Newcomer SageBlan backs up its belief in Montreal tourism with heavy investment
An upstart investment firm is plowing hundreds of millions of dollars into Quebec hotels in the belief that a tourism rebound can generate big returns.
SageBlan Investments has spent about $160 million to buy and revamp four Quebec properties in the past 18 months, including the Vogue Montreal downtown and the former Hôtel Place Dupuis near the Berri-UQAM métro station. Although another $40 million worth of renovations are ongoing, SageBlan is already thinking about its next acquisitions, managing partner and president Gaurav Gupta said.
“We think the future is bright here,” Gupta, 30, told the Montreal Gazette in an interview.
Whether such optimism is warranted will depend on tourism’s ability to overcome COVID-19‘s economic toll. Local assets may need up to two years to return to pre-pandemic profit levels, the Hotel Association of Greater Montreal said last week.
Originally from the Toronto area, Gupta teamed up with adopted Torontonians Anil and Bleda Basegmez — Turkish-born, Swiss-raised cousins with a family background in real estate — to create SageBlan in early 2019. All three investors subsequently moved to Montreal and are now taking French lessons, according to Gupta.
“Montreal is one of the best cities that we’ve ever lived in,” he said. “French is a beautiful language and I want to learn it. Within the next 12 months I’ll have a better handle.”
SageBlan made its first acquisition in mid-2019 with the purchase of Hotel Plaza Valleyfield and closed its latest transactions — the Vogue Montreal and Quebec’s City’s Delta — a year ago, when the COVID-19 pandemic was in full swing.
“The deals were struck pre-COVID, they were renegotiated during COVID, and closing them at the height of the pandemic was no easy task,” Gupta said. “We are long-term investors and we believe in the resilience of the Quebec marketplace. We would make these investments again today.”
SageBlan’s hotels “are all repositioning plays,” Gupta said. “The properties are being renovated, rebranded or being made more efficient.”
The acquisition spree means SageBlan now oversees about 1,000 rooms. It has about 500 hotel employees, in addition to about 20 executives.
Before starting SageBlan, Gupta spent several years working for his family’s Sunray Group, a hotel company that owns more than 50 properties and is run by his uncle.