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Atlanta-Based Valor Hospitality Eyes European Growth After Boost from Private Equity


Atlanta-based lodge administration firm Valor Hospitality Partners is rising its division of lodges within the United Kingdom and Europe with the addition of 17 properties.

Brian McCarthy, Valor Hospitality’s managing director for the U.Okay. and Europe, mentioned his portfolio of United Kingdom lodges has lately doubled, following an appointment by MCAP Global Finance, an affiliate of New York City-based funding supervisor Marathon Asset Management, to handle a newly acquired portfolio of two,374 rooms in 17 lodges. The addition contains 15 Holiday Inns and two Crowne Plazas in several areas throughout the U.Okay, together with Leeds, Leicester, Reading and Southampton.


Overall, the division operates 34 lodges within the U.Okay., with a complete of 5,778 visitor rooms, and an extra 46 lodges throughout Europe, Asia, the Middle East and South Africa.


Valor has loved a prolonged relationship with Marathon.

McCarthy mentioned the European division, based mostly within the English city of Romford, was shaped when Marathon purchased an 11-asset Queen Moat Hotels portfolio in 2014 for 135 million kilos sterling ($188 million).

“Then [in August 2014], it was a joint venture between Marathon and Valor, with a third-party management company founded, and a year later Marathon bought from peer firm Blackstone Group five formerly branded Mint properties, which we managed, too,” he mentioned.

According to Hodges Ward Elliott, Marathon paid 160 million kilos sterling for 5 lodges with roughly 1,200 rooms.

The relationship ended when Marathon exited the European lodge panorama in 2019 with a sale to Thai conglomerate DTGO for 450 million kilos sterling. DTGO additionally purchased the private-equity agency’s share in Valor.

The two corporations’ divulgence gave Valor extra credibility, McCarthy mentioned.

“Valor was pigeonholed as being one and the same as Marathon, but we also had the capability and ability to work beyond them,” McCarthy mentioned.

Today, the second chapter with Marathon was a testomony to the efficiency the primary time round, he mentioned.

“As we go forward potentially opportunistically in Europe, we now have the strengths to work with that organization and others, and we are interested in individual assets potentially under another fund,” McCarthy said. “We have built up over that time best-of-class in all sectors we operate in.”

Valor is interested both in third-party management and portfolio opportunities as the world slowly comes out of the pandemic and hotels change hands, he said.

“We now have strong evidence of good, long-term performance. We are a credible alternative and have ongoing relationships,” McCarthy mentioned, including that throughout the whole firm the ambition is to achieve a milestone of 100 lodges.

McCarthy mentioned for Valor, the COVID-19 pandemic has been marked as one during which its lodges’ house owners have proved to be calm, understanding and concerned.

“It is an unusual time, and the portfolio has had a difficult time, but our owners have proved to be great owners, and we have continued to keep ourselves busy,” he mentioned.

He added that aside from necessary closed durations, Valor’s lodges remained open.

“We have seen hotels have accelerated out of all of this much better if you stayed open, and our market position is far better as a result,” he mentioned. “It is popping into a great interval for us, on the again of our endeavors with Marathon … however nobody has been immune [to COVID-19]. On a human degree, folks have misplaced jobs, and nobody loses sight of that.”

Brian McCarthy is managing director for the U.Okay. and Europe at Valor Hospitality Partners.

McCarthy mentioned Marathon has been a key companion with Valor because the pandemic started.

“We all needed to keep balance, and Marathon has been respectful and 100% joined us,” he mentioned, including that the connection together with his U.S. mum or dad firm and colleagues has additionally been instrumental in operations throughout the final 17 months or so.

CEO Euan McGlashan and Chief Investment Officer Steve Cesinger — an ex-investment banker — based Valor in 2012.

Valor Hospitality has needed to defy some widespread misconceptions about its firm construction, McCarthy mentioned.

“When the terms third party and/or white label are bandied around, there is perhaps a feeling that means [operations] are not fully engaged, but it is an integrated relationship [with Marathon]. It is all one organization, with totally aligned aspirations and objectives.

“It has helped that they also for a while owned part of us.”

McCarthy, who before joining Valor was chief operating officer at De Vere Hotels and Village Urban Resorts, said his U.K. portfolio comprises IHG Hotels & Resorts, Hilton and Marriott International franchises, mostly in the centers of cities such as Birmingham, Bristol, Chester, Leeds, Liverpool and Manchester.

It also operates the first two AC by Marriott hotels opened in the U.K., located in Birmingham and Manchester.

He said he is seeing signs of recovery, too, notably in Chester and Plymouth.

“Plymouth is an interesting market, not just because of leisure. It has a Monday-to-Thursday corporate market in industries such as utilities, energy and dockyards,” he mentioned.

Valor Hospitality has room to develop in different segments, McCarthy mentioned.

“In the future we see our growth coming from elsewhere,” he said. “We’re keen to work with other parties, so we do not pigeonhole ourselves, in segments from budget to luxury. Other owners will appreciate the success we have delivered.”

Further growth in Europe can also be seemingly, he mentioned.

“Absolutely, we’re laser-focused, as we can be successful only if we continue to deliver with owners we work with. We get it that it is all entirely performance-related,” McCarthy mentioned.


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