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11/23/2011 09:24 am ET

Billionaire Ron Burkle Planning Mini-Chain Of Luxe US Hotels

Billionaire Ronald Burkle, a private-equity investor and big Democratic fund raiser, is appealing to a new constituency: scruffy, 20-something backpack travelers who would rather not stay in a hotel.

His Yucaipa Cos. and the Sydell Group, a New York hotel developer and operator, have formed a partnership to roll out premium youth hostels in major U.S. cities.

The venture is looking to spend $250 million to acquire and renovate as many as 10 low-cost hotels over the next two years. It plans to reposition them as high-end youth hostels in places such as New York, San Francisco, Washington and Los Angeles.

Read more on online.wsj.com

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