Investors hunting for Chicago hotels to buy now have a chance to take over the city’s second-biggest: the 1,639-room Palmer House Hilton.
Thor Equities LLC, the hotel’s New York-based owner, has hired Jones Lang LaSalle Inc. to sell the property at 17 E. Monroe St., hoping to find an investor to buy it for as much as $500 million, according to people familiar with Thor’s plans.
Thor has picked a good time to sell, capitalizing on strong investor demand for hotels amid rising occupancies and room rates. Yet the hotel’s size and price will limit the pool of bidders, with deep-pocketed private-equity firms or overseas investors likely to show the most interest.
Thor is putting the Palmer House up for sale nearly eight years after buying it for $230 million. Thor completed a $131-million renovation in 2008 and?refinanced the property?last year with a $365 million loan package.
Thor Chairman and President Joseph Sitt did not respond to an email, and an executive at Chicago-based Jones Lang did not return calls.
The Palmer House was appraised at $436 million last July as part of the refinancing, according to a loan report from Bloomberg L.P. The hotel generated revenue of $115.6 million last year, and net cash flow before debt payments of $33.0 million, according to the report.
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Source: Alby Gallun (2013). Palmer House Hilton put up for sale, ChicagoRealEstateDaily.com?http://www.chicagorealestatedaily.com/article/20130522/CRED03/130529931/palmer-house-hilton-put-up-for-sale published May 22, 2013. Viewed May 24, 2013,