IHG buys the Ruby hotel chain, including three sites in London

IHG has added another new hotel brand – but this time it is an established one. To be fair, with just 20 brands, IHG is being positively restrained compared with Accor (40+) or Marriott’s 36.

The company has paid €111 million for the Ruby hotel brand, which is ‘a premium urban lifestyle brand for modern travellers in must-visit city destinations’.

It looks like something that will sit below IHG’s Hotel Indigo brand, which has been moving increasingly upmarket in my view, whilst still fitting into the ‘lifestyle’ niche. It feels very close to the citizenM model.

Ruby has 20 hotels with a total of 3,500 rooms.

There are three sites in the UK:

• Ruby Lucy (Lower Marsh by Waterloo)
• Ruby Stella (Eyre Street Hill, Farringdon / Holborn)
• Ruby Zoe (Notting Hill Gate, image below)

…. with the remainder in Germany (nine), Austria, Switzerland, Italy, Ireland and the Netherlands. The confirmed pipeline includes a site in Edinburgh.

According to IHG:

“Ruby hotels offer a stylish yet relaxed charm, blending soulful design and authentic stories rooted in the cities they call home. The brand’s ‘Lean Luxury’ approach includes signature touches ranging from a great bed and shower in guest rooms created with restoration and relaxation in mind, to unique cocktails in destination 24/7 bars, all coming together to connect guests with sought-after cities at the right price.

As our 20th brand, Ruby will extend IHG’s appeal to modern, lifestyle-focused travellers, and offers hotel owners a cost-efficient and highly adaptable premium hotel concept, in an industry segment characterised by high barriers to entry and space constraints, often referred to in the industry as ‘urban micro’. Efficiencies for owners are delivered through space-saving designs and a high degree of operational standardisation and automation, including self-service kiosks for speedy check-in.”

Ruby has a niche in converting office blocks to hotels. This is becoming increasingly popular due to ‘work from home’ and the failure of many older buildings to meet minimum environmental standards for letting.

The deal has some interesting quirks

For those interested in M&A, there are some interesting features to this deal.

IHG is literally just acquired the brand. It is not even getting the operating contracts for the existing 20 Ruby hotels, which will remain with the seller. The seller will continue to receive all of the revenue from the existing properties plus the current pipeline, with IHG only receiving its usual franchise fees.

On top of this, the seller is being incentivised to continue opening new hotels under the Ruby brand.

Additional payments, which cap at €181 million for reaching 20,000 rooms, will be made in 2030 and 2035. This only relates to new hotels opened by the seller, not rooms opened by IHG with other operators.

It feels very similar to the deal Hyatt did recently with Lindner to take full control of Lindner’s ‘me and all’ lifestyle brand. This is now being rolled out by Hyatt without the involvement of Lindner.

There is no timeline for the integration of Ruby into IHG One Rewards. You should expect it to take at least six months based on what we’ve seen from Hyatt with recent bolt-ons.

PS. If you are not a regular Head for Points visitor, why not sign up for our FREE weekly or daily newsletters? They are full of the latest Avios, airline, hotel and credit card points news and will help you travel better. To join our 65,000 free subscribers, click the button below or visit this page of the site to find out more. Thank you.

IHG One Rewards update – March 2025:

Get bonus points: IHG is offering double base points on cash stays until 31st March 2025. This kicks in from your second cash stay during the offer period. Read more in our article here and click here to register.

New to IHG One Rewards?  Read our overview of IHG One Rewards here and our article on points expiry rules here. Our article on ‘What are IHG One Rewards points worth?’ is here.

Buy points: If you need additional IHG One Rewards points, you can buy them here.

Want to earn more hotel points?  Click here to see our complete list of promotions from IHG and the other major hotel chains or use the ‘Hotel Offers’ link in the menu bar at the top of the page.