Marriott International has ended 2023 on a high note, with a milestone of more than 60 new openings and 80 new deals across Asia-Pacific excluding China. These developments translate to more than 560 operating hotels and residences, exceeding 10 per cent in net room growth compared to 2022, as well as 320 hotels with more than 69,000 rooms in the development pipeline.
Addressing a select group of Singapore-based media on Monday afternoon, Rajeev Menon, president, Marriott International, APEC (Asia-Pacific excluding China), described his company’s performance in the region as “incredible” and noted that travel and tourism in the region last year was “on steroids”.
Although the hotel giant will only release full-year financial results in February, Menon said the company has “broken every record there is”. He credited both leisure and business travel for 2023’s strong performance.
He added: “While the world seems to be on a precipice because of all the challenging news coming out of the Middle East and parts of Europe, the reality is it has been moving along from an economic point of view. Amid that, APEC has been a star throughout 2023. Thirty-three per cent of the world’s GDP was contributed through APEC. As a result, we are seeing considerable amount of new (hotel) investments coming up in this part of world.”
Detailing Marriott International’s record year of fresh signings, Shawn Hill, chief development officer of APEC, said 19 brands were involved – Fairfield by Marriott was the most in demand among owners, followed by Marriott, Courtyard by Marriott, and JW Marriott; The Luxury Collection and Westin tie in fifth place. Fifteen per cent of new deals in the region were in the luxury segment.
Hill shared that conversion projects were a big driver of growth – 25 conversion deals were inked in 2023, representing 36 per cent of the company’s total signings last year; 30 per cent of these opened within the year.
“This is phenomenal because some opening projects can take three to five years, or decades even, but conversions can be signed and entered into our system very quickly,” Hill explained.
This speed to market benefits Marriott International as well as owners who want to raise their RevPAR quickly.
The year 2023 was also marked with positive partnerships, as 45 per cent of signings came from existing owners and 95 per cent of contracts were renewed.
“It is clear that owners are very happy with our performance. Another major growth turbo-charger for us in 2023 was multi-unit deals. These are big portfolios held by a single owner. Marriott has scale and brands across every price point, as well as people on the ground to help owners analyse how sales would be like and what the labour rates and cost structures were in the market so as to maximise their assets,” he remarked.
Looking ahead, Hill told TTG Asia that double-digit growth is projected this year.
“Our Select collection – comprising moderately priced brands, like Fairfield, Four Points, and Courtyard – is expected to make up 30 per cent of our openings this year. Again, conversions will be a big growth driver for us in 2024, with about 35 to 40 per cent of 2024 openings being such projects. In terms of countries where we’re seeing the most growth, we expect to open more than 1,000 rooms in each of India, Japan, Malaysia and Thailand in 2024,” he said.
And as domestic travel continues to be an important source of business in the region, both Menon and Hill said new signings would spread into more secondary and tertiary cities.
“Our Select service hotels are popular for such signings since they perform well in secondary and tertiary destinations, are cheaper to build, rooms are moderate in price, and owners can get a good return quickly,” Hill said.
Hotel design is also “changing subtly” as the company expands into secondary and tertiary destinations. While hotels are typically smaller in size and function there, Hill said Marriott International is open to providing a meeting space in the property should market demand calls for it.
