Otto Family Acquires Share in Ruby Hotels

Main Photo: The new Ruby Hotel London due to open 2020

Date: November 2019

Location: DACH Region

Name: Ruby Hotels

No. of Keys: 1,116 currently…including pipeline – 2,773

Seller: Ruby Hotels, headed up by  Michael Struck CEO, which started life at Lean Hotels in 2013

Buyer: The Otto family has acquired a 25% share in the Ruby Hotel group. The acquisition has been carried out in the context of an increase of capital. Ruby Hotels is currently operating seven Ruby hotels. Another ten hotels are under construction or being prepared for construction.

Ruby Lucy London is due to open January 2020, with a 2nd London hotel just announced, Ruby Stella in Clerkenwell in 2021.

Ruby Hotels’ general attitude flies in the face of established industry norms. For instance, there will be a fully functional Marshall guitar amp in every room, while check-in will be done via a tablet computer and will take less than a minute, according to the company.

It’s all part of its ‘lean luxury’ philosophy, which involves stripping out the unnecessary and expensive extras and instead concentrating on the fundamentals. In a sideswipe at its competitors, it boasts about the fact that breakfast is locally sourced, which allows them to do away with an expensive kitchen and chefs, while it deliberately steers away from prestigious London addresses, which come with huge rents.

Alexander Otto, CEO of ECE: “As of today, ECE Group already is among the three largest hotel developers in the DACH region. By getting access to the operational expertise of Ruby hotels and combining it with our existing competences in developing hotels, we will gain an excellent position to further strengthen our hotel investment activities.”

ECE has a 13,000 sqm Motel One under construction in Vienna, Austria. They have been involved with projects such as Steigenberger Airport Berlin, Holiday Inn Hamburg, 25hours Dusseldorf and others.

Michael Struck, CEO of Ruby Hotels: “This partnership provides Ruby with access to ECE Group’s pan-European network and development expertise. Based on the flexible room design concepts and the mixed-use approach of building design, we see major opportunities in the extension or conversion of inner-city retail space.”

For example, ECE has managed to sign Ruby Hotels as tenant for a former office space at Kö Galerie Düsseldorf. ECE is also planning a congress hotel and a long-stay concept for the Marriott group in Hamburg’s HafenCity district.

Additionally, in Munich and Hamburg, Ruby has recently started offering Ruby Works: perfectly equipped workspaces and a creative ambiance with access to an inspiring office community.

Financially strong partners support the expansion of Ruby. The Austrian Soravia Group; Michael Hehn, an entrepreneur; Ocean Link, a private equity fund; Franger Investment, a German family office; and Michael Struck jointly hold the company shares.

Price: Undisclosed

THPT Comment: Another hotel company expanding into the workspace sector…becoming a themw. Good marriage for ECE and Ruby.

First Seen: ECE website

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