Sep 18, 2020, 3:35 am
Last edit by: khabah
List of hotels departing IHG for Sonesta:
InterContinental
InterContinental Toronto Yorkville
InterContinental San Juan
InterContinental Stephen F Austin Hotel
Kimpton
Kimpton Hotel Palomar Washington DC
Kimpton Hotel Allegro Chicago
Kimpton Hotel Palomar Chicago
Kimpton Hotel Monaco Portland
Kimpton Hotel Alexis Seattle
Crowne Plaza
Crowne Plaza Los Angeles Airport
Crowne Plaza Redondo Beach & Marina
Crowne Plaza San Jose Silicon Valley
Crowne Plaza Denver
Crowne Plaza Miami International Airport
Crowne Plaza Atlanta Perimeter at Ravinia
Crowne Plaza Atlanta Airport
Crowne Plaza Charlotte
Crowne Plaza White Plains Downtown
Crowne Plaza Columbus
Crowne Plaza Milwaukee West
Holiday Inn
Holiday Inn Anaheim Resort Area
Holiday Inn Atlanta Airport South
Holiday Inn & Suites Chicago O'Hare Rosemont
Staybridge Suites
Staybridge Suites Anaheim
Staybridge Suites San Diego Rancho Bernardo Area
Staybridge Suites Chatsworth
Staybridge Suites San Francisco Airport
Staybridge Suites San Jose
Staybridge Suites San Diego Sorrento Mesa
Staybridge Suites Sunnyvale
Staybridge Suites Torrance Redondo Beach
Staybridge Suites Denver South Park Meadows
Staybridge Suites Fort Lauderdale Plantation
Staybridge Suites Lake Buena Vista
Staybridge Suites Alpharetta North Point
Staybridge Suites Atlanta Perimeter Center East
Staybridge Suites Baton Rouge- University at Southgate
Staybridge Suites Markham
Staybridge Suites Austin Arboretum
Staybridge Suites Dallas Las Colinas
Staybridge Suites San Antonio NW Colonnade
Staybridge Suites Dulles
Staybridge Suites Vancouver Portland Metro
Candlewood Suites
Candlewood Suites Birmingham Hoover
Candlewood Suites Huntsville Research Park
Candlewood Suites Phoenix
Candlewood Suites Phoenix Tempe
Candlewood Suites Orange County Irvine East
Candlewood Suites Orange County Arprt Irvine W
Candlewood Suites Garden Grove Anaheim Area
Candlewood Suites Orange County Irvine Spectrum
Candlewood Suites Silicon Valley San Jose
Candlewood Suites Denver West Federal Center
Candlewood Suites Clearwater
Candlewood Suites Jacksonville
Candlewood Suites Miami Airport West
Candlewood Suites Atlanta
Candlewood Suites Des Moines
Candlewood Suites Chicago Libertyville
Candlewood Suites Chicago Naperville
Candlewood Suites Chicago O'Hare
Candlewood Suites Chicago Waukegan
Candlewood Suites Kansas City Overland Park
Candlewood Suites Wichita Airport
Candlewood Suites Wichita Northeast
Candlewood Suites Boston Braintree
Candlewood Suites Boston Burlington
Candlewood Suites Baltimore BWI Airport
Candlewood Suites Detroit Ann Arbor
Candlewood Suites Detroit Southfield
Candlewood Suites Detroit Troy
Candlewood Suites Detroit Warren
Candlewood Suites Minneapolis Richfield
Candlewood Suites St Louis
Candlewood Suites Charlotte University
Candlewood Suites Jersey City
Candlewood Suites Parsippany Morris Plains
Candlewood Suites Philadelphia Mount Laurel
Candlewood Suites Somerset
Candlewood Suites Albuquerque
Candlewood Suites Las Vegas
Candlewood Suites Nanuet Rockland County
Candlewood Suites Cleveland North Olmsted
Candlewood Suites Columbus Airport
Candlewood Suites Oklahoma City
Candlewood Suites Horsham Willow Grove
Candlewood Suites Pittsburgh Airport
Candlewood Suites Knoxville
Candlewood Suites Nashville Brentwood
Candlewood Suites Arlington
Candlewood Suites Austin Arboretum Northwest
Candlewood Suites Austin South
Candlewood Suites Dallas Fort Worth Fossil Creek
Candlewood Suites Dallas By The Galleria
Candlewood Suites Dallas Las Colinas
Candlewood Suites Dallas Park Central
Candlewood Suites Dallas Plano
Candlewood Suites Houston By The Galleria
Candlewood Suites Houston Clear Lake
Candlewood Suites @ City Centre Energy Corridor
Candlewood Suites Houston Westchase
Candlewood Suites San Antonio Northwest Medical Center
Candlewood Suites Salt Lake City Airport
Candlewood Suites Hampton
InterContinental
InterContinental Toronto Yorkville
InterContinental San Juan
InterContinental Stephen F Austin Hotel
Kimpton
Kimpton Hotel Palomar Washington DC
Kimpton Hotel Allegro Chicago
Kimpton Hotel Palomar Chicago
Kimpton Hotel Monaco Portland
Kimpton Hotel Alexis Seattle
Crowne Plaza
Crowne Plaza Los Angeles Airport
Crowne Plaza Redondo Beach & Marina
Crowne Plaza San Jose Silicon Valley
Crowne Plaza Denver
Crowne Plaza Miami International Airport
Crowne Plaza Atlanta Perimeter at Ravinia
Crowne Plaza Atlanta Airport
Crowne Plaza Charlotte
Crowne Plaza White Plains Downtown
Crowne Plaza Columbus
Crowne Plaza Milwaukee West
Holiday Inn
Holiday Inn Anaheim Resort Area
Holiday Inn Atlanta Airport South
Holiday Inn & Suites Chicago O'Hare Rosemont
Staybridge Suites
Staybridge Suites Anaheim
Staybridge Suites San Diego Rancho Bernardo Area
Staybridge Suites Chatsworth
Staybridge Suites San Francisco Airport
Staybridge Suites San Jose
Staybridge Suites San Diego Sorrento Mesa
Staybridge Suites Sunnyvale
Staybridge Suites Torrance Redondo Beach
Staybridge Suites Denver South Park Meadows
Staybridge Suites Fort Lauderdale Plantation
Staybridge Suites Lake Buena Vista
Staybridge Suites Alpharetta North Point
Staybridge Suites Atlanta Perimeter Center East
Staybridge Suites Baton Rouge- University at Southgate
Staybridge Suites Markham
Staybridge Suites Austin Arboretum
Staybridge Suites Dallas Las Colinas
Staybridge Suites San Antonio NW Colonnade
Staybridge Suites Dulles
Staybridge Suites Vancouver Portland Metro
Candlewood Suites
Candlewood Suites Birmingham Hoover
Candlewood Suites Huntsville Research Park
Candlewood Suites Phoenix
Candlewood Suites Phoenix Tempe
Candlewood Suites Orange County Irvine East
Candlewood Suites Orange County Arprt Irvine W
Candlewood Suites Garden Grove Anaheim Area
Candlewood Suites Orange County Irvine Spectrum
Candlewood Suites Silicon Valley San Jose
Candlewood Suites Denver West Federal Center
Candlewood Suites Clearwater
Candlewood Suites Jacksonville
Candlewood Suites Miami Airport West
Candlewood Suites Atlanta
Candlewood Suites Des Moines
Candlewood Suites Chicago Libertyville
Candlewood Suites Chicago Naperville
Candlewood Suites Chicago O'Hare
Candlewood Suites Chicago Waukegan
Candlewood Suites Kansas City Overland Park
Candlewood Suites Wichita Airport
Candlewood Suites Wichita Northeast
Candlewood Suites Boston Braintree
Candlewood Suites Boston Burlington
Candlewood Suites Baltimore BWI Airport
Candlewood Suites Detroit Ann Arbor
Candlewood Suites Detroit Southfield
Candlewood Suites Detroit Troy
Candlewood Suites Detroit Warren
Candlewood Suites Minneapolis Richfield
Candlewood Suites St Louis
Candlewood Suites Charlotte University
Candlewood Suites Jersey City
Candlewood Suites Parsippany Morris Plains
Candlewood Suites Philadelphia Mount Laurel
Candlewood Suites Somerset
Candlewood Suites Albuquerque
Candlewood Suites Las Vegas
Candlewood Suites Nanuet Rockland County
Candlewood Suites Cleveland North Olmsted
Candlewood Suites Columbus Airport
Candlewood Suites Oklahoma City
Candlewood Suites Horsham Willow Grove
Candlewood Suites Pittsburgh Airport
Candlewood Suites Knoxville
Candlewood Suites Nashville Brentwood
Candlewood Suites Arlington
Candlewood Suites Austin Arboretum Northwest
Candlewood Suites Austin South
Candlewood Suites Dallas Fort Worth Fossil Creek
Candlewood Suites Dallas By The Galleria
Candlewood Suites Dallas Las Colinas
Candlewood Suites Dallas Park Central
Candlewood Suites Dallas Plano
Candlewood Suites Houston By The Galleria
Candlewood Suites Houston Clear Lake
Candlewood Suites @ City Centre Energy Corridor
Candlewood Suites Houston Westchase
Candlewood Suites San Antonio Northwest Medical Center
Candlewood Suites Salt Lake City Airport
Candlewood Suites Hampton
SVC REIT switch their 103 IHG hotels over missed payment to Sonesta (Nov 30, 2020)
Jul 27, 2020, 11:42 am
#1
Original Poster
Join Date: Dec 2000
Location: Philadelphia
Posts: 2,506
SVC REIT switch their 103 IHG hotels over missed payment to Sonesta (Nov 30, 2020)
Looks like IHG owes an owner $7.4 million from June and the owner (SVC REIT) has given them the standard 30 days to remedy it before terminating the agreement November 30.
I'm guessing it is just chest-thumping to pay as SVC is likely to default on their properties due to the much lower occupancy levels post-COVID lockdowns, so even if this was a customary delay before, the additional pressure on them financially means they need to get this payment to prevent a cash flow issue.
The list of the properties that they own in their portfolio is here, with 103 in the US for IHG. Most IHG are select service properties, but they do have the following higher end properties in IC and Kimpton:
InterContinental San Juan
InterContinental Stephen F Austin Hotel
InterContinental Toronto Yorkville
Kimpton Hotel Alexis Seattle
Kimpton Hotel Alegro Chicago
Kimpton Hotel Monaco Portland
Kimpton Hotel Palomar Chicago
Kimpton Hotel Palomar Washington DC
I doubt much will happen here, although the threat to move to Sonesta seems like they may be deeper in talks than expected so these hotels may reflag.
If you think you have a reservation (especially an award reservation) at an affected property afterAugust 24 the termination date of November 30th, I would keep an eye on this to ensure it doesn't evaporate.
I'm guessing it is just chest-thumping to pay as SVC is likely to default on their properties due to the much lower occupancy levels post-COVID lockdowns, so even if this was a customary delay before, the additional pressure on them financially means they need to get this payment to prevent a cash flow issue.
The list of the properties that they own in their portfolio is here, with 103 in the US for IHG. Most IHG are select service properties, but they do have the following higher end properties in IC and Kimpton:
InterContinental San Juan
InterContinental Stephen F Austin Hotel
InterContinental Toronto Yorkville
Kimpton Hotel Alexis Seattle
Kimpton Hotel Alegro Chicago
Kimpton Hotel Monaco Portland
Kimpton Hotel Palomar Chicago
Kimpton Hotel Palomar Washington DC
I doubt much will happen here, although the threat to move to Sonesta seems like they may be deeper in talks than expected so these hotels may reflag.
If you think you have a reservation (especially an award reservation) at an affected property after
Last edited by lowfareair; Jul 27, 2020 at 1:01 pm Reason: Corrected date hotels may leave IHG
Jul 27, 2020, 12:56 pm
#2
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Normally I'd say this is definitely just posturing and they'll work it out, although the press release the REIT issued (https://www.businesswire.com/news/ho...-Terminate-IHG) mentioned that they have an ownership stake in Sonesta so perhaps they see this as a strategic opportunity to terminate the management contracts.
That being said, 100+ properties is about equal to Sonesta's entire current footprint; seems like a lot for a relatively small operator to take on.
Also, the press release states that if they terminate the contracts, the effective date will be November 30.
In any case, some of the Kimptons and CPs on there are ones I stay at frequently and like, so I'm hoping this gets resolved with IHG!
That being said, 100+ properties is about equal to Sonesta's entire current footprint; seems like a lot for a relatively small operator to take on.
Also, the press release states that if they terminate the contracts, the effective date will be November 30.
In any case, some of the Kimptons and CPs on there are ones I stay at frequently and like, so I'm hoping this gets resolved with IHG!
Jul 27, 2020, 1:05 pm
#3
Original Poster
Join Date: Dec 2000
Location: Philadelphia
Posts: 2,506
Normally I'd say this is definitely just posturing and they'll work it out, although the press release the REIT issued (https://www.businesswire.com/news/ho...-Terminate-IHG) mentioned that they have an ownership stake in Sonesta so perhaps they see this as a strategic opportunity to terminate the management contracts.
That being said, 100+ properties is about equal to Sonesta's entire current footprint; seems like a lot for a relatively small operator to take on.
Also, the press release states that if they terminate the contracts, the effective date will be November 30.
In any case, some of the Kimptons and CPs on there are ones I stay at frequently and like, so I'm hoping this gets resolved with IHG!
That being said, 100+ properties is about equal to Sonesta's entire current footprint; seems like a lot for a relatively small operator to take on.
Also, the press release states that if they terminate the contracts, the effective date will be November 30.
In any case, some of the Kimptons and CPs on there are ones I stay at frequently and like, so I'm hoping this gets resolved with IHG!
Yes, I think Sonesta may struggle to grow that quickly, but this downturn could be the impetus to try and gain marketshare when the economy rebounds.
Jul 27, 2020, 1:53 pm
#4
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I'm struggling to figure out why IHG owes SVC any money. I would have thought that the franchise fees flow in the other direction...
Jul 27, 2020, 2:20 pm
#5
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Location: Philadelphia
Posts: 2,506
My guess would be advanced pay reservations - IHG probably collects money up front, takes their cut, and forwards the rest to the hotel. Also, there is reward night reimbursement that could be paid monthly.
Jul 27, 2020, 2:57 pm
#6
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Award night reimbursement could be it, although there is a lot of offsetting between what the hotels owes IHG for points issued, and what IHG owes the hotel for award nights.
Jul 27, 2020, 5:18 pm
#7
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If you think of it as an average of $70K per hotel, the amount kind of makes sense. Higher end properties more, lower end less. I could see that being just what craig says above--prepayments, reimbursements, etc.
I wonder what IHG did with the money?
I wonder what IHG did with the money?
Jul 27, 2020, 6:32 pm
#8
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Hotels collect advance purchase payments on property. This is true for IHG and Marriott. For Hilton they collect payment and forward to hotel via check or ach. My guess as others have stated is reward night reimbursement.
Jul 27, 2020, 8:38 pm
#10
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Somewhat curious to see what SVC has planned here. Given they already own a stake in Sonesta this may be a way for them to cut costs and get out of IHG agreements.
Yet right now when cash flow is low, how can they rebrand the hotels successfully?
I do think we are going to see more and more hotels leaving these major brands if they can given what is happening in the travel industry.
Yet right now when cash flow is low, how can they rebrand the hotels successfully?
I do think we are going to see more and more hotels leaving these major brands if they can given what is happening in the travel industry.
Jul 27, 2020, 10:49 pm
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It also possible with the low occupancy rates it much cheaper to do the rebranding as it costs less to shut down parts of the hotel. Many of the room being empty in the first place.
It also possible that the new management company is able to find reasonably priced financing. I'm currently blanking on the name of the financial product. They could in essence sell there future franchise fees (something that the hotel in question has to always pay) in return for the money needed to do the rebranding.
Jul 28, 2020, 5:50 am
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It also possible that the new management company is able to find reasonably priced financing. I'm currently blanking on the name of the financial product. They could in essence sell there future franchise fees (something that the hotel in question has to always pay) in return for the money needed to do the rebranding.
Jul 28, 2020, 8:12 am
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Jul 28, 2020, 5:32 pm
#15
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Complete Speculation: Sounds like the owner might have been looking for ways out of the IHG contract. My guess is that they purposely stopped submitting the documentation necessary for reimbursement of points for several months. Then, they sent everything all at once for all 100+ properties hoping that IHG might not pay on time due lack of cash flow from the pandemic.
If that's what's happening, it's crafty and almost certainly legal (as I doubt the franchise contract has a "submit your redemptions within 30 days or don't get paid" clause). It does come across as unethical, however.
If that's what's happening, it's crafty and almost certainly legal (as I doubt the franchise contract has a "submit your redemptions within 30 days or don't get paid" clause). It does come across as unethical, however.