US hotelier may sell three properties to raise cash for Abu Dhabi opening
Marriott International, the largest publicly traded US hotel chain, may sell its three Edition properties to fund an expansion of the boutique, luxury brand in the Middle East, incoming CEO Arne Sorenson said.
Marriott is considering adding
Edition properties in the UAE capital Abu Dhabi, as well as Bangkok and
Gurgaon, India, and may add one in West Hollywood, California, adjacent to
Beverly Hills, Sorenson said.
“We already have interested buyers,” Sorenson said in
an interview yesterday at the company’s JW Marriott in downtown Los Angeles. He
will replace JW Marriott Jr as CEO at the end of the month, and Marriott
will remain chairman.
The Edition brand, a joint venture with hotelier Ian
Schrager, is Marriott International’s attempt to break into the boutique
segment in which Starwood Hotels & Resorts Worldwide Inc. (HOT)’s W chain
operates. Marriott, based in Bethesda, Maryland, would continue to operate the
Edition properties after they are sold, Sorenson said.
“We’re willing to put in more money to expand
Edition,” he said.
Marriott agreed in October to buy the Clock Tower
office building near Madison Square Park in Manhattan for an Edition hotel. The
company, which mostly operates hotels without owning properties itself, used
its own money for the transaction after little expansion since the brand was
announced in 2008. Marriott plans to have six Edition hotels by 2015.
The hotelier also is adding Courtyard and Residence
Inn hotels across its JW Marriott and Ritz-Carlton property at Anschutz
Entertainment Group’s L.A. Live entertainment complex in the city’s core.
“Downtown LA still has room for more Marriott
brands,” Sorenson said.
Among the company’s high-end brands, Marriott expects
to have more Ritz-Carlton properties in China than in the US within five to
10 years, Sorenson said. The hotelier also is expanding its Bulgari luxury
brand. It has two such hotels, in Milan and Bali, Indonesia, and will announce
a third, in London, in the next few weeks, he said.
“Luxury will be a powerful long-term growth engine for
us because of the wealth” building in such countries as China, Sorenson said.