Ennismore founder and co-CEO Sharan Pasricha has teamed up with Accor and other investors to create a lifestyle supergroup. Here's a taste of his strategic thinking.
Skift Global Forum 2022
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Who needs another lifestyle brand?
Consumers and developers, that’s who — if you follow recent activity across the hotel industry. Ennismore’s history began in 2011, but the lifestyle hotel leader it has quickly become is the result of a joint venture with Accor first announced in 2020. That partnership, finalized in 2021, brought together brands including The Hoxton, Gleneagles, SLS, Mama Shelter, 25hours, and others into a lifestyle supergroup.
The deal gave the hotel giant a majority stake but allowed Ennismore to get the best of both worlds: independence along with support from a well-run hospitality giant that already operates in nearly every global market. It has moved quickly to expand.
In June, Accor and Ennismore announced intentions to sell a minority stake in the joint venture to a Qatari consortium. Then shortly afterwards Ennismore announced a deal with a Saudi Arabian fund to invest $400 million in expanding lifestyle brands across the country. This followed a similar announcement of a deal to build out 1,300 JO&JOE properties in China in collaboration with Funyard Hotels and Resorts.
Ennismore is the creation of founder and co-CEO Sharan Pasricha, who now runs the group alongside co-CEO Gaurav Bhushan. Pasricha began building Ennismore with the acquisition of the Hoxton Hotel Shoreditch in London in 2012, followed by new Hoxton properties in Europe and the U.S. before acquiring the historic Gleneagles Hotel in Scotland in 2015.
Pasricha spoke with Skift co-founder Jason Clampet in late July, shortly after the Saudi Arabia announcement. Pasricha will be joining us in discussion at this year’s Skift Global Forum in New York.
The interview has been edited for length.
Skift: The deal that happened, how did that come together? The Saudi Arabia deal.
Sharan Pasricha: That’s been in the works for some time now. We’ve been making regular trips to the kingdom and around the region. And when [Accor CEO Sébastian Bazin and I] visited the foreign investment conference that they host in Riyadh, we had the opportunity to meet with some of the key folks in the kingdom and really spoke a lot about Ennismore and our journey. And I think they were really intrigued and interested in the idea of lifestyle.
It helped that a lot of the folks that we met during the trip frequented a lot of our lifestyle hotels. And we started really having early discussions with them about the opportunity to take a lot of our lifestyle brands to the kingdom.
As the world gets more global, we’ve got a really interesting opportunity for a lot of these lifestyle brands that were founded in the West to take those learnings, that spirit, and yet be very aware of the surroundings we’re going into and allow ourselves to build the foundation in some of these new economies.
Skift: Speaking of expansion, with JO&JOE, you’re doing a massive expansion in China. Will the number of properties from that, basically, outpace all the other existing properties you have?
Pasricha: You’ve got to look at China very differently from a lot of other markets. Specifically, as it relates to JO&JOE, this is a partnership with Funyard, which is an old existing relationship. And there’s a plan to build about 1,000 hotels over the next few years. JO&JOE, it’s an incredibly exciting, vibrant brand, and we’re now going to be adapting and tailoring that concept to the Chinese market. There’s a huge and growing market for affordable travel within China. And what JO&JOE offers is a unique opportunity and gateway to enter into that space.
Skift: In terms of [Ennismore’s] relationship with Accor, each one of its lifestyle brands is very unique. Even within the brands, the properties are very unique. On the other hand, Accor has a global breadth, but I don’t think anybody would call their properties unique. How does Ennismore fit within the broader Accor family, and what have they given you that you couldn’t have got independently?
Pasricha: The first part around unique fit with – let’s call them mass-market brands – that are within Accor’s stable. They all will have a place in the market to coexist and you have different guests that are frankly looking for different experiences. One is a fairly utilitarian bed for a night that offers incredible value at a great location. The other is lifestyle brands, which are rooted in purpose and focus and creating communities — which really sets them apart. There’s a place and a time for both.
Somebody read a stat to me the other day where they said, 2 percent of the branded hotels are lifestyle hotels, but almost 10 percent of those in construction are lifestyle hotels.
So really what’s particularly interesting for me is that consumers have spoken. They want a brand and a product that is perhaps more reflective of them and the values they uphold, but also more than just a bed for the night.
And two, I think owners have also understood and realized that there’s a tremendous value-creation opportunity by taking, at times, traditional construction methods and traditional boxes, but programming them very differently – by turning the rulebook on its head and really thinking about revenue generation and spaces in a very different way.
That’s what really makes lifestyle hotels particularly interesting, both on the consumer side and from the ownership side. And do you know what? It helps to be the largest player in one of the fastest growing segments of hospitality, generally.
Our 14 brands, whether it’s JO&JOE at €30 a bed right up to the SLS, there’s something in there for everyone, which is particularly unique and quite exciting for us.
Skift: What keeps you up at night?
Pasricha: The thing that keeps me up at night is making sure that every one of our 14 brands is unique, is authentic, tells a story, is differentiated among our group, has a very clear point of view. And that’s phase one.
Phase two is to make sure within the competitive landscape that we’re incredibly different and authentic from any of our peers and competitors. So those are the bits that keep me up and where I focus much of my time.
In terms of Accor as a partner, I could not be more delighted to have Sébastian and Accor – Europe’s largest hotel company – as a partner in this venture. What’s really unique about this construct is, we’re a company that’s creatively minded, that’s obsessed with this idea of creating brands with purpose.
Actually a lot of these brands are founder-built. So a lot of the founders are very involved in those brands, which really allows us to ensure that there’s tremendous growth and that the culture that each of these brands represent is very much intact. Whether it’s Serge and his son Jeremy Trigano at Mama Shelter, whether it’s Christoph at 25hours, whether it’s Steve and Laura at 21c.
And of course, where the founders are not involved, that’s where I step in and work incredibly closely with our teams to ensure that everything we do feels authentic and has a unique point of view.
As a result, we’ve amassed a really outstanding, world-class group of individuals that are obsessed with this idea of telling stories and who love authentic lifestyle hotels. They love this idea of creating incredible stories in some of the most amazing destinations.
We have over 100 operating hotels today, but close to 160 or so last time I checked in our pipeline. So we’re opening almost a hotel a week, at the moment, in, you name it, from beach resorts to mountain resorts, to city centers, to emerging economies, to all over the place. And what’s particularly exciting for me is to take these 14 brands and make sure they are relevant in all the markets and geographies they expand to. And that’s particularly quite exciting.
And then to add to that, when we’re setting up a hotel in Medellín or in Rio, we don’t need to set up huge IT infrastructures or procurement infrastructures, because we’ve got Accor as our partner to be able to lean and piggyback on.
In a way, I view us as a big startup, but with the might of Europe’s largest hotel company as an ally every single time you need to grow and scale. Accor’s got about 5,500 hotels and hundreds of developers around the world. Now all of a sudden as a large startup, we have the opportunity to partner with all these incredible developers who can help grow the Ennismore stable.
That’s a really unique combination.
Skift: As you’re thinking about growth the next few years, how much do you think is going to come from growing the existing brands that you have versus acquisition of more lifestyle brands?
Pasricha: I subscribe to the school of thought where less is more. I consider 14 already to be quite a lot.
What I don’t want is to follow the traditional mindset of accumulating brands.
For me, a brand is not a brand unless it has a very clear point of view, has a real purpose, a reason for being. Customers can genuinely connect with it in terms of what it offers. And more importantly, people that work there connect with its value.
So unless we can tick all those boxes, for me, it’s not a brand. It then becomes simply a product or a service. So we take brands very seriously.
I wear multiple hats, but I’m also a brand guy and I love how brands make you feel.
Photo credit: Ennismore co-CEO Sharan Pasricha. Ennismore