Hospitality Sector

Hotel Investors Dismiss Large and Lumbering

Marriott is now on the defensive about its Starwood acquisition, heralding the benefit of choice. That notion rings hollow amid the current economic setting. Shareholders seem to agree; the stock price continues to languish. Corporate travel departments after all are charged with compressing travel costs, not expanding room-selection alternatives. In our view, the best news coming out of the just-closed deal is that it provides unexpected opportunities for smaller hotel-management firms to bolster their line-up in markets where Marriott-Starwood is overextended. Operating agreements are seldom cast in stone. And most property owners can be easily persuaded to change their brand affinity. One sidelight: some tech companies may see a windfall as this awkward hotel-room stockpile tries to sort out its potential.

Learn more at The Economist

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