merchant bank Island Capital Group have jointly acquired the Sheraton New York Times Square Hotel, a 1,780-room property in midtown Manhattan, for $373 million. The purchase price equates to $210,000 per guestroom, which is reportedly one of the lowest prices per guestroom paid for fee-simple hotel real estate in Manhattan in the past 13 years.
The Sheraton New York Times Square is the third-largest hotel in New York City by room count. The property opened in 1962 as the Americana and became part of the Sheraton hotel brand in 1979. The property has 62,000 square feet of event space and most recently hosted the New York Democratic Convention.
The acquisition of the hotel follows Island Capital's and MCR's joint venture acquisition of the 725-room Lexington Hotel, Autograph Collection, in Midtown Manhattan. Between those two transactions, Island Capital and MCR have acquired more than 2,500 guestrooms in New York City together. On a standalone basis, MCR operates more than 5,000 rooms in the New York City area, which includes properties such as The TWA Hotel at JFK Airport, The High Line Hotel, Royalton New York, Ink48 Hotel and The New Yorker.
"The Sheraton New York Times Square Hotel is a landmark property that we are committed to enhancing and modernizing over the coming months to make it a go-to destination when traveling for business or pleasure," said Andrew L. Farkas, CEO of Island Capital. "We are excited to continue building our lodging and hospitality footprint in New York City alongside MCR, and we are confident that the city's hospitality industry will continue to bounce back."
"We are delighted to be working with Marriott [International] to position The Sheraton New York Times Square Hotel as one of New York City's premier destinations and one of the flagship hotels for the Sheraton brand in the United States and globally," said Tyler Morse, chairman and CEO of MCR. "The Sheraton New York Times Square Hotel is the gateway to Times Square and a New York City icon. We believe in investing in New York, and we are proud to have kept our eight New York City-area hotels open and the teams employed over the past two years. New York is open for business!"
The Sheraton New York Times Square Hotel will remain part of the Sheraton brand family under a new long-term franchise agreement and will be managed by MCR. Island Capital and MCR intend to invest more than $100 million in the hotel's rooms, banquet areas and public spaces.