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History

We are a Mexico City-based company founded in 2002 by Engineer Luis Eduardo Barrios Sánchez. Since its inception, Hoteles City’s has centred on presenting the market with a new approach to hospitality that prioritizes design, innovation, and construction. This included the operation and management of hotels through a local brand that significantly benefited customers and caught the attention of large chains such as Marriott. This led the eventual integration of the Hoteles City brand into this international hotel chain, as in May 2023, we concluded the sale of our 5 brands (City Express, City Express Plus, City Express Suites, City Express Junior, and City Centro), the loyalty program (City Premios Rewards), associated brands, domains, and intellectual property to Marriott International.

This established a strategic relationship to continue operating and managing the hotels, now backed by the “By Marriott” brand, while also coordinating and managing new projects in Latin America and the Caribbean. Promotora de Hoteles Norte 19 is born from this success story that transformed the hotel industry in Mexico and resulted in the strategic relationship with Marriott International, making us now the largest operator and manager by number of hotels for Marriott in the region. Norte 19 can also develop and operate other brands in different market segments, which we will be able to leverage to continue growing in the region. Norte 19 retains the business model that we had previously at City Express Hotels, and we will continue to operate our different business divisions (hotel assets, hotel operator, developer, and technology platform).

Operamos más de 150 hoteles bajo varios formatos y marcas.

Integrated Solutions

Norte 19 is a company dedicated to offering integrated solutions for the investment, development, and management of your hotel business.
Our offerings include:

Hotel investment fund
Professional team for hotel operations
Design and development of tourism projects
Development and operation of technology solutions for hotel management and marketing.

Our Commitment

Productivity and resource optimization are our commitment. Our operation is based on management processes implemented by experienced leaders, producing high-quality results while meeting international brand standards. In addition, we leverage economies of scale to achieve efficiencies and manage revenues that maximizes the value of your hotel.

What makes Norte 19 different from the rest?

- At Norte 19 we offer a vertical service, providing solutions for construction, development, operation, and technology needs in the hospitality sector.
- Strong integration of our operations and marketing, leading to a clear vision of consumer behavior, a prompt response to their needs, and faster communication and coordination with our distribution network. This results in premium hotels and high-quality service which are supported by our single-manager structure.
- Our patented technology allows us to react faster to market dynamics at a lower cost, resulting in a more flexible and efficient operation.
- In-depth knowledge of the local market and the brands' target customers.
- Our culture is based on rigorous planning and discipline that rests on 9 core principles, a flat organizational structure, and the empowerment of our team.
- Our local advertising budget allows us to respond rapidly and align carefully to the day-to-day needs of each of our hotels and the company.

Hotel Management

We currently operate more than 150 hotels to international standards, ranging from the midscale segment, to select services and full service. Our team is comprised of professionals with extensive experience in both operating in local markets and marketing using traditional and digital channels. Norte 19's professional team has vast experience in the hotel sector, having developed more than 5 recognized brands in our industry. We currently operate more than 17,000 rooms in Mexico, Colombia, Chile, and Costa Rica, in addition to the approval of several hotel chains to operate their brands.

Project Development

We are committed to the design of hotels with our concepts, and we also develop projects that meet the standards of established brands. Our team of experts ensures quality in all stages of the project, meeting requirements and optimizing costs to ensure the success of each hotel. We have developed more than 1,000,000 m2 of integrated projects for the hotel industry, including interior design and equipment. Our team adapts each project to your needs, whether they are new hotels, remodelings, or conversions.

Technology

We develop specialized software for the hospitality industry that gives owners and operators greater control of their business while streamlining decision-making. We have tools for development, operation, distribution, and support that improve guest experience and digital distribution.

Learn more about Norte 19

Factsheet

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FAQs

The primary guest of Hoteles City Express is the business traveler (Road Warrior) who seeks affordable accommodations with a main focus on distribution supervision, supply chains, plant operations, warehousing, among others. About 90% of travelers are domestic and mainly land-based.

With the current structure, the Company estimates that it has the capacity to operate up to 220 hotels. The main growth strategy for Hoteles City Express is to continue scaling its integrated business platform, focusing on the construction of new hotels throughout Mexico once the economy reaches a stabilization stage. Currently, only three of the hotel chains operating in Mexico, including only one international chain, have more than 100 hotels. The growth potential of the Company and the fragmentation of the current hotel network offer significant opportunities in terms of market share and organic growth to operators with recognized products, quality brands and nationwide presence, such as the Company.

The Company seeks to maximize productivity and achieve economies of scale in its operations, from the staffing of its hotels to its supply processes, thus creating an efficient operating structure in costs and expenses that, in its opinion, has contributed to its high profitability, as evidenced by its EBITDA margin of approximately 31% as well as the average ROIC rate of over 12% for a stabilized hotel (excluding the year 2020, where the company faced different challenges derived from the COVID-19 pandemic).

Over the past 17 years, the flexibility and cost efficiency of the Company's operating structure, combined with its systematic, disciplined and agile development and vertical integration platform, has allowed it to open an average of one hotel every 5.9 weeks and to obtain an average ROIC of over 12% for its established owned and co-invested hotels in a typical year.

Thanks to the technological tools with which the Company operates its hotels, along with the high efficiency of each of the properties, the Company can operate a hotel with an average of .20 employees per room, which is well below the hotel industry average. On the other hand, the modular design and construction of each of the different hotels translates into an average cost per key of $1,200,000 M.N.

Hoteles City Express also has a strict program and guidelines when implementing remodeling of pre-existing properties, as well as to carry out maintenance improvements that are required at its properties. The Company has a Capex reserve of 4.5% of revenues for major maintenance and 4.5% of revenues for minor maintenance. Refurbishments are performed on average every 10 years. The determination of candidate hotels to be remodeled is done annually and the hotels are analyzed according to: age of the hotel, accumulated occupancy level, total capital and maintenance expenditures incurred, as well as the brand standard of each property.

City Express Hotels, through its Impacto City platform, contemplates a sustainable model based on 3 strategic pillars: 1) Environmental conservation, 2) Economic value and 3) Social welfare. This reflects its essence, values and philosophy. All of the company's hotels have been built and operate under international standards such as EDGE, LEED, Biosphere Responsible Tourism Certification, Safehotels Covid Clean, among others. In addition to working in compliance with the Sustainable Development Goals of the United Nations (UN), we report under the Global Reporting Initiative (GRI) standards and under the Sustainability Accounting Standards Board (SASB) methodology. For more information visit the sustainability page: https://www.cityexpress.com/sostenibilidad.

The Company receives more than 80% of its reservations through its own channels, which significantly reduces payments/commissions to third parties, increasing the Company's profitability. There are four main channels through which the Company receives reservations: (i) direct sales to customers, including through the 24-hour City Express telephone reservation center, its website, social networks, applications for mobile devices and from guests who arrive at the hotels without having made a reservation; (ii) independent agents, including travel agents, internet portals (Online Travel Agencies), travel consortiums and globalizers (Global Distribution Systems), and digital hotel distribution platforms; (iii) corporate accounts through which companies commit a high volume of hotel nights per year in exchange for a negotiated daily rate; and (iv) commercial alliances, including, for example, with airlines such as Aeromexico, Aeromar, Volaris and Avianca-Taca, through which guests can simultaneously book their flights and hotel nights.

During 2018, Hoteles City Express planned to carry out a transaction to place a portion of its Real Estate Assets in the market through a hotel FIBRA. However, the transaction was affected by the macroeconomic environment and as of today the vehicle is ready to be launched once market conditions permit. This transaction continues to be a strategic operation for the company and will be fundamental to reduce the company's leverage. The purpose of the transaction (in addition to what has already been mentioned) is to align the objectives of the investors with the return profile of the vehicles resulting from the operation, as well as to add transparency to the sources of value that the process of development, stabilization and hotel management bring to the invested capital.

Mission, Vision and Values

To offer integrated solutions for the investment, development, and management of the hotel business, maximizing the value of each property through innovation and a team committed to service excellence.

To set trends through innovative hospitality solutions that respond to the evolving needs of our customers and earn their loyalty.

These are the core values that define Norte 19's culture. Passion for service: Excellence is our standard. We strive to exceed expectations, delivering a superior quality of service to ensure complete satisfaction. Ingenuity and creativity: These are essential elements at Norte 19, as they represent a key factor for competitiveness, growth, and continuous evolution. Empathy: We put our heart into everything we do. We understand and value each person with whom we interact, and seek to create lasting and meaningful experiences. Sustainability: We look to the future. We are committed to practices that protect the environment, promote well-being in the community, and ensure equitable progress. These values not only define who we are as a company but also guide our daily decisions and actions, ensuring that Norte 19 remains an innovative and responsible leader in the hospitality industry.