Starwood Corporate : exploring options to boost value inc acquiring or being acquired
Apr 29, 2015, 9:08 am
#31
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I don't believe a low end brand is needed in the SW portfolio. Four Points is flexible enough that it can cover the mid range down to the upper budget range depending on location. I won't disclose the specific area that we were thinking to put a Four Points with EB investment money, but the location would have relatively low land or existing property-to-convert acquisition costs and lower operating expenses than an urban or urban-adjacent center - so I can offer a solid quality product and not break anyone's nightly budget...plus the brand gives me flexibility to offer meeting space, wedding venue space, etc - I don't know many people who book their wedding reception at a local Travelodge or Motel 6.
Frankly I don't want a low end property to own - I don't need the hassle of constant refurbishment to undo guest damage, hiring security to chase out prostitutes and drug dealers, etc etc. I want mid priced business travelers and road trippers who appreciate the features, quality and value of my property and the brand is a magnet to draw SPG members into an area that has no current SPG coverage.
Days Inn, Extended Stay America, Value Inn, etc have a place in the American hotel landscape, but not as part of the Starwood portfolio. Now I believe there are a few European-only budget chains that are low priced, well maintained, very clean and offer a decent feature set (like Motel One of Germany or the Ibis brand), but I don't think you can "upscale" a budget brand in the US market and not have the individual properties end up trashed because of our unfortunate cultural practices.
Frankly I don't want a low end property to own - I don't need the hassle of constant refurbishment to undo guest damage, hiring security to chase out prostitutes and drug dealers, etc etc. I want mid priced business travelers and road trippers who appreciate the features, quality and value of my property and the brand is a magnet to draw SPG members into an area that has no current SPG coverage.
Days Inn, Extended Stay America, Value Inn, etc have a place in the American hotel landscape, but not as part of the Starwood portfolio. Now I believe there are a few European-only budget chains that are low priced, well maintained, very clean and offer a decent feature set (like Motel One of Germany or the Ibis brand), but I don't think you can "upscale" a budget brand in the US market and not have the individual properties end up trashed because of our unfortunate cultural practices.
Even Hyatt went with Hyatt Place and House, although some will say its like a CY or 4P, pt is Hyatt till then was only FS Hotels in main biz centers(except for its resorts). *W is more like HH or MR and not Hyatt, there may be some top hotels but by and large its not a high end chain.
I will agree that it should stay away from having say Super8,DaysInn,HoJo,s, Motel6 very low end but does need to bring to the table the likes of Hampton Inns or Fairfield Inns
Apr 29, 2015, 9:13 am
#32
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Not to make this a debate about Four Points but I find the new builds to be fine for what they are it is just the conversions that tend to be less than desirable.
As for acquisitions. this year I have spent a number of nights in Choice hotel properties and find them to be perfectly adequate and think they would be fine to bulk up Starwood's lower end
As for acquisitions. this year I have spent a number of nights in Choice hotel properties and find them to be perfectly adequate and think they would be fine to bulk up Starwood's lower end
Apr 29, 2015, 9:40 am
#33
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That's exactly the scenario we should all be wary of as many of us saw firsthand what happened to Hilton under Blackstone.
Apr 29, 2015, 10:54 am
#34
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Apr 29, 2015, 11:06 am
#35
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I was thinking the same thing. The 4P in Canada that I've been to in the past are actually all quite nice and are on a much better level than the Holiday Inns or Days Inns around them.
Apr 29, 2015, 2:02 pm
#36
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I've been travelling today so not online much, but the firm Starwood have hired is Lazard. I understand Starwood is more interested in acquiring than being acquired, though they will be selling some outlying assets this year.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
Apr 29, 2015, 2:10 pm
#37
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I've been travelling today so not online much, but the firm Starwood have hired is Lazard. I understand Starwood is more interested in acquiring than being acquired, though they will be selling some outlying assets this year.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
Apr 29, 2015, 2:15 pm
#38
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It's not the worst idea!
Apr 29, 2015, 2:29 pm
#39
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I don't necessarily agree or disagree, just reporting what I'm seeing. That said, I do think Accor are strong in markets where Starwood are weak, so there is some definite synergy. And the Accor brand could do with a boost to get it in the realms of Starwood / Hilton / Marriott / Hyatt. Accor also covers a broader base than the Starwood portfolio from Ibis through to Sofitel and Pullman etc.
It's not the worst idea!
It's not the worst idea!
Apr 29, 2015, 4:56 pm
#40
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Well you're right...it depends on the overall strategy. If they want to fill the gap at the low end, it's probably a bad strategy. If they want to add additional coverage across the brand range in underserved markets where an acquisition is faster and cheaper than waiting for new properties to open, it's probably a good strategy.
Apr 29, 2015, 5:39 pm
#41
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I've been travelling today so not online much, but the firm Starwood have hired is Lazard. I understand Starwood is more interested in acquiring than being acquired, though they will be selling some outlying assets this year.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
The first thing Lazard are looking into is actually Accor. But take it with a pinch of salt - they'll consider many options before any deal gets struck.
Will share more as I get it.
Accor's stock has a PE ratio around 40; I'm not seeing this as a viable acquisition target.
Apr 29, 2015, 6:51 pm
#42
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I just love the endless speculation from people here who have no idea about what Starwood will or should do.
Starwood might acquire another hotel chain, Starwood might be acquired by another hotel chain, Starwood might merge with another hotel chain, Starwood might do nothing.
Starwood should do what its investors want, Starwood should do what its most loyal customers want, Starwood should do nothing at all.
Perhaps it's wisest to wait and see.
Starwood might acquire another hotel chain, Starwood might be acquired by another hotel chain, Starwood might merge with another hotel chain, Starwood might do nothing.
Starwood should do what its investors want, Starwood should do what its most loyal customers want, Starwood should do nothing at all.
Perhaps it's wisest to wait and see.
Apr 29, 2015, 6:53 pm
#43
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Apr 29, 2015, 7:42 pm
#44
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^ This is just a normal FT thread.
Whether it's speculation on the next quarterly bonus, loyalty program changes, or hotels flagged/deflagged, there's a metric sh!tton of speculation on FT. Or a flat tax. http://www.flyertalk.com/forum/omni-...l#post24730037
Whether it's speculation on the next quarterly bonus, loyalty program changes, or hotels flagged/deflagged, there's a metric sh!tton of speculation on FT. Or a flat tax. http://www.flyertalk.com/forum/omni-...l#post24730037
Last edited by iflyjetz; Apr 29, 2015 at 7:47 pm
Apr 29, 2015, 10:10 pm
#45
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http://www.telegraph.co.uk/finance/m...ood-hopes.html
Looks like many hope IHG and Starwood would merge.
Looks like many hope IHG and Starwood would merge.