Oxford Capital, Angelo, Gordon partnership to sell LondonHouse Chicago for $315 mln

A partnership between Oxford Capital Group and Angelo, Gordon announced the $315 million sale and 25-year lease-management back of LondonHouse Chicago to Germany’s Union Investment Real Estate. The transaction is structured as a 25-year lease covering 100 percent of the total rentable area of the 361,467 square feet based on an annual Fixed Rent. The partnership retains ownership of the separate 28,000 square foot parcel on the first and second floors of the 360 N. Michigan Ave. building.

Press Release

An Oxford Capital Group, LLC (“Oxford Capital”) led venture with Angelo, Gordon today announces the $315 Million sale and 25 year lease-management back of LondonHouse Chicago, at the corner of North Michigan Avenue and Wacker Drive, to Germany’s Union Investment Real Estate (“Union Investment”).

Scheduled to open Spring 2016, LondonHouse Chicago is Oxford Capital’s latest luxury lifestyle hotel development. The hotel features 452-rooms located on Floors 3 – 22 of the Alfred S. Alschuler-designed London Guarantee & Accident Building, and the entire new 22-story architecturally synchronized Modernist glass tower designed by Chicago’s Goettsch Partners.

Built on the site of historic Fort Dearborn in 1923, the London Accident & Guarantee Building is a both a local and national landmark, and one of the four iconic 1920s flanks of the North Michigan Avenue Bridge, along with the Wrigley Building, Tribune Tower, and 333 North Michigan Avenue. The Oxford – Angelo, Gordon venture retains ownership of the separate 28,000SF retail parcel on floors 1 and 2 of the 360 North Michigan Avenue building.

Commenting on the transaction, John W. Rutledge, founder, president and CEO of Oxford Capital and Oxford Hotels & Resorts, LLC, said “We are delighted to announce an agreement with Union Investment for their second foray into the United States’ hotel market. We’ve had a wonderful experience to date with them around our recent similar Godfrey Boston transaction.”

Rutledge continues, “This transaction outcome is a true win-win-win for Oxford, its institutional investment partner Angelo, Gordon, and Union Investment. Specifically Oxford and Angelo, Gordon are able to receive an attractive return on their original investment. Oxford Capital and Oxford Hotels and Resorts secured a long term lease, management, and brand licensing agreement for LondonHouse, which is part of its growing national collection of lifestyle hotels and brands. Finally, this transaction allows for Union Investment to acquire one of the most prominent, well-located properties in the United States at an attractive return for its investors.”

The LondonHouse Chicago transaction is structured as a 25-year lease covering 100% of the total rentable area of 361,467 square feet based on an annual Fixed Rent. An additional Profit Share component documents the spirit of aligned interests between Oxford Capital, Angelo, Gordon, and Union Investment. With the LondonHouse Chicago agreement, Union Investment strategically expands its UniImmo: Europa open-ended real estate fund in the United States.

“This second investment underscores our reputation as a reliable and attractive partner to the hotel industry at international level. It also opens up the prospect of further off-market transactions in the US,” said Andreas Löcher, head of Investment Management Hotels at Union Investment Real Estate GmbH. “Following our joint deals in London and Boston, we are delighted to be expanding our partnership with Oxford Capital in the Chicago metropolitan region with the acquisition of this exceptional property.”

“Working closely with Oxford in overseeing the transformation of and breathing new life into this iconic Chicago landmark has been an extremely rewarding process. We are pleased to have been able to recapitalize this historic asset with an investor well-suited to partner with Oxford as LondonHouse’s long-term stewards,” said Ryan Klenovich, Director at Angelo, Gordon.

About LondonHouse Chicago
The luxury lifestyle, full-service LondonHouse Chicago, is located on the corner of North Michigan Avenue and Wacker Drive inside the architecturally-renowned historic London Guarantee and Accident building, and an all-new modernist 22-story glass tower. LondonHouse will offer 452 luxury guest rooms and suites featuring expansive views of Michigan Avenue, Wacker Drive, the Chicago River, and many other city landmarks. Amenities include LH, Chicago’s first tri-level rooftop venue featuring a private Cupola level, outdoor rooftop terrace, an indoor bar with private dining rooms, a chef-driven restaurant and lobby bar, and 25,000 square-feet of conference and event space. The venue will offer a variety of meeting and event spaces for both small and large groups as well as two column-free ballrooms for social dinners and weddings of up to 300 guests, or receptions for 350 or more. Additional features included in the guest rooms are Hilton’s Digital Key (through its soft-brand affiliation with Curio Collection by Hilton), free Wi-Fi, in-room refrigerator, large HD LED TV’s, SoniCast device streaming, large work desk with task chair and USB outlets, walk-in shower with Malin + Goetz bath amenities, full length mirrors, luxurious linens and a sitting area. Guests can also enjoy the full service spa, 24-hour fitness center and state-of-the-art-technology throughout the hotel. LondonHouse Chicago is affiliated with the Curio Collection Hotels by Hilton Worldwide. Guests also have the added benefit of earning and utilizing Hilton HHonors® points during their stay. For information visit www.londonhousechicago.com.

About Curio – A Collection by Hilton
Curio – A Collection by Hilton (curiocollection.com) is a global collection of distinctive hotels that are woven into the fabric of their destinations. While each one is unique, they are united in their individuality. Curio guests are passionate travelers seeking local discovery and authentic experiences, while resting easier knowing the Hilton name is behind every stay. Curio joins a portfolio of market-leading brands from Hilton Worldwide, a leading global hospitality company. Access the latest news at news.curiocollection.com or inquire about development opportunities at hiltonworldwide.com/development.

About Oxford Capital Group, LLC
Oxford Capital Group, LLC is a national real estate, private equity investment, development and management firm. Oxford Hotels and Resorts, LLC is its wholly owned hotel operating affiliate. Oxford, its affiliates and principals have been involved in approximately $2.5 billion of real estate and private equity investments, including approximately 13,000 hotel rooms and over 2,000 senior housing units. The firm’s primary areas of focus are hotels, resorts, conference centers, senior housing and other operationally intensive forms of real estate, including health, fitness, spa, athletic and sports/entertainment destination clubs, and entertainment destination outlets including hotel rooftop venues, urban retail, parking, and multi-family. Its portfolio of corporate private equity investments include Top Golf, Argo Tea, and Potbelly Sandwich Works. Oxford’s geographic focus include the nation’s top metropolitan areas: Boston, Chicago, Los Angeles, Miami, New York City, Portland, San Francisco, Seattle, metro Washington D.C., select resort markets, and other markets with unique attributes including Charleston, SC, New Orleans, LA and various markets throughout Florida. Notable national projects include: Godfrey Hotel Boston; Doubletree Metropolitan Hotel and Lexington Hotel, New York City; National Conference Center, Lansdowne; VA; Residence Inn and SpringHill Suites by Marriott Charleston, SC Riverfront; and Bay Harbor Hotel, Tampa Bay, FL. Its current portfolio includes a growing collection of upscale, upper upscale and luxury lifestyle hotels and brands including Cass, Felix, Godfrey, Essex, Bay Harbor and LondonHouse. For information, visit www.oxford-capital.com.

About Union Investment
Union Investment is a leading international investment manager specializing in open-ended real estate funds for private and institutional investors. Union Investment has assets under management of some 27.8 billion EUR in nine retail and special funds. The portfolio of Union Investment´s open-ended real estate funds comprise some 390 properties and projects in Germany and other European Countries, the Americas and Asia. Investments in city-centre office space are the mainstay of the company’s investment strategy. In addition, Union Investment is investing in logistics properties, shopping centres and business hotels in selected locations that offer the prospect of attractive returns over the medium and long term. The company’s hotel portfolio consists of 43 properties and projects with a current market value of some €2.5bn.

About Angelo, Gordon & Co.
Angelo, Gordon & Co. is a privately-held registered investment advisor dedicated to alternative investing. The firm was founded in 1988 and currently manages approximately $24 billion. We seek to generate absolute returns with low volatility by exploiting inefficiencies in selected markets and capitalizing on situations that are not in the mainstream of investment opportunities. We creatively seek out new opportunities that allow us to remain a leader in alternative investments. For information, visit www.angelogordon.com.