As part of its asset management strategy, Accor announces the sale of the Novotel Times Square in New York under a sale and management-back agreement, for a total value of 160 million (335,000 per room). The selling price amounts to 71 million.
The buyer has committed to complete a full renovation of the hotel between 2012 and 2013, at an estimated cost of 89 mln. based on a scope defined by Accor. The hotel will remain open while the work is being carried out. In addition, an earn-out amounting up to 12 mln. could be cashed in depending on the results of the hotel after the refurbishment.
Open in 1984 in the center of one of the world's most popular tourist and business destinations, this 480-room flagship hotel will continue to be operated by Accor under a long-term management agreement.
The buyer is a joint-venture formed by two key players in the hotel real-estate asset management business: Chartres (Chartres Lodging Group, LLC) and Apollo (Apollo Global Management, LLC).
Denis Hennequin, Accor's Chairman and CEO, said, "This operation highlights once again our capability to attract leading investors willing to finance value-creative projects, as part of our Asset Management program."