Long Island City’s Z Hotel leased to company with ties to Amazon CEO Jeff Bezos

Z Hotel Exterior
Courtesy of Merchant Hospitality

One year after Amazon owner Jeff Bezos canceled his plan to build an HQ2 campus at Anable Basin, he is back in Long Island City in a convoluted way.

Merchants Hospitality, New York’s largest privately held hospitality investment company, announced that it has signed a long-term lease with apartment rental company Sonder, at Merchant Hospitality’s Z Hotel just down the road from where the HQ2 campus would have been built.

“We just signed a big deal with Sonder and we are quite thrilled about it,” Merchant Hospitality Principal Adam Hochfelder said.

The San Francisco-based Sonder is known as the market leader in alternative apartment and hotel accommodations. Founded in 2014, Sonder boasts over $4 billion in assets under management in 33 cities and over 10,500 apartment and hotel units.

Sonder’s investment partners include Bezos Expedition, the family office of the Amazon CEO as well as Elon Musk and Alex Rodriguez. Sonder will lease all 100 hotel rooms in the hotel potion of Merchant Hospitality’s property at 11-01 43rd Ave. alongside the Queensboro Bridge.

The Z Hotel was popular with European tourists for years and was the place to be whenever the Macy’s 4th of July Fireworks have been on the East River because of the hotel’s rooftop bar with sweeping views of the Manhattan skyline.

The Savanna Rooftop and Cellar Bar will remain open to the public as they are public restaurants, the building is licensed as a hotel, but will offer short-term stays to guests in a short-term living sense.

Merchant Hospitality completed a major $38 million dollar renovation of the entire building, which is known for its unobstructed views from floor to ceiling windows. The property includes 45,000 feet of retail, office, food and amenity space.

Sonder’s lease is for a minimum term of seven years and up to 17 years with extensions.

“Sonder’s lease in our building continues the trend of great tenants and smart money moving into Long Island City,” Hochfelder said. “There are phenomenal companies moving into that neighborhood.”

Sonder joins Macy’s, Altice, Este Lauder and the Centene Corporation in filling the vacuum that was left behind after Amazon’s St. Valentine’s Day breakup with Long Island City a year ago.

“After Long Island City got so much press after the Amazon deal it made other companies realize how great Long Island City is and how many great tenants are moving there,” Hochfelder said.


This story was updated at 12:31 p.m. on Feb. 13.


More from Around New York