A Chinese investment firm is set to take a steep loss on the sale of the almost century-old Ambassador Chicago hotel on the Gold Coast.
A venture of Hong Kong-based Gaw Capital Partners has listed the 285-room inn, located at 1301 North State Parkway, for sale without an asking price, Crain’s reported. Brokerage RobertDouglas was hired to market the property.
Gaw is set to take a loss on the 17-story property it bought for $61.5 million in July 2016. People familiar with the offering say it likely won’t fetch bids higher than the $38.5 million loan Gaw borrowed against it in 2019, the outlet reported. Listing information suggests Gaw invested about $11 million into renovations of the property.
The historic hotel was rebranded as the Ambassador Chicago as a nod to its history as the former Ambassador East hotel, which opened in 1926. In its heyday the property attracted celebrities to its Pump Room restaurant and had the likes of Frank Sinatra and Marilyn Monroe staying in its suites.
When Gaw purchased the property in 2016 from a venture of boutique hotelier Ian Schrager, the $61.5 million price was considered a great deal. Days before the onset of the pandemic, Gaw announced plans to renovate the hotel to connect with the Hyatt Hotels’ Joie de Vivre lifestyle hotel collection. Unfortunately for the investor, the hotel then closed for almost a full year due to the public health crisis.
RobertDouglas is marketing the property as an opportunity to continue running it as a hotel or to transform it into a residential property consisting of standard apartments or senior housing.
Downtown hotel occupancy averaged 76 percent in September, which is up from 56 percent the same month last year, according to data from STR. Despite the improvement, it’s still below the 84 percent average in September 2019, before the pandemic.
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— Victoria Pruitt