AccorHotels’ Kevin Frid and 21c Museum Hotels’ Craig Greenberg said the deal to purchase an 85% stake in 21c for $51 million opens up an opportunity for the growth of lifestyle boutique collection MGallery in North America and beyond.
PARIS and LOUISVILLE, Kentucky—AccorHotels’ news earlier this week that the French company signed an agreement to acquire an 85% stake in Louisville, Kentucky-based 21c Museum Hotels for $51 million will open up new opportunities for both companies, according to Kevin Frid, COO, North and Central America for AccorHotels.
21c will join AccorHotels' MGallery collection of boutique hotels, and that decision creates opportunity for the company to build a presence in the lifestyle space in North America, Frid said.
Frid said in an email interview that 21c will continue to be “one of the largest contemporary art museums in the United States and North America’s only collecting museum dedicated solely to art of the 21st century.” This will be achieved by keeping key people from 21c on board, including founders Laura Lee Brown and Steve Wilson, who will retain a 15% stake in the company.
“21c will continue to be led by President and CEO Craig Greenberg and members of its current senior leadership team,” Frid said. 21c “co-founders (Brown) and (Wilson) will remain closely involved in providing creative guidance and support of the unique combination of art, design and hospitality that defines the 21c experience.”
The eight 21c hotels currently open are in Bentonville, Arkansas; Cincinnati, Ohio; Durham, North Carolina; Kansas City, Missouri; Lexington, Kentucky; Louisville, Kentucky; Nashville and Oklahoma City—and the three under development are in Miami, Chicago and Des Moines, Iowa, according to a news release announcing the deal.
Under the leadership of President and CEO Sébastien Bazin, AccorHotels' recent wave of acquisitions has included a 50% stake of South Africa’s Mantis Group; Swiss brand Mövenpick Hotels & Resorts; 20% of Chilean group Atton Hoteles for $105 million; and becoming the only shareholder of Australia’s Mantra Group, which was made official in May.
MGallery in North America
The purchase of this 21c stake marks the entrance of the MGallery collection into North America, “which is a significant milestone for the brand,” Frid said, adding that he’s confident MGallery “will exceed the expectations of our U.S. guests.”
“The acquisition of 21c and introduction of MGallery into the North American market is an exciting strategic opportunity for AccorHotels to establish a lifestyle ‘boutique’ foothold in the North America region,” he said. “Marrying 21c’s exceptional and distinctive brand with the strength of AccorHotels’ development platform, we anticipate expanded growth and development opportunities for 21c, both in North America and abroad.
“Specific to the U.S., we are excited about the upcoming opening of 21c properties in Chicago and Miami, and look forward to further scaling the brand across additional tier-one cities across the country.”
Craig Greenberg, president and CEO of 21c, said in an email interview he sees significant value in “bringing together these complementary brands and assets.” He recognizes that AccorHotels has been building up its North American presence since the company purchased Fairmont Hotels and Resorts, Raffles Hotels & Resorts and Swissôtel Hotels & Resorts in 2016 for $2.9 billion.
He said 21c will benefit from the scale and growth opportunities made possible through AccorHotels' global platform, and will gain enhanced buying power through procurement groups, lower online-travel-agency fees and access to AccorHotels' distribution network.
Greenberg said “the 21c Museum Hotels brand will remain,” and that following the official close, the company “will have more to share on exactly how the 21c Museum Hotels and MGallery brands will work together.”
The deal is expected to close in the third quarter of 2018, according to the release.
Execs call it a good match
21c will sit within the MGallery collection, but Frid said AccorHotels has no intentions of letting the art-focused brand fade away.
Each hotel under MGallery has a unique story to tell, which is why 21c and MGallery make sense together, he said.
“Look at the other MGallery properties,” Frid said. “Molitor Paris - MGallery is a Parisian palace with a 60-year reign as both the most popular swimming pool in the city and a temple of the Parisian underground scene. INK Hotel Amsterdam - MGallery celebrates a history centered on the written word, beginning in 1904 when the building which now houses the hotel became the base of the Dutch newspaper ‘Tijd. … Each hotel has its own singular story to tell, which has been preserved and celebrated within the MGallery collection.”
Frid added that, “21c will retain its unique value proposition—a boundary-pushing hospitality concept which melds the curation of one of the country’s largest contemporary art museums with chic boutique hotels and chef-driven restaurants—while realizing the strength of becoming part of a much larger and more powerful organization.”
Greenberg said he’s confident that 21c’s unique brand and character will not only remain preserved through this deal, but it will be enhanced, too.
Each 21c property will continue to offer rotating exhibitions of curated art.