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Insight Comment |
Accor and Ennismore have completed their deal to create a lifestyle joint venture.
The new entity, which will be called Ennismore, will comprise 14 hotel and co-working brands with 87 properties spread across the globe and 146 more in the pipeline.
Accor becomes the majority owner of the new entity with 66.67% of the shareholding and Ennismore founder Sharan Pasricha with 33.33% holding.
Pasricha and Gaurav Bhushan, Accor’s CEO lifestyle and entertainment, will serve as co-CEOs.
At the same time as the Ennismore transaction, Accor has deconsolidated formerly leased assets into a separate structure created with a fund managed by Keys REIM as majority owner with 51% shareholding, while Accor and Ennismore affiliates both hold 24.5%.
What They Said
Sharan Pasricha: “It’s a very exciting day and the start of a new chapter for Ennismore as we become the largest and fastest growing lifestyle hospitality company. I couldn’t be more excited to bring together our unrivalled portfolio of brands in this new entity, and share the reins with my longtime friend and now co-CEO, Gaurav.”
Gaurav Bhushan: “This joint venture has been months in the making and I couldn’t be happier to join Ennismore as Co-CEO, alongside Sharan. Our teams are ready and eager to build on each of our unique lifestyle brands, with a dynamic global pipeline, creating an ecosystem of memorable and curated experiences across all our properties.”
Why It Matters
Ennismore claims that it is now the “largest and fastest growing lifestyle hospitality company” and its new roster of brands is undoubtedly impressive.
The portfolio now includes: 21c, 25hours, Delano, Gleneagles, Hyde, Jo&Joe, Mama Shelter, Mondrian, Morgans Originals, SLS, SO/, The Hoxton, Tribe and Working From_
What matters, as far as the joint venture is concerned, is expanding the reach of the brands.
“Many of these brands are very successful in regions (Hoxton – UK, SLS – US, 25 hours – Germany) and this will be an opportunity to use this local expertise across a wider portfolio of brands,” said Richard Clarke, senior analyst at AB Bernstein, said in a note to investors.
The Ennismore Way
Few operators are as clever as Ennismore when it comes to marrying up the brand and asset ownership sides of the hospitality business. At last month’s Adjacent Spaces event at IHIF 2021, Keith Evans, chief investment and development officer at Ennismore talked about the importance of flexibility in a post Covid-19 world.
“Hybrid models I think are really interesting and it’s something that we’ve seen a lot of success in: from a real estate investment perspective, from an operational perspective and looking and mixed-use boxes. Mixed-use boxes that are incorporating hotels, coworking, rooftops, active and dense real estate projects with vibrant ground floors and it’s amazing to see the appeal on the consumer side,” he said in a session entitled: Beyond Real Estate - Harnessing Hotelisation of Spaces.
Evans said consumers were moving away from commoditization and craved differentiated products and experiences – something that has only grown since the start of the pandemic.
“People are looking for an experience, I know that word is thrown around a lot, but I think its localised experience,” he said.