Marriott International boosted its revenue outlook for the
year, based largely on improving corporate transient and group demand that it
projects will continue throughout the year.
As of the end of the first quarter, group room revenue on
the books for the rest of the year at Marriott Hotels & Resorts properties
in North America is up 11 percent year over year, president and CEO Arne
Sorenson said during a Thursday conference call. By comparison, such revenue was
up 2 percent year over year in the first quarter of 2011.
CFO Carl Berquist noted that group bookings both for
business during the quarter and throughout 2012 were higher than expected.
Attendance at booked meetings also was above projected levels, he said, while cancellations
were below expectations. As such, Sorenson acknowledged that a few meeting
planners have complained of limited availability for larger events.
"We think higher attendance might be a trend, as well
as [fewer] cancellations," Berquist said. "As the economy improves
throughout the year, you'd expect to see them perform the same way."
Much of the group growth happened at Marriott’s smaller
properties, Sorenson said. Booked group revenue at hotels with 300 to 700 rooms
rose about 17 percent year over year, while such revenue at the largest hotels increased
by high-single-digit percentages.
Revenue from negotiated corporate business at Marriott
properties in North America increased by 9 percent year over year during the
quarter. About half of that was the result of higher negotiated rates, Berquist
said.
Because of these growth trends—and a limited increase in supply—Marriott
now projects its 2012 revenue per available room to increase between 6 percent
and 8 percent, both within North America and globally.
Marriott also reported strong trends for 2013 bookings,
although the November presidential election could impact government travel,
which already "is not the strongest part of our economy today,"
according to Sorenson. "One of the biggest threats is a substantial
reduction in the size of government, which would have an impact on government
business."