MCR Hotels Takes Soho House Private at $2.7B Enterprise Value
The privately-held U.S. hospitality operator acquires the struggling membership club three years after its IPO, betting on post-restructuring margin expansion.
Published June 10, 2026Source ReutersFrom the chopped neck
Subject on the desk
MCR Hotels
GOLD · June 10, 2026
MACALLAN 1926· June 10, 2026
MCR Hotels Takes Soho House Private at $2.7B Enterprise Value
The privately-held U.S. hospitality operator acquires the struggling membership club three years after its IPO, betting on post-restructuring margin expansion.
MCR Hotels will acquire Soho House & Co. in an all-cash transaction valuing the membership club operator at $2.7 billion enterprise value, taking the company private less than four years after its July 2021 public debut at $14 per share. The deal price represents approximately $9 per share, a 36% discount to the IPO valuation and roughly 2.1x trailing twelve-month revenue based on Soho House's most recent financials showing $1.3 billion in annual sales.
MCR, which operates 148 hotels across 37 U.S. states with brands including TWA Hotel and Hilton properties, structured the acquisition without disclosed debt financing. The New York-based operator has raised approximately $4 billion in equity capital since Tyler Morse and his father founded the company in 2006. Soho House shareholders will receive cash consideration at closing, expected in Q2 2025 pending regulatory approvals and member consultation in the UK, where the company maintains its headquarters despite U.S. operations representing 62% of locations.
The transaction arrives as Soho House exits a two-year operational reset. The club operator, which grew from 28 houses in 2019 to 43 locations globally by year-end 2024, reported Q3 adjusted EBITDA margins of 18.2%, up 320 basis points year-over-year but still trailing pre-pandemic levels of 21%. Membership stood at over 230,000 individuals paying annual fees ranging from $1,800 to $4,800 depending on access tier and geography. Management had previously signaled intent to slow new openings from 6-8 annually to 3-5, prioritizing yield optimization over footprint expansion after activist pressure from investors including Fir Tree Partners, which accumulated a 9.4% stake in 2023.
For MCR, the deal represents vertical integration into experiential hospitality and recurring revenue streams distinct from its management-fee and franchise-based model. Soho House's membership income—approximately $420 million annually based on disclosed metrics—provides contractual visibility rare in traditional lodging. The acquisition also positions MCR to cross-market its 8,000+ hotel rooms to Soho House's demographic: median member age 34, household income exceeding $250,000, concentrated in creative industries. Tyler Morse has not disclosed whether MCR will maintain Soho House's independent brand architecture or integrate loyalty programs, though the company's historical approach favors asset-light operations and franchise partnerships over vertical control.
Operators should watch three pressure points. First, UK regulatory review under the National Security and Investment Act, given Soho House's British heritage and the requirement for member consultation, introduces potential closing delays beyond the stated Q2 timeframe. Second, membership churn data for Q4 2024 and Q1 2025—typically disclosed in March earnings—will indicate whether pricing discipline holds as economic uncertainty rises in coastal markets where 78% of houses operate. Third, MCR's capital deployment post-close: whether it accelerates Soho House's paused development pipeline or redirects resources to its core U.S. hotel portfolio, where occupancy softened to 68% in October 2024 per STR data.
The deal marks the hospitality sector's largest take-private since Blackstone acquired Extended Stay America for $6 billion in 2021. Soho House had explored strategic alternatives since mid-2024, retaining Centerview Partners after its stock traded below $6 for eight consecutive months. The company's board unanimously approved the MCR offer, citing premium to unaffected trading price and certainty of execution. MCR did not disclose financing sources but has historically partnered with Och-Ziff and Island Capital for hotel acquisitions exceeding $500 million. The transaction implicitly values Soho House's brand and member base at approximately $11,700 per member, a metric that will benchmark future club-concept valuations as differentiated hospitality models continue repricing below growth-era comps.
The takeaway
MCR's **$2.7B** Soho House acquisition tests whether membership economics can stabilize faster than traditional lodging revenue per available room in a softening cycle.
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