Accor has announced the sale of two US Sofitel hotels located in New York and Philadelphia, totaling 704 rooms, for €183 million ($255 mln.) to a joint venture comprised of GEM Realty Capital, Inc., Whitehall Street Real Estate Fund and Accor. Accor will remain a 25% shareholder in the joint venture and continue to manage the hotels under the Sofitel brand through a 25-year contract.
Created in March 2006, the joint venture already owns six US Sofitel hotels in Chicago, Los Angeles, Miami, Minneapolis, San Francisco and Washington, DC.
The transaction is part of the Group's asset management strategy in the upper upscale segment, which is designed to increase the return on capital employed and reduce earnings volatility through sale and management-back arrangements. It effectively completes Accor's transformation of its Sofitel business model for North America, with a hotel base operated primarily under management contracts.
The 398-room Sofitel New York was developed by Accor for €65 million ($90 mln) in 2000. The 306-room Sofitel Philadelphia, which occupies the former site of the Philadelphia Stock Exchange in the business district, was also developed in 2000 at a cost of €57 million ($80 mln.).
Source: Accor S.A./Commercial Property News
Sofitel Hotel, New York