Starwood recently announced plans to invest another $1 billion to strengthen its Le Méridien portfolio, and that’s after already spending $3 billion over the past several years to transform the brand. The company sees this as a good bet, and when you consider Le Méridien’s global presence—nearly 100 hotels in more than 40 countries—and upscale approach to hotels, a successful reinvigoration of the brand should pay off huge.
Since Starwood bought the French brand in 2005, it has undergone an extensive mak eover. “When we acquired Le Méridien, it was a portfolio of 130 properties around the world with no thread tying them together,” says Brian Povinelli, SVP and global brand leader at Starwood. “So we saw an opportunity in transforming this collection of properties into one that had a very unique point of view that no other chain of any scale could match.”
Povinelli says the Le Méridien portfolio now is in the strongest state it’s been since Starwood acquired it. “That involved a lot of work, not only in cleaning up the portfolio, but also in exiting the 45 hotels that didn’t meet our future vision.” He adds that Starwood has renovated 25 Le Méridien hotels over the past few years in its efforts to reposition what the brand is about from guest experience and lifestyle standpoint.
Povinelli says the $1 billion will be spent over the next 24 months in new opening and renovations. “We have $200 million in renovations going on in the Middle East and Africa,” says Povinelli. “In the next 12 months we’ll open more Le Méridiens around the world than at any time since we acquired the brand seven years ago. So we’re really seeing momentum pick up with this brand.” Earlier this year, Starwood announced its plans to open 10 Le Méridien resorts and hotels by early 2014.
Starwood’s plans call for a five-year growth plan focused on markets in Asia-Pacific and the Americas. Le Méridien recently opened new hotels in Bali, Istanbul, Oran in Algeria, and Coimbatore in India, Atlanta, Dallas, and Arlington, Virginia. In the next year, Starwood plans to open Le Méridiens in China (Zhengzhou), India (Mahabaleshwar), Vietnam (Ho Chi Minh City), Egypt (Cairo), China (Qingdao), Bangladesh (Dhaka), and the U.S. (Chicago; Tampa, Florida; and Columbus, Ohio). “We just converted a hotel in Atlanta and we have a lot of openings coming up at unique destinations.”
Simon Turner, Starwood’s president of global development says the brand is benefiting from growing recognition and it has an established global presence that gives it a competitive advantage. “Le Méridien’s are in some of the most culturally rich destinations around the world,” says Povinelli. He adds that Starwood has positioned the brand to unlock each destination in terms of the cuisine, the arts, and through the local culture. “You may have a boutique hotel here or there focused on that sort of proposition, but with Le Méridien we have a 100 plus global hotel chain that can maintain a very boutique-y feel to the properties.”
Along with local art and museum partnerships, Starwood is focused on bringing a café culture to life in the environment of Le Méridien hotels. “We do this by focusing on the public spaces—the lobby or hub—and its all about mixing food and beverage with a lively bar atmosphere, café-type seating, and interesting art installations,” says Povinelli. “It creates a unique coffeehouse feel that guests really like.”
Le Méridien is poised for growth and Starwood feels that a little push is all the brand needs to really take flight. “We did this because there’s real opportunity in the upper part of the upper upscale segment,” says Povinelli.
