PPHE, Radisson strengthen art’otel relationship

London-based owner-operator PPHE Hotel Group has reached a deal with Radisson Hotel Group, Brussels, to add its premium lifestyle art’otel brand to the Radisson Hotel portfolio and help accelerate the brand’s growth. While it does not appear that the brand is changing ownership hands, it does mark the 10th brand for Radisson.

Chief Financial Officer and Executive Director Daniel Kos told Hotel Investment Today that the brand isn’t in ‘new hands’ with the announcement. “It will enjoy more visibility and presence in Radisson’s commercial platforms alongside their nine other brands and Radisson will take an active development role for new art’otels around the world,” he said. “PPHE’s current and future art’otel properties will continue to be operated by PPHE.”

Based on a May 2022 deal to extend the two group’s long-standing strategic partnership on “favorable commercial terms,” allowing both companies to leverage their respective brand strengths across their portfolios, Radisson Hotel Group will have access to the art'otel and Park Plaza brands in certain regions, primarily outside of PPHE's core markets, and subject to development targets. Through this arrangement, PPHE will be entitled to fee-based income for the use of its brands. PPHE retains full ownership over the art'otel brand and its special rights under the May 2022 extension of the partnership.

PPHE recently opened art’otel London Battersea Power Station and has three projects in the pipeline – the ongoing construction of art'otel London Hoxton planned for H1 2024; a repositioning in Rome (Q1 2024); and a conversion of an office building in Zagreb, Croatia, by H2 2023. Further relaunches are planned for Berlin and Cologne.

PPHE also re-branded a hotel in Budapest from art'otel to Park Plaza in March 2023. PPHE has also been expanding the Park Plaza brand in Europe, operating since 2002 under an exclusive and perpetual territorial license with Radisson for the brand in EMEA. The first hotel launched under the extended partnership was the Grand Hotel Brioni Pula, which opened under the Radisson Collection Hotel.

While few details were offered about further art’otel expansion opportunities, PPHE did say there is no intention to franchise the brand.

For 1Q23, PPHE Hotel Group reported total revenue of £68.8 million, up 115% vs Q1 2022, and up 10.2% on Q1 2019 pre-pandemic levels driven by higher rates with the UK and the Netherlands showing particularly strong performances.

The group’s disciplined rate-led strategy delivered ADR in 1Q23 of £143.7, up 15.8% vs Q1 2022 and 24.5% ahead Q1 2019 levels. RevPAR was £96.2, up 126.5% vs Q1 2022 and 9.1% vs Q1 2019.

PPHE also secured Clal Insurance as the cornerstone investor for its new European Hospitality Real Estate Fund of up to €250 million equity to facilitate strategic acquisitions of hotels across Europe and help scale the group's hospitality management platform.