1st US company to run Cuba hotels in decades
Starwood Hotels and Resorts has announced that it has signed three hotel deals in Cuba, the first time a US hotel company has done so in almost 60 years.
Starwood beat out several other U.S. hospitality companies that have been trying to invest in hotels in Cuba, including Marriott International. Marriott CEO Arne Sorenson is accompanying President Barack Obama on his historic trip to the Communist island nation Sunday.
Starwood received authorization from the U.S. Treasury Department to operate existing hotels in Cuba. The Hotel Inglaterra in Havana will join Starwood's Luxury Collection brand. The Hotel Quinta Avenida, also in Havana, will become a Four Points by Sheraton. Both hotels will undergo renovations before becoming Starwood properties later this year.
The company also has signed a letter of intent to convert the Hotel Santa Isabel in Havana into a Luxury Collection property.
"We have an amazing and compelling number of brands. We are very strong in Latin America," Jorge Giannattasio, Starwood's senior vice president and chief of Latin America Operations, said in a phone call to USA TODAY from Havana. "We know how to do business in the area. When no one thought it was possible, we made the right argument and we got the license."
Marriott has also received Treasury approval but has yet to announce any hotel deals.
Obama began normalizing relations with Cuba in December 2014. A U.S. embassy in Cuba re-opened last August. And last month, the two nations signed an agreement to let U.S. airlines operate daily round-trip flights to Cuba. All major U.S. airlines are now vying for the right to do so.
While U.S. citizens still cannot travel to Cuba strictly for tourism, they can go there under 12 approved categories including religious and educational activities.
Starwood is taking advantage of a geopolitical shift while also trying to negotiate its own future as it considers competing suitors for a buyout.
On Friday, Starwood dropped a $12.2 billion bid from Marriott to take over the company in favor of a $13 billion all cash offer from a consortium of investors led by Chinese insurance company Anbang.
Starwood has given Marriott through March 28 to make a counteroffer. Marriott said on Friday that it was evaluating the Anbang offer and considering its options. If it is completed, the Marriott-Starwood merger would turn the duo into the largest hotel company in the world. Sorenson, who is vice chair of Obama's Export Council, would become the CEO of the combined companies.