This sounds super exciting in theory, though like many sequels, maybe it makes sense to manage your expectations?
In this post:
Starwood founder is reviving the hotel brand
In 2016, Marriott acquired Starwood for $13 billion, to create the world’s biggest hotel group. The truth is that Starwood was a company that punched above its weight in terms of its hotel portfolio and loyalty program:
- Starwood had some really innovative and “cool” brands, ranging from St. Regis, to W, to Westin, to Luxury Collection; yes, there was a point at which W was actually a cool brand, and you also can’t deny what a brilliant concept the Westin Heavenly Bed was, for an otherwise generic, midscale brand
- The Starwood Preferred Guest loyalty program was the most popular in the miles & points world at the time; it was the first hotel loyalty program to offer elite suite upgrades, guaranteed late check-out, and much more
Us Starwood loyalists were sad when Marriott acquired the brand. That’s because Starwood’s small size always meant that the brand tried harder, so it was worth going out of your way to stay at Starwood properties.
That brings us to the latest development, as reported by The New York Times. 64-year-old Barry Sternlicht founded Starwood, and he’s now trying to revive the hotel brand. Sternlicht is the CEO of Starwood Capital Group, which is a real estate investment firm that owns many hotels, including those branded as Baccarat, 1 Hotels, and Treehouse.
Sternlicht wants another crack at making a mark in the hotel management industry under the Starwood name. As of February 2025, his current hotel company, SH Hotels & Resorts, will take on the Starwood name, in hopes that this will raise the company’s profile. As he explained, “I’m kind of like a singer having one song, I want to have two songs,” and “this is my passion, designing hotels and keeping them on brand is fun.”
When Marriott acquired Starwood, the brand had 1,300 properties in 100 countries. The newly reborn Starwood has 14 properties in five countries. The company has 22 properties in the pipeline, which will open through 2028. This includes 1 Hotels locations in Austin, Crete, Riyadh, and Seattle, Treehouse locations in Manchester Miami, and Riyadh, and Baccarat locations in Dubai, the Maldives, Riyadh, and Rome. Sternlicht is reportedly planning a fourth brand.
My take on the revival of the Starwood brand
Sternlicht is an absolute visionary, and I have huge respect for him. Despite being a numbers guy running a private equity firm, he clearly has a passion for hospitality, and for the details that make it great. That being said, I wouldn’t quite expect this to be Starwood 2.0:
- Ultimately these three hotel brands already exist and operate (great) hotels, so this is more a branding exercise for the entire group, than anything else
- Hotel brands are a lot more “mature” than they were 30 years ago, when Starwood was at its peak growth, so it’s not as easy for a new or small player to convince other hotels to join their portfolio
- The innovative things that Starwood did with loyalty have since been replicated by other hotel groups, so wouldn’t set the hotel group apart in the same way
- There’s just not a huge appetite for newly built hotels at the moment, especially outside of the limited service sector; this is a challenge all hotel groups are dealing with right now
So I’m always happy to see a hotel group grow, and the use of the Starwood brand here does make me nostalgic. It might even be the push I need to finally check out the Baccarat and 1 Hotels brands.
That being said, best case scenario, I could see Sternlicht creating a small brand that becomes a great acquisition target for one of the major hotel groups. I mean, I’d love to see these quality properties be part of one of the big hotel groups. Then again, it almost seems like that’s exactly what Sternlicht is trying to avoid — Starwood was successfully sold off once, and I don’t think he’s looking to have it sold off again.
If Starwood remains independent, it won’t be big enough for anyone to actually be loyal to the group. Size is kind of a key component in creating a hotel group, and getting a loyal following.
Bottom line
The Starwood brand is being revived, as SH Hotels & Resorts will be rebranding as such in the coming weeks. The initial founder of Starwood is now behind Baccarat, 1 Hotels, and Treehouse, and wants to package them all up under his beloved brand.
While the guy behind this is brilliant and I’m excited to see this, I wouldn’t expect Starwood 2.0 to be anything like Starwood 1.0. The industry has changed a lot, mostly for the worse, and I’m not sure the 1994 playbook of creating a quality brand will work in the same way…
What do you make of the (sort of) revival of Starwood?
Where do we sign up?
Of course it will take some time, but this fella knew what guests wanted and he widened our imagination, making very pleasant stays.
Starwood was quite profitable before the takeover, but it wasn't enough profit for the Street.
Although Arne ruined it all, we still bless his soul.
Eh. Starwood SNAs never cleared, and their breakfast benefit was super limited. Additionally, but my last memory is that they basically handed over all their user data to an acquisition firm, which turned out to be a state breach of information. And then, of course, the circular flush of the Marriott treatment.
In an industry that routinely reduces value for customers on an annual basis, it would be nice to see a new value...
Eh. Starwood SNAs never cleared, and their breakfast benefit was super limited. Additionally, but my last memory is that they basically handed over all their user data to an acquisition firm, which turned out to be a state breach of information. And then, of course, the circular flush of the Marriott treatment.
In an industry that routinely reduces value for customers on an annual basis, it would be nice to see a new value proposition. Not "another brand to be consumed by companies who think owners are the customers."
Only 14 current properties and soon could be 13 since it sounds like they are going to lose 1 Hotel Hanalei Bay due to financial issues with the property likely reemerging under new ownership and a new luxury flag.
Surely this is a good thing? There's a real shortage of strong hotel brands and propositions. We had Schrager, then Starwood, then Kimptpn, then CitizenM. And what do we now have? Accor / Ennismore's hoxton is a diluted version of Soho House. Any interesting brands, like Sydell's brands, are being snapped up by the big players. We definitely need more innovation from skilled hoteliers!
Sternlicht innovative... No, He like most, is just a greedy son of a b@(#*#( who saw the $igns from Marriott, rubbed his hands in glee and pocketed his billions. Now that hotel prices are through the roof, he sees the opportunity to make some more billions.
At least he did better than Rocco Forte who destroyed Trust House Forte decades ago.
Sternlicht had exited Starwood years before the sale to Marriott. He wasn’t involved anymore so he didn’t profit off the sale.
Loyalty Lobby is reporting that Starwood 2.0 paid $1 billion for 10 Raddison Blu properties in the UK. That’s very interesting.
That *is* interesting.
I wonder if these are the old 'Radisson Edwardian' properties - which never really fitted the Radisson Blu brand. The Raidsson Blu brand is so confused - with very little coherence. Bring back SAS Radisson! :-)
They are. I can only guess there are other Radisson owners in Europe who want out of Radisson split Radisson was split up. If Starwood 2.0 acquired a good chunk of Radisson Blu properties, it would give them a relatively good start. Especially if Starwood 2.0 combined that with an acquisition of Omni in the USA.
- Sternlicht has consistently said his biggest mistake from the original Starwood was how generous the loyalty program was - so I would not expect those benefits to return in this reinvention
- I would expect them to remain heavily in lifestyle brands like 1 Hotels. I am actually a fan of the 1 properties I have been to (Brooklyn, South Beach, West Hollywood, San Francisco). South Beach is a fun property in particular. Nice party vibes.
Starwood 2.0's current brands have virtually no name recognition. Branding a hotel as 1 Hotel seems like a marketing trick from the 1980s or 1990s as that would have put you in the front of other businesses in the phone book.
If I was advising Starwood 2.0, I'd tell them to drop their current brands since they have no cachet. Use the Starwood name for everything it's worth, which is presumably something since it...
Starwood 2.0's current brands have virtually no name recognition. Branding a hotel as 1 Hotel seems like a marketing trick from the 1980s or 1990s as that would have put you in the front of other businesses in the phone book.
If I was advising Starwood 2.0, I'd tell them to drop their current brands since they have no cachet. Use the Starwood name for everything it's worth, which is presumably something since it was acquired. I'm frankly surprised that Marriott sold it since I thought some of their subsidies or holding companies still used the name Starwood. Maybe I'm mistaken.
As Ben rightly said, across all brands, owners and developers don't seem terribly interested in building new, full-service hotels, at least in North America. That's because of two reasons: First, many markets are saturated with properties across existing brands. Second, labor costs and labor shortages are such that it's more profitable to build and operate a new limited-service hotel.
It seems to me the only way Starwood 2.0 gets growth is to buy some of the smaller "independent" chains like Omni, Outrigger, etc. Starwood 2.0 could add 130-140 properties to its portfolio overnight. Westin has about 220 properties worldwide. Of those, about 120 are in the USA/Canada.
As a consumer, the number one consideration is geographic footprint. Followed by the specific location within a city. Certainly, some will be drawn to the restart based on its history. But, others . . . like me . . . will be focused on the convenience of the locations. (We'll assume consistent quality execution of service.)
Price is also super important- lots of Hyatt properties and even hotels like Moxy can be horribly overpriced compared to the competition [certainly in Europe]. I'd rather pay for a junior suite with breakfast then go to the rival hotel down the road which charges the same amount for a basic room and hope they upgrade and feed me because of my shiny card.
That's obviously meant to be THAN not THEN.
You once again are ignoring the GHA model which of course appears to be the right fit for that sort of brand.
Of course, the strategy might not be to build an enduring network but rather to build another sell-able network.
Didn’t Marriott buy the rights to the name when they acquired Starwood?
@ Peter -- It's a good question. Keep in mind the Starwood name goes beyond the hotel group as such, as Starwood Capital Group was operating before and after Marriott's purchase of Starwood Hotels. Marriott never actually used the Starwood branding in any way. So I'm not sure what exactly the deal was, but I'd imagine that they're not violating any terms of the Marriott agreement.
The word is that Starwood's founder purchased the trademark from Marriott.
Whatever the case, I'm sure the lawyers will already have crawled all over it.
View from the Wing reports that Marriott sold the Starwood name to Starwood 2.0. Remember, Marriott corporate leadership wanted 100 million in cuts. So, I suspect the sale of Starwood brought in a decent amount of money.
Remember, Starwood 1.0 never had any Starwood hotels. Starwood was merely the name of the corporate entity and Starwood Preferred Guest was the name of the loyalty program. So, while Starwood may have cachet with hotel customers who are old enough to remember the former chain, there were never any Starwood 1.0-branded hotels.
You are exactly correct. Starwood Hotels & Resorts was the company that owned the brands. There was never a hotel with the name Starwood.
- 15 year Starwood alumni here including 5 years in Stamford working on a global team