LONDON-A joint venture of New York City-based Morgans hotel Group Co. and Chicago-based Walton Street Capital has sold two hotels here for about $300 million. Capital Hill Hotels Ltd. purchased the Sanderson and St. Martins Lane properties for about $847,000 per room.
Walton had joined the joint venture in early 2007 by buying its 50% share from Burford Hotels Ltd. for about $52 million. At the time, Morgans valued the hotels at about $300 million.
Michael Gross, CEO of Morgans, said in a statement that the sale will net his firm about $73 million, allowing his company to buy the Las Vegas-based Light Group, a 10-year-old hospitality management firm that services MGM Resorts International. Gross said his company is buying a controlling 90% stake in Light for $46.5 million, and will work with MGM in the future.
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“This transaction fulfills our strategic goal of having industry-leading food and beverage capabilities in-house,” he said. “We now have about $150 million in total liquidity and a balance sheet capable to support growth.” The Light purchase will close in the fourth quarter.
Morgans will also continue to operate the two hotels here under long-term management agreements, which were extended from 2027 to 2041. The company owns and/or operates other global hotels such as the Morgans and Mondrian in New York City, the Clift in San Francisco, the Ames in Boston and a hotel in Playa del Carmen, Mexico. Current development projects by the firm include Delano hotels in Turkey and Cabo San Lucas, Mexico; and Mondrian hotels in Doha, Qatar and Nassau.
Jones Lang LaSalle Hotels represented the venture in the London sale. Giorgio Manenti, EVP with JLL Hotels, said in a statement that the transaction “reinforces the international appeal of European gateway cities for real estate investors.”
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