Dutch Hotel Chain CitizenM Nabs $1B Funding to Expand
By Mark Hallum November 11, 2021 5:29 pm
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CitizenM, a lodging company based in the Netherlands, has raised $1 billion from investors to open new hotels, after some financial fallout from the pandemic, the firm confirmed to Commercial Observer.
After learning that the company was positioning itself for greater expansion in spite of the continued threat of COVID-19, Ernest Lee, the head of development and investments of citizenM’s North American division, told CO that it would expand because it thought the hospitality industry would soon bounce back. Now they’re explaining how: with $1 billion from investors GIC, APG and KRC Capital.
“More than half the new capital is earmarked for adding new hotels, and the balance is to complete projects already in the pipeline and to make up for revenue lost during the pandemic,” the company said in a statement
With a portfolio of 24 hotels, citizenM and its fashion mogul founder, Rattan Chadha, is aiming to open 40 or more new outposts by the end of 2024.
Bloomberg first reported on Tuesday that the Dutch brand, known for compact and contemporary designs, would be forging ahead on the plan to come back with a vengeance.
Lee expressed faith in the travel industry as a critical outlet for people with the means to explore, conduct business or visit loved ones.
“We asked ourselves: Do we believe that there’s going to be a secular impact on our business? We quickly came to the conclusion that that was not the case,” Lee told CO in August. “We believe that people will continue to travel for leisure; people will continue to value the reasons why people get together for business travel; people will continue to value conferences and conventions.”
Some of the locations the brand has in mind for the expansion are San Francisco, Miami, Seattle, Chicago, Boston and Washington, D.C., according to a company representative.
The new location for Miami is slated for Worldcenter, a 27-acre megadevelopment still under construction, which could comprise up to 12 towers. Lee said the company is not shy about opening up in this spot regardless of how much work could still be underway when it eventually opens its doors.
The hotels were created in the spirit of offering a younger generation of travelers luxury stays at affordable rates in destination cities. CitizenM believes they offer their guests not only a place to sleep, but also amenities for work and recreation.
Community living rooms are available to guests as are cantinas, meeting rooms and coworking spaces. CitizenM also offers contactless check-in for guests as well as the ability to unlock rooms using a smartphone.
Mark Hallum can be reached at mallum@commercialobserver.com.
