SBE, the US-based luxury hospitality company, has entered into a definitive agreement to acquire Morgans Hotel Group.
The all-cash transaction will see Morgans’ collection of hotel brands added to the SBE portfolio, which currently includes SLS properties in Beverly Hills, Miami and Las Vegas, Redbury Hotels in Hollywood, Miami and New York, and the Raleigh Miami Beach, along with a portfolio of F&B and nightlife brands.
Morgans Hotel Group operates boutique hotels in Miami, Los Angeles, New York, London, San Francisco and Las Vegas, plus a franchised property in Istanbul. In addition to acquiring Morgans’ management agreements and brands, SBE will take direct ownership of the 194-room Delano Hotel in South Beach, the 878-room Hudson Hotel in New York City and the 372-room Clift Hotel in San Francisco.
“We have long admired Morgans, its impressive history and culture of service and innovation, so we’re delighted to reach an agreement on this transaction,” said SBE’s founder, chairman & CEO, Sam Nazarian.
“Our strategic vision is to operate these amazing and unique lifestyle properties in key international gateway markets, and Morgans’ hotels, along with their talented team, fit perfectly within that vision.”
Following the acquisition, SBE expects to add five more hotel properties by the end of 2016, including the SLS Brickell in Miami, Townhouse Hotel in Miami Beach, SLS Park Avenue in New York City, Hyde Hallandale in Florida and the Mondrian Doha, which will take its portfolio to 25 hotels by the end of this year. In total, it plans to open 19 new properties by the end of 2019.
The value of the Morgans acquisition has reported as US$2.25 per share, for a total cash sum of US$82 million. And as part of the transaction, SBE will receive a “significant investment” from Cain Hoy Enterprises, a global real estate investment company.