A subsidiary of Millennium & Copthorne Hotels has agreed to acquire the freehold interest of the 480-room Novotel New York Times Square building from 226 West Fifty-Second Street LLC, a partnership led by a fund affiliated with Apollo Global Management LLC and Chartres Lodging Group for US$273.6 million.
Upon completion of the sale, the hotel will continue to be managed, as at present, by an affiliate of Accor under a management agreement that has an initial term that ends on December 31, 2038 and may be extended by the manager for up to three successive 10-year periods.
The most recent audited results for the hotel show a pre-tax profit of US$2.1 million for the 327-day period ending December 31, 2012. Profit during this period reflects non-repeating cost items and the earnings impact of a significant refurbishment that commenced in the second half of 2012 and completed in November 2013.
“I am delighted that we have secured this transaction. Times Square is one of the world’s top tourist destinations and this beautifully refurbished property will undoubtedly increase our share of the international travel market in New York, one of our three key gateway cities. The property is an important strategic investment for Millennium & Copthorne Hotels and will complement our existing midtown and downtown Manhattan hotels without adding significantly to central management costs,” said Kwek Leng Beng, chairman of Millennium & Copthorne Hotels, London.
