Marriott Sees 3Q Gains In Core Brands

Marriott International late last week announced third-quarter earnings that included marginal increases in year-over-year revenue per available room at its full-service core brands in North America, including Marriott Hotels and Resorts, J.W. Marriott, and Renaissance, with particularly strong gains at the company's deluxe Ritz-Carlton brand, which jumped 5.6 percent. Yet, RevPAR at its midprice and extended stay brands continued to lag from last year.

Marriott was the first of the industry's multi-brand companies to report quarterly earnings. Given Marriott's size and prominence, its relatively positive performance bodes well for the industry as a whole.

Yet, chairman and CEO J.W. Marriott Jr. was hesitant to declare that any significant turnaround in the industry's fortunes, while long-awaited by hotel companies, was truly at hand. The third quarter includes the summer months, traditionally a strong period for leisure travel.

"Since the fourth quarter is more dependent on business travel and group business, we can't be certain that these trends will continue, but it does appear to us that the early stage of a recovery in transient demand is underway," he said.

"Our early estimates for 2004 are for 3 percent to 4 percent RevPAR growth in North America, suggesting that 2003 should be the trough in RevPAR," Marriott added. These projections are in keeping with PricewaterhouseCoopers' latest estimates, which call for 2004 RevPAR growth of 4.9 percent.