By Daniel Geiger, @dangeiger79, courtesy of Crain’s New York Business (www.crainsnewyork.com)
A partnership between Silverstein Properties, Fisher Brothers and Capstone Equities has purchased the Beekman Tower Hotel just north of First Avenue for nearly $85 million.
The group will convert the 170-room Art Deco hotel, which has a storied history as a hangout of major stars including Frank Sinatra and was built as a home away from home for sorority girls, into extended-stay corporate housing suites.
According to a person familiar with the property, the partnership will invest around $20 million to renovate its interiors. Silverstein Properties, the firm headed by World Trade Center developer Larry Silverstein, will operate the property, according to the source.
Mr. Silverstein, this person said, has a smaller scale extended-stay hostelry within his large Silver Towers residential development that he built on West 42nd Side several years ago.
The 26-story Beekman Tower sits on the northeast corner of First Avenue and East 49th Street. A brokerage team from the firm Eastdil Secured, led by Doug Harmon, an executive at the firm, had given over a hundred tours to prospective investors, many of whom, according to a source, remembered the property mainly for its former cache.
The building has a restaurant on its top two floors with a deck offering sweeping views of the surrounding neighborhood and the East River.
"It used to be a place where Frank Sinatra would hang out after a show and would give impromptu performances," the source said. "It was the Boom Boom Room of its day."
The partnership will own the property in equal one-third shares. Fisher Brothers will handle the renovation of the property, which is showing its age inside, the source said.
Hudson Advisors, an affiliate of the private equity firm Lone Star, bought the debt on the property during the downturn from Anglo Irish Bank, after its owner Peninsula Real Estate Fund ran out of funds to renovate the building, according to published reports. Hudson Advisors eventually took control of the property and was the seller in the deal to Silverstein Properties and its partners.
Calls to the parties involved were not immediately returned.
