MeriStar Invests $50M in Radisson Lexington

NEW YORK CITY-MeriStar Hospitality Corp. has acquired an interest in the Radisson Lexington Hotel in Midtown with a $50-million structured investment. The move will provide a nearly $5.8-million cumulative annual preferred return and a 49.99% equity participation. The other investor is a private real estate fund, according to the company.

MeriStar financed the investment in the landmark 705-room hotel with cash on hand. According to a company spokesman, MeriStar was attracted to the property because of the location–at the corner of Lexington Avenue and 48th Street–and occupancy rates in the low 90% range.

“We are pleased to have been able to reallocate capital from our non-core asset sales into a strong hotel in a premier market,” says chief financial officer Donald D. Ollinger in a statement. “We completed this transaction without having to access the capital markets while maintaining adequate liquidity.”