Walton Street poised to profit on Hotel Lincoln sale

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Less than two years after buying the Hotel Lincoln, Walton Street Capital is putting the Lincoln Park property up for sale, capitalizing on strong investor demand for Chicago hotels.

A joint venture led by the Chicago-based private-equity firm hired New York-based brokerage Eastdil Secured to sell the 184-room hotel at 1816 N. Lincoln Ave., confirmed Walton Street Principal Stephen Sotoloff. Walton Street bought its stake in the boutique hotel in September 2013 in a transaction that valued the property at $45 million.

“We love it, but we executed our business plan and cash flow has gone up significantly,” Sotoloff said.

Walton Street, headed by billionaire investor Neil Bluhm, and its partner, Chicago-based AJ Capital Partners, boosted the hotel’s revenue by adding a retractable roof to its rooftop bar, the J. Parker, allowing it to be open year-round, Sotoloff said. More broadly, Chicago hotel values have increased the past two years as occupancies and room rates have blown past pre-recession levels.

As a result, the Hotel Lincoln, a former Days Inn that opened in 2012, may fetch more than $70 million, according to people familiar with the property. The Walton Street joint venture already pulled some out of the hotel in February, when it boosted the property’s loan from $32 million to $45.5 million, implying a significant increase in the property’s value, according to Cook County property records.

Read more: Walton Street poised to profit on Hotel Lincoln sale

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