SVC amends Sonesta deal: Service Properties Trust (SVC) has amended its existing management agreement with Sonesta International Hotels Corp., which currently manages 262 SVC hotels, 68 of which are expected to be sold. The term for the retained hotels will expire on January 31, 2037 and includes two 15-year renewal options. All retained hotels are subject to a pooling agreement that combines the management agreements for the retained hotels for purposes of calculating gross revenues, hotel operating expenses, fees and distributions and the owner’s priority return due to SVC. The owner’s priority return for the retained hotels is set at US$325.2 million annually. Although SVC continues to own 34% of Sonesta, SVC will have the right to terminate Sonesta’s management of specific SVC owned hotels if minimum performance thresholds are not met starting in 2023. SVC will renovate the retained hotels to comply with agreed upon brand standards. As such funding is advanced by SVC, the aggregate annual owner’s priority return due to SVC under the amended agreement will increase by 6% of the amounts funded. SVC currently expects to complete these renovations over the next three years at an estimated cost of US$600 million. Trade area restrictions by hotel brand have been added to define boundaries to protect SVC owned hotels in response to Sonesta increasing its franchising and third-party management activities.
Jose Andres returns to LA: Jose Andres’ ThinkFoodGroup announced its return to Los Angeles with the opening of three new restaurants in downtown Los Angeles, California, at The Grand LA and Conrad Los Angeles. The Conrad Los Angeles will house two original concepts from ThinkFoodGroup. Both located on the 10th floor, one will be a rooftop dining venue with a Latin and Asian-inspired menu, while the other one will be dedicated to classic Spanish flavors. Bazaar Meat by Jose Andres will open later in the year as a standalone restaurant inside the Grand LA.
AMR Collection debuts in South America: Apple Leisure Group announced the signing of the 286-key Dreams Karibana Cartagena Beach & Golf Resort in Colombia. The resort is scheduled to open on April 1 and marks AMR Collection’s first property in South America. All rooms have a private terrace, balcony or swim-out suites. The property also consists of a private beach club, an 18-hole golf course designed by Nicklaus Design and 24,700 square feet of meeting and event space. As part of the brand’s signature Unlimited-Luxury inclusions, the resort will also feature five bars and lounges, three gourmet and a la carte dining venues and pool and beach service.
French aid for tourism sector: France will ease access to crisis funds and might delay loan repayments for businesses struggling with the drop in tourism and leisure activities as COVID cases surge. To access support covering fixed costs, the French government will cut 50% loss of revenues from the previous 65% and speed up the procedure for even the smallest business. The funds can be availed by the businesses in the tourism sector, including restaurants and bars. The cost of the new measures is expected to be covered by €1.8 billion (US$2 billion) of unused crisis funds which was previously budgeted.
Starwood acquires majority stake in Land Tejas: A controlled affiliate of Miami Beach, Florida-based Starwood Capital Group has acquired a majority interest in the assets owned by Land Tejas, a Houston, Texas-based residential development company. The acquisition comprises 10 communities, with many in late stages of development with nearly 16,000 residential lots and several commercial assets. The communities offer affordable price points targeting the entry-level and move-up segments, which has significant buyer demand. Additionally, the company owns two lagoon resorts, one in Humble and the other near Texas City, with a third coming to Sierra Vista in Rosharon, south of Houston. Currently, Starwood has more than US$105 billion of assets under management.
Sonder grows in Canada: Sonder Holdings Inc., San Francisco, California, announced new properties in Canada and contracting hundreds of additional units in Toronto and Montreal. Sonder recently opened the 20-unit Sonder Saint Paul in Montreal and the 157-unit Sonder Maisonneuve. The company currently operates more than 385 units in Montreal and has around 270 additional contracted units in two more properties, including the old Board of Trade building. In Toronto, Sonder contracted over 110 units in four more locations, which are in addition to around 120 live units in five Sonder locations in the city. Sonder also operates a 66-unit property in Vancouver and is planning to expand into Ottawa, Quebec City, Banff, Calgary and Victoria.