NEW YORK CITY—Germany's Deka Immobilien has acquired the 655-room Marriott East Side Hotel for $270 million—or approximately $412,000 per unit—under a joint venture with Ashkenazy Acquisition Corp. This is Deka's first hotel acquisition in the Americas. The seller of the four-star hotel was Morgan Stanley.
The 35-story hotel, located at 525 Lexington Ave., was built in 1924 by architect Arthur Loomis, whose firm also designed the Empire State Building. The property includes a conference and business center and it is centrally located in Midtown, between 48th and 49th streets. The property will be operated as a Marriott hotel under a long-term agreement.
Savills Studley's US Cross Border Investment team, led by executive managing director Robert Stamm, advised Deka on the acquisition. JLL advised Morgan Stanley in the transaction.
This is the second joint venture investment Deka-ImmobilienGlobal has concluded with AAC in New York, the first being the purchase of the retail condominium at 522 Fifth Ave.
“We are pleased to bring Deka and Ashkenazy together on another synergistic venture in Manhattan,” says Stamm. “The investment structure for the Marriott East Side provides Deka with predictable annual cash flow and future upside in one of the world's most defensive hospitality markets.”
The investment allows Deka to participate in the positive performance of the highest-priced hotel market in the US, a market that also enjoys the country's highest occupancy rates. The acquisition also expands Deka's portfolio holdings in the US, another important component of the regional allocation of Deka-ImmobilienGlobal.
Over the last few years, Stamm's team has advised Deka on over $2 billion of transactions in North America.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
