The Sheraton Times Square in New York is being sold at a massive loss…
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Sheraton Times Square sold for $356 million
Host Hotels & Resorts is selling the Sheraton Times Square to MCR Hotels for $356 million. The hotel last sold for $738 million in 2006, so 16 years later the hotel is being sold for less than half of what it was purchased for. Host has been trying to sell the hotel for several years now — going as far back as 2018, the company was trying to sell the hotel for up to $550 million.
Once closed, this will mark the city’s biggest hotel deal since the start of the pandemic. The 51-story hotel is the third largest in the city in terms of the number of rooms. It’s located at 811 7th Avenue.
The hotel will continue to be a Sheraton, but…
Once this transition is completed, the hotel will continue to be branded as a Sheraton. However, the hotel will go from being managed by Marriott, to only having a franchise agreement with Marriott. In other words, MCR Hotels will be directly hiring staff, and will be responsible for more operational decisions.
Unfortunately that’s probably not great news. MCR Hotels has 125+ hotels in 34 states, and owns several properties you may be familiar with, like the TWA Hotel JFK.
Several months ago I wrote about how MCR’s CEO wanted hotels to get more inspiration from ultra low cost airlines, and “stop giving things away for free.” So I wouldn’t be too excited about MCR taking over this property.
Bottom line
The Sheraton Times Square is getting new owners, as the hotel has been sold to MCR Hotels for $356 million. This represents a loss of more than $380 million compared to the 2006 purchase price of $738 million. The hotel will continue to be operated as a Sheraton, but under a franchise agreement model with MCR Hotels. Since MCR Hotels wants to be the Spirit Airlines of hotel owners, I wouldn’t consider that to be great news.
What do you make of the sale of the Sheraton Times Square?
(Tip of the hat to Points, Miles & Martinis)
Despite it being dated, they had amazingly friendly and helpful staff, I hope they can be retained. It’s a great location for when I bring my family to NYC.
I am not surprised - I stayed their 10 or 12 times. The place seemed out of date - and the neighborhood has declined a lot from 2000 to now. Finally, the options around this Sheraton are much better.
32 million? Keep smoking the toothpaste.
what?
The Hilton Times Square on 42nd sadly shut down in October 2020 for good in the pandemic first year
The Sheraton is a dated iconic hotel
I stayed there last summer the new beds were hard like a rock (rip sweet sleeper ) and at breakfast they had no cheese to make an omelette nor avocado
If I never returned it would be ok by me
I burned a Bonvoid promotional...
The Hilton Times Square on 42nd sadly shut down in October 2020 for good in the pandemic first year
The Sheraton is a dated iconic hotel
I stayed there last summer the new beds were hard like a rock (rip sweet sleeper ) and at breakfast they had no cheese to make an omelette nor avocado
If I never returned it would be ok by me
I burned a Bonvoid promotional award there
My long time friend who has lived near Central Park West for decades now carries a small weapon for their safety to go to work for the Schubert Theatre Organization in Times Square
I've always liked that hotel best of Times Square hotels for the location and views, You can walk toward 5th Av and the park without having to walk through the square but you have the best views of it. Huge hotel.
LOTS of people want to go and do in fact go to NYC, me included. I was just there two weeks ago as my daughter was attending an event at Radio City. My Amtrak train into the city was completely sold out...so NYC seems to be doing just fine. We stayed at the Hilton Times Square which is just down the block from this Sheraton. The Hilton was operating at a pretty solid capacity level....
LOTS of people want to go and do in fact go to NYC, me included. I was just there two weeks ago as my daughter was attending an event at Radio City. My Amtrak train into the city was completely sold out...so NYC seems to be doing just fine. We stayed at the Hilton Times Square which is just down the block from this Sheraton. The Hilton was operating at a pretty solid capacity level.
I am not a huge fan of Sheratons in general, but from what you describe, the change in ownership does not sound like an upgrade.
You must mean Hilton Garden Times Square. Hilton Times Square succumbed to the pandemic
I'm sorry, I did make a mistake. I actually meant the New York Hilton MIDTOWN, at 1335 6th Avenue between 53rd and 54th. It is the one that is right near this Sheraton, which is at 53rd and 7th. We took the E train from Penn Station which puts you right in front of the Sheraton, and then it was a short 1 block walk to the Hilton.
I would not go out of my...
I'm sorry, I did make a mistake. I actually meant the New York Hilton MIDTOWN, at 1335 6th Avenue between 53rd and 54th. It is the one that is right near this Sheraton, which is at 53rd and 7th. We took the E train from Penn Station which puts you right in front of the Sheraton, and then it was a short 1 block walk to the Hilton.
I would not go out of my way to stay at either of these hotels, but it was fine, and given that my teenage daughter and her friend were going to a 10 pm show at Radio City, I thought there would be something to be said for having a short walk back to the hotel around midnight.
I will also say we enjoyed a delightful meal at one of our favorites in that part of town, P. S. Kitchen. Both the food and the restaurant's mission are great. Definitely worth checking out if you are in the area!
Well Delta Diamond doesn’t know what he is talking about. They will operate, albeit differently, but with considerably more staff than a GM and FOM…this is 1850 rooms…give me a break. And I stayed there in 11/2019, was an excellent stay and as a former hotel GM it takes a large executive staff to operate a property like that.
Prove me wrong. Properties not operated by Marriott have demonstrably fewer middle and upper managers. You get supervisors over managers or you get a manager overseeing multiple departments. A third-party operator starts outsourcing services, like housekeeping, to cut costs if there isn't a union agreement in place with existing housekeepers. They contract all of the restaurants out to third parties or they take the food menus and focus on flatbreads and burgers -- the cheap...
Prove me wrong. Properties not operated by Marriott have demonstrably fewer middle and upper managers. You get supervisors over managers or you get a manager overseeing multiple departments. A third-party operator starts outsourcing services, like housekeeping, to cut costs if there isn't a union agreement in place with existing housekeepers. They contract all of the restaurants out to third parties or they take the food menus and focus on flatbreads and burgers -- the cheap stuff with good markups.
Doesn't affect my travel plans
This is the only SPG / Marriott hotel I have ever walked out of. I attempted to stay here in 2014 when it was under renovation. The lobby was practically non-existent and there was no restaurant / food on the property due to the renovation. When I got up to my room, things got worse - the room smelled like smoke, the TV did not turn on, the heater sounded like a jet engine, there...
This is the only SPG / Marriott hotel I have ever walked out of. I attempted to stay here in 2014 when it was under renovation. The lobby was practically non-existent and there was no restaurant / food on the property due to the renovation. When I got up to my room, things got worse - the room smelled like smoke, the TV did not turn on, the heater sounded like a jet engine, there was mold all over the bathroom, and the sheets had holes in them. I walked back down to the front desk and told them I wanted to check out and did not expect to be charged any fees -- and they immediately took care of it, it seemed like this was a request they were accustomed to. I walked a few blocks over to the Four Points Midtown, which isn't an amazing hotel by any stretch of the imagination but was exponentially better than this Sheraton. Absolute dump.
Times Square is getting bad. You can’t walk five feet with out smelling weed. Rv’s selling weed all over the place. It will lose tourists once people realize you can’t take your kids there with out getting a contact high. I’m all for personal choice on weed but not at the expense of other peoples choices.
Nobody wants to go to NYC. Crime is high, police are being assassinated, taxes are high. Even AOC goes to Florida.
Lol, let's ask the 32.9 million people who visited last year.
There’s more to life than the New York Post and Fox.
...you mean even more bias...
was Times Square ever good? (contact highs are also super rare)
MCR is a dumpster fire. I had the WORST experience at the TWA hotel and there was no guest support, and no recourse to MCR for multiple guest service fails during my stay. I've learned to take my business trips and conferences to non-MCR properties...with prejudice.
Looks like my trips to this Sheraton will be no more.
Btw, it's a Sheraton....so my standards are low just by hearing the brand. :-)
Know what to expect.
Outside of the design aesthetics and cool factor, I've never read about ANY positive stays at the JFK TWA Hotel before, during or after the pandemic.
The first hotel I stayed at in NYC on my very first visit. Great staff and excellent positioning to all the attractions
It's one of my least favorite hotels in NYC. I stopped staying there after I arrived to a packed lobby one night around 11 PM. There were tons of people in the lobby just hanging around. I attempted to check in (as an Ambassador) and was told my room was not ready. I had to wait until 2 AM until they had it cleaned and ready. People were freaking out and yelling at the staff....
It's one of my least favorite hotels in NYC. I stopped staying there after I arrived to a packed lobby one night around 11 PM. There were tons of people in the lobby just hanging around. I attempted to check in (as an Ambassador) and was told my room was not ready. I had to wait until 2 AM until they had it cleaned and ready. People were freaking out and yelling at the staff. The staff got increasingly rude and the situation was awful. This was around 2017. I have refused to ever stay there again.
Cannot agree more - overcrowded, dark, dank, tiny and I renovated rooms, vomit in the hallways on two occasions.
Never again.
Well, let's see if the reception staff are going to be re-educated to properly treat with respect all guests.
The Marriott in downtown Baltimore also recently sold.
Aren't all Sheraton's being renovated? Seems like this one is due. Wonder who is gonna foot that bill.
I love this hotel..I think they should renovate and sell some of the rooms as condo's.
Not a bad idea. And frankly, I'm shocked multifamily developers didn't take interest in this hotel for more $ with that sole purpose in mind, unless the franchise agreement exclusively prohibited it. The purchase price equates to roughly $200K a key. Converting two hotel rooms into a one bedroom apartment ($400K + renovation costs) or three hotel rooms into a two bedroom apartment ($600K + renovation costs) sounds like an easy no brainer. That's not...
Not a bad idea. And frankly, I'm shocked multifamily developers didn't take interest in this hotel for more $ with that sole purpose in mind, unless the franchise agreement exclusively prohibited it. The purchase price equates to roughly $200K a key. Converting two hotel rooms into a one bedroom apartment ($400K + renovation costs) or three hotel rooms into a two bedroom apartment ($600K + renovation costs) sounds like an easy no brainer. That's not factoring in all the value of the meeting space, ground floor retail opportunities, etc.
Except nobody wants to live in New York City right now.
Rent just hit an all time high. Some of it may have to do with the end of Covid incentive rates, but bidding wars are also pushing up prices as supply is very low with a 1.32% vacancy rate.
Finally! OMAAT has used the financial term, "bottom line" correctly /s
The rooms are TINY. It would take 4 hotel rooms to make a 1000sft unit.
I see you are not familiar with the size of the average NYC apartment.
What do you expect? This hotel is just too huge, especially in a city full of hotels and amazing Airbnb options. Moreover, there are so many Marriott options in New York City, including the also ridiculously huge Marriott at Times Square, that there's nothing to make this Sheraton stand out. It depends on meetings and events -- something that's not coming back to NYC at pre-pandemic levels. And by eliminating the management agreement with Marriott,...
What do you expect? This hotel is just too huge, especially in a city full of hotels and amazing Airbnb options. Moreover, there are so many Marriott options in New York City, including the also ridiculously huge Marriott at Times Square, that there's nothing to make this Sheraton stand out. It depends on meetings and events -- something that's not coming back to NYC at pre-pandemic levels. And by eliminating the management agreement with Marriott, MCR will surely save a lot of money. Marriott International is stupid for not requiring its full-service properties to be managed by Marriott. Franchisees save money operating their own property or hiring a third-party manager like Aimbridge by eliminating a lot of management and optional services, like concierges, guest relations staff, etc. At a Marriott-managed property, especially a HUGE property like the Sheraton, you'll have a general manager, resident manager, rooms director or operations director, front office manager, and guest relations manager. At a comparable property NOT managed by Marriott, you may only have a general manager and front office manager. I also wouldn't be surprised if they can get away with outsourcing housekeeping to a third-party agency.