Marriott's Q3 Profit Drop Emblematic of Hospitality Sector's Cooling

New York, NY, November 5, 2019-Marriott International reported a 23% drop in quarterly profit and lowered its view for a crucial metric in the hospitality industry, as growth in the hotel business cools off, reports the Wall Street Journal.

“Bethesda, Md.-based Marriott-the world’s largest hotel company, with some 7,200 properties-now expects comparable revenue per available room, adjusted for currency fluctuations, at the low end of its guidance of 1% to 2% growth.”

This follows a Wall Street Journal report in September, which stated that, “Hotel owners in large cities say they are getting squeezed by weaker business-traveler demand, higher labor costs and a crush of new hotel projects that is weighing on room rates.

“’The floodgates have opened in terms of supply,’ said Bashar Wali, principal and president of Portland, Ore.-based Provenance Hotels, which owns and manages 14 hotels across the U.S. ‘When there are so many offerings, you don’t have the ability to stretch rates even during the high demand period.’