Dive Brief:
- Canada-based real estate investment firm Leyad forayed into New York City with the approximately $62 million acquisition of the 226-room Ink48 Hotel in Manhattan’s Hell's Kitchen neighborhood.
- A joint venture with New York City-based private equity firm Capstone Equities, the transaction represents $275,000 per key and marks one of the lowest closings per key of a renovated hotel in Manhattan in years, according to Leyad.
- The Canada firm is actively seeking additional investment opportunities in the market, which is a growing tourism and business hub, according to CEO Henry Zavriyev. Urban markets across the U.S. are slated to see increased hotel investment in coming months driven in part by group travel.
Dive Insight:
Leyad acquired New York City’s Ink48 Hotel hoping to “capitalize on current market upswings” in New York City’s hospitality sector, according to Zavriyev.
The Manhattan lodging sector saw “robust” occupancy, ADR and RevPAR growth in the first half of 2024, PwC reported in August. The market saw several large hotel transactions in the second half of the year as well, including Gencom’s reported $300 million Thompson Central Park buy and Host Hotels & Resorts’ $265 million acquisition of 1 Hotel Central Park.
In the third quarter, New York City was the second-largest global market for hotel transaction volume, with $1.6 billion in hotel deals, JLL reported last month.
New York City is particularly desirable for hotel investment because of its “unparalleled global influence and dynamic tourism and business environment,” Zavriyev said in a statement.
The city welcomed 62.2 million visitors in 2023, and visitation is expected to grow 4.2% year over year to 64.8 million visitors in 2024, according to New York City Tourism + Conventions. Additionally, the organization forecasts that 68.1 million people will visit the city in 2025, exceeding 2019’s pre-pandemic benchmark.
Nationwide, strong group travel fundamentals will continue to drive hotel investment in urban markets, JLL projected in August.
Leyad plans to continue expansion across “prime urban markets,” including New York City, Zavriyev said.
