Wyndham Hotels & Resorts and LuxUrban Hotels, Inc. (NASDAQ: LUXH today announced a newly signed deal to bring 16 LuxUrban hotels, representing approximately 1,400 rooms, into the Trademark Collection by Wyndham brand later this year.
Located across New York, Los Angeles, Miami, Washington, and New Orleans, the hotels will maintain their LuxUrban branding while also gaining affiliation and recognition via the Trademark brand name. In exchange, Wyndham will provide financial, sales, and operational related support to help advance LuxUrban's asset-light acquisition-driven growth strategy. The agreement also paves the way for additional LuxUrban hotels—including any locations not yet acquired—to join Trademark in the future.
"We created Trademark Collection by Wyndham specifically to cater to the needs of operators like LuxUrban," said Chip Ohlsson, chief development officer, Wyndham Hotels & Resorts. "So many hotels today, particularly those in urban destinations, have a distinct character and unique charm that hoteliers want to hold on to. At the same time, they want the visibility, distribution and support that comes with being part of a well-known brand. Trademark gracefully bridges that gap, affording hoteliers the opportunity to maintain their independence while unlocking the resources of the world's largest hotel franchisor."
Ohlsson added, "In just a few years, LuxUrban has created a significant position in the U.S. urban hotel market, proving the success of its unique, asset light operating model. We're excited to have their hotels join what continues to be one of Wyndham's fastest growing brands and even more excited by the long-term growth opportunities that exist for both LuxUrban and for Trademark."
Trademark Collection by Wyndham is geared toward three- and four-star hoteliers looking to tap into the scale and resources of Wyndham while maintaining their hotels' independent spirit. Today, the brand includes more than 185 hotels in nearly 25 countries, including locations in top-tier cities like Atlanta, San Francisco, Las Vegas, Montreal, Berlin, Zurich, Athens and Istanbul, among others.
Founded in 2017, LuxUrban leverages an asset-light strategy, securing long-term leases for hotels in key city-center destinations. The approach allows LuxUrban to capitalize on growing consumer demand for short stay accommodations in destination cities while aiding the owners of distressed urban assets who, in addition to struggling with the lingering effects of the global pandemic, may also be juggling rising interest rates, depressed property values and tighter underwriting terms. By acquiring the operating rights to these hotels under long-term Master Lease Agreements, LuxUrban helps property owners retain ownership of their assets while unlocking each hotel's full commercial potential.
"Our collaboration with Wyndham is a tremendous leap forward for LuxUrban and a validation of our operating model, execution abilities, and large opportunity landscape," said Brian Ferdinand, chairman and CEO, LuxUrban Hotels. "We appreciate Wyndham's collaborative approach to the process, the depth and breadth of their due diligence, and their confidence in our team and outlook. With the support of a world class hospitality organization like Wyndham, as well as their assistance with growth and working capital in the form of development advance notes for existing and future projects, we believe we are now in the best position in our history to accelerate growth, enhance cash flow and capture the benefits of scale."
Wyndham Hotels & Resorts brings an owner-first mentality to franchising, prioritizing the needs of franchisees to help ensure their long-term success. As the world's largest hotel franchisor, with more hotels than any other major hotel company, Wyndham leverages its scale to provide best-in-class services and support across marketing, distribution, sales, sourcing and technology. Through Wyndham Rewards, recently named number one hotel rewards program by editors of U.S News & World Report, hotels within the Wyndham portfolio benefit from access to a rapidly growing membership base of more than 100 million enrolled members, who today account for nearly one out of every two U.S. check-ins.
Added Ferdinand, "We're incredibly enthusiastic about our alignment with Wyndham, and believe that the financial, brand and operating advantages our relationship provides will make LuxUrban an even more attractive solution for property owners looking to employ our asset-light, triple net lease alternatives, particularly those looking to tap into new sources of capital while maintaining ownership of their asset."