Gencom, an owner of luxury and lifestyle hotels across the U.S. and also management company Pyramid Global Hospitality, has teamed with real estate company GD Holdings, to acquire a majority stake in the 192-room St. Regis Chicago for an undisclosed price. As part of the deal, Chicago-based Magellan Development Group, which oversaw development of the hotel, which is also part of the Magellan-developed, 28-acre Lakeshore East master development, will retain an ownership interest in the project.
The hotel, which is managed by Marriott International, opened on May 15. It was initially going to be the Wanda Vista Hotel (Wanda is a Chinese conglomerate based in Beijing), but since rebranded as a St. Regis. The property itself started as the Vista Tower. The hotel is located in the city’s Lakeshore East Loop community and occupies the first 11 floors within three interconnected towers comprising hotel guestrooms and branded residences. The property, which is Chicago’s third tallest building and the 10th tallest building in the U.S., was designed by American architect Jeanne Gang, who also designed Aqua in Chicago, which was awarded the Emporis Skyscraper Award as 2009 skyscraper of the year, and her architectural firm Studio Gang Architects.
The hotel features nearly 12,000 square feet of meeting space, including the 5,000-square-foot Astor ballroom, and 7,000 square feet of executive function rooms. It also includes the St. Regis Spa and fitness center with yoga and group exercise rooms, rooftop terrace and indoor swimming pool.
The hotel has five dining outlets totaling 580 seats and 38,000 square feet of space. Two of the new restaurant concepts are being led and managed by Lettuce Entertain You Enterprises. The first restaurant Miru, located on the 11th floor, is a Japanese concept offering an all-day dining experience from Lettuce Entertain You Chef Hisanobu Osaka. The second restaurant Tre Dita is a Tuscan steakhouse in collaboration with Los Angeles-based Chef Evan Funke, which will open in the Fall of 2023.
The acquisition marks the first St. Regis brand in both Gencom’s and GD’s portfolios. The former owns such hotels as The Ritz-Carlton, Key Biscayne; Four Seasons Papagayo in Costa Rica and Rosewood Bermuda. Gencom also owns management company Pyramid Global Hospitality and has a stake in Provenance Hotels. GD Holdings has direct investments in real estate, including luxury hotels under Four Seasons and Ritz-Carlton flags.
“During the pandemic, Gencom saw a unique opportunity to purchase this asset while it was still under construction and strategically arranged to close on the transaction once the property was delivered,” said Gencom’s Chief Investment Officer Alessandro Colantonio, speaking on behalf of the joint venture. “From the onset, we recognized the long-term value of this investment given the strength of the Chicago market and the significance of opening the first luxury hotel downtown in over a decade. Through this acquisition, Gencom and GD also reinforces their relationship with Marriott International, adding yet another high-end hotel brand to each group’s growing hospitality portfolios.”
FINANCING
Though financial terms of the acquisition were not disclosed, JLL Capital Markets announced that it arranged $76 million in acquisition financing for the hotel, for the borrowers: Gencom, GD Holdings and Magellan. The loan was arranged through the lender, Värde Partners.
The JLL Capital Markets Debt Advisory team was led by Senior Managing Director Eric Tupler, Executive Vice President Jeff Bucaro and analysts Mark DesLauriers and Jake Martin.
“The St. Regis is the first 5-star hotel property built in Chicago in over a decade. Given the strong recovery of the Chicago luxury hotel market combined with the exceptional room quality, sizes, and amenities, we had several lenders vying for the financing” said Bucaro.