NEW YORK,– Madison Realty Capital (MRC) closed $30.5 million of financing collateralized by the GEM Hotel, a luxury boutique hotel located at 300 West 22nd Street in the Chelsea neighborhood of Manhattan. The funds refinance previous debt and support sponsor Icon Realty Management’s business plan to reposition the hotel with an expanded marketing strategy and updated branding, coupled with strategic capital improvements to the property.
“This deal provided MRC with the opportunity to refinance a successful and established hospitality asset with strong sponsorship and a new business plan aimed at making it even more competitive in the local market,” said Josh Zegen, Co-Founder and Managing Principal of MRC. “We were able to deliver quickly on Icon’s financing requirement, with a solution tailored to their needs.”
The GEM Hotel is a five-story, 30,948 GSF 4-star, luxury hotel that was constructed originally in 1912 as a residential property, and converted to hospitality use by the sponsor in 2007. Located on the corner of 8th Avenue and 22nd Street, the property boasts 57 feet of prime frontage along 8th Avenue. At the time of conversion, the sponsor installed completely new mechanical systems and made structural upgrades to the building.
Going forward, the sponsor’s business plan is to increase revenue by implementing an aggressive marketing strategy across internet booking channels, corporate accounts, along with a branding overhaul. In addition, the sponsor will implement a new capital improvement plan that includes room upgrades, lobby and hallway improvements, and façade work.
JLL’s Aaron Appel brokered the financing. “MRC continues to deliver financing solutions for leading borrowers in New York and beyond,” Appel said. “Their ability to assess and underwrite large, complex transactions quickly has brought them significant repeat business, as well as new business from owners and developers.”
About Madison Realty Capital (MRC)
Madison Realty Capital (MRC) is a New York City-based real estate private equity firm focused on real estate debt and equity investment strategies. Founded in 2004, MRC has invested in approximately $10 billion of transactions in the multifamily, retail, office, industrial and hotel sectors. The firm manages investments in the United States on behalf of a global investor base consisting of corporate and public pension funds, sovereign wealth funds, university endowments, foundations, fund of funds, family offices, and high net worth individuals. MRC is a fully integrated firm with over 70 employees across all real estate investment, development, and property management disciplines. Debt strategies include construction and acquisition lending, special situation financing and debt acquisitions; equity real estate strategies include opportunistic and value-add investments as well as ground-up development. Among other industry recognitions, MRC has been named to the Commercial Observer’s prestigious “Power 100” list of New York City real estate players and is consistently cited as one of the industry’s top construction lenders.