South Korea’s largest hotel group has paid $36 million for a 191-room Chicago property, where it plans to launch its lifestyle brand in the United States.
Seoul-based Lotte Hotels & Resorts this week announced it has completed the $36 million purchase of the Kimpton Hotel Monaco Chicago. The 13-story hotel is at 225 N. Wabash Ave., not far from the Magnificent Mile shopping avenue.
Lotte said in a statement that it plans to open an L7 lifestyle hotel there in the second half of 2023, adding that “Chicago possesses attractive local culture which makes it optimal for L7 Hotels to expand.”
There are three L7 hotels in South Korea, where the company said it provides entertainment such as indoor driving ranges, video game competitions and collaborations with fashion and beauty brands.
The company also has hotels branded with its Lotte name, including one in New York and one in Seattle, and a luxury concept called Signiel. There also are brands focused on business and resort travel.
L7 first opened in 2016 in Myeongdong, Seoul’s main tourism and shopping district. The Chicago outpost is similar, with its location near the Riverwalk, North Michigan Avenue shopping and Millennium Park.
Lotte currently has 32 hotels in seven countries. Last year, the company announced plans to open another 20 hotels in the Americas in the next five years.
The Chicago hotel will undergo a renovation before switching to the L7 brand next year, the company said.
Chicago is a key opening because it’s in the center of the United States, after previously bringing the Lotte brand to each coast, CEO Sejin Ahn said in the statement.
“Based on our brand portfolio, we plan to strive for global expansion,” Ahn said.
The sale of the Kimpton Hotel Monaco had been expected after its previous owner, Xenia Hotels & Resorts, in December disclosed it had a deal to sell it for $36 million, or almost $188,500 per room.
Later that month, Crain’s Chicago Business reported the buyer under contract was Lotte. At the time, it was unknown which brand Lotte planned on bringing to Chicago.
The sale comes at a big loss for Orlando, Florida-based Xenia, which bought the hotel for just over $53 million in 2013.
Lotte isn’t the only international hotel brand planning an entry to Chicago during the COVID-19 pandemic, which has rocked the hospitality industry. Chicago has been hit particularly hard because much of its business comes from conventions in the sprawling McCormick Place complex just south of the Loop business district.
Despite difficult times for the tourism industry, Dutch brand citizenM plans to open a 280-room hotel within a 47-story apartment and hotel tower under construction at 300 N. Michigan Ave. A few blocks away, Spain’s RIU Hotels & Resorts recently paid $28 million for a site at 148-158 E. Ontario St. where it plans to begin construction soon on a 390-room hotel.
Also nearby, Marriott is building out a 191-room St. Regis-branded luxury hotel on the lower 12 floors of the recently completed St. Regis Chicago building. The 101-story hotel and condo tower, designed by Jeanne Gang and formerly known as Vista Tower, is Chicago’s third-tallest skyscraper at 1,191 feet.