CorpHousing Inks Leases for Two NYC Hotels
Short-term rental player aims to have 3,000 units under management by end of year.
CorpHousing Group (CHG), the short-term rental company that embraced an asset-light expansion strategy of leasing hotels, has inked 15-year master-lease operation agreements with two New York City hotels in the past week.
CorpHousing announced a 15-year deal for The Tuscany Hotel at 120 East 39th Street in Manhattan’s Murray Hill neighborhood. The Miami-based company plans to begin operating the units in the fourth quarter under its LuxUrban brand, which is oriented toward vacation and business travelers.
Earlier this month, CorpHousing said it had acquired 217 units in a luxury hotel in Downtown Manhattan, the name of which it did not specify.
Following its IPO in August, CHG shifted its strategy from acquiring multifamily apartments to leasing “dislocated” hotel properties in desirable urban locations.
The company has been aggressively lining up master lease agreements in the past two months to fulfill the scaling strategy promised by the IPO, which charted a 34% increase to the number of units under management in GHG’s leased portfolio, aiming for a total of up to 3,000 units.
CHG also has signed master leases with The Blakely Hotel and the Marriott Herald Square Hotel, both in NYC, and the Georgetown Suites Harbour in Washington DC. The operator provides guests with its trademarked Heroic Service under the LuxUrban hospitality brand.
According to a report in the South Florida Business Journal, CHG raised about $16M in the IPO. “Our approach [gives] property owners the ability to create stable cash flow streams to maximize returns which have been significantly impacted by restrictions on travel and leisure due to the pandemic,” said Brian Ferdinand, CHG CEO, in a statement.
CHG markets its leased hotel space though its own online portal and through dozens of third-party sales and distribution channels.
Investors have been opening their wallets as fast as they can to provide financial backing to platforms serving the emerging market for short-term, “flexible living” apartment rentals aimed at migrating remote workers.
Earlier this month, Landing, a platform that offers fully furnished apartments for rentals as short as a month, announced it has arranged $125M in new backing, including $75M in equity funding and a $50M loan. Online rental marketplace Zumper said it raised $30M in a Series D1 round by Kleiner Perkins, backing the platform will use to expand its short-term offerings.
Last month, Sentral—a flex-living pioneer launched last year with $500M in backing from ICONIQ Capital—formed a partnership with OliverBuchananGroup (OPG) to develop new mixed-use, multifamily projects that deploy Sentral platform for short-term rentals in high-growth US markets.
WeWork co-founder Adam Neumann secured $350M in backing from Andreeseen Horowitz for a new flexible-living startup named Flow.