Apollo Global Management pays $83.5M to Torchlight Investors for hotel in Times Square

Apollo Global Management through the entity Tsq Hotel Owner LLC paid $83.5 million to Torchlight Investors through the entity Hts West 42nd Street LLC for property (H1) at 234 West 42nd Street in Times Square, Manhattan. Apollo bought the property through a ground lease. The property has been occupied by the Hilton Times Square.

The transfer was first reported in June by The Wall Street Journal, which said hotel investor Newbond Holdings was also a buyer alongside Apollo. 
The deal closed on September 14, 2022 and was recorded on October 3, 2022. The property has 300,359 square feet of built space according to PincusCo analysis of city data. The sale price per built square foot is $278 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for Torchlight Investors was Gianluca Montalti and Jorge Rodriguez. The signatory for Apollo Global Management was Jason Faver. Torchlight obtained the ground lease from Sunstone Hotel Investors through a deed-in-lieu of foreclosure on December 22, 2020.
Apollo Global Management financed the purchase with an acquisition loan from lender Fortress Investment Group through the entity DB HTS LLC valued at $69.5 million for the property

Prior sales and revenue

Prior to this transaction, Pincusco has no record that the buyer Apollo Global Management had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Torchlight Investors purchased two properties in two transactions for a total of $78 million and had not sold any properties over the same time period.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The block

On this tax block, PincusCo has identified the owners of three of the 10 commercial properties representing 1,635,659 square feet of the 3,013,927 square feet. The largest owner is RXR Realty, followed by Yellowstone Real Estate Investments and then Torchlight Investors.
There are no active new building construction projects on this tax block.

The majority, or 69 percent of the 1.9 million square feet of built space are office buildings, with specialty buildings next occupying 15 percent of the space.

The seller

The PincusCo database currently indicates that Torchlight Investors owned at least two commercial properties in New York City with 311,525 square feet and a city-determined market value of $91 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 96 percent of the 311,525 square feet of built space are hotel properties, with retail properties next occupying 4 percent of the space. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that Apollo Global Management owned at least three commercial properties in New York City with 1,396,625 square feet and a city-determined market value of $59.8 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 100 percent of the 1,396,625 square feet of built space are elevator properties, with development properties next occupying 0 percent of the space. They are all located in Manhattan.

Direct link to Acris document. link