Watermark Capital Sells Holiday Inn in Chelsea, NYC for $80 million To Two Kings Real Estate
Main Photo: The Holiday Manhattan 6th Ave – Chelsea
Date: July 2022
Name: The Holiday Manhattan 6th Ave – Chelsea
Location: 125 West 26th, Chelsea, New York City, NY, USA
Number of Keys: 226
Seller: Watermark Capital
Buyer: Two Kings Real Estate
Watermark Capital has found a taker for the struggling Holiday Inn in Chelsea.
Two Kings Real Estate bought the 226-key hotel from the Chicago-based investment firm for $80.3 million, according to city property records filed Tuesday. Two Kings principal Christopher Wang signed for the buyer. Brendan Medzigian, Watermark’s head of transactions, signed for the seller.
Two Kings acquired the property at 125 West 26th Street for 30 percent less than the $113 million Watermark paid Magna Hospitality for the hotel in 2013. The New York-based real estate operator did not immediately respond to a request for comment.
Watermark had been looking to sell the indebted hotel since January in an effort to cut its financial losses. The national hotel investor fell behind on it’s mortgage payments in October 2020 and the loan was transferred to a special servicer in January 2021. At the time, the property’s value was appraised at $78.4 million, slightly more than its $72 million loan.
The firm had avoided foreclosure by negotiating with its lender, but it was expected that a buyer would need to pick up the balance of Watermark’s loan.
The Holiday Inn, located between Sixth and Seventh Avenues, has managed to stay open for most of the pandemic. However, the hotel has struggled to make up for lost revenue as the city’s hospitality industry has slowly recovered.
Watermark owns some 20 hotels, mainly branded under Marriott, with the odd Hilton, Hyatt and The Equinox VT, across the USA. The REIT was acquired by Brookfield Asset Management in May 2022 for $3.8bn.
Two Kings is an owner-operator across the real estate specturm with apartments, hotels, office and retail space.
Price: US$80m
Price per Key: $354k
THPT Comment: Good price for Two Kings. Reflects the general feeling for hotels in Manhattan.
First Seen: Real Deal
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