South Korea’s Lotte Group, among the Asian nation’s top five conglomerates, has been identified as the buyer of the Kimpton Hotel Monaco Chicago in Chicago’s Loop.
Lotte Hotels & Resorts will probably rebrand the 191-room hotel at 225 North Wabash Avenue, Crain’s reported, citing unidentified people familiar with the matter. It’s among 20 hotels the conglomerate plans to open across North America in the next five years.
Lotte expanded its presence to the U.S. in 2015 when it bought what is now the Lotte New York Palace hotel in Manhattan, and followed up with the Lotte Hotel Seattle last year. Lotte also said it would hire a new chief executive to oversee the US properties.
The Korean company is buying the hotel from Orlando-based Xenia for $36 million, 35 percent less than its appraised value eight years ago. Local investor Inland American Real Estate bought the hotel in 2013 as part of a three-property deal for $189 million. The hotel was valued at $56 million, according to Real Capital Analytics. Inland spun off its hotels into Xenia in 2015.
Chicago’s hotel market has been slow to rebound, reflecting a pandemic-era slump in business and tourist travel. While average revenue per available room in downtown hotels quadrupled in October from the same month a year earlier, it’s still just 60 percent less than October 2019, according to STR.
Hotel revenue from business travelers in Chicago this year probably slumped by about $2.1 billion from $2.5 billion in 2019, according to the American Hotel & Lodging Association.
Lotte joins Spanish luxury hotel owner RIU Hotels & Resorts, which recently got approval to develop a $200 million, 388-room hotel on East Ontario Street. Toronto’s Full G Capital paid almost $55 million for the Talbott Hotel in the Gold Coast.
Other Chicago hotels that changed hands since 2020 include the 178-key Talbott Hotel, which sold for about $55 million and the 247-room Thompson Chicago hotel for $71 million.
[Crain’s] — Victoria Pruitt
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