The song “Nothing Gonna Stop Us Now” by Jefferson Starship comes to mind when receiving news of yet another acquisition by AccorHotels – this time purchasing a 50% stake in New York-based luxury lifestyle operator, sbe Entertainment Group (sbe).
This investment will see AccorHotels expanding further in the luxury lifestyle hospitality segment, as well as broaden its footprint in North America by adding gateway cities such Los Angeles, Miami, Las Vegas and New York.
The French hospitality group will acquire the 50% of sbe’s common equity held in part by real-estate investment firm Cain International for US$125 million, with the group’s founder and CEO Sam Nazarian continuing to own the remaining 50%.
Additionally, AccorHotels will invest US$194 million in a new preferred debt instrument that will be used to redeem all existing preferred units, also held in part by Cain International, bringing the total investment to US$319 million.
sbe will remain independent and continue to be led by Nazarian, while retaining its global headquarters in New York.
“This long-term investment by AccorHotels provides sbe, its customers and hotel owners with greater depth and breadth around the world,” Nazarian commented.
This deal, building on sbe’s acquisition of Morgans Hotel Group in 2016, would further accelerate sbe’s growth domestically in the United States and expand into new markets internationally, particularly in Europe, he added.
sbe hotels will also be distributed on the AccorHotels distribution platform, be featured on Accorhotels.com and will be part of the AccorHotels loyalty programme.
Sébastien Bazin, chairman & CEO, AccorHotels, said the partnership with sbe “marks a new step in expanding AccorHotels’ footprint in this fast-growing segment in key US cities such as Miami, Los Angeles or Las Vegas, and in other international destinations.”
Delano South Beach Miami, Florida, is one of sbe’s landmark destination.
Founded in 2002, sbe develops, manages and operates global properties and brands that include include SLS, Delano, Mondrian, Hyde, The Originals (Sanderson, St. Martin Lane, Hudson, 10 Karakoy, Shore Club) and the Redbury Hotels. Through its Disruptive Restaurant Group platform the company has created culinary brands Katsuya, Umami Burger, Cleo, Leynia, Diez & Siez and Filia and innovative entertainment brands including Hyde nightclub and dayclub, Nightingale, Privilege dayclub Black Orchid, S Bar, Skybar and the Doheny Room.
Landmark destinations in sbe portfolio include Delano South Beach in Miami, SLS Baha Mar in the Bahamas, Mondrian Doha in Qatar, Hyde Bellagio in Las Vegas, Mondrian Park Avenue in New York City and the newly-opened 57 story SLS LUX Brickell in Miami. Upcoming opening includes Delano Rio de Janeiro, Delano Dubai at the Palm and Hyde Midtown in Miami.
By the end of 2018 sbe will operate 25 hotels, comprising 7,498 keys with a majority in North America, 170 restaurants and entertainment venues in global destinations, as well as new properties in the Middle East, Asia and Latin America. It currently has a further 20 hotels and residences around the world in its pipeline, as well as 59 standalone restaurants and nightlife venues.
The transaction, subject to regulatory approvals, is expected to be completed by July 31, 2018.
• All images credit: AccorHotels
