Thursday, September 20, 2007

Wan't to buy the Pump Room? You had your chance.

The owners of the Ambassador East Hotel have taken the property off the market after failing to attract a credible bid for the property (which includes the venerable Pump Room restaurant) at a price above $60 million, or almost 20% lower than the asking price of $71 million. Instead, look for a renovation and a short-term refinancing at a 75% LTV.

Maybe this deal is a casualty of CMBS spreads, as the article indicates. Or maybe it is a location issue, as more hotels come in at different parts of downtown. Or maybe the hotel just needs a sprucing up to attract first-flight buyers. My take is that it is a timing issue that will be resolved as the market settles. It will be interesting to see how this whole scenario plays out at the end. I like this old grand dame hotel, and I think it will turn out well in the end.