Marriott International is set to expand its footprint in
Latin America and the Caribbean via an agreed-upon $100 million acquisition of
Hoteles City Express. The deal not only will add the 31st brand to
the company’s portfolio, it also will make Marriott International the largest hotel
company in Latin America and the Caribbean. The agreement, which includes more
than 17,000 guest rooms in 152 hotels and 75 cities across Mexico, Chile,
Columbia and Costa Rica, is expected to close in the first half of 2023 pending
The move marks Marriott’s entry into the “popular affordable
midscale segment,” to put it in the words of Marriott International CEO Anthony
Capuano, who spearheaded the acquisition. It’s a market that has done extremely
well in the business travel space in the United States, particularly since essential
business travel like infrastructure teams, engineers and client service groups
recovered travel faster than white-collar executives. That said, the City
Express portfolio offers several brand extensions, including City Express, City
Express Plus, City Express Suites, City Express Junio and City Centro that play
squarely in the business travel segment. The transaction will increase
Marriott’s presence in the region by 45 percent.
The Hoteles City Express agreement wasn’t the only move by
Capuano to make headlines in the business travel sector this year. The company often
has been bold about getting in front of the request-for-proposals season, when
it comes to rate increase predictions. Capuano spoke openly about significant rate
increases for corporate clients in 2023.
As early as August, he estimated in the company’s
second-quarter earnings call that corporate rate percent increases would hit
the “high single digits.” It was the first shot across the bow for corporate
buyers and seemed to set expectations for the upcoming negotiation season,
which by many accounts was a delayed process this year as corporates got what program
data they had in order for a year in which hotels would no longer extend
previous deals—and, in fact, would look to recoup pandemic losses.
In a BTN survey of business travel buyers fielded 6 weeks
after Capuano’s initial corporate rate musings, 87 percent of buyers expected
rate increases for 2023. More than 45 percent expected rate increases between 5
percent and 10 percent.