Though it has been widely rumored for months (see tips below), Steve Hanson and hospitality money man Barry Sternlicht (pictured) have finally closed a deal that will send 50% of BR Guest to Sternlicht's 1 Hotel and Residences and, in essence, put 100% of BR Guest in Sternlicht's control. Steve Cuozzo has the story:
Manhattan restaurant king Stephen Hanson just made the deal of his life, selling all of his popular eateries to Barry Sternlicht's Starwood Capital Group as one of a pair of transactions he valued at around $150 million.Close readers will note that the general matter of Hanson selling to Sternlicht has been out there for some time.
Hanson will get about half that amount after payouts to his former minority partners in 16 eateries, of which Hanson owned 72 percent. The restaurants, including Blue Water Grill, Atlantic Grill, three branches of Dos Caminos and two Ruby Foo's, were all owned separately from Hanson's management company, B.R. Guest...The big surprise is that Hanson also gets 50 percent of a new venture he and Sternlicht formed after the sale of the restaurants. In the second agreement, Sternlicht folded Hanson's management company into a new entity, to be called B.R. Guest LLC, which will both own and manage the dining spots.
Here's how the deal has evolved over the last few months, including some insider commentary, via the always-buzzing tipline:
11/10/06: "BR GUEST has been sold to Barry Sternlicht and the new 1 Hotels Group, according to a senior partner at BRG. Hanson has been promising top management a huge payout for years to keep them around and endure the abuse (which is worse than anyone can imagine. I endured it for a long time.) but we'll see if they actually get paid. I doubt it. I'm sure he saw the writing on the wall as turnover there for management is 80% plus and the new concepts outside NYC aren't working. Very glad Michael White finally left."
4/3/07: "The deal with Steve Hanson and Barry Sternlicht was agreed to all the way back October of 2006, when It was announced the BRGuest would be providing The F&B in all of the new 1 Hotel and Residences. In the deal Hanson agreed to sell 50% of his holdings while still operating as the companies CEO, it's a done deal. Internally BRGuest is revamping itself and changing the companies structure, which was already insanely corporate to begin with, and changing the operation to something more similar to the world of hotels, with a lot of emphasis of HR. From what I understand Steve is looking to be out of BR guest by the end of Fiscal 2007."
· Sternlicht Sets $150M Table for Restaurateur [NYP]
· Barry Sternlict [Starwood Capital]
BONUS: An insider writes with color on the Cutlets rumor that David Burke is taking the helm at Hanson's new steakhouse: "It terms of David Burke and a prime house with his name on it on Park Ave. I wouldn't hold my breath waiting. BRGuest took a clobbering with the Barca 18 collaboration with Eric Ripert, and while and the Prime House in Chicago has met with moderate success, Blue Water Grill Chicago (sister to the popular BWGNY) has not, i.e. measuring which way the wind blows in Chicago is not the best indicator of what will meet with success in NYC. As a company BR Guest has never been Chef Driven, it's most notable high profile collaborations with Michael White (Fiamma) and Eric Ripert (Barca 18), have both ended in disappointment. I imagine the "buzz" coming out about another possible collaboration with DB and BR Guest is distinctly one-sided, breezing in from the Hawaiian Tropics.