Dive Brief:
- Global real estate investment and development firm Gencom acquired the 587-key Thompson Central Park Hotel in New York City, entering “one of the world’s top hospitality markets,” Chief Investment Officer Alessandro Colantonio said in a release obtained by Hotel Dive.
- The 42-story hotel sits along Manhattan’s Billionaires’ Row just south of Central Park and includes updated amenities and dining concepts following a comprehensive renovation in 2021, according to Gencom. The property is part of Hyatt’s luxury lifestyle Thompson Hotels brand.
- With the acquisition, Gencom diversifies its portfolio and strengthens its existing relationship with Hyatt Hotels Corp., Gencom Founder and Principal Karim Alibhai said in a statement. The deal marks another notable U.S. hotel transaction as investment activity in urban markets ramps up across the industry.
Dive Insight:
With the Thompson buy — Miami-based Gencom’s first NYC acquisition — the firm continues its strategy to acquire “trophy hotel assets in core U.S. markets,” according to Colantonio.
“New York City has been at the top of our list, and we’ve bid on a lot of properties over the years in the New York market. It’s never been the right dynamics and timing until now. We’re finally putting that pin on the map, and it is a very important moment for us,” Colantonio told Hotel Dive.
Gencom declined to disclose the seller and sales price of its Thompson Central Park Hotel deal, though Commercial Observer reported Tuesday that the transaction was priced at about $300 million.
Following a 2021 renovation and rebranding, the Hyatt hotel offers 4,500 square feet of meeting space and several dining concepts, including casual spot Burger Joint, restaurant and bar Parker’s and the upscale Indian Accent, offering traditional Indian dishes with “a unique twist” by Chef Manish Mehrotra. Later this year, a 6,500-square-foot spa and fitness center is expected to open at the hotel, according to Gencom.
The New York City market is particularly desirable given its strong visitation, attracting more than 63 million business and leisure travelers annually, according to Gencom.
In the second quarter of this year, Manhattan saw “robust,” albeit decelerated, annual growth for hotel occupancy, ADR and RevPAR, according to a lodging index published by PwC. The market’s luxury segment saw the most significant year-over-year increase in RevPAR in the quarter, according to PwC, tracking with similar growth patterns nationwide.
“Recognizing the strength of the U.S. hospitality market, particularly in cities with high barriers to entry like New York, this transaction represents a key addition to our hospitality portfolio in North America that includes iconic hotel properties in major markets such as Miami, Chicago, Denver and Philadelphia,” Alibhai said.
The hotel marks the first Thompson Hotels-branded property in Gencom’s hospitality portfolio, but not the first under Hyatt. Gencom owns an Andaz property and is working with Hyatt to redevelop downtown Miami’s Hyatt Regency Miami. Gencom’s portfolio includes other luxury brands like The Ritz-Carlton, Four Seasons Hotels & Resorts, St. Regis, Rosewood, Fairmont and Auberge Resorts.
Gencom’s NYC acquisition comes amid heightened hotel investment activity across the country, with JLL reporting last month that transaction volume for deals larger than $200 million is at its highest level in eight years.
In the first half of 2024, New York City had the second largest hotel transaction volume of markets in the U.S. at $802 million, following Phoenix, according to JLL. One notable recent hotel deal in the market was Host Hotels & Resorts’ $265 million acquisition of 1 Hotel Central Park in July.
Declined supply growth and increased group travel will drive hotel investment in urban and other high-barrier-to-entry markets for the remainder of 2024, JLL forecasted.
