The Gramercy Park Hotel in Manhattan has a new tenant. According to various news reports, MCR Hotels, headed by Tyler Morse, has signed a 99-year ground lease with Solil Management, after it took the hotel over from Aby Rosen’s RFR Holding, which ran into trouble making payments in the wake of the COVID-19 pademic.
The hotel has sat idle for two years, but MCR’s Morse told The Wall Street Journal that the hotel will reopen after two years of renovations. The Journal, citing a source, said MCR paid $50 million for the lease, which the city values at $179.8 million for purposes of assessing taxes, reported PincusCo.
The hotel is located at 2 Lexington Avenue in the Gramercy Park neighborhood of Manhattan and had been a haunt for many a celebrity, including New York Yankees and past presidents. It even made a cameo in the film “Almost Famous.”
The deal is believed to have closed on August 17 and was recorded on Wednesday, PincusCo further added. According to analysis of city data, the property has 188,933 square feet of built space and has a sale price per built square foot of $951.
This comes less than a year after Aby Rosen’s RFR Holding was forced to check out of the hotel as its controller following a lawsuit filed by the hotel’s landlord, Solil. Rosen leased the land for $5 million a year. Solil sued Rosen in April 2021 over nonpayment of rent worth $80 million racked up from November 2020 to April 2021. According to a legal complaint, RFR Holding stopped payments, claiming that the leasehold was “worthless” amid the decline in tourism.
Solil Management had filed a lawsuit to collect about $80 million in rent, but the judge said Rosen was not personally liable for the sum.
Besides the outstanding rent, RFR had reportedly stopped maintaining the hotel building, which had “deteriorated to a shocking degree.” While the hotel’s mechanical systems were in poor condition, the elevators required servicing and the HVAC equipment had been held together by duct tape, according to court papers.
During the pandemic, Rosen allegedly housed his mother in a three-bedroom suite at the hotel and allowed employees of RFR Realty to stay there for free.
Rosen acquired Gramercy Park Hotel with business partner Ian Schrager in 2003 before buying out his stake and taking full ownership of the hotel in 2010. Rosen was known to have filled the hotel with artworks from his own private collection, which included pieces by Andy Warhol, Jean-Michel Basquiat and Damien Hirst.
After staying closed for more than three years, the luxury hotel had last opened in September 2022 but only to see all of its items — from furniture, soup spoons, the famed artworks and even robes — being liquidated and go on sale to the public.
Gramercy Park Hotel was reportedly built on the site where writer Edith Wharton and architect Sanford White once stayed. Built-in the mid-1920s, the hotel opened in 1925 and has since hosted several celebrities like former presidents, athletes and legendary actors. The hotel was also a popular choice among music bands and musicians, with The Clash, the Rolling Stones and Bob Dylan frequenting the legendary property.
Before it closed, the hotel was home to Italian restaurant Maialiano (owned by Danny Meyer) on the ground floor and the iconic The Rose Bar.
The hotel gave guests access to Gramercy Park, the private park across the road, which is known to be accessible only to residents living in that neighborhood.
MCR is one of the largest hotel owners and operators in the U.S. It owns the TWA Hotel at John F. Kennedy International Airport and the High Line Hotel in Manhattan. In total, it owns some 25,000 in the U.S. and ranked 65th globally by number of rooms in HOTELS Magazine’s 2023 The List.