Recently, Marriott International's (Nasdaq: MAR) Guangzhou W Hotel was exposed to be closed and undergoing internal rectification. On January 16th, a reporter from Huaxia Times visited the hotel and found that there were still cars coming and going in front of the hotel door, with passengers carrying suitcases in and out. Many guests in the lobby were chatting in the rest area, and the business situation was still normal.
A front desk staff member told our reporter that the hotel's banquets, conferences, fitness centers, SPAs, and dining facilities are currently operating normally. As of the 18th of this month, hotel rooms can still be checked in, but reservations are not accepted. After the 18th, the hotel will be closed for rectification, and both check-in and reservation will be suspended.
There are currently various opinions online regarding the specific reasons for the suspension of business for rectification. Regarding this, a reporter from Huaxia Times called the Marriott International customer service hotline, but the other party said "we do not have detailed information on our end". The customer service of W Hotel in Guangzhou also stated "we are unable to provide more information on the specific reason" and stated that the hotel's public relations department will respond to this in the future. As of the time of publication, the reporter has not received any response.
The reason becomes a mystery
According to third-party platforms such as Ctrip, all room types at W Hotel in Guangzhou can be booked from today until February 1st, making it non bookable. Hotel rooms can be booked from February 2nd onwards.
Guangzhou W Hotel, as the first W hotel in mainland China, has received much attention for its closure and rectification. Regarding the reasons for its closure and rectification, both Guangzhou W Hotel and its parent company Marriott International have been vague and have not provided a formal response.
Regarding this, the customer service of W Hotel in Guangzhou stated, "I am not very clear about this. I will have my colleagues in the public relations department respond to this within today." However, as of the time of publication, the reporter has not received a formal response.
Meanwhile, some netizens speculate that the suspension of operations for rectification may be due to operational issues, which in turn has led to strategic adjustments by the parent company Marriott International Group in the Chinese market.
According to the latest quarterly report released by Marriott International on November 2, 2023, in the first three fiscal quarters of fiscal year 2023, in terms of system wide statistics (including franchising properties), the RevPAR of Marriott International Group in Greater China (including Chinese Mainland, Hong Kong, Macao and Taiwan, China) was 83.53 dollars, an increase of 77.9% year on year, and the occupancy rate was 67.8%, The average daily rate of sold rooms was $123.11, a year-on-year increase of 22.2 percentage points, representing a 19.8% increase.
According to quarterly reports, in the first three quarters of fiscal year 2023, Marriott International Group's revenue per available room and average room rate sold in Greater China were the lowest compared to the United States and Canada, Asia Pacific (excluding China), Caribbean and Latin America, Europe, the Middle East, and Africa.
"Although Marriott International Hotel's revenue in Greater China has increased year-on-year, there is still a gap compared to the region, and it may make strategic adjustments in the Chinese market," an unnamed industry insider told our reporter.
At present, the W Hotel in Guangzhou is still operating normally. On January 16th, the reporter visited the hotel and found that there were still cars coming and going in front of the hotel, with passengers carrying suitcases in and out. Many guests in the lobby were chatting in the rest area, and the activities were still held normally.
The front desk staff told reporters that the hotel's banquets, conferences, fitness centers, SPAs, and dining facilities will continue to operate normally. As of the 18th of this month, hotel rooms can still be checked in, but reservations are not accepted. After the 18th, they will be closed for rectification, and check-in and reservations will be suspended.
Expanding in Xiamen and Chengdu markets
It is reported that Marriott International has opened nearly 520 hotels in China, accounting for 10% of the total number of rooms in the world. In the Asia Pacific region, last year Marriott International Group also achieved the milestone of opening its 1000th hotel in the region (excluding China).
W Hotel is a multinational hotel brand under Marriott International, attracting high-end customers with innovative styles such as fashion, music, design, and pop culture. The business philosophy of W Hotel is to become the center of culture in various cities and develop impressive design concepts based on local characteristics.
As the first W hotel in the mainland, W Hotel Guangzhou was officially opened in 2013 and located in the high-end business district of the Pearl River New Town. On May 23, 2022, the National Tourism Star Hotel Rating Committee issued the Announcement on Approving Five Star Tourist Hotels, which showed that W Hotel Guangzhou was rated as a five-star tourist hotel.
With the expansion of Marriott International's W brand in the Chinese market, the W Hotel on Chang'an Street in Beijing opened in 2014, the W Hotel on the Bund in Shanghai opened three years later, and the W Hotel in Suzhou also opened in the same year. The W Hotel in Xi'an opened in 2018. From 2020 to 2021, W hotels in core cities such as Chengdu, Changsha, and Xiamen also opened one after another.
In terms of performance, Marriott International's latest financial report shows that Marriott's total operating revenue for the third quarter of the 2023 fiscal year was approximately 5.928 billion US dollars, a year-on-year increase of 11.58%; Net profit was approximately 752 million US dollars, a year-on-year increase of 19.37%; Adjusted EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) was approximately $1.142 billion, a year-on-year increase of 15.94%.
Meanwhile, it is reported that Marriott International Group has recently announced that it has signed a new project agreement with Chengdu High tech West Zone Development and Construction Co., Ltd. and Chengdu High tech Investment Group Co., Ltd. to develop two new hotels in Chengdu, including the Marriott Hotel in Chengdu High tech West Zone and the Sheraton Hotel in Futian. The two new hotels are expected to open in the second half of 2026.
Meanwhile, on November 8th, Xiamen Nanyang Hotel Investment Co., Ltd. successfully signed a cooperation agreement with Marriott International Group to build a group of exhibition hotels at the Xiamen International Expo Center - Xiamen Nanyang Westin Hotel, Xiamen Nanyang Marriott Hotel, and Xiamen Nanyang Elegant Hotel. The three hotels have a total of 838 guest rooms and are expected to complete construction by the end of 2025.