NEW YORK CITY Legendary hotelier Ian Schrager is set to launch a pair of new hotel chains, acting as an owner-operator, a departure from his history of managing properties for others.
Together known as Schrager Hotels, the two new hotel brands include a luxury lifestyle brand and another that is “incredibly stylish, less expensive and reasonably priced for both large major city center 1000-plus-room hotels and smaller hotels,” he says. Both brands will focus on offering guests good value for money.
The luxury brand will charge rates slightly below the competitive set in a given market, delivering a modernized, unpretentious version of classic luxury. The other brand will consist of less-expensive, stylized large hotels in city centers.
The first hotel in Schrager’s latest venture will be Chicago’s historic Ambassador East Hotel, which he acquired last year and which is undergoing a US$25 million renovation. It is unclear which branding style he will stamp on the property.
Schrager plans to lean on existing financial partnerships, including Morgan Stanley, to help finance further building acquisitions and hotel conversions, he tells The Wall Street Journal. He says deals are in the works in New York City and London, and he is also scouting Los Angeles and Miami. Additionally, Schrager is targeting international gateway cities including Paris, Barcelona, Istanbul, Mexico City, Rio de Janeiro and other cities in Europe, Asia, China, India and South America.
The announcement comes in conjunction with the sale of Schrager’s interests in Gramercy Park Hotel, scheduled to close today. “It was a very good financial transaction for me,” Schrager says of the sale. “I received an offer that was just too good to refuse. However, it is a bittersweet moment as well. I put 110% into that hotel, as I do with all of my projects, but it was time to move on and seek new challenges.”