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Sofitel New York sold: the "DSK" affair no heavy blow to former owners?

Hotel Sofitel New York, which hit the headlines in 2011 with the "DSK" affair, has been sold at a price of $273 million. This appears to be a clean getaway for former property owners given this is well above the asset's 2007 market value.

Hong Kong-based group Keck Seng Investments recently announced it purchased hotel Sofitel Manhattan in New York. The deal was sealed at a price of $273 million (about 204 million euros). This property had the misfortune of hitting global headlines in 2011 with the "DSK" affair, which at the times compelled hotel and top Sofitel management to react. It is thus especially interesting to see what happened to the market value of such a hotel, which had to implement crisis communication to fight a global bad buzz which could have turned out to jeopardise the property's long-term market value.

Current state of affairs show that hotel owners did not blow their money on a now worthless property: through this latest deal, the hotel has been bought by Keck Seng Investments from 44th Street OwnerCo at a price of $273 million, or about $686,000 per room. 

Hotel Sofitel New York had originally been purchased in 2007 from the French hotel operator Accor by a consortium of investors (GEM Realty Capital, Whitehall Real Estate Fund and Accor) through a deal that included hotels Sofitel New York and Sofitel Philadelphia, or 704 rooms together bought for a portfolio price of $255 million. As the hotel Sofitel New York alone (398 rooms) was sold for $273 million in 2014, it appears that hotel owners who faced the DSK affair did manage to keep their house in order.

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