The coronavirus pandemic may be ebbing, but the hospitality industry still ain’t doing so hot.
In what has been an ongoing trend, another hotel — this time Chelsea’s Holiday Inn at 125 W. 26th St. — has sold, albeit at a steep discount.
Two Kings Management paid owner Watermark Lodging Trust approximately $80.3 million for the budget-friendly lodgings — a far cry from the roughly $111 million Watermark paid for the address in 2013, Crain’s reported.
Not only did Watermark get some $31 million less than it paid for the property nine years ago, but the Chicago-based real estate investment trust had put an additional $8 million of renovations and capital improvements into the full-service hotel. While at one point the 226-room inn’s value was within the ballpark of $121 million, the pandemic did quite a number on its appraising: According to an April analysis by the firm Trepp, the hotel is now worth 30 percent less than it was before COVID-19.
A $72 million loan on the property has not helped Watermark resell the establishment, which it’s been trying to do since at least January, according to Crain’s.
“Unfortunately for hotels and their workers, it is extremely misleading to suggest that the industry will bounce all the way back anytime soon,” Hotel Association of New York City President and CEO Vijay Dandapani reflected to the publication on the future state of the bedraggled, loan-ridden industry. “The only way for the hotel industry in New York to fully recover is if its tax burden is reduced so that debt can be reduced.”
Indeed, bargain deals on Manhattan hotels have not been hard to find of late, with the Holiday Inn’s reduced price tag only the most recent of many, including a Midtown DoubleTree’s sale at a roughly $186 million loss and the Lexington Hotel’s sale at a roughly $160 million loss.