Hilton hotel will reopen after sale, hastening a return to Times Square

Hilton hotel will reopen after sale, hastening a return to Times Square

New owners are betting on a revival of the area as tourists return to New York City.

The 478-room hotel near downtown New York City's Times Square is poised to reopen under new ownership after closing two years ago, the latest sign that investors are betting on the area's return.

Investment firm Apollo Global Management Inc. and hotel investor Newbond Holdings have agreed to buy Hilton Times Square for about $85 million, according to people familiar with the matter. The deal is expected to close by the end of the summer and the new owners plan to reopen the property in the fall, these people said.

The recent sale agreement represents a significant discount to the hotel's 2006 sale price of $242.5 million, reflecting both the hard times that New York's entertainment district has endured during the pandemic and some of the problems with this property.

From desired residences to major commercial transactions.

The hotel closed in April 2020 and has not opened since, making it one of the most high-profile victims of the collapse in New York City tourism. Previous owner Sunstone Hotel Investors Inc. defaulted on the loan for the hotel and transferred the property to lender, Torchlight Investors, in late 2020.

Forty-four New York City hotels with more than 10,500 rooms have closed permanently due to the pandemic, the most of all U.S. cities, according to hotel data tracker STR. A slow rebound in business travel and international visitors has put pressure on the city's hotel sector.

But lately, there have been signs of life reviving in Times Square. Investors and developers are betting even more on tourist and entertainment venues, while the district's offices remain largely empty throughout the day. Attendance at Broadway shows is approaching pre-pandemic levels, and some hotels are filling up again.

The Hard Rock International hotel opened on West 48th Street in April, and last year a Jimmy Buffett-style Margaritaville resort with an outdoor pool opened in Times Square. Real estate investors also break in if the price is correct. The hotel's owner and operator MCR and Island Capital Group LLC recently paid $373 million for the Sheraton New York Times Square hotel, about half the price the property was sold for in 2006.

Hoteliers have been encouraged by recent predictions that the city's tourism is in a strong recovery. NYC & Co., a travel and marketing organization for the city, predicts that visitors to the Big Apple will grow to more than 56 million in 2022, up from about 22 million in 2020, according to its website. The group sees that figure reaching 65 million next year as more international visitors return, bringing the total to an astounding distance from 2019 levels.

Hilton Times Square is on a lease of land that is being renewed and renewed under new owners, people familiar with the matter said. Apollo and Newbond, a firm co-founded by hotel industry veteran Neil Lutra, also plan to invest in improving rooms and lobbies.

The hotel on 42nd Street is known for its unobstructed views of the city. Its lobby is located on the 15th floor, and the rooms rise to the 44th floor.