Blackstone has big plans for Motel 6. The day after the investment company finalized its $1.9 billion acquisition of the Motel 6 and Studio 6 brands, Jonathan Gray, the 42-year-old head of Blackstone’s real estate division, provided a tantalizing glimpse into the near future to the hundreds of owners and operators gathered for the annual Motel 6 brand conference in Las Vegas.
Gray said that Blackstone intends to massively accelerate the growth of the Motel 6 and its sister extended-stay brand, Studio 6. Sitting on a reported $50 billion in assets that include Hilton Worldwide, La Quinta, and Extended Stay America, Gray’s real estate division has rapidly established itself as Blackstone’s most profitable branch. Given the company’s success growing other hotel chains, he said, “We have the right people and strategy in place to restore and rapidly expand this great American brand.”
Jim Amorosia, CEO of Motel 6 and Studio 6, welcomes Blackstone’s ambitious new ownership approach. “Blackstone has let us know how big they want us to be and left it up to us to figure out how to get there.” And the first step in this growth plan, according to both Gray and Amorosia, is to invest in property improvements across the current Motel 6 hotel line. To that end Blackstone is providing $500 million toward capital expenditures.
Currently there are 1,000 Motel 6 and Studio 6 properties and the plan is to grow that number to 2,500 by expanding even further into Canada, by entering new markets in Mexico and South America through strategic partnerships, and by looking for new build and conversion opportunities in the U.S. Amorosia sees the U.S. urban market as a place that Motel 6 needs to move into and said that the company is making headway on that front.
“Motel 6 and Studio 6 brands are moving to the top of the North America economy segment—and beyond.” Gray said, “Outside the U.S., the sky’s the limit.”