By Konrad Putzier
An investor from Kuwait has bought two hotels in Manhattan for $135 million from Rhode Island-based Magna Hospitality.
CBRE Group and King & Spalding LLP advised KFH Capital Investment, the investment management subsidiary of the bank Kuwait Finance House, on the deal.
The sale of the hotels, the Holiday Inn Express Manhattan Times Square South at 60 West 36th Street and the Hampton Inn United Nations at 231 East 43rd Street, appeared in public property records two weeks ago, but the buyer remained unknown.
The sites for both hotels were initially owned by Sam Chang, who sold them to Magna in 2008. The hotels both opened in February 2013.
KFH paid $63.3 million for the 135-room Holiday Inn and $71.9 million for the Hampton Inn. The firm announced it would retain Ardent Hotel Management Company as their manager. Kuwait Finance House is one of the few banks in the world to operate in compliance with Islamic Sharia law and its strict guidelines on interest payments.
“This transaction gave us the opportunity to acquire two high-quality assets while gaining exposure to Manhattan’s dynamic hospitality market,” Abdulaziz N. Almarzooq, general manager of KFH Capital, said in a press release.
“The acquisition meets our investment criteria, providing for an attractive going in current yield with significant upside potential in one of the strongest hotel markets in the United States. We are very excited about this acquisition, and believe it will be accretive to our investment products portfolio.”
Imran Ahmed, executive managing director, CBRE Capital Advisors, Inc, said, “We are delighted to have had this opportunity to advise KFH Capital on its acquisition of these two hotels, and look forward to providing them with our services on future real estate investments.”