The Talbott Hotel in the Gold Coast has a new owner.
Toronto-based FullG Capital purchased the 16-story, 178-room property for something close to $55 million, Crain’s Chicago Business reported.
Back in October 2015 a joint venture led by Sterling Bay, Geolo Capital and Wanxiang America Real Estate Group bought the hotel, located at 20 E. Delaware Place, for $51 million. The deal included some big-name celebrity investors as well, such as John Cusack and Chris Chelios. JLL, which brokered the deal, said the group put more than $16 million into renovating all of the guest rooms, lobby, restaurants and fitness center.
After investing more than $67 million in the property, the venture refinanced the property in 2019 with a $45.9 million loan. The latest sale means Sterling Bay will take a net loss on the property.
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The hotel recovery is far from complete
Despite the pandemic’s effect on hotel occupancy, FullG Capital decided to buy the property after the city experienced an increase in tourism this summer.
Revenue per available room in downtown hotels open in August averaged to $105.22, showing a jump from the same month a year earlier when the average was $30. The current average is still well below that of August 2019, which was $175 according to STR data.
Other firms are betting on the future of Chicago’s hotel industry. Oxford Capital Group paid more than $72 million for the 247-room Thompson Chicago hotel on Bellevue Place.
“It definitely speaks to the optimistic view on Chicago’s recovery and the fact that, even though things aren’t great right now, even buyers believe that Chicago will return in full,” appraiser Stacey Nadolny of hotel consultancy HVS told Crain’s.
The Talbott has changed hands multiple times even before the pandemic. The hotel was managed by Two Roads Hospitality but then switched management companies to become a Pivot-branded property under Atlanta-based Davidson Hospitality.
[Crain’s] — Victoria Pruitt