Burnett Equities Buys NYC Hotel Martinique New York on Broadway for $55M Oklahoma City-based Burnett Equities has acquired NYC Hotel Martinique New York on Broadway for $55.5 million from Herald Hotel Associates. The ownership plans to invest an additional $55 million to redevelop the 531-room property for a total investment of $110 million. The property is one of New York City’s oldest operating hotels, and is a landmark property.In addition to the property’s designation as a landmark, the transaction had a number of challenges. The property is unionized and on a ground lease with a nearly vacant retail area. In addition, the property was undergoing a bankruptcy, which was filed in 2020 as the pandemic shuttered the property. As a result, the sale took nearly 12 months to complete, including the marketing process.Eric Anton and Nelson Lee of Marcus & Millichap’s Manhattan office represented the sellers in the transaction and secured the buyer. In addition to brokering the deal, the team also bolstered the property value by securing six retail leases for the property in the midst of the pandemic and in only three months.Mission Capital Debt & Equity, part of Marcus & Millichap Capital Corporation and MMCC’s Matthew Polci, Steven Buchwald, Jordan Ray and Lexington Henn, Burnett Equities secured a mortgage of $71 million and a more financeable ground lease.The New York City hotel market was tremendously impacted by the pandemic, but investors are stepping up this year to buy and renovate hotel product—and there have been some major transactions. In July, MCR, Three Wall Capital and the Island Capital Group formed a joint venture to acquire The Lexington Hotel, Autograph Collection by Marriott for $185 million. The property has 725 guest rooms, equating to a sales price of $225,000 per door. Like many hotel properties, The Lexington Hotel was shuttered during the pandemic. It is scheduled to reopen in August, and the new ownership says that the property is on track to hit that goal.Hotels that have maintained a strong performance this year are particularly attractive. Debt markets for hotel financing continue to expand as capital is more readily available, spreads continue to compress, and terms are improving. This favorable financing backdrop has continued to support higher underlying real estate values and increasing transaction activity, particularly for cash-flowing and better-performing hotels.On the other hand, hotels located in Manhattan’s city center will have the hardest time rebounding. Visits to city center hotels declined precipitously in August to hit more than 30% less than 2019 numbers, according to new research from Placer.ai.