Industry News
June 30, 2008
By: Eugene Gilligan, Senior Editor
Kuwait-based M.A. Kharafi Group has launched a new company to invest in hotel and resort properties in the United States and worldwide.
As part of Kharafi, the new company--dubbed Sovereign Hospitality Holdings--already has assets of $800 million due to its parent company's existing portfolio of 21 hotels and resorts located in Egypt, South Africa, Gambia, Syria, Lebanon and Albania. The new company is developing projects in Libya, Senegal, Ethiopia and Mauritania and has management agreements in place with Four Seasons Hotels & Resorts, InterContinental Hotels Group, Hyatt International, Rotana Hotels and Resorts, Starwood Hotels and Resorts and Six Senses Spa.
In the last month, the Sovereign has signed an agreement with InterContinenal to develop a 370-room InterContinental Hotel in Damascus, Syria, to be completed in 2010, as part of a mixed-use development that will include a shopping mall, cinema, office space, conference center, meeting rooms, ballrooms, specialty shops, health club, and space. Additionally, Sovereign recently signed another agreement with InterContinental to develop a site in Dakar, Senegal, on Africa’s west coast, that will include an InterContinental Hotel.
In recent years, much foreign hotel investment into the United States has been made by overseas hotel companies looking to establish a presence here, said Mark McDermott (pictured), senior managing director of PKF Capital. He cited two big sales as an example: Hong Kong-based Great Eagle Holdings’ $170 million acquisition of the Ritz Carlton Huntington Hotel & Spa in Pasadena, Calif. in October of 2007, which the company converted to their Langham brand. And, in May of 2007, Taj Hotels, based in India, acquired the Campton Place Hotel in San Francisco for $58 million, which the company converted to its Taj brand. Taj also made a similar play in New York, buying The Pierre in $2005 for $50 million. “These companies look for ‘brandable’ assets that they can convert to their specific brand,” McDermott.
Despite the weak dollar that would be thought to spur foreign hotel investment, these companies’ acquisition targets are four-star or higher targets in gateway cities, McDermott said, so the number of assets that meet this criteria is limited. Sovereign Hospitality has shown some flexibility, though, as it has worked with Four Seasons, InterContinental, Hyatt and Starwood, amongst other brands.
Established more than 100 years ago, M.A. Kharafi & Sons Co. is a private, Kuwait-based group with a diverse array of businesses, including construction, manufacturing, IT, aviation, fast food restaurants, agriculture and real estate. The company has annual revenues of $4 billion.
By: Eugene Gilligan, Senior Editor
Kuwait-based M.A. Kharafi Group has launched a new company to invest in hotel and resort properties in the United States and worldwide. As part of Kharafi, the new company--dubbed Sovereign Hospitality Holdings--already has assets of $800 million due to its parent company's existing portfolio of 21 hotels and resorts located in Egypt, South Africa, Gambia, Syria, Lebanon and Albania. The new company is developing projects in Libya, Senegal, Ethiopia and Mauritania and has management agreements in place with Four Seasons Hotels & Resorts, InterContinental Hotels Group, Hyatt International, Rotana Hotels and Resorts, Starwood Hotels and Resorts and Six Senses Spa.
In the last month, the Sovereign has signed an agreement with InterContinenal to develop a 370-room InterContinental Hotel in Damascus, Syria, to be completed in 2010, as part of a mixed-use development that will include a shopping mall, cinema, office space, conference center, meeting rooms, ballrooms, specialty shops, health club, and space. Additionally, Sovereign recently signed another agreement with InterContinental to develop a site in Dakar, Senegal, on Africa’s west coast, that will include an InterContinental Hotel.
In recent years, much foreign hotel investment into the United States has been made by overseas hotel companies looking to establish a presence here, said Mark McDermott (pictured), senior managing director of PKF Capital. He cited two big sales as an example: Hong Kong-based Great Eagle Holdings’ $170 million acquisition of the Ritz Carlton Huntington Hotel & Spa in Pasadena, Calif. in October of 2007, which the company converted to their Langham brand. And, in May of 2007, Taj Hotels, based in India, acquired the Campton Place Hotel in San Francisco for $58 million, which the company converted to its Taj brand. Taj also made a similar play in New York, buying The Pierre in $2005 for $50 million. “These companies look for ‘brandable’ assets that they can convert to their specific brand,” McDermott.
Despite the weak dollar that would be thought to spur foreign hotel investment, these companies’ acquisition targets are four-star or higher targets in gateway cities, McDermott said, so the number of assets that meet this criteria is limited. Sovereign Hospitality has shown some flexibility, though, as it has worked with Four Seasons, InterContinental, Hyatt and Starwood, amongst other brands.
Established more than 100 years ago, M.A. Kharafi & Sons Co. is a private, Kuwait-based group with a diverse array of businesses, including construction, manufacturing, IT, aviation, fast food restaurants, agriculture and real estate. The company has annual revenues of $4 billion.
Recent Industry News Headlines
June 10, 2009
June 10, 2009
June 09, 2009
June 09, 2009
June 09, 2009
Subscribe to this blog's feed
