America's retail real estate underwent a rough phase during the recession. Though the conditions are slowly improving, the remnant shocks can still be felt. The sale of the New York LaGuardia Airport Marriott Hotel is just another example of real estate's depression trail. The hotel sold for around $22 million, which is around one-third of the price it was earlier sold for in 2007.
Rubicon Cos, a private real estate investing firm based in Connecticut was reportedly the buyer of the hotel. The property was a mortgage-backed estate that was forfeited almost a year back by a lending consortium from RLJ Lodging Trust, who purchased the hotel in 2007, reports The Wall Street Journal.
The low price of the hotel does not come as a surprise as airport hotels do not sell at a very high value. The condition of the place also added to its lowered sale price. RLJ Lodging Trust was planning a $11.5 million renovation on the building before it was forfeited.
The average annual price of a room in a New York Hotel is around $163,130. However, the average room price for the LaGuardia Marriott hotel was summed up at $50,000 per room, around $113,130 lesser than the average.
Some lodging analysts opined that the price was too low considering its occupancy rate over the last one year. Throughout 2012, the hotel recorded an 80 percent occupancy rate. Most of the occupants were travelling businessmen. The hotel also received a boost during the annual U.S. Open Tennis Championship held in the summer, reports Queens NYC.
Marc Gordon, chairman of Rubicon expressed that the location of the property was a brownie point along with its strong occupancy rates throughout 2012. He hopes to use his hotel management expertise to develop the property.
"It may not be the center of the universe like Manhattan, but this is one of the premier hotels in Queens," Gordon told The Wall Street Journal.