Now that Marriott has completed its $13 billion acquisition of Starwood resorts—to create the world’s larges hotel company—the chain has 5,700 hotels and 1.1 million rooms across 30 brands in more than 110 countries. The deal will bring together Marriott’s Courtyard by Marriott properties as well as The Ritz-Carlton, Starwood’s St Regis, W, and Four Points by Sheraton resorts, under a single portfolio: Marriott International.
With this acquisition, though, Marriott is looking to add another 50,000 rooms to its Middle East and Africa portfolio (MEA) within the next 6 years.
“Today, we have 90,000 [rooms in the MEA] that are operating and under construction. By 2022, the 90,000 will be 140,000. That is my ambition,” explains Marriott President and Managing Director for the Middle East and Africa at Marriott International, Alex Kyriakidis. Of course, he also notes that the company will likely experience its greatest period of growth in the budget hotel segment over the next few years.
Indeed, he goes on to say, “I think over the next five years, we are still going to see growth in all three segments: luxury, premium and select [budget]. But I think we will see the greatest growth proportionately in the select segment… because in quite a few cities, particularly in the Gulf, the luxury space is maxed out. But there is demand for value priced brands for guests whose budgets are not at the luxury or premium end.”
Kyriakidis also assures that the merger will not result in any job cuts. If you think about it, actually, the merger—which gives the Marriott more properties in the UAE, Egypt, South Africa, Nigeria, and Saudi Arabia—could create more jobs.
He comments that these countries are growing in the travel and tourism industry.
“We are bullish about Dubai beyond 2020,” Kyriakidis continues. “The government is regenerating the whole area where 2020 Expo will take place, it is investing in another major airport, theme parks, malls, more leisure attractions, and continuing to grow Emirates as the airline and the hub in Dubai.”
Finally, he advises that those small companies that cannot keep up with demand in a market that is volatile should definitely consider going out of business. At the same time, though, he says there is “significant interest” in this smaller market because it can act as a kind of safety since there is quite a bit of pent up demand.