Marriott Buys the W Union Square for US$206m, to Control Major Refurbishment

Main Photo: The W New York

Date: November 2019

Location: Union Square, New York, NY, USA

Name: The W Hotel New York

No. of Keys: 270

Seller: Westbrook Partners, who bought the hotel at 201 Park Avenue South just a year ago, according to public records, for $165.5 million, financed through a $100 million loan from HSBC. Westbrook are a major property company with large office building in NY, Paris, Japan and in hotels, Dolphin Square in London and the Ritz-Carlton Boston.

Buyer: Marriott International purchases The W New York – Union Square to create W brand’s Next-Generation flagship In North America. The purchase marks a new chapter in the  transformation plan for the company’s iconic luxury lifestyle brand.

The company paid $206 million for W New York – Union Square, with plans for a significant renovation. Marriott International will transform the existing hotel into a cutting-edge W Hotels showcase, advancing the company’s strategy to redefine and reinvigorate the brand in North America.

“There’s no better place than New York City to reveal to the world the future of our W Hotels brand, so we’re tremendously excited about this acquisition and the unique opportunity that it presents for our reinvention strategy,” said Arne Sorenson, President and CEO, Marriott International.

“When W was launched as a single hotel in New York 21 years ago with ground-breaking design and a bold approach to nightlife, it pushed the boundaries of how people thought about a hotel. Given how much travellers crave these types of experiences today and the brand’s global reach, we see limitless potential for the W brand with hotel owners and developers, travellers and locals.”

Located at 201 Park Avenue South, the 20-story hotel features historic Beaux Arts architecture, panoramic views of Union Square’s namesake pedestrian plaza and lively park, and a “W Union Square” rooftop sign that stands out on the Downtown skyline. The property first opened its doors in 1911 as the headquarters of the Guardian Life Insurance Company of America, and in 2000 opened as W New York – Union Square, becoming an anchor for locals and out-of-town guests, alike.

The renovation seeks to unlock the property’s untapped potential with plans for a signature, socially-charged spa and an expanded restaurant on one of New York City’s most bustling street corners. Honouring the brand’s electric New York City roots and innovative drive, the renovated hotel will be the incubator and catalyst for a new vision for W in North America – one focused on immersive, next-level contextual design; authentic, experiential programming, and a fresh take on the brand’s signature Whatever/Whenever service philosophy.

The purchase and renovation of W New York – Union Square is part of a comprehensive plan by Marriott International to reinvigorate the W portfolio in North America. The plan also includes the recent opening of W Aspen – the brand’s first alpine destination in the United States, and the anticipated 2020 debuts of W hotels in Philadelphia and Toronto.

Additionally, W owners in North America have already committed to $200 million worth of renovations on properties across the U.S. and Canada, such as the recent top-to-bottom renovation of W Washington D.C.

As of June, Marriott International had 56 open W hotels worldwide in 26 countries and territories, with another 32 signed W hotel projects in the pipeline with the brand debuting in eight additional countries. In keeping with Marriott International’s asset-light strategy, the company over time expects to market W New York – Union Square for sale subject to a long-term management agreement.

Due to the company’s asset-light strategy, Marriott said it expects to market W New York – Union Square for sale subject to a long-term management agreement.

Marriott took a similar approach as it worked to re-position the Sheraton brand last year. It acquired and renovated the Sheraton Grand Phoenix, which then served as a living innovation hotel that helped engage owners to experience and develop the Marriott Hotels brand, enhance guest satisfaction, and improve hotel profitability.

Price: US$206m

Price per Key: US$762,963

THPT Comment: Look forward to the unveiling of this exciting new W brand hotel. Interesting move to buy the hotel, to manage the refurb, with a plan to sell it after all is done.

First Seen: Hospitality Net

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