Marriott Sells 5 UK Hotels to Britannia

Date: July 2018

Location: Sunderland, Norwich, Newcastle Gosforth, Leeds/Bradford and Southampton

Names: Were Marriott – now Grand Hotel Sunderland, Hollins Hall Hotel & Country Club, Sprowston Manor Hotel & Country Club, Meon Valley Hotel & Country Club and Grand Hotel Gosforth Park Newcastle.

Sprowston Manor

No. of Keys: 589

Seller: Marriott…advised by Christie & Co

Buyer: Britannia Hotels, owned by the illustrious Alex Langsam. Now upto 60 hotels in the UK from the early days of three or four hotels in Manchester. In addition Britannia also acquired The Grand Hotel Blackpool (formerly The Blackpool Hilton), for £135m (as part of a group deal for 1300 rms) for 278 rooms, in March 2018.

Alex has never minded courting controversy… From a recent article in the UK’s Daily Telegraph:

He (Alex Langsam) has been dubbed ‘The Asylum King’ after securing lucrative Home Office contracts to house refugees in his budget hotels.

Now Britannia Hotels founder Alex Langsam, 77, has entered The Sunday Times rich list after amassing an estimate fortune of £220 million.

The hotel chain, which has twice been voted the worst in Britain by consumer watchdog Which?, made £14 million in profit last year as the number of asylum seekers soared to 36,000-a-year.

Many paying guests have complained after realising they are sharing hotels with hundreds of migrants from Eritrea, Somalia, Sudan, Syria and Afghanistan.

Mr Langsam, who also owns the Pontins holiday business, entered the Rich List at number 460, a spot jointly shared with Keith Richards, the Rolling Stones’ guitarist.

In 2011/2012 the Home Office spent £150 million providing accommodation for asylum seekers but the figure is now thought to be closer to £200 million. 17 hotels within the Britannia chain housed asylum seekers in the last financial year.

Lord Green of Deddington, MigrationWatch’s chairman told The Telegraph: “It’s extraordinary that the Home Office continues using hotels like this to accommodate asylum seekers on such a large scale.”

Mr Langsam, a widower, who has no children, lives in a ten-bedroomed former hotel worth more than £3 million in Cheshire. He owns two Jaguar cars and a Bentley.

THPT Comment: We have known Alex since the mid-seventies, when he opened his first hotel in Didsbury, Manchester. He certainly calls a spade “a bloody shovel” Some suggested his empire would go pop several times, but you have to give it to him – 60 hotels later a personal value of £220m, he has defied his critics.

On a broader basis Marriott removed nearly 14,000 rooms from its system, in the last quarter.

And while Marriott remains net positive considering the 23,000 rooms it opened during this period, the culling of rooms’ inventory was still substantial.

However, Arne Sorenson, Marriott’s CEO maintained this is actually a lower level of room deletions when compared to previous quarters, with Q2 room deletions coming from a total of 18 hotels, 20 percent of which the CEO said were the result of contract expirations.

“The core question to address is what this says about our partners who want to affiliate hotels with us,” Sorenson said. “We also added 40,000 new rooms to our pipeline. That’s 241 hotels…almost a new hotel every nine hours.”

A number of these deletions are a result of Marriott’s merger last year with Starwood Hotels & Resorts Worldwide, such as the ongoing rework of the Sheraton brand.

Sorenson elaborated that the opening of the 23,000 rooms in second quarter resulted in overall room growth of 5 percent. By the end of the quarter, Marriott’s worldwide development pipeline totalled 2,740 properties, consisting of approximately 466,000 rooms. Roughly 11 percent of this pipeline consists of luxury hotel development.

And while Marriott seeks to add new properties to its system the company is not finished working on its existing portfolio.

“We have Marriott, Sheraton, Westin, JW Marriott and Delta all in the upper-upscale, full-service segments,” Sorenson said. “They are now all a part of us, so how do we target these brands to minimise customer confusion? That’s what our brand teams are hard at work at. We talked about Sheraton the most because [it] needed the most work.”

Outside of the USA, however, the story is different. The FIFA World Cup in Russia led to what Sorenson characterised as “considerable last-minute demand,” and he pointed to countries like France and Turkey as markets where Marriott will thrive in the next two quarters.

First Seen: Britannia Hotels website

and Hotel Management