Bethesda, Md. -- Host Marriott has agreed to acquire 38 luxury and upscale lodging properties from Starwood Hotels in a deal valued at more than $4 billion, the companies announced today.
The deal will allow Host Marriott to diversify its brand portfolio, which consists heavily of Marriott International brands, and expand geographically beyond its North American base. After the sale, Host Marriott will own 145 hotels in nine countries under 17 brands.
To reflect its brand diversification, the company said it will change its name to Host Hotels and Resorts when the deal closes, which is expected in the first quarter of next year.
For Starwood, of White Plains, N.Y., the sale will continue the company's transition away from hotel ownership so that it can concentrate more fully on its lodging management and franchise operations. Under terms of the agreement, Starwood will manage the properties up to 40 years. Starwood will still own 93 hotels after the sale.
"Starwood will be increasingly focused on driving top line growth and profitability through marketing, branding (and) development" after the sale, said company chief executive Steven Heyer.
The sale portfolio includes 20 Sheratons, 13 Westins, one St. Regis, two Ws, one Luxury Collection, and one non-branded hotel. Twenty-eight hotels are located in North America, six hotels in Europe, and two each in Asia and Latin America. The portfolio totals nearly 19,000 guest rooms.
"We believe these assets represent one of the highest quality lodging portfolios available, and they will complement our existing portfolio of outstanding hotels," said Host Marriott chief executive Christopher Nassetta.
One of the country's largest lodging real estate investment trusts, Host Marriott is a separate company from Marriott International, although Marriott International manages many Host Marriott hotels.