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New York & Tri-State  + Midtown New York  + Hospitality  | 

DiamondRock Finalizes $185M Sale of Midtown Manhattan Hotel

DiamondRock Hospitality Company said Thursday today that it completed the disposition of the 725-key Lexington Hotel in Midtown Manhattan to an undisclosed buyer for $185.3 million. Bethesda, MD-based DiamondRock acquired the property in 2011.

Including DiamondRock’s projected capital expenditures, the sale price represents a 14.2x multiple on 2019 hotel EBITDA and a 5.4% cap rate on 2019 hotel NOI. The company intends to redeploy net proceeds from the sale to acquire high-growth experiential resort and urban lifestyle hotels aligned with its investment strategy.

“We are pleased to announce the closing of this transaction, which right-sizes our portfolio’s exposure to New York City,” said Mark W. Brugger, president and CEO of DiamondRock.  “This disposition also provides DiamondRock with significant investment capacity for on-strategy acquisitions.”

Following the sale, DiamondRock’s New York City footprint has decreased from 1,517 keys across four properties to 792 keys across three, according to CoStar.


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DiamondRock Hospitality

About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).