The focal point of Chicago's tourism industry has shifted slightly south, he adds, from the Near North Side to Millennium Park, and that puts LondonHouse at the center of everything. Guests will only have to walk a short distance to reach the park, financial district, theater district, Magnificent Mile shops and the nightlife of River North. “On top of that, it has the vintage and historic appeal that many tourists appreciate.”

This is not the first deal that Union has done with Oxford Capital. It entered the Boston market last December by buying the 242-room Godfrey Hotel Boston in a similar transaction from a joint venture of Oxford and Walton Street Capital, LLC for about $180 million.

“This transaction outcome is a true win-win-win for Oxford, its institutional investment partner Angelo, Gordon, and Union Investment,” says John W. Rutledge, founder, president and chief executive officer of Oxford Capital and Oxford Hotels & Resorts, LLC. “Specifically Oxford and Angelo, Gordon are able to receive an attractive return on their original investment. Oxford Capital and Oxford Hotels and Resorts secured a long term lease, management, and brand licensing agreement for LondonHouse, which is part of its growing national collection of lifestyle hotels and brands.”

“This second investment underscores our reputation as a reliable and attractive partner to the hotel industry at international level,” says Andreas Löcher, head of investment management hotels at Union Investment Real Estate GmbH. “It also opens up the prospect of further off-market transactions in the US.”

CHICAGO—In another sign that the Chicago market remains a top priority for investors from overseas, Hamburg-based Union Investment Real Estate has bought the new 452-room LondonHouse Chicago hotel at N. Michigan Ave. and the river for $315 million from a Chicago-based venture led by Oxford Capital Group, LLC. As part of the blockbuster deal, Oxford has agreed to lease and manage the luxury hotel for 25 years. Oxford plans to open later this spring.

The Oxford venture retains ownership of the 28,000 square foot retail parcel on the first and second floors of the 1920s-era structure at 360 N. Michigan Ave., formerly known as the London Guarantee & Accident Building. The sold property includes the new 22-story Modernist glass tower designed by Chicago's Goettsch Partners.

One of the most significant aspects of the sale is Union's willingness “to put a lot of money into a project that does not have a proven history,” Bryan Younge, the new national hospitality and leisure group practice leader for Colliers International Group Inc., tells GlobeSt.com. Still, considering the hotel's location and strong brand, he believes that Union has made a solid decision. “I think that Oxford's concept is spot on, and it has a dynamic market behind it.”

“There is still the risk of a glut,” he says, considering the thousands of new hotel units opening up in and near the downtown, but even if that happens, it most likely won't impact LondonHouse. “I think this hotel will be one of the city's top performers; I don't view this as an aggressive purchase.”

The focal point of Chicago's tourism industry has shifted slightly south, he adds, from the Near North Side to Millennium Park, and that puts LondonHouse at the center of everything. Guests will only have to walk a short distance to reach the park, financial district, theater district, Magnificent Mile shops and the nightlife of River North. “On top of that, it has the vintage and historic appeal that many tourists appreciate.”

This is not the first deal that Union has done with Oxford Capital. It entered the Boston market last December by buying the 242-room Godfrey Hotel Boston in a similar transaction from a joint venture of Oxford and Walton Street Capital, LLC for about $180 million.

“This transaction outcome is a true win-win-win for Oxford, its institutional investment partner Angelo, Gordon, and Union Investment,” says John W. Rutledge, founder, president and chief executive officer of Oxford Capital and Oxford Hotels & Resorts, LLC. “Specifically Oxford and Angelo, Gordon are able to receive an attractive return on their original investment. Oxford Capital and Oxford Hotels and Resorts secured a long term lease, management, and brand licensing agreement for LondonHouse, which is part of its growing national collection of lifestyle hotels and brands.”

“This second investment underscores our reputation as a reliable and attractive partner to the hotel industry at international level,” says Andreas Löcher, head of investment management hotels at Union Investment Real Estate GmbH. “It also opens up the prospect of further off-market transactions in the US.”