In September, Wyndham Hotel Group COO Bob Loewen told a crowd of owners and managers attending the company’s annual Global Conference that the company was carefully planning its international growth. The Latin American region in particular had been breaking records, with “more hotels, more new brands, the most growth than in WHG history.”
Wyndham’s presence in Latin America just got a lot stronger, with this morning’s announcement that the company had acquired Argentinian company Fën Hotels, adding 26 management contracts across Argentina, Peru, Costa Rica, Uruguay, Paraguay, Bolivia, and the U.S. The deal includes two new Fën-built Wyndham Grand hotels opening in Montevideo, Uruguay, and Asunción, Paraguay.
With the addition of Fën Hotels’ Esplendor Boutique Hotels and Dazzler Hotels, Wyndham Hotel Group’s portfolio now has 18 brands, all of which will be bookable through Wyndham Rewards by the end of 2017. The two companies are slated to be integrated over the next 18 months.
Fën Hotels’ 100+ executives and management staff in Buenos Aires will continue leading Fën hotels and augment Wyndham Hotel Group’s Latin America team as Fën's current headquarters becomes Wyndham Hotel Group's new Latin America HQ for management operations. Current Fën CEO Patricio Fuks will remain as chairman of Fën, helping lead Fën's explosive growth across the region.
Latin America’s Appeal
Latin America is showing solid signs of economic growth with new infrastructure projects, foreign investment, record international visitors and a growing middle-class population. At the conference, Paulo Pena, president and managing director of Latin America and Caribbean for Wyndham, said that the region as a whole offered a “major opportunity” for branded hotel development. “We’re very focused on a few key markets,” he said, citing Brazil, Mexico, Colombia and Peru as areas of particular interest. Other countries are also emerging as lucrative destinations, he said, and the company has recently brought its Wyndham brand to Argentina, its Baymont brand to Mexico, Days Inn to Guatemala and Tryp to Mexico & Puerto Rico.
“As consumers become more aware of brands and what’s available beyond the region, there’s a migration toward brand preference,” Pena said. Latin America previously had a lot of independent hotels, he said, but branded properties are attracting new consumers as the overall economy improves.
“As a U.S. company, we look at how we appeal to U.S. travelers going international,” Pena said, but noted that Wyndham can also appeal to domestic travelers in other countries. “In countries like Mexico and Brazil, 80 percent of demand is domestic,” he said. Similarly, inter-regional travel also makes different markets lucrative, even if they haven’t caught on with American travelers yet. As such, having a strong presence in the region is very important, he said.
Why Fën is Fine
Fën Hotels has 22 existing hotels in six countries and a strong pipeline throughout Latin America. Together with Wyndham’s existing hotels in the region, the combined portfolio of 188 hotels in 19 countries will join Wyndham’s nearly 8,000 hotels across the globe.
“Wyndham Hotel Group’s strength and significant scale…dramatically increases our distribution, immediately enabling us to grow faster not only in Argentina, but also throughout the region,” Patricio Fuks, Fën Hotels CEO and co-founder, said in a statement.
Fën Hotels’ partner, Emprenurban, led by CEO Ivan Kozicki, will become a Wyndham strategic partner across Latin America, launching the first two Wyndham Grand Hotels in Latin America later this year and next. “Coupling our proven development model and capabilities across Latin America with Wyndham’s global brands and resources will ensure an accelerated and robust joint growth pipeline for Fën and Wyndham,” Ivan Kozicki, Emprenurban CEO and Fën Hotels co-founder, said.
Last year, Fen was tapped to manage as many as 5,000 new hotel rooms in Latin America when Hungarian-born American billionaire George Soros’ investment firm agreed to spend up to $300 million on the company’s Latin America expansion. At the time, Fuks said that new hotel acquisition or construction in major U.S. cities is increasingly competitive and expensive, he said, “but you can still build for a reasonable price in Latin America’s capital cities.”