Sale off for Starwood Capital’s budget Louvre Hotels

Starwood Capital’s Louvre Hotels has dropped plans to sell its UK budget Campanile and Première Classe hotels, and has instead set up a strategy to grow the brands.​

The group was being marketed for sale earlier this year​ by Christie & Co, with Louvre Hotels intending to retain management of the brands.

However, David Anderson, European operations director at Campanile, told BigHospitality that the intended sale is now off the cards.

“We’d seen an opportunity, and we tried and tested it.  But we’ve now decided to hold on to the freeholds and we’re generally planning brand expansions.

“We’re very determined to grow.  In the past, growth was through subsidiaries. Now we’re looking at expanding through franchises, management and acquisitions.”

Second Glasgow Campanile​

The news comes as the group today opens its second hotel in Glasgow, increasing its portfolio of budget hotels in the UK to 20, including 19 Campanile Hotels and one Première Classe.

The majority (18) of these are owned premises, while two of the hotels (including the new Glasgow Hotel) are management contracts.

Campanile Hotel Restaurant Glasgow International Airport, which was formerly operated as the Purple Hotel, is located 10 minutes from the airport and will target both tourists and business travellers with its prices of around £50 per room.

According to Anderson, Glasgow was an ideal location for expanding Campanile to its second site as the brand was already well recognised, and the city is generally under-served by hotels.

“Glasgow is such a busy, vibrant city, and normal trading is enough to keep hotels going.  When there’s a big event or convention, there’s an undersupply of hotels,” he said.

The new hotel adds 103 bedrooms to the existing 107 rooms at partner hotel Campanile SECC, which opened in 2003.

Première Classe​

The group is also keeping a close eye on the performance and approach of its Première Classe hotel, which opened in Coventry earlier this year​. 

The site was re-branded from a Campanile to a ‘super-budget’ Première Classe as the falling average rates in the region prompted the operator to identify an opportunity for the first £35-a-night budget Première Classe.

So far, the group says it is “delighted” with the commercial performance of the site, but it will not rush into further expansion until it has had “a good twelve months to re-affirm our business assumptions and make sure we’re happy with what the right offer is in the economy market”.

Subsequently, expansion plans for Première Classe will likely involve partnerships with external groups interested in re-branding their existing hotels or constructing new sites under the Première Classe brand.

Growth plans for campanile are more immediate, said Anderson.

“I’m cautiously optimistic and want to grow at a steady pace.  Our aim over the next few years is to have a good coverage incorporating the key cities and towns in the UK, and also re-enforcing our presence in the cities where we’re already present.

“We want to be in all the key cities, and London is definitely on the wish-list.”