Starwood Hotels and Resorts
reported some positive third-quarter metrics and announced the edition of a new
brand, but rumors from outside the company of a pending sale once again generated
the most interest from analysts during the company's quarterly earnings call.
On Tuesday, The Wall Street Journal reported that multiple Chinese firms are looking at the company.
On Wednesday, CNBC reported that Hyatt Hotels was also in the running. During the
call, Starwood interim CEO Adam Aron deflected questions about the sale, the
company's ongoing exploration of "strategic alternatives" and its months-long
CEO search.
"Although
there is no specific news [about the company's fate] to announce on this call
today," Aron said, "our progress and our process is active and nearing conclusion. I'd be surprised if we don't have answer to these questions before this calendar year ends."
During a separate earnings
call on Wednesday, Hilton Worldwide CEO Chris Nassetta said analysts could rule
out Hilton interest in Starwood.
Systemwide occupancy at
Starwood properties increased 2 percentage points year over year to 73.6
percent, while average daily rate decreased 3 percent to $171.56. North
American occupancy increased 1.2 percentage points to 79 percent, and ADR
increased 1.9 percent to $176.59.
Starwood also announced an
11th brand, which will bring select Design Hotels into the fold. Starwood
became a “passive investor” in the affiliation of smaller, independent, boutique-style
hotels like Manhattan's Gramercy Park Hotel, in 2011. Aron said properties in
the Design Hotels collective would have the option to join the Starwood brand
family through a marketing partnership, taking advantage of Starwood’s
distribution capabilities and its established loyalty program, Starwood’s
Preferred Guest. “This will fill a special niche in Starwood's portfolio,
incorporating a handpicked collection of independently owned, smaller
properties committed to individuality, progressive design and cultural
authenticity,” Aron said. He did not provide a formal brand name, stating
details were forthcoming.
From January through September,
Starwood opened 68 hotels and added 14,000 rooms to its system, a pace that's
47 percent ahead of the same period last year, Aron said. The company also
experienced a 26 percent increase in signings for the year, completing 141 hotel
deals since January 1.
The company’s net income
dipped 19.3 percent year over year to $88 million.