NEW YORK CITY — Hotel operator Starwood Hotels & Resorts Worldwide (NYSE: HOT) has sold the 665-room Manhattan at Times Square Hotel in New York City for $275 million.
The buyers — Rockpoint Group, Goldman Sach's Real Estate Principal Investment Area and Highgate Holdings — have decided to operate the hotel as an independent property managed by Highgate.
Starwood executives say the sale was in line with an ongoing strategy to make the company more “asset light.”
“As we continue our transition to an asset-light model, we continue to look for opportunities to sell our owned hotels at attractive prices to best create value for our shareholders, and this sale of a non-strategic asset is consistent with that strategy,” says Simon Turner, Starwood's president of global development.
In 2010, Starwood removed the Sheraton flag from the hotel. With the sale completed, the hotel will no longer be affiliated with Starwood. “With all nine of our brands already well-represented in New York City across approximately 9,000 rooms, we believe this sale presented the best value to our shareholders,” says Turner.
The property is located on Seventh Avenue between 51st and 52nd streets. The building is minutes from sites such as Central Park, Rockefeller Center and 5th Avenue shopping.
According to a Marcus & Millichap third-quarter report, investors' interest in hotel properties in the high-density Northeast region remains keen. Across the region, the number of transactions increased more than two times, with each segment posting a sizable gain, and dollar volume spiked 40 percent.
Starwood's stock price closed at $57.14 per share on Wednesday, up from $38.77 per share one year ago.
— Liz Burlingame