Service Properties Trust (Nasdaq: SVC), or SVC, announced on Friday that it has completed the transition of branding and management for 78 hotels to subsidiaries of Sonesta International Hotels Corporation, or Sonesta, from Marriott International, Inc., or MAR. Ten additional hotels are expected to transition to Sonesta by the end of March.
SVC entered short-term management agreements with Sonesta to manage the 78 hotels on terms substantially consistent with its legacy management agreements with Sonesta that expire on December 31, 2021. SVC will enter similar management agreements with Sonesta for the ten hotels scheduled to be transitioned to Sonesta by the end of March. These 88 hotels include one Royal Sonesta hotel, two Sonesta hotels, 32 Sonesta ES Suites, four Sonesta Simply Suites and 49 Sonesta Select brands.
John Murray, President and Chief Executive Officer of SVC, made the following statement regarding today’s announcement:
“We are pleased to have successfully transitioned 78 hotels to Sonesta, with ten additional hotels transitioning in the coming weeks. We believe that as a 34% owner of Sonesta, SVC will benefit from Sonesta’s growth, as well as share in more of the upside from the recovery of these hotels. The rebranding of these hotels with Sonesta will also create greater flexibility for us in managing through the presently challenging market conditions and provide improved decision-making control over dispositions or alternative uses, which we expect will have a positive impact on this portfolio’s performance in the future.”