San Francisco-based Kimpton Hotels & Restaurants, which
was acquired by InterContinental Hotels Group (IHG) earlier this year, has lost most of its portfolio in its home city because of a labor-related
issue, according to a hotel workers' union.
Last month, Kimpton discontinued managing seven of its
nine San Francisco hotels. Four of the properties — the Argonaut, the
Tuscan, the Prescott and Hotel Palomar (since renamed Hotel Zelos) — are owned
by Pebblebrook Hotel Trust. Noble House Hotels took over management of the
Argonaut and Tuscan, while the Prescott and Palomar were taken over by Viceroy
Hotels and Benchmark Hospitality, respectively.
The other three — the Harbor Court, Triton and Hotel Monaco
(since renamed the Marker) — are owned by LaSalle Hotel
Properties. OLS Hotels took over management of the Harbor Court and Triton,
while the Marker is now overseen by Destination Hotels.
Kimpton continues to operate the Sir Francis Drake and
Buchanan hotels. Kimpton took over the latter hotel, which was formerly the
Hotel Tomo, from Joie de Vivre last year.
IHG confirmed that the seven hotels were no longer part of
Kimpton and that those hotels collectively accounted for about $6 million in
management-fee revenue.
The loss of the seven San Francisco properties was “driven
by a specific issue and will not impact other growth plans in the U.S. or
overseas,” IHG CEO Richard Solomons said on a July 30 conference call with
analysts. IHG CFO Paul
Edgecliffe-Johnson added on the call that the exits were spurred by a
“location-specific issue that has nothing to do with the brand or IHG.”
Neither Solomons nor Edgecliffe-Johnson would specify the
nature of the issue, which a local union said was labor-related. In
a July 28 statement, Unite Here Local 2 said that in June it requested that IHG
maintain a neutral stance on union organizing drives at the seven hotels, as
Kimpton had been contractually required to do.
IHG relinquished management even though the seven hotels
were performing well, alleged the union. Unite Here claims that "numerous" employees have lost jobs because of the
management changeovers.
IHG said it has secured five management agreements for new
Kimpton hotels in other locations this year. Kimpton also recently added the Hotel
Monaco in Pittsburgh and the Palladian in Seattle to its portfolio, and has
made efforts in recent years to expand its presence throughout the southeastern
part of the U.S.
Still, Kimpton loses most of its portfolio in one of the
country’s most lucrative hotel markets as well as the city where Kimpton made
much of its reputation.