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/Svc Ihg Agreement

Svc Ihg Agreement

“This new agreement with SVC reinforces our continued development as a global hotel operator and brand and we look forward to introducing our existing loyal customers as well as new customers in all destinations in our significantly expanded portfolio.” NEWTON, Massachusetts-25. August 2020-Service Properties Trust (Nasdaq: SVC) or SVC announced today that it will transfer the brand and management of 103 hotels from InterContinental Hotels Group plc (NYSE: IHG) or IHG to Sonesta International Hotels Corporation or Sonesta. As previously announced, SVC sent layoffs to IHG for non-payment of SVC`s minimum yields and rents due for July and August 2020, for a total amount of $26.4 million, plus accrued interest, and IHG had until August 24, 2020 to avoid termination by payment to SVC. SVC has up to 24 SVC does not expect to receive payments from IHG on August 1, 2020 and still expects to receive payments from IHG in the future and management agreements with IHG are terminated. The effective date of the termination is November 30, 2020, the same date on which SVC currently plans to transfer the brand and management of these hotels to Sonesta. “SVC and IHG have a long relationship that began in 2003, but we have not reached an amicable solution to IHG`s failures under our management agreements with them,” said John Murray, President and CEO of SVC. “That is why, after a phase of negotiations with IHG, we have decided to end IHG and rename these hotels sonesta. Based on historical experience, we believe that the current portfolio of 103 hotels could perform as well or better as Sonesta hotels after the changeover to the euro and once stabilized in their respective markets. The company also expects “greater flexibility” in Sonesta`s management of its business under current market conditions, Murray added. “For example, we expect some of the modified hotels to be reused or sold in the future for alternative use.” In the absence of a healing payment from IHG, SVC currently plans to move to the management and branding of these 103 hotels from IHG to Sonesta International Hotels Corporation or Sonesta, primarily under the Royal Sonesta, Sonesta and Sonesta ES Suites brands.

2021-10-10T06:21:31+00:00October 10th, 2021|Categories: Uncategorized|0 Comments