Main Photo: The 17th Floor Bar & Club at The Surrey Hotel
Date: December 2020
Location: Near Central Park, New York, NY, USA
Name: The Surrey Hotel
No. of Keys: 189
Seller: The tony hotel near Central Park is a recreation of the original Surrey, which was built in 1926 and hosted famous people including John F. Kennedy and Bette Davis. The seller is Denihan Hospitality Group.
Denihan is an operator of upscale, luxury, boutique, and lifestyle hotels in North America. The company was founded some 50 years ago and has established itself as a privately-held, hotel management company and long-term owner.
Denihan operates or licenses hotels and residences under one of it’s boutique brands – The James, The Surrey, The Benjamin, and the Affinia Hotels & Suites. They re-opened the hotel after a major investment back in 2009.
Buyer: Billionaire British brothers David and Simon Reuben are buying New York City’s upscale Surrey Hotel in their latest push into U.S. real estate. It is believed that the deal is set to value the five-star Manhattan property at less than the $215 million asking price, The Reubens plan to hire a top hospitality management company to operate the 189-room hotel.
The Reubens, famous for their London property holdings, made a significant push into Manhattan this year by buying a retail condo from SL Green Realty Corp. for about $170 million, Bloomberg News has reported.
Eight other Manhattan hotels have been sold since March, when New York became the epi-center of the Covid-19 pandemic, according to data from Real Capital Analytics. Those include the Royalton, in Midtown, and the Hudson Hotel, which was acquired by Todd Boehly’s Eldridge.
The Surrey would arguably be the highest-profile Manhattan hotel to change hands since the pandemic levelled New York’s tourism industry. While lodging demand has increased in the months since, corporate travellers remain grounded and many of the city’s cultural institutions are still closed.
The occupancy rate at New York hotels was 39% in October, down from 91% in the year before period, according to lodging data firm STR, and the guests who are checking in are paying heavily discounted rates.
The Reuben brothers are also in negotiations to acquire a landmark site on Rodeo Drive, the luxury shopping area in Beverly Hills, California, according to the person. The billionaires are returning to the real estate deal-making they’re known for, after making an aborted attempt earlier this year to buy English Premier League soccer team Newcastle United together with the Saudi sovereign wealth fund.
A representative for the Reubens declined to comment. A spokesperson for the Surrey Hotel’s owner, Denihan Hospitality Group, didn’t immediately respond to a request for comment.
These latest transactions follow three recent financing deals the Reubens did in the last month worth more than $300 million, including buying the mortgage of Miami’s St. Regis Bal Harbour Resort as well as a stake in a senior loan tied to the St. Regis Chicago. They also acquired a holding in the senior mortgage over The Drew Hotel in Las Vegas.
Price: Say US$200m
Price per Key: Around US$1m
THPT Comment: The Reuben brothers are continuing their spending spree on classy hotels both in Europe and North America.
First Seen: Bloomberg
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