Morgans Hotel Group sold off two of its boutique hotels in New York City, the Royalton and Morgans, for $140 million, or approximately $500,000 per room, late last month. Morgans sold the property to Felcor Lodging Trust but will continue to operate the hotels under 15-year management agreements with one 10-year extension option.
Michael Gross, Chief Executive Officer of Morgans said, "We are pleased to complete the sales of these New York hotels and we look forward to a long and beneficial partnership with FelCor as we continue to manage the hotels. With this transaction, we have now completed the sale of three assets which has allowed us to reduce our debt and provided us with financial strength to expand our brands."
Morgans reportedly used part of the proceeds to retire a credit facility. According to a Reuters report, the two hotels, along with the Delano hotel in South Beach that the company sold off in April, were collateral for the credit facility. Delano is currently unencumbered, the company said in a statement.
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