St. Regis Chicago Hotel Sold to Miami, Denver Investors
UPDATED, May 16, 2023 4:30 p.m.
Chicago’s brand-new St. Regis hotel has been sold.
A joint venture of Miami-based Gencom and Denver-based GD Holdings bought the 192-key hotel, which is branded by St. Regis, a luxury label owned and managed by Marriott International. The hotel is within the first 11 floors of the iconic wave-shaped tower overlooking the Chicago River and Lake Michigan in the East Loop.
It’s one of few luxury hotels to open in downtown Chicago in the last decade, and the buyers finalized the deal nearly as soon as it opened following years of delay. A representative for the buyers declined to disclose the sale price. The deal has not yet been documented in public records.
“During the pandemic, Gencom saw a unique opportunity to purchase this asset while it was still under construction and strategically arranged to close on the transaction once the property was delivered,” Gencom chief investment officer Alessandro Colantonio said in a written statement.
Chicago’s Magellan Development Group built the hotel and will retain an ownership interest, according to the buyers’ announcement. Magellan CEO David Carlins declined to comment.
The buyers acquired the property with a $76 million loan from Varde Partners that JLL helped arrange, Crain’s reported. Colantonio told The Real Deal multiple lenders were interested in financing the deal. Nightly rates start at more than $700 per room in the property, a high water mark for Chicago hotels.
“It’s not the best time for lending right now, we went into it with eyes wide open on expectations and ended up right where we were hoping with Varde,” he said.
The hotel, located at 363 East Wacker Drive, opened this week, more than a year later than originally planned. Supply-chain issues and the breakdown of a deal with Alinea Group that would have had the company operate two restaurants in the property led to the June 2022 launch being pushed back.
Magellan first broke ground on the $1 billion development in 2016. At the time, the 101-story condo building and hotel was known as the Wanda Vista Tower, with China-based Wanda Group on board to operate the hotel before selling its 90 percent stake to Magellan and partners Goldman Sachs and J.P. Morgan.
The tower’s new name was announced in late 2020, after Magellan locked in the Marriott division St. Regis Hotels & Resorts as the new operator.
Condos in the tower range in price from $1 million to more than $20 million. Sales in the building made up half of the 10 most expensive residential deals in Chicago last year, with those five buyers paying a combined $56.6 million for units in the 101-story tower, which is the city’s third-tallest.
The building had Chicago’s priciest condo sale of 2022 in September, with a 71st-floor four-bedroom unit selling to Grupo Mexico CEO German Larrea for $20.6 million. The second-highest sale in the building was a $9.2 million deal for a 91st-floor unit in June.
The hotel also boasts five restaurants across 38,000 square feet. Two of the restaurants will be operated by Chicago’s Lettuce Entertain You Enterprises. One will be called Miru, which means “view” in Japanese, and the other is Tre Dita, which means three fingers in Italian.
This story was updated to add comments from an interview with Gencom’s CIO and the acquisition loan amount.
