National Report – Interstate Hotels & Resorts, already one of the largest global hotel management companies, is showing no signs of letting up. In July, it acquired the management agreements of Rim Hospitality in a deal that accounts for nearly 70 hotels and more than 10,600 rooms. Rim’s hotels, which are spread throughout California, New Mexico and Texas, give Interstate a further presence and reach westward. The terms of the deal were not disclosed.
Subsequently, Interstate created a Rim Hospitality Division with a dedicated team based out of Rim’s Newport Beach, Calif., headquarters to manage the acquired portfolio.
“Rim Hospitality brings a portfolio of high-quality independent and branded, full- and select-service hotels, outstanding operating talent and diverse client base to Interstate,” said Jim Abrahamson, CEO of Interstate. “Enhancing our domestic portfolio with a heavy West Coast focus, complemented by remarkable operations, development and finance professionals, we are confident we will continue to deliver exceptional service to guests and outstanding returns to owners.”
Rim’s core executive leadership will remain post-acquisition, including Russ Cox, Mark LeBlanc and Jeff Virgil.
Cox, who oversees all operations, sales and marketing and revenue management efforts for the divisional portfolio, will continue as EVP, reporting to Ted Knighton, Interstate’s president and COO; Mark LeBlanc will transition as the EVP of development, reporting directly to Leslie Ng, CIO of Interstate; and Jeff Virgil will continue in a senior finance role.
Meanwhile, Mark Burden, president, CEO and managing partner of Rim, will continue to be heavily involved in an advisory capacity.
“Interstate is committed to strengthening our presence on the West Coast, enriching services and focusing on success for our owners and client base in the region,” said Ng. “Maintaining and enhancing Rim’s leadership teams and executives for continuity and growth is an extremely important objective of Interstate.”
“We are excited about joining the leader of our industry and having access to the resources and experience Interstate possesses, while still maintaining our core business principle of personalized service to all of our owners, regardless of the size of their portfolio,” said Burden. “Our team of seasoned hospitality professionals will be aided by the advanced systems Interstate has in human resources, purchasing, finance and IT, enabling them to focus more on driving revenues and profits for our owners.”
For its part, Rim Hospitality celebrated 30 years of business last year with a rebrand to “modernize its look and update its message.” At the time, Burden said of it, “If there’s one thing that 30 years in hospitality has taught us, it’s to never stay stagnant. We’re constantly striving to generate strategic and profitable solutions for our clients, and our rebranding reflects that dedication which has enabled our continued success.”
Though this move by Interstate upped its domestic presence, two prior deals gave the management company a further foothold in Europe. In September 2013, Interstate acquired Glasgow-based Chardon Management Ltd., an independent management company in the UK, which at the time elevated Interstate’s total UK portfolio to 47 hotels either open or under development (that number has since changed).
Chardon Management’s portfolio included 32 hotels with 3,414 rooms, consisting of Holiday Inn Express and Holiday Inn branded hotels in addition to Hotel Indigo, Best Western, Choice, Ibis Styles and independent hotel brands.
In March, also in 2013, Interstate acquired the management platform of Liverpool, UK-based Sanguine Hospitality, a hospitality development and ownership company.
The transaction netted Interstate a portfolio of 14 hotels in the UK, aggregating more than 1,900 rooms. That portfolio included nine newly developed hotels under international brands and five hotels that were currently in development. Brands represented included DoubleTree by Hilton, Hampton by Hilton, Hilton, Wyndham and Hotel Indigo.
Interstate is a subsidiary of a joint venture between the subsidiaries of Thayer Lodging Group and Jin Jiang Hotels.
The company and its affiliates manage 440 hotels with more than 81,000 rooms in North America, Europe and Asia-Pacific, with ownership interest in 31 hotels.
In addition, Interstate has executed agreements to manage 39 hotels with over 6,400 rooms under construction or development throughout the world.