German Investor Makes First Foray into Boston

By Keith Loria, Contributing Editor

Oxford Capital Group, LLC in a joint venture with an affiliate of Walton Street Capital, LLC, have agreed to a sale lease/management back to Germany’s Union Investment Real Estate of The Godfrey Hotel Boston.

“After thoroughly vetting a large number of interested investors and suitors, we chose Union Investment for a variety of reasons, including its commitment to a highly professional transaction process, the scale and quality of its organization and people, and its competitive pricing,” John Rutledge, Oxford Capital Group’s founder, president and CEO, said in a prepared release. “And as always, we’re looking for win-win relationships with our investors.”

Located in Boston’s rapidly growing Downtown Crossing neighborhood, the Godfrey Hotel Boston is a 242-room high design, lifestyle hotel scheduled to open in January 2016.

“We are delighted to have reached this agreement with Union Investment for The Godfrey Boston to be its first foray into the United States’ hotel market,” Rutledge said. “We are confident in the future success of The Godfrey and that the property, brand, and management platform will benefit from the transaction.”

The Godfrey will offer its guests and visitors a range of amenities including George Howell Coffee, its own artisan small batch roasted coffee cafe, a fitness center, a soon-to-be-announced partnership with a well-regarded local restaurant group and an executive boardroom.

The transaction is structured as a 25-year lease covering 100 percent of the total rentable area of 135,000 square feet based on an annual fixed rent. An additional profit share component documents the spirit of aligned interests between Oxford Capital, Walton Street Capital and Union Investment.

“The international growth of our hotel investment activities is based on a clear strategy of expanding our hotel portfolio and diversifying even further across all asset classes,” Andreas Locher, Union Investment Real Estate’s head of investment management hotels, said in the release. “Our long-standing presence in the U.S. office market and our strong commitment, both in metropolitan areas and in gateway cities, is successfully opening doors and enabling us to tap into attractive hotel markets in North America.”

Downtown Boston/Downtown Crossing is in the midst of a dramatic transformation, as reflected in the many new high rise residential and retail developments as well as significant refurbishments of office buildings, apartments and retail properties.