If you enjoy visiting Barbados, Marriott Bonvoy may just have got a lot more attractive for you.
The hotel group, which owns 30 brands including Sheraton, St Regis, Ritz Carlton, JW Marriott, Renaissance and a whole lot more, has just announced its purchase of Elegant Hotels Group.
Elegant Hotels has seven properties on Barbados, six of which are on the more attractive west side on what is called the ‘Platinum Coast’. There is also one hotel in St Lucia, The Landings, which does not seem to be included in the deal.
Assuming there are no competing bids, the acquisition will cost Marriott just over £100 million, which was a 57% premium on the existing share price. Including net debt, the enterprise value is around £150m. Despite having most of its assets in Barbados, Elegant was UK based and listed.
Marriott has been very clear about its plans for the group:
The hotels will be renovated
The hotels will be rebranded under existing Marriott brands, operating on an all-inclusive basis
The hotels will be re-sold, with Marriott retaining a long-term management contract
It is a clever strategy in theory. Marriott could make an immediate profit on its expenditure if the hotels are re-sold well (they should be worth more if sold individually, since fewer investors have the appetite for seven assets in the same market) and it retains long-term revenue from the management contract.
More importantly, it gains seven hotels which – despite adding just 0.1% to the global hotel count – will make Marriott Bonvoy disproportionately more attractive as a scheme in which to earn points.
The deal also jump-starts Marriott’s new move into the all-inclusive sector which, again, it sees as a key selling point for Bonvoy. It believes that many loyalty scheme members are put off from redeeming at luxury hotels, even if they have enough points, due to the high cost of food and drink and that this can become a real differentiator.
The seven hotels have 588 rooms in total. They are Colony Club, Tamarind, The House, Crystal Cove, Turtle Beach, Waves Hotel & Spa and Treasure Beach. The beachfront Barbados restaurant Daphne’s is also included in the deal.
PS. One thing that intrigues me about this deal is the price. The hotels are all freehold and they are in the best locations in Barbados. The cost, however, is only £250,000 per room. Given the exceptionally high cost of property in Barbados, you would assume – if the Government would allow it – there would be substantially more profit in knocking 4-5 rooms together and creating multi-million $ multi-room beachfront apartments.
How to earn Marriott Bonvoy points from UK credit cards (January 2021)
There are various ways of earning Marriott Bonvoy points from UK credit cards. Many cards also have generous sign-up bonuses!
You can also earn Marriott Bonvoy points by converting American Express Membership Rewards points at the rate of 2:3.
Do you know that holders of The Platinum Card from American Express receive FREE Marriott Bonvoy Gold Elite status for as long as they hold the card? It also comes with Hilton Honors Gold, Radisson Rewards Gold, Shangri-La Golden Circle Jade and MeliaRewards Gold status. We reviewed American Express Platinum in detail here and you can apply here.
You can also earn American Express Membership Rewards points with American Express Gold (20,000 bonus points), the American Express Rewards Credit Card (5,000 bonus points) and – for small business owners – American Express Business Gold (20,000 bonus points) and Business Platinum (40,000 bonus points).
(Want to earn more hotel points? Click here to see our complete list of promotions from the major hotel chains or use the ‘Hotel Offers’ link in the menu bar at the top of the page.)