Blackstone has acquired Village Hotels from KSL Capital Partners, expanding its presence in the British travel sector. The deal, valued at around $1 billion, adds 33 properties in the UK to Blackstone’s portfolio. Village Hotels offers traditional hotel stays alongside fitness clubs, dining outlets, and co-working spaces. This move signifies Blackstone’s focus on experiential hospitality and leisure, and its interest in the UK market.
The acquisition of Village Hotels marks Blackstone’s continued bullishness on experiential hospitality, following its previous acquisition of Bourne Leisure in 2021. KSL Capital Partners, which bought Village Hotels in 2014, is exiting the investment after helping the chain add more than 1,200 guest rooms and 45,000 fitness members. The deal is seen as a strategic move by Blackstone to further its investments in the UK leisure industry.
Analysts believe that the hotel sector could see increased deal-making activity if the U.S. Federal Reserve cuts interest rates this year. This would provide certainty about the direction of rates and boost confidence among dealmakers in the U.S. and Europe. It is estimated that global hotel transaction volume could increase by 15% to 25% compared to the unusually low level of deal-making in 2023.
James Seppala, head of real estate in Europe for Blackstone, believes there is great potential in the lodging and leisure sector. Gary Davis, CEO of Village Hotels, is optimistic that the deal will allow the brand to expand its presence in the UK. Blackstone has previously made investments in the travel sector, including Japanese hotels and owning a stake in hotel tech player SiteMinder and meetings tech player Cvent.
Blackstone’s history in the hotel sector includes taking Hilton private and guiding it to a successful IPO. The firm also controls Motel 6 through G6 Hospitality and owns a stake in various travel-related companies. The acquisition of Village Hotels further solidifies Blackstone’s position in the UK leisure market and reaffirms its commitment to experiential hospitality and leisure offerings.
Overall, the acquisition of Village Hotels by Blackstone for $1 billion demonstrates the private equity firm’s confidence in the UK travel sector and its focus on experiential hospitality. The deal adds 33 properties to Blackstone’s portfolio, expanding its presence in the leisure industry. The move highlights Blackstone’s strategy to invest in experiences over goods and signals potential growth in the hotel sector with the predicted increase in deal-making activity.
