Spanish Operator Meliá Spends $203M On NoMad Hotel

A hotel franchise owned by Spanish operator Meliá Hotels International is now the owner of a 313-room NoMad property it has operated since the hotel opened a decade ago. 

An entity tied to the Innside by Meliá Hotel at 132-142 W. 27th St. paid $203M to an entity linked to developer Artimus to acquire the property, according to deed records filed Friday.

Artimus NYC began building the hotel in 2013, after acquiring the vacant lot then in the hotel's place for $35M, The Real Deal previously reported.

Meliá, which is headquartered in Palma de Mallorca and is Spain’s largest hotel operator, leased the 21-story building after it came online in 2016.

Artimus NYC and Meliá didn't immediately respond to requests for comment.

The trade of the four-star hotel is the latest in a string of New York City hotel sales that kicked off last year, when operators that had held assets since the pandemic began selling them off at discounts. Hoteliers started snapping up the city’s luxury hotels at a rapid clip, spying opportunity amid demand from well-off travelers.

Although the NoMad hotel isn't classified as luxury, Meliá set a goal three years ago to expand its luxury portfolio by 40% by 2026. It projected revenues from operations in its home country to rise by 5% this year, Reuters reported in January.

Hoteliers' optimism about NYC properties also stems from the lack of new supply: A 2021 regulation required new hotel developments to obtain special permits from the city council, resulting in zero applications to build hotels for an entire year after the rule's passing. 

But NYC hotels face pressures that are expected to squeeze hoteliers across the country, as flight prices spike due to oil shortages from the Iran war. Both international and domestic tourism are already suffering, according to reports from ABC News and the BBC.

Operators and guests in the city may face additional headwinds after the Hotel and Gaming Trades Council — the city’s most powerful union, representing some 40,000 hotel employees — successfully lobbied in May for a new contract that will see some workers earn as much as $100K a year. 

Executives said they plan to pass costs on to guests, the New York Post reported, citing anonymous executives.