Kempinski Hotels has cut ties with German investment management company, 12.18, some 17-months after forging an alliance.
The strategic partnership planned to see Kempinski launch a new lifestyle brand called 7Pines Kempinski with the first property in Ibiza. The Spanish hotel was opened by 7Pines in 2018.
Under the venture, the duo planned to expand the brand by 20 new hotels by 2022, fuelled by a €500 million investment capital.
More importantly, perhaps, was the alliance would have provided the European luxury hotelier with a foot in the door to the lucrative New York and wider US market after 12.18 had acquired the former San Carlos Hotel in The Big Apple.
The 7Pines Ibiza Kempinski hotel still appears on Kimpinski’s global destination list, however the mooted 7Pines Manhattan isn’t.
“New York has always been a dream destination for Kempinski Hotels and this important partnership makes it a reality,” said Kempinski’s former CEO, Martin Smura, at the time.
Late last week, Kempinski quietly revealed it had begun an investigation into the dealings of Smura, who had his employment suddenly terminated in December 2020.
Smura had overseen the arrangement with 12.18 in 2019. He was immediately succeeded by Bernold Schroeder, that Kempinski labelled as a “CEO transition”.
While unable to comment on the investigation itself, Kempinski said it had conducted an “in-depth review of all projects initiated by Martin Smura. As a result, Kempinski decided to terminate the planned cooperation with the 12.18. Group.”
“The termination of this planned cooperation has no impact on Kempinski’s financials,” the company said, adding that it has a “strong pipeline” of prestigious hotel openings in the future, including Kempinski Palace Engelberg in Switzerland, the Universal Beijing Resort in China and additional projects underway in Saudi Arabia and Tanzania.
Kempinski also recently acquired international wellness brand, Resense Spa, a sign the hotelier says, shows it “continues to strengthen its international foothold as a leading luxury hospitality operator.”
Meanwhile, German prosecutors this week commenced a criminal examination into several people connected to Kempinski, citing breach of trust charges, Travel Weekly in the US reported. The names of those individuals being investigated were withheld.
Lead image: 7Pines Kempinski Ibiza opened in mid-2018