Veris Residential, a company that's evolving into a pure-play apartment landlord, and Hyatt Hotels have sold a 351-room hotel to a pair of partners that plan to upgrade the property.
Taconic Capital Advisors and HEI Hotels & Resorts acquired the Hyatt Regency Jersey City, a full-service hotel located in Jersey City, New Jersey, for an undisclosed price. It's adjacent to Exchange Place on a pier that extends into the Hudson River across from Manhattan.
While the price was not disclosed, Taconic and HEI said they would assume a $100 million fixed-rate commercial mortgage-backed securities mortgage with "ample remaining term" on the property in conjunction with the purchase.
“Hyatt Regency Jersey City was a compelling opportunity to acquire a world-class hotel with a strong segmentation mix and a diverse set of revenue contributors,“ Andrew Lam, a director in Taconic Capital’s Commercial Real Estate Group, said in a statement. “The highly accretive assumable financing allowed us to continue our thesis for well-located urban, upscale hotels in an otherwise prohibitive financing environment.”
Completed in 2002, the Hyatt Regency Jersey City has received more than $15 million in upgrades since 2010.
The new owners, who will continue to operate the hotel as a Hyatt Regency, said they plan to start making major enhancements to the guest rooms, food-and-beverage outlets and event spaces. HEI, headquartered in Norwalk, Connecticut, will manage the hospitality property.
Veris, a real estate investment trust based in Jersey City, has been shedding the noncore properties in its portfolio to focus on multifamily housing, and divesting the Hyatt appears to be part of that plan. The company recently rejected an unsolicited bid from Kushner Cos.
HEI Partner Clark Hanrattie said in a statement that the Hyatt has been the beneficiary of business from the growing number of corporations that have leased office space in Jersey City, where rents are less pricey than in New York. It's also benefited from the revitalization of Hudson Yards and lower Manhattan, Hanrattie said.
The hotel is located in an area that has 28 million square feet of office space within a 1-mile radius. Tourist attractions such as the Statue of Liberty and Ellis Island are nearby.
The property features a gym and indoor-heated pool, a restaurant and lounge and 20,000 square feet of meeting space that has served as a venue for company retreats, weddings and social gatherings.
The Jersey City deal isn't the first joint acquisition by New York-based Taconic and HEI. In March this year, they purchased the Westchester Marriott in Tarrytown, New York, for $40 million, according to CoStar data. It's a 15-acre property with 444 guest rooms and 21 event spaces for a total of 26,700 square feet.