Wednesday, February 28, 2024

Marriott marks another year of strong opening, signs 726 hotel deals in 2022

Marriott International signed an average of two deals a day in 2022, for a total of 726 management and franchise agreements, an increase of 21 percent over 2021 signings, representing nearly 108,000 rooms.

In addition, Marriott’s City Express transaction, announced in October 2022, is expected to add around 17,000 rooms.

Conversions helped drive signings activity, contributing a robust 20,500 rooms, or approximately 20 percent of rooms signed during the year. Half of the 2022 rooms signed were in international markets, including key growth markets such as India, Saudi Arabia, Mexico and the Caribbean.

The company’s industry-leading global development pipeline totaled over 3,000 properties representing more than 496,000 hotel rooms at the end of the year, excluding the City Express rooms. During the year, the company added 394 properties, representing more than 65,000 rooms on a gross basis, growing the system 4.4 percent. Including deletions of 1.3 per cent, net rooms increased 3.1 per cent.

Excluding the impact of the company’s exit from Russia, the deletion rate was 0.8 per cent and net rooms increased 3.6 percent. At the end of 2022, Marriott’s worldwide system consisted of nearly 8,300 properties and roughly 1.5 million rooms in 138 countries and territories.

“We were pleased with the accelerating pace of development activity in 2022 as the global recovery continued,” said Anthony Capuano, CEO, Marriott International. “The proven resilience of travel is powerful and energizing. Given the attractiveness of our portfolio of global brands, top-ranked Marriott Bonvoy loyalty program, momentum around conversions, and commitment to innovation, we are excited to continue to help lead in the growth of travel.”

Extending Marriott’s lead in luxury
With an unparalleled portfolio of nearly 500 luxury hotels and resorts in 69 countries and territories, Marriott is poised to extend its lead in luxury with a record 42 luxury hotel agreements signed last year, representing nearly 8,000 rooms.

Conversions continue to contribute meaningfully to growth
Marriott continues to see strong momentum from conversions, including multi-unit conversion opportunities. The company added more than 80 conversion properties in 2022 in locations around the world including Brazil (JW Marriott Hotel São Paulo) and India (The St. Regis Goa Resort). In the US and Canada region, the company signed 56 conversion deals, representing nearly 8,000 rooms, including a record 34 select-service deals representing nearly 4,000 rooms. The company’s collection brands, including Autograph Collection Hotels, The Luxury Collection, and Tribute Portfolio, represented 30 percent of global conversion rooms signed, with over 6,000 rooms signed in 2022.

“We continue to see conversions provide meaningful growth for our system, reinforcing the value of Marriott’s brands as owners look to reposition assets and maximize returns,” said Noah Silverman, Global Development Officer, U.S. & Canada, Marriott International.

Marriott jumps into affordable midscale
Among the major highlights of 2022, Marriott announced its planned entry into the popular affordable midscale segment. As of October, 2022, the portfolio was comprised of 152 hotels, including around 17,000 rooms across 75 cities in Mexico and three additional countries in Latin America, and five under-construction projects, representing an additional 676 rooms.

Given the high-growth nature of the affordable midscale segment, the company sees opportunities to further expand the City Express by Marriott brand in the Caribbean and Latin America region, as well as in other locations. Marriott expects the transaction, which is subject to regulatory approval and other customary closing conditions, could close in the first half of 2023.

All-In on All-Inclusive in New Segments and Markets
As a top player in the high growth all‐inclusive space, Marriott continues to focus on expanding its all-inclusive platform to meet rising guest demand. The company anticipates that Southeast Asia and resort markets in Europe and the Middle East could provide additional all-inclusive opportunities in the future.

“We have seen a tremendous year of growth in our international regions,” said Carlton Ervin, Global Development Officer, International, Marriott International. “In the Middle East, we saw a record number of room signings. With rising momentum in our all-inclusive offerings and our planned expansion into the midscale market, we remain focused on providing consumers with more offerings to meet their needs.”

Select service development opportunities continue to be a key growth driver for Marriott, representing three-quarters of global deal signings and nearly half of signings across international regions. In 2022, the company signed 523 select service deals. In addition, the company added 216 select service hotels around the world.

Increasing popularity of longer stays
With growing consumer travel preferences for more space driven by the blending of work and leisure trips, the longer stay segment is a highly attractive option for both guests and hotel developers.

“The select service and extended stay segments continue to generate significant growth for the company, particularly in the US and Canada,” said Silverman. “We see exceptional opportunity to propel growth further among our select service and extended stay brands, particularly in underserved secondary and tertiary markets.” 

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