Blackstone, Starwood Deal for Extended Stay America Is Latest Bet on Travel

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Photographer: Spencer Platt/Getty Images North America

The smart money is betting that the yearlong chill in travel is about to thaw.  

Blackstone Group Inc. and Starwood Capital Group announced a deal on Monday to buy Extended Stay America Inc. for $6 billion, following a spate of recent investment activities that suggest confidence in a recovery of the leisure and hospitality industry as vaccine rollouts hold out hope for an end to pandemic restrictions. Last week, Hilton Grand Vacations Inc. agreed to buy Diamond Resorts International Inc., combining two big players in the time-share category while earlier this month, Apollo Global Management Inc. and Vici Properties Inc. said they were buying The Venetian Resort and Sands Expo and Convention Center in Las Vegas in a deal valued at $6.25 billion. Meanwhile, Bloomberg News reported recently that Dreamscape Cos. has $1 billion to put toward snapping up hotels, with its chief executive officer seeking ways to wager on the potential for a pickup in business travel. 

The latest travel trends suggest there is reason for optimism. JetBlue Airways Corp. and Southwest Airlines Co. indicated in Monday regulatory filings that they were seeing improvements in bookings by leisure travelers. Shares of Tripadvisor Inc. surged Monday, likely reflecting optimism about how strategic initiatives such as its new subscription service might fare against a more favorable tourism backdrop. Surveys suggest U.S. consumer sentiment about the safety and desirability of travel seems to have turned a corner recently, with vaccine distribution ramping up significantly and the Biden administration offering a more upbeat timeline about when the country might have enough supply for all adults. 

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