More than three months after announcing the move, 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 99 hotels to subsidiaries of Sonesta International Hotels Corp. from InterContinental Hotels Group. Three additional hotels located in Canada and Puerto Rico will transition to Sonesta in mid-December.
SVC entered short-term agreements with Sonesta to manage the 99 hotels that expire on Dec. 31, 2021. These 99 hotels are now operated under the Royal Sonesta, Sonesta and Sonesta ES Suites brands. Sonesta has launched Sonesta Simply Suites, a new extended-stay hotel concept with 61 initial locations, making it one of the largest U.S. hotel brand launches in history. The three hotels scheduled to be transitioned to Sonesta in mid-December will enter similar management agreements with Sonesta and they will be operated under the Royal Sonesta and Sonesta ES Suites brands.
“We are excited to complete this milestone in transitioning 99 hotels to Sonesta and the launching of the Sonesta Simply Suites brand,” said John Murray, president and CEO of SVC. “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. The rebranding of these hotels with Sonesta will also create greater flexibility for us in managing through these challenging market conditions, give us improved decision-making control over dispositions or alternative uses, and potentially have a positive impact on this portfolio’s performance in the future. For example, while all of our hotels have been significantly negatively affected by the COVID-19 pandemic, year to date and for the third quarter of 2020, comparable hotel [revenue per available room] performance at existing Sonesta managed hotels has been among the best performing of SVC’s hotel portfolios.”