Indian Firm Acquires Motel 6 for $525 Million.

Motel 6, the iconic budget motel chain with a six-decade history, is about to undergo a major transformation. In a multi-million dollar deal, the company is being acquired by Oyo, an Indian-based travel company. But fear not, loyal travelers, the familiar "We'll leave the light on for you" promise remains intact.

Blackstone, Motel 6's parent company, announced the all-cash transaction, valued at $525 million, on Friday. The deal includes not only Motel 6 but also its extended-stay sister brand, Studio 6. Blackstone expects the transaction to be finalized by the end of the year.

"This acquisition is a significant milestone for a start-up company like us to strengthen our international presence," said Gautam Swaroop, chief executive of Oyo International, in a statement. Oyo, which entered the U.S. market five years ago, operates 320 hotels across 35 states, having added roughly 100 hotels to its portfolio last year.

Swaroop emphasized the strategic value of Motel 6's brand recognition and financial profile. "Motel 6's strong brand recognition, financial profile and network in the US, combined with Oyo's entrepreneurial spirit will be instrumental in charting a sustainable path forward for the company which will continue to operate as a separate entity," he stated.

The sale comes as the U.S. hotel industry navigates a post-pandemic recovery. According to NPR, hotel employment remains significantly lower than pre-pandemic levels, with almost 200,000 fewer workers in 2024. Jan Freitag, an analyst with real estate data firm CoStar, reported that occupancy for economy-class hotels in the first eight months of 2024 was down 2.2% compared to the previous year, settling at 54.2%. Room rates for economy-class hotels also saw a slight decline, averaging around $79, down 1% from the previous year.