Kronos Hotels has acquired a portfolio of 16 hotels with approximately 3,100 rooms and annual sales approaching $60 million from Lodgian.In addition, Kronos has signed an agreement to purchase one additional Lodgian-owned hotel in a deal which is expected to close later this year.
The current purchase, which closed on June 13, is the first in a series of acquisitions designed to rapidly position Kronos as a major hotel owner and operator both in the United States and worldwide. Kronos is planning to add another 12 properties within the next six months. Two of the hotels will be in Malaysia.
The CEO of Kronos Hotels is Charles Morais, who owns and operates 14 hotels along the East Coast, including the 183-room Crowne Plaza near JFK International Airport in New York City.
Morais and his fellow investors - who include brothers Rajesh Mir and Sunil Mir, Sarwir Hansa, and Moses Daniel - have hired a group of proven hotel veterans to handle day-to-day management responsibilities for the newly acquired hotels, notably:
- Carl Newberry, who will serve as COO and CFO and has more than 30 years experience including as chief financial officer and treasurer with Days Inn, as a senior executive with Suburban Extended Stay Hotels, and as the owner/operator of numerous hotels bearing the flags of such major franchisers as Marriott, Sheraton, Radisson, Ramada, Days Inns, Best Western, and Holiday Inn
- Phil Riley, who will serve as vice president of operations and has more than 25 years experience in ownership or management of about 250 hotels and resorts, including Shorewood Resort properties
- Tim McDonnell and Vini Gupta, will serve as Regional VP’s
The 16 hotels acquired by Kronos Hotels from Lodgian include a 393-room Clarion Hotel in Louisville, Kentucky, plus seven Holiday Inns and two Holiday Inn Express properties located in four states - Florida, Alabama, Michigan, and Pennsylvania. Three of the properties will be re-branded promptly - a Holiday Inn to a Baymont Inn, plus a Holiday Inn Express and a Park Inn both to the full-service Clarion brand of Choice Hotels.
The purchase was brokered by Teague Hunter with Hunter Realty in Atlanta and Alex Madjeski with First Financial Bancorp in Los Angeles. Financing is being provided by Royal Bank of Scotland.
Morais has a history since 1999 of purchasing hotels and is one of the leading Asian American hoteliers making a move to more upscale hotels. He plans for Kronos Hotels to move quickly in acquiring full-service properties throughout the United States, Europe, and Malaysia.
“We understand the hospitality business and intend to grow Kronos Hotels aggressively yet responsibly - including with other major acquisitions in the very near future,” said Morais.
According to Newberry, “Our professional management team rivals any hotel management company in both experience and expertise. Together, we expect to create a corporate culture that enables all of our associates to achieve specific financial and market share objectives while enjoying work every day.”
With this acquisition, Kronos Hotels will own and operate hotels in the United States that have assets approaching a quarter billion dollars. The company also operates a hotel subsidiary called Sovereign Palms in Morais’ native Malaysia.
Morais plans to set up a 24-hour call center in Malaysia so travelers can call one toll-free number in the United States to book rooms at all Kronos properties.
“The more completely we serve our guests and the easier we make it for them to stay at our properties, the faster we will grow due to repeat business from satisfied travelers,” added Morais.