ARLINGTON, VA—Interstate Hotels & Resorts has entered into an agreement to acquire the management agreements of 82 premium-branded, select- and full-service hotels, plus one restaurant from White Lodging. The transaction is anticipated to close by the end of January 2018 at which time Interstate will begin managing the hotels.
“We will operate this portfolio of high quality assets under long term agreements, helping the respective owners achieve increased long term value,” said Michael Deitemeyer, Interstate’s president & CEO. “A transaction of this magnitude will allow Interstate to further enhance our industry leading systems and create additional value through our enhanced buying power. We look forward to welcoming 2,500 new associates to the global Interstate family, and with a transition of this level, further enhancing our leadership pipeline.”
The 82 hotels—78 are select-service—are located in eight states and aggregate to 10,188 rooms under lodging brands including Marriott, Hyatt and Hilton. Upon completion of the transaction, Interstate will be operating approximately 540 properties in 12 countries inclusive of committed pipeline.
“This repositioning allows us to better focus on assets consistent with our market and development objectives while partnering with owners looking to grow with us,” said Bruce White, chairman and founder, White Lodging. “We will use the net proceeds to continue to reinvest in strategic select and full service assets.”
“This transition is a major shift in our portfolio mix, allowing us the flexibility to capitalize on new opportunities that will strengthen the diversity of our national footprint,” said Deno Yiankes, president and CEO, investments and development, White Lodging.
While the transaction represents just under half of the hotels in White Lodging’s portfolio, it represents less than 25% of its revenue, according to the company. Upon completion of the hotels currently being developed, White Lodging will operate over 100 hotels, representing 26 brands, as well as 40 restaurants, including eight rooftop bars.
“The sale of these contracts will allow White Lodging to increase its focus on the disciplined execution of our key initiatives, the training and development of our associates and creating incremental value for our partners,” said Ken Barrett, president and CEO of White Lodging’s hotel management division.
The transaction is expected to close on or before Jan. 31, 2018.