Israeli by birth and currently living in Atlanta, Ronen Nissenbaum is a c-suite executive with a long string of successes that span the universe from Tel Aviv to Singapore City and from Euro Disney to the iconic Waldorf properties. Doggedly pursuing an interview with this forceful hotelier, I was able to garner exactly 58 minutes of Nissenbaum’s time at his trophy Waldorf Astoria New York Hotel as he did a rush through New York.
A global business executive with a passport that must have more pages than War and Peace, Nissenbaum presents as a low-keyed, warm-hearted charmer that actually covers a calculating, shrewd, ambitious decision-maker who carries a platinum resume that shouts accomplishments.
Sounding more like a real estate developer than a hotel executive, Nissenbaum is currently the Vice President of Operations, Luxury Hotel-America with Hilton Worldwide. He is the go-to person for operations that includes Waldorf Astoria Hotels and Resorts and Conrad Hotels and Resorts.
In the press release issued by Hilton, Nissenbaum’s promotion to VP Operations is considered to be an “ascension” to this post, a word usually reserved for God-like individuals and defined as, “the rising of a star above the horizon (freedictionary.com);” the Merriam-Webster dictionary illustrates the word-usage by referencing “ascension to the presidency.”
Clearly his position within the Hilton hierarchy is considered extremely important and he has been tasked by the corporations’ Joe Berger, Area President, Americas, Hilton Worldwide to focus on, “…both acquiring additional properties and ensuring the guests of Waldorf Astoria and Conrad enjoy truly unforgettable and inspiring experiences at our hotels.”
Starting at the Beginning
Nissenbaum started his career by attending the Swiss Hotel School, Les Roches (class of 1989), and continued his education at the Goizueta Business School/Emory University where he was awarded an MBA. He also spent time with the Israeli Air Force and was an officer of the Israeli Defense Forces as IDF Spokesperson. Nissenbaum comes from a family of hoteliers. His uncle managed The St. Regis Hotel in New York and The New York Palace during the period it was known as The Helmsley Palace and The Plaza.
Like so many career hoteliers Nissenbaum started in the front office and the food and beverage departments of properties in Belgium, Switzerland and Israel. Over the years he has been associated with the InterContinental Hotel Group in Israel, Berlin, Paris and Atlanta and he has held senior management positions with Forte hotels in London and Euro Disney in Paris. In Singapore he operated the Marina Bay Sands and more recently he was the President and CEO of The Plaza Group, supervising the NY Plaza Hotel and the development of the Plaza Hotel brand. In 2014 he became the Managing Director of the Waldorf Astoria New York and Towers of the Waldorf Astoria New York and in November 2015 he moved into the newly created position of VP Operations.
Nissenbaums’ most recent success is participating in the sale of the NY Waldorf to the Anbang Insurance Group Co. Ltd (PRC) for almost $2 billion. To make the deal even more intriguing it is linked to a management service contract with Hilton Worldwide Holdings that will span 100 years. This deal is in line with Hilton’s “capital-lite” strategy whereby it manages hotels, for a fee, that have been built and owned by others.
The Waldorf Astoria New York Park Avenue entrance
While Anbang may not be brand noted in the USA, it is well-known in China as its Chairman and CEO, Wu Xiaohui, is married to Deng Xiaoping’s granddaughter (Deng encouraged China’s opening to the West from December 1978 – 1992), according to Alison Tudor-Ackroyd in FinanceAsia. In addition, Chen Xiaolu, the son of Chen Yi, a senior military commander under Mao, is a Director and Levin Zhu, the son of Zhu Rongji, China’s former prime minister and successful banker, is an associate.
Anbang was not the only suitor for this trophy property but was able to beat-out two other buyers, one from the U.S. and the other from the Middle East. The accepted offer (closed in 2015) raised the profile of this insurance conglomerate. Some were surprised at the $1.95 billion price tag – the largest ever sale of a US hotel and the largest US real estate purchase by a Chinese buyer. The price for the 1,413 hotel means that Anbang committed approximately $1.4 million per room. In addition to the real estate some consider the purchase also met non-financial considerations such as “learning best practices, understanding business models in a mature market and accumulating management experience through local relationships,” according to Ross Moskowitz, partner in the Stroock & Stroock & Lavan LLP Real Estate Department and a former official with the New York City Economic Development Corporation.
In addition to the amount paid for the property, investors were surprised at the profile of the buyer as Anbang is not considered a “heavyweight in the Chinese insurance markets” and “has a fairly small 3.6% market share among domestic insurers in China,” according to Tom Huddleston, Jr. (Fortune.com)
The New York Waldorf is first hotel acquired by Anbang, but not likely to be the last. This insurance giant has 20 million customers for its financial and insurance services and products (i.e., life insurance, pensions, health insurance, property and casualty insurance and asset management). The purchase, however, clearly fits into its current objective which is to, “seize the opportunities brought by economic globalization and deliver services to customers around the world….” Anbang plans to increase international asset investments in Europe and North America.
The deal raised US government concern and was reviewed for potential security risks by the Committee on Foreign Investment in the United States (CFIUS). The investigation was prompted by the fact that the Waldorf Towers (part of the property) has been the home to the US Ambassador to the United Nations and a destination property for major players in the US government, including the President. The US State Department has leased a resident for the US ambassador to the UN on the 42nd floor of the Waldorf Towers for more than 50 years. Every September the department takes two floors to serve as headquarters for US diplomats attending the UN General Assembly.
New York City Wins
While the CFIUS was busy investigating the sale, the New York City administrators have not commented on the deal. It is speculated that this silence reflects the understanding that NYC is a recipient of almost $60 million from the deal which is equal to the 3 percent transfer tax paid on real estate transactions.
With the Anbang purchase of the Waldorf Astoria New York we can look forward to a new look in the rooms and public areas as well as opportunities to purchase condos. The remaining proceeds from the sale of the property will be used to add five landmark properties in resort and urban locales:
• Hilton Orlando Bonnet Creek in Orlando Florida
• Waldorf Astoria Orlando in Orlando, Florida
• The Reach in Key West Florida
• Casa Marina in Key West, Florida
• Parc 55 in San Francisco, California (a new addition to the Hilton Hotels and Resorts brand; managed by Hilton Worldwide; other acquisitions currently managed by Hilton Worldwide)
The $1.76 billion price for the acquisitions will increase the presence of Hilton in Florida resort markets and San Francisco – which is regarded as a growth market. The balance of the proceeds of the Waldorf Astoria New York sale will go to purchase of additional assets.
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