EDITOR'S COMMENT
• An interesting effect of the US extended stay sector's terrific recent performance is the increased desirability of quality assets in the space. Condor Hospitality Trust, which according to a report in Investors Observer as recently as two weeks ago, was one of the top performing REITs in US hospitality, has decided to liquidate the trust and sell all of its 15-strong portfolio to an affiliate of Blackstone.
Presumably it received an offer that was too good to turn down - and a purchase price of $305 million for 15 hotels certainly signals that Blackstone is keen to strengthen its hand in the extended stay sector, building on its $6.3 billion JV acquisition of Extended Stay America, in partnership with with Starwood Capital, earlier this year.
Another REIT, Sandpiper Lodging Trust, has also been quietly but steadily acquiring extended stay assets across the US over the last few months. It also has a management arm to operate the hotels, so in common with ESA - which owns most of its inventory - the opco and propco are under the same ownership, a departure from the norm in the hotel world but a growing trend in extended stay.
Service Properties Trust is another example which springs to mind, following its decision to switch more than 200 of its assets from IHG and Marriott to its Sonesta Suites brand.
We are unlikely to see the big five hotel companies start acquiring assets, but it wouldn't be a surprise to see more examples emerging where the opco and propco are essentially on the same team.
• If you missed last week's SAN webinar on new brands in the extended stay space, click here to see a recording of Oakwood's Dean Schreiber, Cove's Steven Haag and Naomi Heaton of The Other House talking about their experiences of launching a new flag during the pandemic.
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