Categorized | Commercial

Chinese Billionaire Buys New York’s Carlyle Hotel

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New York’s Carlyle hotel was one of five luxury hotels recently purchased by Chinese Billionaire Cheng Yu-tung. His family’s company, New World Development Co., purchased hotels in Santa Fe, New Mexico, the British Virgin Islands, Dallas, and New York.

The deal, which was $570 million, serves as a key piece to New World Development’s plans to build its luxury hotel presence. It could also lead the way to other luxury hotels in the United States being purchased by Chinese investors, as all indications point to a growing interest in the high-end hotel real estate market.

The purchase reflects the tremendous growth of the middle class in China, as more and more Chinese citizens are looking to travel to other parts of the world. The United States is an ideal destination, thanks in part to how well their currency matches up with the U.S. dollar. Investors from China and other Asian countries are also viewing the luxury hotel industry as a part of a worldwide long-term investment strategy.

One of the reasons why luxury hotels are looking increasingly attractive to these Asian investors is that revenue per available room continues to increase. Luxury hotels have proven to be a cash cow, even in the toughest economic times. Each of the hotels purchased by Cheng Yu-tung feature unique luxuries to go along with brilliant views. For example, the Carlyle hotel offers fine antiques in each room, and even velour bathrobes and slippers for child guests. The hotel in Santa Fe that was purchased by Yu-tung features hand-carved floors and sculpted stairways.

With China’s middle class stronger than ever, Yu-tung and other investors have great hopes for international luxury hotels, and for good reason.

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About Drew Wilson

Drew focuses on the Commercial and Mortgage/Finance categories.

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