Chicago Real Estate Magnate Buying Luxury Hotel

November 13, 2011

Chicago real estate‘s most successful investor has agreed to purchase a Gold Coast hotel for about $95 million.

Sam Zell has secured a deal to buy the independent Elysian Hotel with plans to turn it into a Hilton chain brand, according to Crain’s Business.

The price tag for the 188-room hotel comes out to about $505,000 per unit, making it the highest per-room price ever paid for a hotel in Chicago.

the elysian

The Elysian Hotel is being purchased by Chicago real estate magnate Sam Zell.

The plan is reportedly to convert it into a Waldorf Astoria, the luxury brand of parent company Hilton Worldwide Inc., which would run the hotel.

Considered one of Chicago’s most expensive hotels, the Elysian is only two years old but has been losing money, despite its high regard.

Chicago’s Elysian Hotel, which received a 5-diamond rating by AAA for 2011 and 2012, has been named:

*Top U.S. Hotel in 201 by Condé Nast Traveler magazine

*Top U.S. Hotel by U.S. News & World Report for 2011

*No. 1 Hotel in Chicago by Travel Advisor

*Third best U.S. hotel by Travel and Leisure magazine

The 60-story high-rise also includes 51 luxury condominiums that begin around $3 million apiece.

Equity International‘s Sam Zell started investing in hotels a few years ago, though from a speech made in 2009, you would think it would be one area of the real estate business from which he would stay away.

Zell was speaking at a real estate conference at, ironically, the Waldorf Astoria in New York, when he described a bleak future for the hotel industry, saying we’re “likely to see the kind of a massacre in the hotel industry . . . similar to what office (property) saw in the early 1990s.”

Guess maybe he changed his mind.

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