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Skift Take
Blackstone wants to capitalize on the upside of a travel recovery in hotels, and its investment in Groups360 is a small step. The upshot is it helps Groups360 triple the number of hotel it works with.
Groups360, a platform which helps match meeting planners with venues, has secured $35 million in an investment round led by property and technology investment firm Zigg Capital, which includes participation from Blackstone Innovations Investments, and New York Hedge fund Fir Tree Partners.
They join existing investors Accor, Hilton, IHG Hotels & Resorts, and Marriott International, which pumped $50 million into Groups360 in 2019.
The platform, which provides real-time availability and instant booking capabilities for hotel room blocks and meeting space, will use the money to expand in Europe, the Middle East and Africa, plus the Asia Pacific region. But more importantly, it gains access to Blackstone’s vast hotel portfolio, which includes the 650-property strong Extended Stay America chain.
Groups360 plugs into 7,000 properties to offer instant booking for group stays, with non-real time booking capabilities at 200,000 properties worldwide via its GroupSync tool. However, Groups360’s executive chairman David Kloeppel told Skift he aims to have between 20,000 and 25,000 directly integrated properties by the end of the year — thanks in part to Blackstone’s investment. The terms of the deal weren’t disclosed.
“Blackstone has been very engaged and very interested in the product and platform. They clearly know the hotel business and see a great opportunity for the platform to be integrated into their properties,” said Kloeppel.
Investment group Blackstone recently notched a massive windfall on a casino resort in the heart of the Las Vegas Strip, selling it for $5.65 billion. Blackstone owned a majority stake in Hilton for 11 years and walked away with a $14 billion profit.
“We believe that Groups360’s inventory distribution model and instant booking capability will help drive industry-wide transformation and can create value for Blackstone’s real estate portfolio,” said John Stecher, chief technology officer at Blackstone, in a statement.
Groups360 also recently announced commercial partnerships with Omni Hotels & Resorts, TFE Hotels, and Premier Inn.
Meanwhile, commenting on Accor’s decision to use its own D-EDGE hospitality technology provider for its 5,300 hotels worldwide, Kloeppel said it would help Groups360’s own business.
“What you’re seeing are brands consolidating their customer reservation system, so that inventory is easier to get to. But more importantly as a brand they can roll it out across all the the brands,” he said. “Different franchises have different platforms. Long term for us, it makes it easier to maintain.”
The groups market, particularly company retreats and offsites, is expected to play a significant role in the hospitality sector’s recovery, offsetting the reduction in traditional business traveler traffic. Kloeppel said Groups360 was already seeing a growth in smaller bookings.
Blackstone, which is the world’s largest alternative asset manager, has indicated it wished it had a greater exposure to the hospitality market, according to reports.
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