London-based Quadrum Global is considering selling its Arlo Hotels brand, according to a report from Bloomberg. The company has engaged Moelis & Co. and Eastdil Secured to look for potential buyers for both the brand and its real estate assets. There is no certainty that this process will lead to a sale.
Moelis & Co. and Eastdil Secured did not provide comments on the matter, and Quadrum Global did not respond to requests for comment.
Quadrum launched Arlo Hotels in 2016 after an earlier partnership with John Pritzker ended. The chain currently includes seven hotels aimed at urban travelers: four in New York City (including one in Brooklyn), and one each in Chicago, Miami, and Washington, D.C.
In early 2023, Quadrum expanded the brand by purchasing the Williamsburg Hotel at 96 Wythe Avenue in Brooklyn out of bankruptcy for $96 million. This acquisition followed a federal bankruptcy judge’s decision to remove developers Toby Moskovits and Michael Lichtenstein from control of the property.
At the time Arlo was founded, other micro-hotel brands such as Pod Hotel and Yotel were already established competitors in Manhattan. Today’s market also features rivals like Marriott International’s citizenM brand and Generator Hostels.
Recent months have seen increased investor activity within New York City’s hotel sector. For example, Island Capital led by Andrew Farkas, along with partners Three Wall Capital and MCR, recently listed the Lexington Hotel in Midtown East with an asking price near $275 million; Eastdil is participating in that sale as well.
Hotel occupancy rates in New York City have improved significantly since pandemic lows. According to Lodging Analytics Research & Consulting, average weekly occupancy exceeded 84 percent last year compared to about 50 percent during the height of COVID-19 restrictions. However, ongoing challenges such as rising labor costs, higher interest rates, and property taxes continue to impact profitability across the industry.
