The Anti-Marriott: What You Can Learn From Peregrine’s Asset-Heavy Playbook

While Marriott, Hyatt, and Accor have spent years selling buildings to chase franchise and management fees instead, Peregrine Hospitality is running the opposite trade as an operating arm of private-equity firm KSL Capital Partners. Peregrine Hospitality manages and asset-manages 64 hotels valued at $2.5 billion and all owned by KSL or its affiliates. It's betting that being an owner-operator is an advantage in a sector with few natural moats. "We don't have a patented technology or a secret black box to create a competitive moat," said Peregrine Hospitality CEO Greg Kennealey, comparing the hotel sector to tech and pharmaceutical companies that have proprietary intellectual property. Every hotel the company runs typically faces 3 to 10 local rivals offering rooms with similar amenities, pools, and breakfasts. Kennealey is wagering that disciplined operations will produce advantages in talent, branding, and ancillary revenue that