Several weeks ago, we learned about how the iconic Starwood Hotels brand would be revived. There’s now an update, as this has taken place. This sounds super exciting in theory, though like many sequels, maybe it makes sense to manage your expectations?
In this post:
Starwood founder revives beloved 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. 64-year-old Barry Sternlicht founded Starwood, and he’s now reviving 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, and we’re now seeing that come to life. His hotel company, SH Hotels & Resorts, has just rebranded as Starwood Hotels, in hopes that this will raise the company’s profile.
Here’s how Sternlicht describes this development:
“Reintroducing the Starwood Hotels name is personally very exciting for me. It’s a tribute to a legacy that millions of people know and trust — and it comes at a decisive moment in our company’s history. Over the past decade, SH Hotels & Resorts has built three extraordinary brands, including the mission-driven 1 Hotels, which demonstrates how guests can live a luxurious, sustainable life without sacrifice. I didn’t want to do another typical hotel brand after W. The world doesn’t need another brand, it needs a better 1. By reviving the Starwood Hotels name, we aim to marry this trusted legacy of youth, innovation, and guest focus with our modern, tech-enabled, personalized approach to hospitality. As we take this next step, we’re doubling down on our mission to inspire, innovate, and make a difference — for our guests, our partners, and the planet.”
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 has been revived, as SH Hotels & Resorts has been rebranded as Starwood Hotels. The initial founder of Starwood is now behind Baccarat, 1 Hotels, and Treehouse, and is packing 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?
You say that many of the innovative things Starwood did with loyalty have been replicated, but the execution is frequently lacking. Starwood Platinum guest felt recognized and important almost every time. In Bonvoy, definitely not the case. If they add some mid-sized chains like they did last time, and they nail the execution on making Platinum guests feel very welcome they will gain a lot of followers. Read some of the other stories like Aloft...
You say that many of the innovative things Starwood did with loyalty have been replicated, but the execution is frequently lacking. Starwood Platinum guest felt recognized and important almost every time. In Bonvoy, definitely not the case. If they add some mid-sized chains like they did last time, and they nail the execution on making Platinum guests feel very welcome they will gain a lot of followers. Read some of the other stories like Aloft doing away with breakfast for elites, the crazy devaluation of points, etc. There is definitely room for someone coming in and nailing the basics.
One day hopefully soon, there will be a hotel and an airline that is a true pleasure to use.
Remember Starwood took over some big brands to get big quickly, Sheraton, Westin, Meridien. Don't know if thats Barry's plans this time.
It sure would be nice, instead of just competing for SIZE, there comes some beautiful hotel and airline in our world.
Maybe Hyatt can finally acquire Starwood this time around!
I was a Starwood loyalist who went out of my way to stay at their often out of the way properties, becoming lifetime platinum. Then Marriot comes in and creates two new tiers above platinum, and doing all the other crap that makes Marriott so uniquely mediocre re and awful.
I am a capitalist and I don’t bemoan Sternlicht the right to sell to the highest bidder. But I will never again support any of his properties as a customer
@Erik0J
Hear! Hear!
Will all due respect, this is kind of silly. First - Sternlict had nothing to do with the sale of Starwood to Marriott. He was not involved with Starwood at the time of the sale - Starwood was a public company with a different CEO, board, etc. If you have any issue with how the merger went, direct that to Marriott. Second - people can spend however they want, but if you don’t stay at...
Will all due respect, this is kind of silly. First - Sternlict had nothing to do with the sale of Starwood to Marriott. He was not involved with Starwood at the time of the sale - Starwood was a public company with a different CEO, board, etc. If you have any issue with how the merger went, direct that to Marriott. Second - people can spend however they want, but if you don’t stay at an objectively good hotel (this new Starwood, Marriott, whatever) because of some corporate action years ago, you are just limiting your own options for no reason
You limit your options even more when you suck at the teat of loyalty programs and do dumb crap like mattress runs and all manner of ridiculous spend just to tell some company that does not care about you that you are loyal to them.
Barry’s own firm is Starwood Capital, so I’m sure it was a nonstarter for him to give the name - even for hotels - to Marriyuck.
I still can't believe Marriott didn't buy the rights to Starwood. That aside, Starwood 2.0 isn't even going to be factor for 99.9% of hotel customers unless they expand. Obvious acquisition targets include Omni, Loews, Club Quarters, Pendry, Drury, and Valencia. But you'd likely need to invest a lot of money in Drury and Omni to bring them up to a good standard. If you acquired all those small chains, maybe you get maybe 300 new hotels.
Dury is unlikely to sell as they're family owned and content with being a regional hotel company. And I'll add their properties are nice for midscale level from my experience.
Especially in some markets where there aren't many options. Most are somewhere between a Hilton Garden Inn and a Courtyard. It would fill a niche. It's why Hyatt should have bought Radisson.