When Nine Orchard opened its doors in 2022, it marked a pivotal moment for Dimes Square—a neighborhood straddling Chinatown and the Lower East Side that’s long been caught between scrappy charm and creeping gentrification. Housed in the historic Jarmulowsky Bank Building, a Beaux-Arts structure dating back to 1912, the hotel emerged after a decade-long, painstaking renovation. With rooms starting at $475 a night, warm cookies at turndown, and seasonal postcards illustrated by Leanne Shapton, Nine Orchard brought a new level of luxury to the area. The hotel’s restaurants were helmed by acclaimed chef Ignacio Mattos of Estela, further cementing its status as a high-end destination.
The building itself had sat vacant for years, with previous plans to convert it into offices or residences falling through—especially after the pandemic made office space a tough sell. Nick Farmakis of Savills pointed to nearby Essex Crossing as an example, where large office spaces remain empty or subleased. In that context, a hotel made the most sense for the location.
Despite initial concerns about what the hotel symbolized for the neighborhood, Nine Orchard quickly became a hotspot. Its 113 rooms and stylish public spaces—like the Corner Bar and the Swan Room—attracted a crowd of well-heeled 20- and 30-somethings, as well as tourists drawn to the building’s old-world aesthetic. Celebrities and creatives made appearances: Emily Adams Bode Aujla and her husband Aaron were spotted having breakfast, Tom Holland launched a nonalcoholic beer with Zendaya, and artists like Ryan McGinley and Michael Stipe hosted events. The hotel hosted everything from rooftop dance parties to live jazz and literary readings. Though Mattos eventually parted ways with the hotel’s dining program, the buzz around Nine Orchard remained strong.
Last week, news broke that DLJ Real Estate Capital Partners had sold Nine Orchard to MML Hospitality, an Austin-based restaurant and hotel group led by chefs Larry McGuire and Tom Moorman. DLJ originally purchased the bank building and an adjacent lot in 2012 for a combined $41 million. The new owners paid $92 million, according to city records—a sale that seemed to confirm the skyrocketing real estate values in Dimes Square, particularly in the post-COVID era.
MML Hospitality is known for its upscale restaurants and hotels in cities like Austin, Aspen, Houston, and New Orleans. April Bloomfield, who had been consulting for Nine Orchard, is now their executive chef. The deal includes the hotel’s restaurants, which weren’t part of the original property when DLJ acquired it, adding to the overall value. Still, the renovation itself was a massive undertaking, reportedly costing $300 million and involving the restoration of the building’s historic façade, cupola, and spire.
While the $92 million sale price might seem like a windfall, it’s not quite the windfall it appears. Adelaide Polsinelli, a commercial real estate agent at Compass, noted that the hotel traded at $1,289 per square foot—high for the area, where recent sales have ranged from $446 to $700 per square foot. But there’s little to compare it to: few buildings in the neighborhood have undergone such extensive renovations, and hotel sales often fetch higher prices due to the inclusion of operating businesses like restaurants and bars. For context, the Sixty SoHo Hotel sold for $1.1 million per room in 2023, while the Mondrian in Midtown East went for $665,000 per room. Nine Orchard’s sale breaks down to $814,000 per room.
This is the second New York hotel DLJ has sold this year. In January, the firm offloaded the Kimpton Hotel Eventi in Chelsea to Blackstone for $175 million.
Meanwhile, other changes are reshaping the neighborhood. The beloved A&N Fruit Store, known for its watermelon slushies and whimsical snowmen, announced it would close in October after 15 years. The new owners of 23 Canal Street, where the store is located, have asked all tenants to vacate. Nearby, at 3-5 Essex Street—also previously owned by DLJ—the city has approved the demolition of 3 Essex, a building destabilized by nearby construction.
The sale of Nine Orchard may not be a simple success story, but it does underscore the rapid transformation of Dimes Square. What was once a quirky, transitional pocket of Manhattan is now home to one of the city’s most talked-about boutique hotels—and a real estate market that’s heating up fast.
Source: curbed.com