Marriott US hotels hit rough patch in Q1

Marriott International reported relatively modest North
American revenue per available room (RevPAR) growth of 0.8% in the first
quarter, with performance negatively impacted by a confluence of events.

RevPAR would have grown an additional 0.7% if it weren’t for
the partial federal government shutdown in January, tough comparisons to
hurricane recovery in Florida and Houston, and a lingering impact from the
fourth-quarter labor strike in Hawaii, said Marriott CEO Arne Sorenson during
the company’s Q1 earnings call Friday.

Additionally, North American RevPAR was weighed down in part
by a weak performance from limited-service hotels, for which RevPAR declined
0.3%. Marriott’s limited-service brands include Courtyard, Residence Inn
and Fairfield.

Sorenson attributed the company’s challenges in the
limited-service space to “geographic distribution and partly age of
product, maybe for Courtyard,” but added that he didn’t predict any “dramatic
difference in performance between the segments as the year goes on.”

North American occupancy fell, dropping 0.8 percentage points for the
quarter, while average daily rate was up 2%.

Despite the sluggishness, Sorenson remained fairly
optimistic about the remainder of the year, highlighting that group bookings
for April in particular were strong.

“While March was a disappointing month in many
respects, it is not a harbinger of a predictably different environment than one
that we’ve been going through the last few quarters,” he said. “Thematically,
today, I think we’d say it’s steady as she goes for the next few quarters.”

Source: Read Full Article