Activities
Starwood Hotels & Resorts is a major international player in the luxury upscale hotel, resort and timeshare markets.
It was founded in 1995 when Barry Sternlicht acquired the struggling Hotel Investors Trust, which was then valued at less than $10m (£5.3b). By 2005, he had built Starwood into a company worth $15b (£8b).
The group owns, leases or franchises more than 850 properties in 95 countries across eight brands. They are:
Sheraton Hotels and Resorts
Le Méridien Hotels and Resorts
Westin Hotels and Resorts
The Luxury Collection (the cream of the crop, mostly unbranded),
St Regis Hotels & Resorts
W Hotels (a boutique business brand)
Four Points by Sheraton (a mid-scale brand)
aloft (a sophisticated select-service brand to be launched in early 2006)
Starwood Vacation Ownership (operated under the Westin and Sheraton brands)
Timeline
- 1904: Colonel John Jacob Astor (who sank with the Titanic in 1912) opens the St Regis New York.
- 1937: Sheraton Hotels is founded when Ernest Henderson and Robert Moore buy their first hotel in Springfield, Massachusetts.
- 1945: Sheraton becomes the first hotel company to be listed on the New York Stock Exchange. It moves into Canada in 1949 with the purchase of two hotel chains, enters Latin America in the 1960s and opens its 100th hotel in 1965.
- 1995: Sheraton introduces the mid-scale Four Points by Sheraton brand.
- 1991: Barry Sternlicht forms Starwood Capital Partners.
- 1993: Starwood Capital buys its first hotels and by 1994 has interests in 8,000 bedrooms in more than 30 properties.
- 1995: Starwood Capital takes control of Hotel Investors Trust (a real estate investment trust) which is renamed Starwood Lodging. Starwood Hotels acquires the Luxury Collection and combines it with St Regis Hotels & Resorts.
- 1997: Starwood buys three Westin Regina resorts in Mexico (its first international properties) along with 15 hotels from Flatley Company/Tara Hotels. In September, it announces plans for a $1.8b takeover of Westin Hotels and Resorts. In October it announces plans to buy ITT Sheraton Corporation for $14.3b, which faces a hostile bid from Hilton. It also buys the five-star Turnberry golfing hotel in Ayrshire, Scotland.
- 1998: Starwood Lodging completes the takeover of Westin in January and changes its name to Starwood Hotels and Resorts. In February it completes the purchase of Sheraton, bringing its portfolio to more than 650 hotels and resorts in more than 70 countries. It also buys the St Regis New York along with Ritz-Carlton hotels in Washington DC and Aspen, Colorado, which become St Regis hotels.
- December 1998: The first W hotel opens in New York City.
- 1999: In January, Starwood changes its status from a REIT to a Corporation. It sells the Caesars gaming interests that came with Sheraton for €3b and buys Vistana, a vacation ownership company.
- 2000: The former Grand Hotel in Rome becomes Europe’s first St Regis hotel.
- January 2002: Starwood puts Ciga – the 25-strong chain of five-star hotels in Italy, Spain, and Austria that it acquired with Sheraton – on the market. It sells the Sardininan hotels in July but continues to manage them.
- May 2004: Sternlicht steps down as executive chairman of Starwood to spend more time with his private real estate investment company Starwood Capital.
- April 2005: Starwood Capital and Lehman Brothers make a £700m rescue offer for the struggling, 130-strong four-star Le Méridien chain. The plan, which involves assuming Le Méridien's $1.3b (£725m( debt) was first mooted in January 2004. In a separate deal, Starwood Hotels is to assume the Le Méridien brand, along its management and franchise business, and operate the hotels.
- September 2005: Starwood and its W Hotels division announce plans for aloft - a sophisticated select service brand offering loft-like guest rooms, enhanced technology, and landscaped outdoor spaces for all-day socialising. The first five hotels will come on stream in the USA in early 2006. The group plans to have 500 alofts worldwide by 2012.
- October 2005: Starwood announces plans to sell assets worth between $2b and $4b over the next 12 months while retaining management or franchise contracts.
- November 2005: Starwood agrees to sell 38 properties, including 25 in the USA, to US real estate company Host Marriott Corporation for £4.04b. The deal includes six European hotels - including the Sheraton Skyline hotel and conference centre in Hayes, UK - and properties in Rome, Milan, Madrid, Venice and Warsaw. Starwood is to continue to manage the hotels under a 40-year agreement.
- Late November 2005: Starwood completes the acquisition of the Le Méridien brand, management and franchise business for $225m (£130m) while a joint venture between Starwood Capital and Lehmann Brothers buys the 32 owned and leased Le Méridien hotels.
Financial snapshot
Full Year
Turnover: $5.98b (2004: $5.4b)
Owned, leased and joint venture hotels contributed $3.5b (2004: $3.3b)
Vacation ownership and residential sales and services contributed $889m (2004: $640m)
Net profit: $422m (2004: $395m)
EBITDA: $1.4b (2004: $1.15b)
Half Year
Total revenues: $2.97b (2003: $2.59b)
Owned, leased and joint venture hotels contributed $1.75b (2003: $1.6b)
Vacation ownership and residential sales and services contributed $464m ($2003: $268m)
Net income: $224m (2003: $188m)
EBITDA: $663m (2003: $533m)
Financial year end: 31 December, 2005
Half year end: 30 June, 2005
Operating data
Starwood has around 850 properties in more than 95 countries, of which the majority are managed or franchised.
St Regis: 12 hotels
Le Méridien: 130 hotels
The Luxury Collection: more than 75 mostly unbranded hotels in 25 countries, including St Regis hotels and the London Lanesborough
Sheraton: more than 400 hotels and resorts in more than 70 countries
Westin: more than 120 hotels
Four Points by Sheraton: more than 120 hotels
W Hotels: approximately 25 hotels. Most are in the USA but there are also W hotels in Seoul, Sydney and Montreal
Starwood Vacation Ownership operates around 19 high-quality timeshare resorts under the Westin and Sheraton brands in the USA and the Bahamas
Regional breakdown: North America: 437 hotels and resorts, EMEA: 175, Latin America: 46, Asia Pacific: 94
The Le Méridien business acquired in November 2005 includes 43 hotels in Europe, 47 in Africa and the Middle East, 28 in Asia Pacific and India, and 12 in the Americas.
UK properties: 12
The Lanesborough, London (a managed hotel that is part of the Luxury Collection)
Sheraton Park Tower, Knightsbridge (Luxury Collection)
Sheraton Belgravia
Park Lane Hotel, Piccadilly
Sheraton Skyline Hotel and Conference Centre, Heathrow
Sheraton Heathrow
Sheraton Grand Hotel & Spa, Edinburgh
Westin Dublin
Westin Turnberry Resort, Ayshire
Le Méridien London Gatwick
Le Méridien Piccadilly
Café Royal, London
Number of employees: 145,000 at its owned and managed properties worldwide (including Le Méridien, which employed 30,000 staff before its acquisition)
Strategy
"During the [fourth] quarter we made significant progress toward reducing our investment in owned real estate, while maintaining long-term, attractive management agreements with an outstanding partner.
In addition to its robust pipeline of existing vacation ownership inventory, the company continues to evaluate its existing owned real estate for potential conversion to vacation ownership, fractional, or residential projects.
For example, the company is converting four floors of the St. Regis hotel in New York into fractional units and residences and has
partially demolished the Sheraton in Cancun, Mexico, where it will build a timeshare development that is expected to have up to 73 units upon completion of the first phase. The company is also working with its business partners to develop similar conversion opportunities at managed hotels."
Source: chief executive Steven Heyer, 2 February, 2006
Chief executive
Stephen J Heyer
Key directors
Executive chairman: Barry Sternlicht
Executive vice-president & chief marketing officer: Javier Benito
President, Real Estate Group: Theodore Darnall
Executive vice-president, human resources: David Norton
Executive vice-president, chief financial officer: Vasant Prabhu
Senior vice-president, St. Regis & The Luxury Collection: Stephen Alden
Senior vice-president, Westin Hotels & Resorts: Sue A. Brush
Chairman and chief executive officer, Starwood Vacation Ownership: Raymond. Gellein
Senior vice-president, Four Points by Sheraton: Hoyt H. Harper, II
Senior vice-president, chief marketing officer, W Hotels Worldwide : Ross Klein
President, North America: Geoffrey A. Ballotti
President, Asia-Pacific: Miguel Ko
President, Latin America: Osvaldo V. Librizzi
President, Europe, Africa, and Middle East: Roeland Vos
Senior vice-president operations, North West Europe: Michael Wale
Director of sales and marketing, North West Europe: Paul James
1111 Westchester Avenue
White Plains
NY 10604
Tel: 001 914 640-8100
Fax: 001 914 640-8310
E-mail:
Website: http://www.starwood.com
In February 2005, Starwood announced plans to open more than 70 new hotels in 2005 and 2006, nearly half outside the USA.
