Angelo, Gordon and Oxford Property Group have sold LondonHouse Chicago, a 452-unit hotel building, to Union Investment Real Estate for $315 million, the groups said Tuesday.
The sellers bought the property at 85 East Wacker Drive for $53 million in July 2013, according to real estate data provider Real Capital Analytics (RCA). The joint venture gutted the historic building, which was constructed in 1923, to add 21,000 square feet of ground-floor retail and a two-level rooftop terrace to the 22-story building, according to media reports. The hotel opens this spring with a 25-year lease on the property, according to the firms’ statement.
Capital for the purchase came from Union’s open-ended real estate fund, UniImmo: Europa. The Hamburg, Germany-based firm’s €2.5 billion fund was launched in January 2004 with a focus on office investments, according to a company spokesman. In December, Union used capital from the fund to purchase The Godfrey Hotel Boston, a 242-room luxury hotel, from Oxford and Walton Street Capital for $180 million, according to an announcement at the time. Union’s hotel portfolio comprises 52 properties, according to the press release.
“This second investment [in US hotels] underscores our reputation as a reliable and attractive partner to the hotel industry at international level,” said Andreas Löcher, Union’s head of hotel investment management, in Tuesday’s statement. “It also opens up the prospect of further off-market transactions in the US.”
The firm began investing in US real estate in 2002. Its first North America purchase with capital from the global fund was the 2005 acquisition of a five-story office complex in Seattle, according to its website. Earlier this month, the firm said it purchased the headquarters of sneaker company Converse in Boston for $150 million. The firm is also buying another Boston office, the 440,000 square foot building at 99 Seaport Boulevard, for $450 million from Skanska USA, according to RCA.