Why Marriott Thinks It Could Fare Better Than in Previous Recessions
Photo Caption: A photo illustration of a planned Edition hotel for Lake Como, Italy, that will be owned and developed by Bain Capital and Omnam Group. Set to open in 2025 with 145 guest rooms. Source: Marriott International.
Skift Take
In the economic multiverse, hotels are still booming. The world's largest hotelier has a remarkably rosy forecast for 2023 as the company highlights why it will be stronger than in the past if a downturn happens.
Marriott International forecast that its fourth quarter would surpass 2019 in revenue per available room, a a closely watched number, underscoring the resilience of travel spending despite economic worries.
“We expect continued demand growth around the world in the fourth quarter and anticipate that global RevPAR [revenue per available room] could increase two percent to four percent compared to 2019,” said CEO Anthony Capuano on Thursday's earnings call. Executives also highlighted why they will be stronger than in the past should a downturn hit the global economy.
The Bethesda, Maryland-based company — operator of more than 30 brands ranging from Ritz Carlton to Fairfield Inn — raised its annual profit forecast on Thursday, thanks to higher rates it has been able to charge during the global travel boom. The company predicted that its worldwide revenue per available room could come in closer to pre-pandemic levels than it had expected at between 2 and 4 percent above 2019 levels.
Forward leisure bookings for holidays, such as Thanksgiving and Christmas, look strong through year's year — though the company's clearest visibility is only a few weeks out.
Group bookings also look strong. Fourth-quarter full-service group revenue is currently pacing to be more than 4 percent of the comparable quarter in 2019. Relatively last-minute bookings have allowed for strong pricing so far.
Optimism About 2023Marriott believed that several factors would allow it to perform better during a possible economic downturn next year than it had done in past downturns.
"We def
