Marriott chairman
bullish on hotel biz

The chain will open 25,000 hotel rooms
this year, 25 percent of them
outside of the United States

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By Tim Ruel
truel@starbulletin.com

Despite tough times in the travel business, hotel owner Marriott International Inc. is opening 25,000 hotel rooms around the world, nearly as many as last year, said J. Willard Marriott Jr., Marriott's chairman and chief executive.

Some 25 percent of the new rooms are outside the United States, Marriott said. The firm's luxury hotels, such as its Ritz-Carlton collection, have been hit hard by a downturn in the world economy, but "we're still making good money," Marriott said.

This year, the hotel firm is primarily opening select-service properties, such as its Courtyard and Residence Inn brands. A lot of niche markets are still underserved, Marriott said.

The company plans to target business travelers with its 140-room Courtyard Maui hotel, scheduled to open near Kahului Airport in 2003. The company is also opening two time-share resorts in Hawaii, one at Ko Olina and one on Kauai.

Marriott spoke yesterday at a media luncheon at the Washington, D.C.-based company's Waikiki Beach Marriott Resort. Marriott bought the 1,300-room hotel at the Diamond Head end of Kalakaua Avenue two years ago from the Japanese Otaka group, secured a long-term management contract, then sold it.

Marriott now has seven Hawaii hotels, plus two time-share resorts, and a total of 5,000 workers in the state, making it Hawaii's largest private employer.

The past year hasn't been easy, though. "It is a difficult market, no question," said Stan Brown, Marriott's vice president for Pacific Islands.

People are traveling, but most people will only travel within their particular regions of the world, Brown said. Europeans are visiting other European countries; the Japanese are visiting China.

As such, Americans are still flocking to Hawaii. Marriott has had double-digit growth in room revenue growth at most of its Hawaii properties, and has gained luxury market share in Waikiki and Maui, Brown said. Occupancy has fallen to within 80 percent to 90 percent.

Ultimately, Marriott expects people to start traveling longer distances again, Brown said.