Published September 11, 2013
Marriott is opening its newest EDITION branded hotel Friday in London, but that hotel, along with two others in New York and Miami Beach, are close to being sold to an Abu Dhabi government fund, according to The Wall Street Journal.
Marriott International (MAR) CEO Arne Sorenson told FOX Business a sale is being considered, but would not confirm nor deny reports about the potential buyer being the Middle Eastern sovereign wealth fund.
“We have signed a letter of intent with an institutional buyer,” said Sorenson, while declining to comment further on specifics.
The hotels, which Sorenson says are strategically located in global travel hotspots, are part of an $800 million investment the company made to develop its own spot and brand version in the upscale, glitzy, boutique-style space in a partnership with hotelier Ian Schrager.
“[It’s] really unusual for a Marriott to step in with our own balance sheet and build hotels on a balance sheet. We did it because of our partnership with Ian, and because this was a space we really felt like we had to be in…and we had to be in with a dominant entry,” said Sorenson.
And the feeling is mutual for Schrager – known for his “buzzy” works like the Royalton and the redesigned Gramercy Park Hotel. He says partnering with the more conservative brand was a pure business decision.
“We never looked down on [the Marriott brand] as they had a different business model…but then when I 'grew up' I realized that if I can tap into what they do really great—and they can take advantage of what I do great—then we can really break new ground,” said Schrager.
The Miami Beach hotel is expected to open next year, while Manhattan’s converted MetLife-building project is slated for a 2015 launch.
“The great thing about cities like London, Miami and New York, they’re global cities. Great demand whether its business travel or leisure travel. Everyone wants to go to these cities,” said Sorenson.