Northwood Investors, a New York-based real estate investment managers, has agreed to sell The New York Palace Hotel in New York City’s midtown Manhattan to Lotte Hotels & Resorts, a Korean owner and operator of luxury hotels, for $805 million. The transaction is scheduled to close later this summer.
“I am pleased we were able to restore and revitalize The New York Palace to its position as one of the best luxury hotels in the world,” said John Kukral, president and chief executive of Northwood Investors, in a statement. “We are honored to have had the opportunity to work with many dedicated employees at The New York Palace without whom the transformation would not have been possible.”
Northwood originally acquired the 899-room luxury hotel, which was built in 1981, from the Brunei Investment Authority in 2011 for $377 million, according to New York-based data provider Real Capital Analytics. The firm, which bought the property on behalf of its first fund, Northwood Real Estate Partners, completed a $160 million redesign of the New York Palace Hotel in the fall of 2013. The redesign included the renovation of the rooms and suites in The Towers at the hotel, as well as additional upgrades such as new lobbies, specialty suites and restaurants and bars.
Meanwhile, the transaction marks the first transaction in the continental US for Lotte Hotels & Resorts. According to its website, Lotte’s sole US property currently is the Lotte Hotel Guam. Lotte Hotels & Resorts is considered one of the top hotel owners and operators in the Korean lodging market and is a member of The Lotte Group, which is one of the biggest Korean conglomerates with 79 affiliates and annual revenue of $74 billion in 2013.
“Lotte is a highly-experienced hotel operator and we are excited that they have chosen to acquire The New York Palace as part of their continued global expansion,” said Jonathan Wang, managing director of Northwood Investors. “We look forward to seeing the company build on its success through its ownership of The Palace.”
Law firm Paul Hastings LLP represented Lotte Hotels & Resorts in the transaction.