Kimberly Raphael brings extensive experience in corporate sales management to downtown boutique hotel
14.03.2024 - 12:35 / skift.com / Sean Oneill / Chris Nassetta
Hilton will spend $210 million to acquire Graduate Hotels, a hotel brand that builds and runs 33 hotels near U.S. and U.K. universities, it said Thursday. The brand caters to college alumni, students, and communities with hip, nostalgic-themed design and campus-centric amenities.
“We believe the addressable market for the Graduate brand is 400-500 hotels globally,” said Hilton CEO Chris Nassetta in a statement.
Hilton announced the brand would become available on its booking site and app “later this year.” The news was first reported by the Wall Street Journal, following a report on deal talks in Bloomberg.
AJ Capital Partners launched the brand in 2014, with Ben Weprin as founder. It and its partners will retain ownership of the properties, the companies said, because Hilton prefers an asset-light model.
Graduate Hotels has been one of America’s fastest-growing hotel companies. Its hotels come with decor, amenities, and services themed to the nearby school and surrounding locality. Graduate Hotels has at least four in the pipeline, with properties “opening soon” in Austin and Dallas, Texas; Auburn, Alabama; and Princeton, N.J.
The acquisition is rare for Hilton, a company that has prided itself on building essentially all the brands it has added in the past decade.
The deal, which the companies forecast will close in the second quarter, faces regulatory review. Hilton forecasted that the fee contribution for the first full year of ownership would be about $16 million.
Graduate Hotels has defied the traditional belief that it was too difficult to build profitable hotels by colleges because of seasonality and a college town’s typical lack of diversified economic bases. For smaller schools, the customer base is mainly students, alumni, and the community. Each hotel aims to evoke the distinct vibe, lore, and team colors of its respective school through whimsical decor, nodding to mascots, customs, and notable alumni.
Study Hotels is a smaller rival to Graduate with hotels near Yale in New Haven and three other locations.
Skift reported last year on another play for the university hotel market. The new Sports Illustrated Resorts is a venture by Experiential Ventures Hospitality and Authentic Brands Group, who have invested about $3 million to renovate and rebrand a 150-room hotel — the Ancora Cap Cana, owned by Cap Cana Development — to create a vibe for sports fans. The brand has plans to grow even though the publication’s future is uncertain.
What am I looking at? The performance of hotels and short-term rental sector stocks within the ST200. The index includes companies publicly traded across global markets, including international and regional hotel brands, hotel REITs, hotel management companies,
Kimberly Raphael brings extensive experience in corporate sales management to downtown boutique hotel
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