Agents React to Starwood Sale

by Jessica Montevago
Agents React to Starwood Sale

With at least three companies in the running to buy Starwood Hotels & Resorts, agents are wondering what a possible deal might mean for them.

Two Chinese companies, Shanghai Jin Jiang International Hotels and Hainan Airlines’ parent HNA Group, as well as U.S.-based Hyatt Hotels Corporation have all shown interest in bidding on the company.

Hyatt last week was said to be in “advanced negotiations” to buy the brand, which includes chains like Sheraton and Westin.

So far all three companies have declined comment.

What it means to travel agents

While agents and their clients are familiar with Hyatt Hotels, the same can’t be said for Jin Jiang International Hotels and HNA Group. And no matter who the new owner will be, agents are concerned about their future with the brand.

Bjorn Hanson, a clinical professor at New York University’s Preston Robert Tisch Center for Hospitality and Tourism, said “it’s uncertain if a Chinese company would let Starwood remain independent with a new board of directors or take the opposite approach and micro-manage the business.”

But, he noted the acquisition may be a strategic opportunity, allowing either Chinese company to control an international hotel management company.

Jamie Mussolini, founder and president of Beachfronts Travel LLC in Westchester, NY, told TMR she worries new owners might not value travel agents the same way Starwood does, including offering reward programs. It’s unclear if a new owner would keep such incentives, though Hanson says that if a Hyatt acquisition takes place they would likely merge loyalty programs.

Agents are even more concerned that new management will steal client information from hotel databases and reach out to them directly.

“Will we be x’ed out? We just don’t know what this new company will do,” Mussolini said.

Kimberly Wilson Wetty, co-president of Valerie Wilson Travel in New York, said she’s not worried, though. “Travel agencies are so loyal to Starwood,” she noted. “They wouldn’t want to damage that relationship.”

Companies interested in buying Starwood value the brand, and would want to work with agents to keep business stable and consistent.

“Starwood has such a huge stronghold in the business space,” Wilson Wetty said, “to lose that relationship would be a huge hit to their bottom line.”

Another change that would affect agents is the human side of the business, the personal relationships agents have built with their partners at Starwood, Mussolini said. Agents have spent years working with the same people, building a rapport that cannot be easily recreated.

But Wilson Wetty noted the example of Rosewood Hotels, where it’s business as usual even after the chain was bought by a Chinese company in 2011.

The bottom line, she said, is that they’re buying the properties as an investment—and they won’t mess with a good thing.

Photo courtesy: Ildar Sagdejev

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