Reuben Brothers to Buy New York City’s Surrey Hotel
(Bloomberg) -- Billionaire British brothers David and Simon Reuben are buying New York City’s upscale Surrey Hotel in their latest push into U.S. real estate, according to a person familiar with the matter.
The deal is set to value the five-star Manhattan property at less than the $215 million asking price, the person said, asking not be identified discussing private information. The Reubens plan to hire a top hospitality management company to operate the 189-room hotel, according to the person.
The tony hotel near Central Park is a recreation of the original Surrey, which was built in 1926 and hosted famous people including John F. Kennedy and Bette Davis. The Reubens, famous for their London property holdings, made a significant push into Manhattan this year by buying a retail condo from SL Green Realty Corp. for about $170 million, Bloomberg News has reported.
Eight other Manhattan hotels have been sold since March, when New York became the epicenter of the Covid-19 pandemic, according to data from Real Capital Analytics. Those include the Royalton, in Midtown, and the Hudson Hotel, which was acquired by Todd Boehly’s Eldridge.
The Surrey would arguably be the highest-profile Manhattan hotel to change hands since the pandemic leveled New York’s tourism industry. While lodging demand has increased in the months since, corporate travelers remain grounded and many of the city’s cultural institutions are still closed.
The occupancy rate at New York hotels was 39% in October, down from 91% in the year before period, according to lodging data firm STR, and the guests who are checking in are paying heavily discounted rates.
The Reuben brothers are also in negotiations to acquire a landmark site on Rodeo Drive, the luxury shopping area in Beverly Hills, California, according to the person. The billionaires are returning to the real estate dealmaking they’re known for, after making an aborted attempt earlier this year to buy English Premier League soccer team Newcastle United together with the Saudi sovereign wealth fund.
A representative for the Reubens declined to comment. A spokesperson for the Surrey Hotel’s owner, Denihan Hospitality Group, didn’t immediately respond to a request for comment.
These latest transactions follow three recent financing deals the Reubens did in the last month worth more than $300 million, including buying the mortgage of Miami’s St. Regis Bal Harbour Resort as well as a stake in a senior loan tied to the St. Regis Chicago, the person said. They also acquired a holding in the senior mortgage over The Drew Hotel in Las Vegas, according to the person.
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