STAMFORD, Conn., March 20 (UPI) -- Starwood Hotels and Resorts will be the first American company in half a century to manage hotels in Cuba, the company announced.
The move signals the return of American companies to the Cuban travel market, with the island gearing up to receive a surge of visitors from the United States.
As part of two deals signed just before President Barack Obama is set to visit the island nation 90 miles from Key West, Starwood will refurbish and manage the Hotel Inglaterra on the Parque Central near Old Havana and the Hotel Quinta Avenida in the upscale district of Miramar. The company said it will begin managing both properties this year.
This agreement is expected to create the deepest ties so far between a U.S. company and the Cuban government since Obama announced a diplomatic thawing between the countries in December 2014.
The hotels Starwood will manage are owned by Cuban state enterprises, including a military conglomerate.
Starwood, which has its corporate headquarters in Stamford, Conn., plans to make a "multimillion-dollar investment to bring the hotels up to our standards," the company said.
Tourism in Cuba is at an all-time high, including a sharp rise in the number of American visitors, especially since travel restrictions were eased, the BBC reported. This deal is not the only news Starwood has made recently. It announced Friday it may accept a $13 billion bid for the chain from China's Anbang Insurance in what could be the biggest takeover of an American company by a Chinese business.
Anbang Insurance, which owns New York's Waldorf Astoria, outbid Marriott International for Starwood. The current $78-per-share cash offer includes J.C. Flowers & Co. and Primavera Capital as partners.
Starwood Senior Vice President Jorge Giannattasio, who heads its Latin American operations, called the Cuba deal "a pivotal moment.
"We are in an inflection point in the relationship between the two countries and in the hospitality industry," said Giannattasio, who spoke by phone from Havana. The deal, he added, would "create new expectations for the quality of Cuban hotels."
The third hotel in the management agreement, Hotel Inglaterra, owned by Cuban state tourism company Gran Caribe, a Cuban will become one of Starwood's Luxury Collection hotels. The Quinta Avenida, currently run by a Cuban military tourism group, will become a Four Points by Sheraton hotel.