At first glance, Pegasus Capital Advisors’ decision to buy Six Senses Hotels Resorts Spas three years ago may have seemed a little surprising. After all, the US-based ­private equity firm didn’t have a track record of investing in spas or hospitality, while the Asia-based development and management company had built its reputation on creating intimate, slightly quirky and highly localised (albeit highly luxurious) experiences of a kind not obviously compatible with the growth expectations of most private equity investors.

You don’t have to delve too deeply, however, to understand what attracted Pegasus to the contract management business – then including 10 Six Senses- or Evason-branded resorts and spas, plus 18 Six Senses Spas in other properties – which it purchased from founders Sonu and Eva Shivadasani and shareholders for an undisclosed sum in April 2012.

Since 1996 Pegasus Capital Advisors, under the steerage of its founding partner, chair and president Craig Cogut, has made its name by specialising in sustainable and, more recently, wellness-related investments. With current assets under management of $1.8bn, the firm actively seeks to partner companies “committed to overcoming global resource scarcity in the fields of health and wellness, sustainable communities, energy and zero waste”.

Meanwhile, Six Senses, which turns 20 this year, has long been a pioneer of sustainable practices in the hospitality industry, as well as one of the first resort brands to put spa and wellness at the heart of its offering.

Add to this Cogut’s experience of investing in hotels with a significant spa presence and the potential for Pegasus to add value – and for Six Senses to deliver it – is clear.

“[We felt] the brand was uniquely positioned but hadn’t been fully fleshed out or grown,” says Cogut, who co-founded Apollo Advisors (now Apollo Global Management) prior to setting up Pegasus. “Our belief was that this was an absolutely tremendous platform.”

In addition to the company’s environmental and wellness credentials, Cogut cites the evocative identity – “you couldn’t ask for a better name” – and the properties themselves as key factors in the decision to buy. “The existing resorts were spectacular. The bones were there, both in terms of architecture and design and in terms of every Six Senses being different and having its own sense of place.”

Combined with steady growth in the luxury travel market and increasing recognition of wellness in the hospitality sector, there was, says Cogut, an opportunity for the Asia-based company to become a global leader. Since then, the firm has further strengthened its spa and wellness portfolio with the acquisition in 2013 of Raison d’Etre Spas, the Stockholm-based spa consultancy and management company.

Three years on from the Six Senses acquisition, how close is Pegasus to realising its goals for its first spa and hospitality investment? And as a fund manager whose obligation is to its investors, what’s its next move?

Global growth
Unlike some private equity firms, Pegasus focuses on “long-term business building and working with management teams to create something of fundamental value, rather than just to play with the markets,” says Cogut.

With Six Senses, the first crucial step was getting the right people. Starting with Wolf Hengst, former president of Four Seasons, as new executive chair, a dream team was recruited: Neil Jacobs, former president of Starwood Capital Hotels and senior vice president for Four Seasons in Asia, as CEO; Bernard Bohnenberger, previously the group’s managing director, as president; and Anna Bjurstam, former owner and CEO of Raison d’Etre Spas, as vice president of Six Senses Spas (now managing partner of Raison d’Etre, Bjurstam divides her time between both businesses).

“We brought in a world-class management team to enable growth,” says Cogut. “Neil’s a visionary. The people he’s brought in, and some people we had before, are superb.”

The next priority was the backlog of projects and opportunities that had been put on hold during the takeover. Now, with the decks cleared, the focus is firmly on refining the product and global expansion.“Clearly part of our investment thesis was to expand: Africa, South America, and selectively in North America and Europe. We’re starting to do that,” says Cogut.

According to Cogut, Six Senses has “a very, very big development pipeline,” and while there’s a lot he can’t talk about, there are 15 resort openings confirmed for the next three years, including five in Bhutan, three in China and one each in Bali, Taiwan, France, Portugal, the Seychelles (its first African resort), Tunisia and St Lucia. There are also seven spas in other properties: one each in Oman, Qatar, Greece, Spain and the US, and two in India.

Which is Cogut most excited about? “I’m excited about everything we’re doing,” he says, although he namechecks two resorts due to open this year: the Douro Valley in Portugal’s wine region, which has “both history and natural beauty”, and the Seychelles, an island property that’s “going to be absolutely spectacular. About three-quarters of the island won’t be developed but will be available for hiking. It should be a national park.”

Design vision
In such pristine settings, getting the architecture and design right is crucial, says Cogut. In an interview with CLADmag’s sister magazine, Spa Business, Neil Jacobs said the Six Senses design philosophy would evolve “to lose a bit of the Robinson Crusoe feel and add some modernity.” Cogut confirms this, but stresses the change will be a subtle shift of emphasis in select properties rather than a complete overhaul.

“We appeal to customers of various ages, but compared to some other luxury brands, [our customer base is] more cutting-edge and younger-feeling, and [a more modern] aesthetic is relevant to that group,” Cogut says. “One of the wonderful things about Six Senses is there’s not a lot of bricks and mortar. There are some [hotel] brands that like a lot of concrete. Six Senses isn’t about that, our resorts have a low footprint and we’re not changing that at all – or how we harmonise with the environment.”

When it comes to creating the design vision and hiring architects, Cogut says Pegasus plays no direct role, instead placing complete trust in the judgement of his team: Jacobs and Bjurstam, on the spa side, along with Andrew Best, the group’s vice president of architecture and technical services, and Omar Romero, vice president of development.

An exception to this hands-off policy is in the area of sustainability. In addition to appointing experienced environmental architect Amber Marie Beard to the newly created role of vice president of sustainability and putting together a high-profile advisory board, Pegasus draws broadly on its many other eco-focused investments – from waste management and energy to lighting and air-conditioning companies – to bring ideas, knowledge and expertise to the table. This takes Six Senses’ commitment to sustainability, which is already central to its philosophy, to another level. But what does the fund manager hope to gain?

“I obviously believe, since we invest in it, there are economic benefits,” says Cogut. “But sometimes you can’t measure just on narrow economics. There are long-term benefits to doing things properly which often corporations don’t focus on.”

New directions
In addition to expanding geographically, another growth strategy under consideration is the development of Six Senses hotels in urban locations, both to help build the brand and to cater for the needs of its city-dwelling and visiting customers. “Urban retreats are hard to find,” he says. “There’s a segment of guests who’d welcome that. It’s incredibly appealing in the world we live in, where we’re so disconnected from nature – from our sixth sense.”

It’s not something they will be rushing into, however. “It’s on the cards, but these things take time. Finding the right sites and the right partners is important,” Cogut says.

The company is also considering investing in Six Senses-branded real estate. “We’re looking at owning or investing in certain properties through a number of structures,” he says.

A more immediate focus for the company, however, is on refining and expanding its spa and wellness offering under Jacobs and Bjurstam’s leadership. “We’re trying to aggressively position the spa business to offer many new services, taking advantage of science and knowledge on the wellness side.”

In certain areas, such as sleep health and digestive disorders, Pegasus helps directly by contributing ideas and expertise from its other wellness-related companies – such as the Lighting Science Group, a company developing LED lighting to aid sleep and improve health, or PanTheryx, a medical nutrition company specialising in intestinal problems.

Alongside Six Senses, Pegasus is expanding and adding value to Raison d’Etre Spas, particularly its educational platform (the company runs online spa management programmes) and its LivNordic brand, which combines Scandinavian design, fitness, bathing, treatments and products in a single concept.

“The interest in nordic wellness and the LivNordic brand has been incredible,” he says. “In addition to the original LivNordic spa in Stockholm, we’ve entered the cruise industry with a LivNordic Spa on the Viking Star and two cruise ship spas planned for next year, plus another five on land.”

For now, Pegasus has no plans to acquire more spa or hospitality businesses – “Six Senses and Raison d’Etre are our focus and our vehicles” – nor is it letting go of the investments any time soon. “We’re in no hurry to sell because there’s tremendous value creation happening. There’s a lot to do to build out both brands. We’re a fund and have to sell for our investors, but certainly not in the short term.”

Such is Cogut’s enthusiasm for Six Senses, in particular, you get the impression that when the time does come to sell it will be with some regret. “I love Six Senses,” he admits. “I vacation there, and it’s because my family and I love what they do – whether it’s the spas, the wellness programmes, the beauty of the setting or the sense of place.”