Gramercy Park Hotel Will Reopen Under New Operator

MCR Hotels has signed a 99-year ground lease for Manhattan’s Gramercy Park Hotel, a 1920s landmark that closed during the pandemic and was foreclosed on last year.

MCR plans to renovate the 200-room Gramercy Park and reopen it in about two years as a boutique luxury hotel, according to a report in the Wall Street Journal.

The new owner paid $50M for the long-term lease on the hotel at 2 Lexington Avenue. “We intend to return it to its original splendor,” MCR CEO Tyler Morse told WSJ.

Morse said he intends to make the Gramercy Park a five-star property like the Crosby Street Hotel in lower Manhattan. MCR plans to reopen Maialino, an Italian restaurant on the ground floor of Gramercy Park.

The original Gramercy Park Hotel was acquired by developer Aby Rosen and hotelier Ian Schrager in 2003. The partners renovated it into an art-scene celebrity haunt with rooms as large as 600 SF.

Rosen bought out Schrager. After the hotel closed down during the pandemic, lease payments were missed. The property was foreclosed on by Solil Management, a real estate firm that owns the hotel and the land beneath it.

In June, 2022, a judge ejected Rosen from his lease controlling the hotel. Solil took control of the property and stripped it down, selling almost everything that was inside of it, WSJ reported. 

According to the report, the only remaining items include a vintage chandelier in the hotel lobby and red velvet curtains at the once-popular Rose and Jade bars.

MCR is the third largest hotel owner-operator in the US. According to the company’s website, it has developed 189 hotel properties operated under 31 brands. MCR’s current portfolio encompasses 25,000 rooms in 150 hotels in 37 states and 107 cities.

The portfolio includes the TWA Hotel at John F. Kennedy International Airport and the High Line Hotel in Manhattan. The company has been steadily increasing its holdings in Manhattan, adding the midtown Sheraton last year and the Lexington Hotel in 2021.

As of the end of July, NYC’s luxury hospitality sector was notching a year-to-date RevPAR (revenue per available room) of $334, which exceeds the pre-pandemic level of $297 in 2019—three times higher than the RevPAR in June 2021, according to data from STR.