Union Investment pays $200m in NYC as it grows hotel portfolio

Union Investment is investing more than $200m (€191m) in New York as it diversifies its hotel exposure.

The German company has bought the Courtyard by Marriott World Trade Center, a 317-room hotel for its open-ended real estate fund UniImmo Global.

It paid more than $200m for the asset from developer Hidrock Properties and investment company Robert Finvarb Companies.

The hotel has 30 stories and total usable space of 154,200sqft and is in Manhattan’s financial district, close to the World Trade Center complex and Ground Zero memorial.

Andreas Löcher, head of investment management hotels at Union Investment Real Estate, said: “We are delighted to have agreed the acquisition of this first-class property in New York, the most liquid hotel market worldwide, and see potential for growth in room rates.”

The deal follows Union’s first US hotel acquisitions in Boston and Chicago.

In the past six years, the value of the company’s international hotel holdings has risen by more than 100% and are now worth €3.37bn. The fund manager now owns 60 hotels with a total of 16,715 rooms.

“With the three US hotels we have acquired since November 2015 for Unilmmo Europa and Unilmmo Global, we have achieved the desired diversification in terms of location and operator right from the start, thereby replicating the key characteristics of our European hotel portfolio,” said Löcher.

“In the coming years, we intend to tap into new locations for our funds in both America and Europe.”