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Belmond owns or partly owns 46 luxurious properties and the uber posh Venice Simplon-Orient-Express rail service of Agatha Christie fame. Belmond properties are iconic pieces of real estate with historical significance ( and if you’re unfamiliar it may be because the name was changed in 2014 from Orient Express to Belmond). In fact, I was uber lucky to celebrate my 21st birthday at one of their famed restaurants, the 21 Club. While the rest of the hotel marketplace has opted to “operate” hotels vs owning the underlying real estate, Belmond hasn’t, and instead owns the vast majority of the properties that bear their name. Their lofty place in the market, as well as the pivot to lifestyle that Hyatt has employed, makes this blogger think an acquisition could be likely.
Over the years they’ve rejected numerous offers ( in part because of their distribution of voting shares allowing the board sole discretion to dismiss any offers), but things changed, and in August, the luxury brand publicly stated it was open to a sale. Notably, luxury hotels have had greater success as the economy has recovered and Belmond isn’t any different: occupancy rates have remained constant while average room rates soared.
VFTW wrote about Hyatt being a great suitor, and I couldn’t agree more. Since that article, Hyatt has a pivoted even more towards high-end lifestyle: the partnership with SLH ( Small Luxury Hotels ) and more recently Two Roads. reveals strategic differentiation that Hyatt seeks vs its larger competitors, namely Marriott and IHG.
Hyatt offers a pathway to keeping Belmond exclusive
Belmond had intimated that it doesn’t want to turn into another Ritz Carlton ( folded into a large conglomerate only to lose its original exclusivity and grandeur), and those concerns would need to be addressed, but Hyatt’s recent affinity towards high-end boutique properties is seemingly synergistic with Belmond’s long term branding goals.
Currently their hotels aim to compete with the likes of Rocco Forte, Raffles, Peninsula, Banyan Tree, etc. In order to squarely position themselves in the market, the depth of Hyatt’s pockets could greatly serve renovation needs that many of the properties require while also putting Hyatt in a league of their own in terms of the ability to earn and burn at iconic and luxurious boutique properties around the world. That seems like a win-win for both parties.
If I were a Hyatt exec – I’d be making my case.
*feature image courtesy of Belmond.com
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