A $90M Loan Funds A $68M Hotel Deal

The Real Deal reported Oct. 25 that RLJ Lodging Trust sold seven hotels with 1,057 rooms on South Cicero Avenue, beside Midway Airport, to Endeavor Hotels for $68M. RLJ paid $139M in 2006. The sale works out to about $64,300 per key against about $131,500 then, a decline of about 51% (both derived). RLJ did not comment.

Endeavor's financing is a $90M mortgage from Access Point Financial, about 132% of the price (derived). The Real Deal reads the loan as a sign of planned improvements.

On Oct. 24 the same outlet reported that a court-appointed receiver has hired CBRE to sell 55 East Jackson, a 22-story, 452,000 SF Loop tower that Firenze Group bought in 2019 for $64M. Sources cited by Crain's put bids near $11M, about $24 per SF (derived). Lender Ready Capital filed a $62M foreclosure suit in 2024, then dropped it and rejected taking ownership this summer.

Our Read

Price in both cases is a financing-and-repositioning number. The Midway buyer borrowed more than it paid, so the capital stack includes dollars beyond the purchase price. Whether those are renovation, reserves or costs is not in the report. What the loan does show is that a hospitality lender was willing to advance $90M against a $68M purchase, but neither an appraisal nor the allocation of proceeds was reported; this is not a verified loan-to-value ratio.

The tower runs the other way. Nothing in the reporting shows a lender financing a stabilized asset. CBRE is marketing the building as an office-to-residential play, so about $24 per SF is a price for a structure and a leasehold position, with conversion cost still to be added. Three terms decide value: a ground lease the owner defaulted on, a landmark designation dating to 2012, and a conversion budget no one has published.

Read together, 2006 and 2019 basis are no longer comparables. The questions a bidder needs answered are replacement cost, the cost to reposition, and what a lender will advance against the finished asset. Ready Capital’s decision to dismiss its foreclosure suit and decline ownership underscores the uncertainty; it does not establish a new transaction value.

Demand context is mixed. Chicago drew about 57M visitors in 2025 against a 61.6M record in 2019, per The Real Deal, and business travel remains below pre-pandemic levels, which has kept hotel values from recovering with visitor counts.

Stakeholder Lens

Lenders: the Midway loan shows sizing above price when a business plan is attached; the tower shows the opposite outcome when a lender prefers to step back. Buyers: separate the purchase price from the capital plan before comparing deals. Owners: a hold decision anchored to prior basis competes with buyers underwriting replacement cost. Converters: ground-lease and landmark terms can matter as much as the per-SF price.