Andrew Farkas

Andrew Farkas, meet Seamless.

One of New York’s most celebrated real estate investors proved that part of remaining a big-time investor is keeping up with the times.

In this case, Farkas bought two Times Square hotels in the pandemic’s darker days, picking up the Sheraton Times Square and the Lexington — some 2,500 rooms between them — for just over $200,000 a key. Their previous owners paid between $650,000 and $700,000 a key, he said.

Today, riding the recovery in Times Square and more broadly in New York tourism, Farkas estimates the hotels would be worth around $350,000 a key were he trying to sell them — which he is not, at least for now. But it was not enough for him to just hang on and enjoy the recovery. He also had to read the market and respond.

In this case, he closed one of the hotels’ in-house restaurants, and instead set up a stand for Seamless and other online food delivery services to make up for the building’s lost room service.

“It was basic common sense,” said Farkas. “Why have room service these days?”

A long, long time ago, when Farkas was less than a decade out of school, he formed Insignia Financial Group, which he merged with legendary broker Edward S. Gordon’s real estate company to form Insignia ESG. It was one of the city’s most active brokerages when L.A.-based CBRE bought it more than 20 years ago, mostly because of its strength in New York.

These days, Island, a global real estate-oriented investment bank, is Farkas’s main concern. That company owns controlling interests in businesses that together manage about $4.6 billion in assets, and Island has serviced about $250 billion of complex distressed transactions capital since Farkas founded it in 2003. 

He said he remains focused on finding undervalued assets and bringing them up to snuff, saying tough times like these almost always present such opportunities.

“I think we will see more and more opportunities coming from the banks,” he said. “There is going to be a lot of opportunity to buy things that are in distress.”