Chetrit Nabs funds once dirtiest hotel in New York
Joseph Chetrit got a loan to revamp one of Times Square’s dirtiest hotels.
Chetrit’s company, The Chetrit Group, secured a $185 million construction loan from Mack Real Estate Credit Strategies for the 570-key Carter Hotel at 250 West 43rd Street, according to a person familiar with the deal. The financing will replace a $152 million bridge loan from JPMorgan in 2018.
Adi Chugh of Surya Capital Partners arranged financing for Chetrit. He had also arranged the 2018 financing.
The Carter Hotel, originally built in 1930, earned the rare distinction of being named New York’s dirtiest hotel three times by TripAdvisor. He also made headlines for a bizarre 2007 homicide.
The Observer in 2014 called it “undeniably, unequivocally, New York’s worst hotel”. The hotel, at 250 West 43rd Street, closed that year.
It was also the year Chetrit bought the establishment from the estate of controversial investor Tran Dinh Truong for $192 million. The necessary renovations were estimated at around $125 million at the time. A year later, Chetrit secured a $129 million loan from an Apollo subsidiary.
The new loan will be used to complete a gut renovation and transform the property into a modern hotel.
Aging hotels in Times Square have struggled during the pandemic. MCR Investors bought the Sheraton New York Times Square Hotel from Host Hotels & Resorts for $323 million, less than half of what Host Hotels paid in 2006. This year Apollo Global Management and Newbond Holdings sold the Hilton Times Square for just $85 million. , a substantial discount from its sale price of $242.5 million in 2006.
But newer hotels have performed well. Sharif El-Gamal’s Soho Properties closed a $317 million refinance of its Margaritaville Resort Times Square shortly after it was built in 2021. Meanwhile, Gary Barnett’s Extell Development closed a $325 million refinance for its 446-key Hard Rock brand hotel in Times Square.