Starwood Capital Group has invested $250M in Yotel and acquired a 30% stake in the company. Starwood is investing in real estate acquisitions for new build, hotel conversion and adaptive reuse properties as Yotel expands internationally. Yotel is expanding into San Francisco with its first hotel at Market and Seventh streets expected to open in the first quarter.

Starwood’s investment and partnership with Yotel will allow the micro-hotel chain to expand worldwide with a particular focus on Europe, North America and Asia. It also will help Yotel strengthen brand identity and enhance the guest experience. Yotel offers small tech-filled rooms for guests along with co-working and social spaces. Starwood already has secured city center sites in Edinburgh, Glasgow and Amsterdam, which are expected to open as Yotels in 2019.

Starwood Capital Group Managing Director, head of European Hotels Cody Bradshaw and Senior Vice President Sarah Broughton will join Yotel’s board of directors along with major stakeholders, including Al-Bahar Group, IFA Hotels & Resorts, United Investment Portugal and Kuwait Real Estate Co., which jointly own a 65% stake in Yotel.

The hotel chain has 15 locations in various stages of development, according to Yotel CEO Hubert Viriot. In addition to the San Francisco location, it also recently opened a location in Boston and will open its first Asian hotel in Singapore on Oct. 1.

Bank of America Merrill Lynch advised Starwood Capital Group on the transaction.

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