Wyndham Worldwide to Buy Midscale Hotel Brand La Quinta

Wyndham Worldwide will acquire La Quinta’s hotel franchise and hotel management businesses for $1.95 billion, the company announced today, adding nearly 900 midscale and upper-midscale properties to its portfolio.

La Quinta Holdings, Inc. operates the La Quinta Inn & Suites, La Quinta Inn, and LQ Hotel brands in the U.S., Canada, Mexico, Honduras and Colombia. La Quinta will spin off its real estate assets into a publicly-traded real estate investment trust, CorePoint Lodging Inc., prior to the sale.

Wyndham’s hotel unit, Wyndham Hotel Group, will span a total of 21 brands, also including its namesake brand and budget brands Super 8 and Days Inn, when the deal closes in the second quarter of this year.

Wyndham will also gain La Quinta’s 13 million loyalty members, when the program combines with Wyndham Rewards

The deal gives Wyndham more exposure to the midscale and upper-midscale segments “that have been growing RevPAR (revenue per available room) faster than any other segment outside of the economy segment,” according to Moody’s lodging analyst Peter Trombetta, Reuters reported.

Wyndham has continued its investment in the midscale and upper-midscale segment, driven by a growing global middle class that is expected to more than double in the next 10 years. Last year, Wyndham acquired Minnesota-based AmericInn brand, a mid-scale brand with 200 hotels in the Midwest. Wyndham also recently launched Trademark Hotel Collection, a soft brand consisting of independent upper-midscale hotels.