It’s another year, and yet another sharing economy investment for AccorHotels.
Today, Paris-based AccorHotels announced that it has “begun exclusive negotiations” to eventually acquire all of Travel Keys, an Atlanta-based private vacation rental broker that has more than 5,000 villas worldwide. The deal is expected to close in the second quarter of 2017 and no acquisition price has been announced.
Together with AccorHotels’ acquisition of onefinestay, which was completed last year, as well as Accor’s investments in Squarebreak and Oasis, Accor’s sharing economy investments, including Travel Keys, would eventually encompass 8,500 addresses in the luxury private rental market.
In a press statement, Sebastien Bazin, Chairman & CEO of AccorHotels, said, “We are extremely pleased to have Bobby Gibson and his team join the AccorHotels family. They have built a very robust business over the years that will be instrumental in our strategy to create the number one luxury private rental player in the world. Travel Keys brings an impressive portfolio of premium properties to our existing activities. This acquisition further demonstrates our agility and dynamic approach to offer comprehensive services to our clients.”
In the same release, Bobby Gibson, CEO of Travel Keys said, “We feel a strong link with the AccorHotels’ teams, and share in the vision of both Sebastien Bazin and the private rental leaders at AccorHotels about the future of our industry. We are very enthusiastic about this partnership, writing a new and exciting chapter of Travel Keys’ story. Our objective is to offer extraordinary experiences to our guests, i.e. the best homes in the best locations with the highest level of service. At the same time, we cater to extremely demanding hosts who find their unique assets mismatched to the mass market offerings found in emerging peer to peer marketplaces.”
AccorHotels CEO Bazin hasn’t shied away from making bold statements about the need for more traditional hotel companies to expand into the alternative accommodations space.
Shortly after news of Accor’s $168-million acquisition of onefinestay was announced in April 2016, Bazin told Skift: “It would be absolutely foolish and irresponsible to fight against any new concept, offer, or services like this, let alone fighting against the sharing economy. This is where the world is leading us. All of those new services are very powerful and very well implemented and executed. You need to embrace it.”
Given this pending acquisition of Travel Keys, and AccorHotels’ other investments in Squarebreak and Oasis, it’s clear that when it comes to exploring the private rental space, the company is pursuing a very distinct upscale and luxury strategy.
Steven Daines, CEO of new businesses for AccorHotels, told Skift that the addition of Travel Keys will be complementary to Accor’s existing portfolio of private rentals.
“The idea is that these businesses have considerable growth potential, as does the entire private rental sector but particularly on the luxury side. We see exciting opportunities for growth,” Daines said.
Whereas onefinestay’s portfolio is primarily urban, and primarily consisting of people’s primary homes, Travel Keys’ portfolio is much more leisure and resort-oriented, and in places where Squarebreak doesn’t have a large concentration of rentals. Oasis, by contrast, is also generally more urban and has more homes located in South America, and caters to extended stay business. Oasis, of which Accor is a 30-percent stakeholder, recently received an investment of $2.5 million from an “undisclosed investor.”
“What we’ve understood is that in the resort areas, it’s a business that’s been going on for much longer because it’s secondary homes, and it’s a very different business fundamentally to what it is in the urban market,” Daines explained. “We felt we needed that additional brick, so to speak, to complete that portfolio of homes. Squarebreak also operates more on the leisure resort side of private rentals, but in France and Northern Africa. We really need a portfolio of homes in the Caribbean, Asia and other resort areas where Travel Keys operates. That’s the reason why we’re pushing for that.”
He added, “We’re all excited about putting these various pieces together and gradually offer what could be a leading portfolio in the number of homes. We obviously have a lot of work to do. We need to negotiate the deal. Early negotiations have started. We have to see how we’ll piece it together, and piece together the various bricks that we bought.”
When asked how business for onefinestay has been, nearly a year after Accor’s acquisition, Daines said, “It’s been great. Our intention, whereas with the Fairmont, Raffles, Swissotel group was a specific intent to integrate, in the case of onefinestay there was never any such intent.” Onefinestay co-founder and CEO Greg Marsh left the company a few months after AccorHotels acquired the company.
Daines added, “The private rental business needs autonomy. It is a different business to hospitality and whilst there may be synergies and there are, we haven’t integrated onefinestay like we have with Fairmont Raffles. We are very satisfied with onefinestay, which is why we are continuing in that segment in private rentals.”
When asked if AccorHotels would pursue a similar strategy with Travel Keys as it has with onefinestay, Daines answered, “That’s something we have to see in the coming weeks and months. I don’t know at this stage. We are dealing with a completely different business; it’s resort and leisure. Onefinestay is strictly urban. We’re going to need the know how of a company like Travel Keys for sure. How we put all that together is something which we will be deciding in the next few weeks and months.”