It’s a hotel deal made in Manhattan.
In a sign of confidence in the New York hotel market, three investment groups with strong local knowledge—Gencom, Argent Ventures and a Highgate—have partnered to acquire the 607-room, 34-story InterContinental New York Times Square for a reported $230 million or just shy of $379,000 per key.
The seller was a joint venture between Tishman and MetLife Investment Management. An anticipated deal was first reported back in September by Bloomberg.
As part of the deal, IHG will reliquish management of the hotel, which will now be operated under a franchise agreement by Highgate, one of the largest hotel operators in New York City.
The property includes roughly 20,000 square feet of flexible meeting space, a signature restaurant, a Shake Shack and a 24-hour fitness center. Plans are in place for a renovation of guestrooms, public areas, and dining venues to enhance the guest experience.
The deal represents Gencom’s second hotel buy in New York City in the past 18 months following its 2024 acquisition of Thompson Central Park. “This transaction underscores our confidence in the long-term strength and global appeal of this destination,” said Karim Alibhai, founder and principal of Gencom. “We look forward to leveraging Gencom’s expertise to elevate the property’s experience further, blending luxury with the energy and sophistication of Manhattan.”
Gencom is a major investor in upper-upscale and luxury hotels. Beyond its Thompson acquisition, Gencom has been fairly active in preceding months. In March, it acquired The Ritz-Carlton, New Orleans and the Courtyard by Marriott French Quarter Iberville, a combined 758 rooms. In 2023, it acquired The St. Regis Chicago.
Alibhai founded Gencom in 1987 and in its nascent years the firm focused on the limited-service, full-service and extended-stay segments. It pivoted ito luxury and branded residential in the late 1990s, with successful investments in such assets as The Ritz-Carlton, Key Biscayne, The Ritz-Carlton Philadelphia and The Ritz-Carlton, Bachelor Gulch in Colorado. Since then, it’s put together a formidable portfolio that includes other luxury hotels such as Four Seasons Papagayo in Costa Rica and Rosewood and Fairmont properties in Bermuda. It has more than $8 billion in assets under management.
Argent Ventures brings experience from its recent acquisition and conversion of the Crowne Plaza Times Square into the Hyatt Regency Times Square, also operated by Highgate. The InterContinental New York Times Square acquisition follows Highgate’s recent investment in the 1,331-room Row NYC, and marks a continuation of Highgate’s longstanding track record investing in New York real estate.
“Highgate is thrilled to complete another significant investment in New York, and to partner with Gencom and Argent Ventures,” said Zach Berger, a Highgate principal. “Highgate has invested in New York across multiple cycles and multiple asset classes, and remains committed to fielding a best-in-class operating team in the market and delivering exceptional experiences for our guests and leading results for our partners. We are also excited to continue expanding our activities with IHG, and to lead this new chapter for the InterContinental New York Times Square.”
Deal financing was provided through a $190-million loan from Monroe Capital, reports The Real Deal. Eastdil Secured advised the seller and arranged the debt. Eastdil Secured represented the seller on the sale as well as the buyer in securing financing.
Eastdil Secured represented the seller on the sale as well as the buyer in securing financing. The seller was a joint venture between Tishman and MetLife Investment Management.
Dan Lesser, CEO of LW Hospitality Advisors, an asset management group, said the transaction is part of a recent pick up in deal activity in New York City, though warned of the city’s difficult operating environment that is presenting headwinds for owners and operators. “The top line is doing well in New York, but there are definitely headwinds,” he said, which are weakening the bottom line. The more difficult operating environment, he continued, is impacting asset valuations. “What we’re seeing in New York, and elsewhere around the country, is a resetting of pricing, because the market is now speaking. When there are no transactions, everybody takes wild guesses as to what value is. Now that there are transactions, there’s a reset that’s factoring in the positives of strong revenue and the headwinds of being able to generate profits.”
Recent transactions, according to data culled by LWHA, include the New York EDITION selling for $235 million to Kam Sang Company and Slate Property Group & Breaking Group acquiring the Stewart Hotel with plans to convert it to affordable housing.
The InterContinental New York Times Square opened in July 2010 with then Mayor Michael Bloomberg presiding over the ribbon cutting. The hotel actually straddles the Times Square and Hells Kitchen neighborhoods. As Shermans Travel wrote back when the hotel opened: “This works to InterContinental’s advantage: A quirk in zoning laws caps most buildings in that neighborhood at seven stories, so the upper floors of the hotel boast killer views of western Manhattan. Some corner suites can even see all the way north to Central Park.”