Sonesta completes addition of 88 former Marriotts to portfolio

Newton, Mass.-based real estate investment trust Service Properties Trust (which commonly goes by its Nasdaq symbol SVC) has completed the transition of branding and management for 78 hotels to subsidiaries of Sonesta International Hotels Corp. from Marriott International, a move that was first announced in October. Ten additional hotels are expected to transition to Sonesta by the end of March.

SVC, which owns a 34 percent stake in Sonesta, entered short-term management agreements with Sonesta to manage the 78 hotels on terms substantially consistent with its legacy management agreements with Sonesta that expire on Dec. 31. SVC will enter similar management agreements with Sonesta for the 10 hotels scheduled to be transitioned to Sonesta by the end of March. 

The additional 88 hotels fall under five of the Sonesta brands as follows:

  • One Royal Sonesta full-service hotel and resort
  • Two Sonesta Hotels & Resorts full-service properties
  • 32 Sonesta ES Suites all-suite extended-stay hotels
  • Four Sonesta Simply Suites, recently launched all-suites extended-stay hotels
  • 49 Sonesta Select upscale focused-service hotels

As a result of this expansion, Sonesta will be introduced for the first time to the following destinations:

  • Kauai, Hawaii: Royal Sonesta Kauai Resort
  • Charleston, S.C.: Sonesta Select Charleston Airport; Sonesta ES Suites Charleston
  • Boca Raton, Fla.: Sonesta Select Boca Raton

This latest expansion also significantly extends Sonesta’s presence in a number of key U.S. cities including: Atlanta with 13 new properties; Boston with 12 new hotels; Chicago with 14; Dallas-Fort Worth, Texas, with 12; Kansas City, Mo., with three; Nashville with 3; Scottsdale, Ariz., with four; and the San Francisco Bay area with 10.

Sonesta has seen a 350 percent increase in hotels since mid-2020. “Over the last six months, we have nearly quadrupled our presence in North America, added over 200 hotels to our national portfolio, and launched two new hotel brands: Sonesta Simply Suites and Sonesta Select,” said Carlos Flores, president and CEO, Sonesta International Hotels Corp. “We are immensely proud of our recent growth and plan to leverage our newly acquired scale for the benefit of Sonesta’s guests, employees and hotel owners.”  

“We believe that as a 34 percent owner of Sonesta, SVC will benefit from Sonesta’s growth, as well as share in more of the upside from the recovery of these hotels,” said John Murray, president and CEO of SVC. “The rebranding of these hotels with Sonesta will also create greater flexibility for us in managing through the presently challenging market conditions and provide improved decision-making control over dispositions or alternative uses, which we expect will have a positive impact on this portfolio’s performance in the future.”  

This addition follows a busy H2 2020 for Sonesta. At the end of December, Sonesta announced plans to acquire RLH Corp. in an all-cash transaction valued at approximately $90 million. Earlier in the year, SVC completed the shift of 99 hotels from IHG to Sonesta.