Company's 23rd Brand Brings 40 Hotels, 6,000 Rooms to Portfolio
Wyndham Hotels & Resorts announced today that it has acquired its 23rd brand, Vienna House, from Berlin-based HR Group for $44 million.
European hotel operator HR Group, a long-standing franchise partner with Wyndham, will continue to own or lease and operate the Vienna House hotels under long-term franchise agreements with Wyndham. HR Group operates 145 hotels in more than 100 cities in 10 countries, with 20 projects signed and under construction, and an overall room count of more than 25,000.
Wyndham executives have signaled their intent to buy a brand, most recently on a second-quarter earnings call with analysts, as the company looks to deploy capital toward portfolio growth both through acquisitions and organically. The company ended the second quarter with $400 million in cash and approximately $1.1 billion in total liquidity, and is expected to have more than $600 million of cash to deploy this year.
During the earnings call, Wyndham Chief Financial Officer Michele Allen said that "from an M&A landscape perspective, we're looking for opportunities both domestically and internationally particularly in what we consider to be high-growth markets with high-demand generators," adding that "size and scale matter ... now more than they ever have, and we expect that to continue."
The Vienna House acquisition adds approximately 40 hotels in Europe, with more than 6,000 rooms in the upscale and midscale segment, to Wyndham's portfolio of 23 brands with approximately 9,000 hotels across more than 95 countries on six continents. Twenty-eight of the Vienna House hotels are in Germany, "further cementing Wyndham's foothold in one of its largest European markets with 120 franchised hotels and more than 19,000 rooms," the company said in a news release.
“Europe continues to present accelerating growth for the travel sector with strong demand steadily bouncing back across leisure and business,” Wyndham President and CEO Geoff Ballotti said in the release. “Vienna House's guest-centric culture, strong brand recognition and ambitious brand development plans align with our distribution goals, making it a perfect match to continue our international growth and reinforces our position and commitment to the region.”
The company's most significant brand acquisition in recent years was La Quinta, which added more than 900 franchised hotels to the Wyndham portfolio when that $1.95 billion deal closed in May 2018. Prior to that, the company acquired the AmericInn brand in October 2017, adding 200 hotels; and Dolce in February 2015, adding 24 hotels.
On July 21, Wyndham announced a partnership with Palladium Hotel Group that will add 14 resorts to its all-inclusive Registry Hotels Collection brand.
Also this week, Wyndham broke ground on the first hotel in its new, extended-stay brand, still unnamed but given the working title "Project ECHO," in Plano, Texas. The brand has 72 hotels in the development pipeline as of the end of the second quarter. The first property in Plano will have 124 rooms — single and two-queen studio suites with kitchenettes — as well as a fitness center and guest laundry facility. The hotel is owned by Gulf Coast Hotel Management and is expected to open in the second half of 2023.
Copyright 2022 CoStar Group. All rights reserved. From https://www.costar.com. By Robert McCune, Hotel News Now.