France-based Sofitel Luxury Hotels is planning to sell the majority of owned hotels in its existing portfolio within the next five years to focus on being an operator.
Following the most recent sale of a hotel in Paris, the wholly-owned subsidiary of Accor owns and operates 20 properties worldwide, but is looking to reduce the number of owned hotels to less than half of that number within the next five years, according to CEO Robert Gaymer-Jones.
“We’re focused on being a manager, perhaps being an owner gives us an edge because we have an understanding of what the owners see as to how hotels should be managed, but our strategy is to reduce our asset ownership," Gaymer-Jones told Hotelier Middle East.
“We put the money from these investments back into our hotels. It’s not like we don’t want to own any hotels, if we find hotels in certain locations around the world in high-value key markets we would put our own investment in again,” he said.
When asked how many properties the firm would ideally still own in five years time, Gaymer-Jones replied six or seven: “And the reason we keep six or seven is because some of the time they’re leases and it’s very difficult to get out of a lease”.
Regionally, Sofitel currently has significant share ownership in Morocco, as well as investments in Cairo and Mauritius.
Gaymer-Jones added: “We will hold onto some hotels until we feel the time is right to sell —– obviously you sell when there’s huge demand. Also, we want to make sure we sell to owners who are really interested in being partners with Sofitel. For existing hotels the owner is bound to maintain the management agreement with us, so we sell on the basis we have the rights to develop the hotel and maintain the standards”.
Today, the group’s hotel count — including owned and operated, and operated-only properties — stands at 120 hotels in 40 countries.
Its most recent opening was the Sofitel Abu Dhabi Corniche on March 18.