Taj Hotels sells iconic Taj Boston for $125 million
Taj Hotels Resorts and Palaces, part of the Tata Group, on Wednesday said it has sold the historic Taj Boston hotel in the US to a consortium comprising New England Development, Eastern Real Estate, Rockpoint Group, Lubert-Adler and Highgate for $125 million (about Rs 839 crore).business Updated: Jul 13, 2016 13:39 IST
Indian Hotels Company (IHC), part of the Tata Group, on Wednesday said it has sold the historic Taj Boston hotel in the US to a consortium comprising New England Development, Eastern Real Estate, Rockpoint Group, Lubert-Adler and Highgate for $125 million (about Rs 839 crore).
“United Overseas Holdings effected on July 12 the divestment of Taj Boston Hotel through sale of the entire issued and outstanding LLC interests of IHMS (Boston) LLC held by UOH to AS Holding LLC, Boston for an aggregate consideration of $125 million,” IHC said in a BSE filing.
United Overseas Holdings (UOH) is an indirect wholly-owned subsidiary of IHC and IHMS (Boston) LLC is a direct subsidiary of UOH.
IHC, which runs Taj group of hotels, said net sale proceeds will be utilised largely to retire outstanding debt.
While the partnership will take over the ownership of the 90-year old, 273-key hotel, Taj Hotels will retain its brand presence in Boston through a long-term management services agreement, according to a statement issued by Taj Hotels.
Tatas had bought the hotel for $170 million in 2006. However, global economic recession impacted fortunes of the hospitality sector around the world and its profitability as well.
As part of the transaction, New England Development, Eastern Real Estate and Highgate, will serve as asset managers, working closely with the Taj Hotels Resorts and Palaces team, private equity firm Rockpoint Group, and real estate investment company Lubert Adler. All current bookings for the hotel rooms, restaurants and banquets will be honoured, and guests can continue to book the hotel through existing channels, the Taj statement said.
“The US remains an important market for us, and we are committed to our presence, which we have built over the past decade in key cities like New York, San Francisco and Boston,” said Rakesh Sarna, MD and CEO, Taj Hotels Resorts and Palaces. “We are excited about our relationship with our new partners, who are all recognised leaders in real estate development and have deep roots and expertise in this market. We will work together to ensure that the hotel will maintain unparalleled guest service standards of Taj while celebrating Boston culture and history.”
Taj Boston is one of the landmarks to the Back Bay skyline with its location on the Boston Public Garden, and adjacent to the city’s premier retail district. The hotel is famous for its ambience of an elegant Boston townhouse and has traditional furnishings, crystal chandeliers, luxurious bedding, and indulgent bath amenities. The 273-guestrooms include 44-exquisitely-designed spacious suites, each featuring classic décor and a wood-burning fireplace.
“We are thrilled to join with Eastern Real Estate, Rockpoint, Lubert-Adler and Highgate in acquiring this legendary hotel property – located in one of the country’s most-famous shopping districts. Taj Boston is an internationally-acclaimed hotel due to its rich heritage, superb location and grand architecture,” said Stephen R Karp, chairman of New England Development. “We look forward to making further improvements to this legendary hotel so it becomes the focal point of Boston’s cultural activities.”
US-based New England Development (NED) is a premier real estate development and management company with a portfolio that includes retail, mixed-use, and hospitality assets plus marinas and golf courses. The company operates luxury hotels on Nantucket, including the White Elephant Hotel and The Wauwinet. NED was also a major part of the team that developed the Westin Boston Waterfront Hotel adjacent to the Boston Convention and Exhibition Centre.