Mallorca, Spain-based Iberostar Hotels & Resorts has signed a deal with British firm IHG Hotels & Resorts to place approximately 70 hotels and 24,300 keys of its portfolio onto IHG’s loyalty platform, according to a news release.
There is no change to the ownership of either entity, but it does mark another move by one of the world's largest hotel firms to expand its presence in the all-inclusive market.
The agreement has an initial term of 30 years and the option to renew for additional terms of 20 years upon mutual agreement. Iberostar’s hotels and rooms will be marketed on the loyalty platform under Iberostar Beachfront Resorts. The news release states Iberostar Beachfront Resorts “will become the 18th brand for IHG ... [and] will boost IHG’s global system size by up to 3%.”
The brand will be placed in a new portfolio segment for IHG, “Exclusive Partners.”
According to the news release, total revenue for the 70-hotel Iberostar portfolio was $1.3 billion in 2019. IHG stated that it expects the deal to yield annual fees revenue in excess of $40 million by 2027.
The first of the hotels will join the loyalty platform in December, including assets in Brazil, Canary Islands, Dominican Republic, Jamaica and Mexico. Hotels in Spain, Southern Europe and Northern Africa are anticipated to join IHG’s system over the course of 2023 and 2024.
The staggered integration into the loyalty platform is due to 27 of the hotels still requiring additional approvals from third parties to make the switch, according to the news release.
An Iberostar pipeline of six resorts and approximately 3,000 rooms is also expected to join the loyalty platform.
According to Iberostar’s website, the Spanish firm has more than 100 hotels and resorts.
IHG now claims it has 260 resort properties within its brands, but that it “has fewer than 20 resort properties in the countries where the Iberostar Beachfront Resorts properties are located.”
Keith Barr, IHG’s CEO, said “guests have told us of their wish for increased choice of resort and all-inclusive destinations within our brand portfolio.”
Miguel Fluxá, Iberostar’s chairman, added “retaining 100% ownership of Iberostar allows us to continue to generate differentiation in the hospitality industry with a long-term vision for our employees, clients, tour operators, distribution partners and local communities that have been loyal to us during all these years.”