Gaylord Sells Hotels Brand Rights, Management of Four Properties to Marriott International for $210 Million
June 3, 2012
Following a strategic review, Gaylord Entertainment has decided to sell the Gaylord Hotels brand and the rights to manage its four convention center/hotels properties to Marriott International for $210 million.
Once the sale is finalized, Gaylord will continue to own its hotel properties and other businesses and will reorganize and elect to be treated as a real estate investment trust (REIT) effective Jan. 1.
By transferring day-to-day control of the hotels to Marriott, Gaylord expects to save $33 million to $40 million a year.
The four properties include the Gaylord Opryland Resort and Convention Center in Nashville, Tenn.; Gaylord Texan Resort and Convention Center in Grapevine, Texas; Gaylord Palms Resort and Convention Center in Kissimmee, Fla.; and Gaylord National Resort and Convention Center in Prince George’s County, Md.
“We are pleased to be announcing today a transaction that we believe allows shareholders the potential to realize maximum long-term value for their shares in Gaylord Entertainment,” said Colin V. Reed, Gaylord’s chairman and CEO.
He added, “Our months-long review of various options led us to the conclusion that the REIT structure represents the best pathway to realize the long-term value of our business and to position the Gaylord brand for continued growth.”
The strategic review found that the sale of the brand and management rights would have several long-term benefits for the shareholders and the company, according to Gaylord officials.
The company would have the cash received in connection with the sale of the brand and management rights, there would be the opportunity to realize substantial cost savings and revenue enhancements because of Marriott’s scale and reach in the hospitality market and Gaylord would be a well-capitalized REIT focused on group-oriented destination hotels in urban and resort markets.
Once the deal is finalized, the four Gaylord properties will join the Marriott portfolio of brands.
Marriott will receive a management contract with an initial 35 year term, 2 percent base management fee and an incentive fee linked to improvement in hotel profitability.
“We have long admired Gaylord, both for the hotels they have created and for their superb job in hosting major meetings and events,” said Arne Sorenson, Marriott International president and CEO.
He added, “Working with the Gaylord brand, the existing four hotels and a Gaylord team that provides outstanding customer service, we are convinced there is tremendous upside potential for growing hotel revenues and profits and developing careers."
Gaylord will continue to own and operate the Grand Ole Opry, Ryman Auditorium and other attractions as taxable REIT subsidiaries.
The deal will impact the Aurora, Colo., hotel and convention center project, according to Gaylord officials.
“The company will no longer view large-scale development as a means for growth and will not proceed with the Colorado project in the form previously anticipated. The company will reexamine how the project could be completed with minimal financial commitment by Gaylord during the development phase,” Gaylord company officials said.
Partner Voices
Overview:
The award-winning Orange County Convention Center (OCCC) goes the extra mile to make every day extraordinary by offering customer service excellence and industry-leading partnerships. From their dedicated in-house Rigging team to their robust Exhibitor Services, The Center of Hospitality brings your imagination to life by helping you host unforgettable meetings and events. With more than 2 million square feet of exhibit space, world-class services and a dream destination, we are committed to making even the most ambitious conventions a reality.
In October 2023, the Orange County Board of County Commissioners voted to approve allocating Tourist Development Tax funding for the $560 million Phase 5A completion of the OCCC. The Convention Way Grand Concourse project will include enhancements to the North-South Building, featuring an additional 60,000 square feet of meeting space, an 80,000- square-foot ballroom and new entry to the North-South Building along Convention Way.
“We are thrilled to begin work on completing our North-South Building which will allow us to meet the growing needs of our clients,” said OCCC Executive Director Mark Tester. “As an economic driver for the community, this project will provide the Center with connectivity and meeting space to host more events and continue to infuse the local economy with new money and expanding business opportunities.”
Amenities:
The Center of Hospitality goes above and beyond by offering world-class customer service and industry-leading partnerships. From the largest convention center Wi-Fi network to custom LAN/WAN design, the Center takes pride in enhancing exhibitor and customer experience.
The OCCC is the exclusive provider of electricity (24-hour power at no additional cost), aerial rigging and lighting, water, natural gas and propane, compressed air, and cable TV services. Convenience
The Center is at the epicenter of the destination, with an abundance of hotels, restaurants, and attractions within walking distance. Pedestrian bridges connect both buildings to more than 5,200 rooms and is within a 15-minute drive from the Orlando International Airport. The convenience of the location goes hand-in-hand with top notch service to help meet an event’s every need.
Gold Key Members
The OCCC’s Gold Key Members represent the best of the best when it comes to exceptional service and exclusive benefits for clients, exhibitors and guests. The Center’s Gold Key memberships with Universal Orlando Resort, SeaWorld Orlando and Walt Disney World greatly enhance meeting planner and attendee experiences offering world-renowned venues, immersive experiences and creative resources for their events.
OCCC Events:
This fiscal year, the OCCC is projected to host 168 events, 1.7 million attendees, and $2.9 billion in economic impact.
The Center’s top five events during their 2022-2023 fiscal year included:
AAU Jr. National Volleyball Championships 2023
200,000 Attendees
$257 Million in Economic Impact
MEGACON 2023
160,000 Attendees
$205 Million in Economic Impact
Open Championship Series 2023
69,500 Attendees
$89 Million in Economic Impact
Sunshine Classic 2023
42,000 Attendees
$54 Million in Economic Impact
Premiere Orlando 2023
42,000 Attendees
$108 Million in Economic Impact
Add new comment