The real estate investment trust announced that the Hersha Hospitality Trust sold the 43-room Duane Street Hotel in Tribeca for $18 million.
Premier Equities a private real estate financer and management company bought the hotel at 130 Duane Street for $419,000 per room.
Premier, in turn, rented all of the 17,500-square-foot hotel’s rooms to short-term rental company Sonder.
Hersha and Premier entered into a necessary sales contract for the hotel in late February with an initial sales price of $20 million. Hersha used the profits from the sale which had a 4.3 % capitalization rate to settle down debt.
This is not the first time that Premier Equities’ partnering with Sonder, Premier purchased the Flatiron Hotel prior to the pandemic and rented it to Sonder in 2019.
Sonder was interested in the 130 Duane Street property as part of its transition into more of a hotel brand. It was established as a short-term rental site similar to Airbnb, according to a source familiar with the Tribeca deal.
The property is also one of the few non-union hotels that have sold since the pandemic began, making it more attractive to buyers.
The spokesperson for Sonder stated that they are looking ahead to opening the doors at this fantastic property following this year, and will be running the full building as a hotel.