Grupo Posadas, S.A.B. de C.V., and Bighorn Capital, Inc., have teamed to bring Live Aqua, Posadas’ premier luxury boutique hotel brand, to five U.S. cities.
Bighorn Capital has invested $450 million to develop an initial five properties targeted in U.S. gateway cities Chicago, Miami, Los Angeles, Houston and Washington, D.C. The move marks the first international expansion for Mexico’s largest hotel operator.
“First, this is another example of the attractiveness of the industry today. With interest rates at historic relative lows and the U.S. economy continuing to recover, hospitality is the recipient of record-breaking results,” Gregory LaBerge, Marcus & Millichap’s national director, national hospitality group, told Commercial Property Executive. “Ultimately, their desire to enter key U.S. markets and compete with other luxury hoteliers will benefit guests. As is most often the case with competition, operators will be forced to sharpen their focus on creating greater value for the customer—both in product and service.”
Each of the five cities where the Aqua hotels are being developed have large Hispanic populations and attract substantial Latin American and international tourists who will provide a strong foundation of guests that have an affinity for the Live Aqua brand concept and sophisticated luxury services. The hotels are expected to comprise an average of 250 to 300 units.
“We are very excited to introduce the American consumer and international tourists to Live Aqua, our luxury brand with a unique Latin style known for warm, attentive service,” Javier Barrera, Posadas’ vice president, said in a company statement. “Through our partnership with Bighorn Capital and Début Hotel Group, both of whom have a deep understanding of the innate characteristics of success in the U.S. market, we believe we can establish a lasting and important lifestyle brand in the U.S.”
The first development will be an 82-story high-rise in Chicago’s West Loop area and is dual-branded with the Live Aqua and Dream Hotels brands. It is targeted for completion in 2017.
The Début Hotel Group, which owns and operates hotel brands including Dream Hotels, Night Hotels and Time Hotels, will manage the Live Aqua U.S. hotels.
“We are proud to partner with Posadas and Bighorn to help bring the Live Aqua Hotels brand to life throughout the U.S.,” Eric Danziger, Début Hotel Group’s president & CEO, said in a statement. “We have successfully managed upscale lifestyle properties for over 30 years, and we look forward to leveraging our expertise to maintain the distinctive and exclusive experience that Posadas pioneered with the Live Aqua brand in the Mexican market.”
According to LaBerge, this is certainly not a bad time for them to enter the U.S. market, and Grupo Posada’s ability to attract a loyal following will be determined by their creativity in design and strength in execution.
“The hospitality industry continues to shine in nearly every metric. And the luxury space ADR has strengthened year over year, with little headwind preventing additional future gains,” he said. “Grupo Posadas currently owns or operates 136 hotels, and therefore, will bring to the states a proven operating model, targeted at one the largest and fastest growing ethnic segments—Hispanics. Their ability to source high-quality real estate in core markets, and then build product that appeals to the luxury-seeking Hispanic and Latin traveler, will determine their success.”