Sometimes, real-estate deals which transpire in the hotel industry make it feel like a game of Monopoly. From one moment to the next, no one really knows what each roll of the dice will bring. Which player will land on the property of choice? How much will the transaction cost? How long will it take to close the deal? And finally, how will it impact the rest of the marketplace?

These are only a few of the questions that typically surface in any real-estate transaction. But, earlier this year, in the case of Marriott’s acquisition of Starwood Hotels, the deal took on a life of its own as a consortium of Chinese companies, led by Anbang Insurance Group, made a competing and unsolicited offer to acquire the American behemoth, adding an unexpected twist to an already complex acquisition. For several weeks, a bidding war ensued and just when it seemed like a decision had been finalized, a new offer was on the table, leading one to speculate just how long the acquisition process would take. For Marriott, the back-and-forth machinations ended up costing them more on the deal and delaying the outcome. Ultimately, patience prevailed and the process was finally settled with Marriott emerging victoriously; but not before a lot of nerves were frayed.

On the flip side, Accor’s acquisition of Fairmont Hotels & Resorts has been less frenetic and, perhaps, more straightforward, with little additional information surfacing since the deal was announced late last year. But like the Marriott deal, the impact of this buyout has yet to be determined. What will happen to the Fairmont brand? Will the company remain headquartered in Canada or move to Europe? How will the acquisition impact staff here?

Welcome to the world of hotel investment. While we may liken real-estate deals to a game, they’re anything but. This is serious business with high stakes and sometimes high anxiety. Last year, a total of $2.47 billion was exchanged among buyers and sellers in Canada, representing almost 150 deals. It’s been a strong year for the Canadian marketplace, as many of the stories in this special Canadian Hotel Investment Issue illustrate (See stories beginning on p.14). But, it’s also been a busy one with regard to mergers and acquisitions — and not just as it relates to hotels. Even real estate, consultancy and lending communities were involved. In the past year, CBRE acquired PKF; DTZ acquired Cushman & Wakefield and in mid-April, Canadian Western Bank bought GE Capital’s Candian Franchise Finance business.

Granted, it may appear that these transactions involve only two sides — a buyer and a seller — but the reality is far greater in scope, as each of these deals ultimately affects the broader industry at large in ways we can’t always predict.


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