Morgans Hotel Group Announces Plans for New Mondrian in SoHo
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Morgans Hotel Group Announces Plans for New Mondrian in SoHo
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Category: North America & West Indies / Carribean islands
This is a press release selected by our editorial committee and published online for free on 2007-07-02
Morgans Hotel Group Co. (NASDAQ: MHGC) ("MHG") today announced a new joint venture with Cape Advisors Inc., a New York-based developer, to develop a Mondrian hotel in SoHo, Manhattan. Mondrian SoHo will be operated by MHG under a long-term management contract and is expected to open during the second half of 2009. The hotel is the sixth announced Mondrian, including Los Angeles, Scottsdale, and properties under development in Las Vegas, Miami and Chicago.
The joint venture will convert a property currently owned by Cape Advisors on Lafayette Street into Mondrian SoHo. The hotel is anticipated to have over 270 rooms, a bar and restaurant, as well as other amenities.
"Mondrian SoHo will be highly complementary to our existing portfolio of New York properties," said Marc Gordon, Chief Investment Officer of MHG. "Due to the popularity of the SoHo market, sites for new hotels are extremely rare, and we look forward to establishing a presence in one of the most desirable downtown areas. Furthermore, we expect Mondrian SoHo to benefit from cost savings, labor efficiencies and other synergies of the centralized operation of our three other Manhattan hotels: Morgans, Royalton and Hudson."
Ed Scheetz, President and Chief Executive Officer of MHG, said, "SoHo is downtown's most attractive location--a mix of fashion, industry, culture and nightlife set in the historic cast-iron buildings and cobble-stoned streets. Boutique hotels have performed extremely well in SoHo, and we are pleased to partner with Cape Advisors to open our first property in lower Manhattan."
Mondrian SoHo is expected to have significant space for a restaurant, bar, ballroom, meeting rooms, exercise facility and a penthouse suite with outdoor space that can be used as a guest room or for private events. The hotel is also expected to boast a street-courtyard, which would serve as the hotel entrance and outdoor dining space.
MHG contributed approximately $5 million for a 20% interest in the joint venture. Upon completion, MHG is expected to operate the hotel under a 10-year management contract with two 10-year extension options.
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