USA: Starwood Signs Deal To Renovate And Run Three Cuban Hotels

Starwood signed a deal on Saturday to renovate and run three Cuban hotels, returning U.S. chains to the island more than 50 years after American hotels were taken over by Fidel Castro's socialist revolution.

All Cuban hotels are state-owned so the deal puts a major U.S. corporation directly into business with the Communist government under a special license that pushes the U.S. administration's legal dismantling of the trade embargo on Cuba further than ever before. In a once-unimaginable arrangement, a hotel owned by the tourism arm of the Cuban military will become a Sheraton Four Points.

The deal comes on the eve of President Barack Obama's historic visit to Cuba, which opens a new era between the former Cold War foes that has American travelers and businesses eagerly eyeing opportunities on the island nation 90 miles (145 kilometers) south of Florida.

Starwood's chief of Latin America operations, Jorge Giannattasio, said the company will invest millions to renovate and rebrand the Quinta Avenida, Santa Isabel and Inglaterra hotels, train and hire new staff and reopen the hotels by the end of the year. The Quinta Avenida is owned by Gaviota, a military-run tourism conglomerate. The Santa Isabel and Inglaterra, which are run by other state agencies, will be operated as part of Starwood's Luxury Collection brand.

It's unclear, however, how long Starwood can be called an American company. On Friday, Starwood called off a $12.2 billion buyout agreement with Marriott in favor of an offer from a group of investors led by the Chinese insurance company Anbang.