The Standalone Lifestyle Hotel Management Company That Won't Be Rolled Up
Skift Take
Early Check-In
Editor’s Note: Skift Senior Hospitality Editor Sean O’Neill brings readers exclusive reporting and insights into hotel deals and development, and how those trends are making an impact across the travel industry.Owners of U.S. hotels have long turned to third-party management companies, such as Sage Hospitality Group, to run their properties. Sage stands out because, since 2017, it has grown from having 17 independent, soft branded, luxury, or lifestyle properties in largely suburban areas to having 47 lifestyle hotels in major urban areas (out of 60 hotels total).
Sage made a big, deliberate shift in its total portfolio. To understand its bet on lifestyle, and what that bet says about the broader sector, we need to cover some backstory.
Sage does many things, but it's best known for third-party hotel management. Most hotel managers are essentially mom-and-pop players — overseeing roughly a few dozen hotels each, on average.
But a push is on to consolidate the hotel management players.
Aimbridge, the largest hotel management company in the U.S., manages more than 1,500 properties on behalf of about 400 owners. Advent International, a private equity firm, took a majority ownership interest in the third-party hotel operator Aimbridge Hospitality in 2019, merged it with competitor Interstate Hotels & Resorts, and plans to try to take Aimbridge public once the markets settle down. Highgate, another giant hotel management company, is privately owned by founders Mahmood and Mehdi Khimji. In 2014, the company gave a minority stake to private equity firm Trilantic Capital Partners. It has more recently done deals to expand in cooperation with Cerberus Capital Management. In December, Highgate bought Viceroy. It plans to turn Highgate into a brand recognized by consumers. This consumer branding is relati