Anbang Insurance Group Co of Beijing will buy the venerable Waldorf Astoria hotel in New York for $1.95 billion. [Photo by Jack Freifelder / China Daily]

China's Anbang Insurance Group Co has acquired the famous Waldorf Astoria New York hotel for $1.95 billion.

Hilton Worldwide Holdings Inc announced on Monday that it had reached an agreement to sell the high-profile property that straddles Lexington and Park avenues.

It will be the largest amount ever paid for a US hotel, according to research firm Lodging Econometrics, and the highest price paid by a Chinese buyer for a US property to date, according to commercial real estate brokerage CBRE Group Inc.

When Anbang's purchase is completed, Chinese investors will have spent $2.7 billion on New York-area real estate in 2014, exceeding last year's total by $100 million, according to Real Capital Analytics Inc, a research firm that tracks commercial real estate sale.

The purchase is Anbang's first major deal in the United States, and the Wall Street Journal reported on Monday that Anbang had to beat out two other bidders.

"There really are no other sales to compare it to," Bruce Ford, senior vice-president and director of global business development at Lodging Econometrics, told Bloomberg News on Monday. "It is the most unique asset with the most unique location in the world."

Under the purchase agreement, Hilton will manage the hotel. The two companies said they plan to undertake a major renovation that will "restore the property to its historic grandeur", according to a press release.

The Waldorf Astoria opened in 1931 as the tallest and largest hotel in the world, according to its website. But Hilton did not purchase the property until 1972.

"This relationship represents a unique opportunity for our organizations to work together to finally maximize the full value of this iconic asset on a full city block in midtown Manhattan," said Christopher J Nassetta, president and CEO of Hilton Worldwide. "[And it] will ensure that the Waldorf Astoria New York represents the brand's world-class standards for generations to come."

Kevin Mallory, global head of the hotel unit of CBRE Group Inc, told Bloomberg News Monday that the pending $1.95 billion price tag for the Waldorf Astoria Hotel is the most paid by a Chinese buyer for a US property to date.

"We're seeing a diversification strategy being employed by insurance companies and others, and it's also true when it comes to private Chinese investors," Mallory said in an interview with Bloomberg News. "We've seen a lot of wealth generated there over the last decade, and we see private investors diversifying their portfolio around the globe."

Hilton Worldwide has its headquarters in Virginia. It is one of the world's largest global hospitality companies, with holdings in properties around the world.

Hilton's portfolio contains more than 4,200 managed, franchised, owned and leased hotels, with about 690,000 rooms in more than 90 countries.

The Waldorf is also the flagship hotel of Hilton's worldwide luxury brand, Waldorf Astoria Hotels & Resorts. Since the brand's inception in 2007, it has increased its holdings to nearly 30 hotels, including properties in Amsterdam, Bangkok, Beijing, Chicago, Dubai, Jerusalem and Shanghai.

Anbang, a leading Chinese insurance company founded in 2004 and based in Beijing, provides a variety of financial and insurance services to its clientele, including life, health and property insurance, as well as asset management services.

The deal for the Waldorf is the most recent Chinese property purchase in New York, but it is not the only recent high-profile deal.

In December 2013, Fosun International Ltd, the investment branch of the larger Fosun Group, agreed to buy One Chase Manhattan Plaza from JPMorgan Chase & Co for $725 million.

Earlier last year, Zhang Xin, co-founder of Chinese real estate giant Soho China Ltd, led a group in its purchase of a 40 percent stake in the General Motors Building.

Bruce Ford, senior vice-president and director of global business development at Lodging Econometrics said that the hotel's redevelopment potential makes it an attractive investment.

jackfreifelder@chinadailyusa.com