Marriott posts 4.9 percent global RevPAR growth in Q2
The company’s global system reached nearly 9,000 properties and 1.659 million rooms by the end of the quarter
By Vishnu Rageev RAug 02, 2024
MARRIOTT INTERNATIONAL REPORTED 4.9 percent year-over-year global RevPAR growth in the second quarter of 2024, with U.S. and Canada RevPAR rising 3.9 percent and international RevPAR increasing 7.4 percent. The company’s net income grew to $772 million from $726 million a year ago, Marriott said in a statement.
“Marriott reported strong second quarter results, with net rooms up 6 percent year-over-year and worldwide RevPAR growth of nearly 5 percent, as consumers continued to prioritize travel,” said Anthony Capuano, Marriott International’s president and CEO. “International RevPAR increased more than 7 percent, with Asia-Pacific excluding China leading the way, posting an impressive 13 percent RevPAR increase from the year-ago quarter.”
RevPAR for the U.S. and Canada grew nearly 4 percent during the quarter, Capuano said, and all customer segments grew versus the prior year quarter.
“Group RevPAR rose nearly 10 percent year-over-year, with both rate and occupancy increasing in the mid-single digits,” Capuano said.
Marriott's diluted EPS was $2.69, up from $2.38 a year ago, while adjusted diluted EPS rose to $2.50 from $2.26 in the second quarter of 2023. The company’s adjusted EBITDA was $1.324 billion for the quarter, up from $1.219 billion in the previous year.
The company’s operating income was $1.195 billion for the quarter, up from $1.096 billion in the second quarter of 2023. Net income rose to $772 million, compared to $726 million a year ago. Adjusted operating income was $1.120 billion, up from $1.043 billion in the previous year. Adjusted net income totaled $716 million, compared to $690 million a year ago, while adjusted EBITDA was $1.324 billion, up from $1.219 billion during the same period in 2023.
Marriott repurchased 1 million shares of common stock for $1.0 billion in the second quarter. Year-to-date through July 29, the company returned $2.8 billion to shareholders through dividends and share repurchases. It expects to return approximately $4.3 billion to shareholders in 2024 through share repurchases and dividends.
Growing pipeline
Marriott’s global system reached nearly 9,000 properties and about 1.659 million rooms at the end of second quarter. The company added around 15,500 net rooms during the quarter, and its development pipeline now includes about 3,500 properties and more than 559,000 rooms, including roughly 33,000 approved but not yet contracted rooms. More than 209,000 pipeline rooms were under construction at the quarter’s end, with 57 percent located in international markets.
“Owner preference for our brands remains strong,” Capuano said. “We signed nearly 31,000 rooms in the quarter, 75 percent of which were in international markets. Our momentum around conversions continued, accounting for 37 percent of room additions in the quarter. We continue to expand our industry leading global portfolio, and our expectation for net rooms growth remains at 5.5 to 6 percent for full year 2024.”
Marriott reports a membership base of over 210 million, with Marriott Bonvoy serving as a key competitive advantage.
“We remain focused on enhancing the loyalty program’s benefits and finding new ways to engage with our members both on and off property,” Capuano said. “In June, we announced a collaboration with Starbucks. The number of members who have linked their accounts is already well exceeding our expectations.”
Franchise development
Marriott’s base management and franchise fees reached $1.148 billion in the second quarter, a 9 percent increase from $1.057 billion a year ago, the statement said. This rise is mainly due to RevPAR growth and unit expansion. Non-RevPAR-related franchise fees totaled $234 million for the quarter, up from $206 million the previous year, driven by a 10 percent increase in co-branded credit card fees and $13 million in higher residential branding fees.
Incentive management fees reached $195 million, up from $193 million in the second quarter of 2023, Marriott said. The increase was affected by weaker results in China and unfavorable foreign exchange.
The company said managed hotels in international markets accounted for more than 60 percent of the incentive fees earned.
Costs and outlook
Marriott’s owned, leased and other revenue, net of direct expenses, came in at $99 million during the quarter, down from $103 million a year ago. The company’s general, administrative and other expenses were $248 million for the quarter, up from $240 million a year ago. Its net interest expense was $164 million for the quarter, up from $141 million a year ago, primarily due to higher debt balances.
The company narrowed its RevPAR growth outlook due to a weaker operating environment in Greater China and slightly softer expectations in the U.S. and Canada. The company expects systemwide RevPAR growth of 3 percent to 4 percent for both the third quarter and the full year, and net rooms growth of 5.5 percent to 6 percent for the full year.
Marriott recently released its 2024 Serve 360 Report, highlighting progress toward its 2025 sustainability and social impact goals. The report covers data on sustainable operations, diversity and inclusion, volunteerism and other ESG activities by Marriott associates and hotels worldwide.
Howard Johnson is marking its 100th anniversary with fried clam–shaped soaps.
The soaps pay homage to an iconic HoJo menu item.
Available at select hotels and for online purchase starting Oct. 3.
HOWARD JOHNSON BY Wyndham marks a century with one of its most famous menu items, the fried clam strip. The brand is introducing limited-edition HoJo’s Original Fried Clam Soap, available at select Howard Johnson hotels across the U.S. and for online purchase beginning Oct. 3.
Designed to resemble the original food item, the soaps are infused with lemon, sea salt and butter in a nod to the butter-soaked rolls that once accompanied the fried clams, according to a statement by Wyndham.
“Howard Johnson is a brand woven into America’s cultural fabric and beloved by millions for generations,” said Marissa Yoss, HoJo’s head of marketing. “As we celebrate 100 years, our limited-edition fried clam soap is a fun, nostalgic tribute to the brand’s storied past and a playful nod to the retro-modern, family-friendly spirit that continues defining our hotels today.”
For World Waffle Day celebrations, Comfort Hotels hosted a one-day Waffle Lounge in New York City on Aug. 21.
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Hersha Hotels & Resorts sold The Boxer Boston to Eurostars Hotels.
The company acquired the property in 2012 for $12.6 million.
The property now sold for $23.6 million.
HERSHA HOTELS & RESORTS sold The Boxer Boston, an 80-room hotel in Boston’s West End, to Eurostars Hotels, part of Spain’s Grupo Hotusa. The company, which reportedly acquired the property in 2012 for $12.6 million, received $23.6 million for it.
The seven-story hotel, built in 1904, is near TD Garden, the Charles River Esplanade, One Congress, North Station and Massachusetts General Hospital, said JLL Hotels & Hospitality, which brokered the sale. It also has a fitness center.
Hersha Hotels & Resorts is part of the Hersha Group, founded in 1984 by Hasu Shah. Jay Shah serves as senior advisor and his brother Neil Shah is president and CEO.
JLL Managing Director Alan Suzuki, Senior Director Matthew Enright and Associate Emily Zhang represented the seller.
"The Boxer’s prime location at the crossroads of Boston's West End, North End and Downtown districts, combined with its strong cash flow and its unencumbered status regarding brand and management, made this an exceptionally attractive investment," said Suzuki. "Boston continues to demonstrate resilient lodging fundamentals driven by its diverse demand generators, including world-class educational institutions, medical facilities, corporate presence and convention and leisure attractions."
The property will become the Spanish hotel chain Eurostars’ fifth U.S. hotel, supporting the group’s North American expansion, the statement said.
Amancio López Seijas, president of Grupo Hotusa and Eurostars Hotels Co., said the addition of Eurostars’ The Boxer strengthens the company’s presence in key locations and promotes urban tourism.
Peachtree recognized by Inc. and the Atlanta Business Chronicle.
Named to the 2025 Inc. 5000 list for the third year.
Chronicle’s Pacesetter Awards recognize metro Atlanta’s fastest-growing companies.
PEACHTREE GROUP ENTERED the 2025 Inc. 5000 list for the third consecutive year. The company also won the Atlanta Business Chronicle Pacesetter Awards as one of the city’s fastest-growing private companies.
The Inc. 5000 list provides a data-driven look at independent businesses with sustained success nationwide, while the Business Chronicle’s Pacesetter Awards recognize metro Atlanta’s fastest-growing privately held companies, Peachtree said in a statement.
“We are in the business of identifying and capitalizing on mispriced risk, and in today’s environment of disruption and dislocation, that has created strong tailwinds for our growth,” said Greg Friedman, managing principal and CEO. “These recognitions validate our ability to execute in complex markets, and we see significant opportunity ahead as we continue to scale our platform.”
The Atlanta-based investment firm, led by Friedman; Jatin Desai, managing principal and CFO and Mitul Patel, principal, oversees a diversified portfolio of more than $8 billion.
A PETITION FOR a referendum on Los Angeles’s proposed “Olympic Wage” ordinance, requiring a $30 minimum wage for hospitality workers by the 2028 Olympic Games, lacked sufficient signatures, according to the Los Angeles County Registrar. The ordinance will take effect, raising hotel worker wages from the current $22.50 to $25 next year, $27.50 in 2027 and $30 in 2028.
Mandatory health care benefits payments will also begin in 2026.
The L.A. Alliance for Tourism, Jobs and Progress sought a referendum to repeal the ordinance, approved by the city council four months ago. The petition needed about 93,000 signatures but fell short by about 9,000, according to Interim City Clerk Petty Santos.
The council approved the minimum wage increase for tourism workers in May 2023, despite opposition from business leaders citing a decline in international travel. The ordinance requires hotels with more than 60 rooms and businesses at Los Angeles International Airport to pay workers $30 an hour by 2028. It passed on a 12 to 3 vote, with Councilmembers John Lee, Traci Park and Monica Rodriguez opposed.
The L.A. Alliance submitted more than 140,000 signatures in June opposing the tourism wage ordinance, triggering a June 2026 repeal vote supported by airlines, hotels and concession businesses.
AAHOA called the ruling a setback for Los Angeles hotel owners, who will bear the costs of the mandate.
"This ruling is a major setback for Los Angeles' small business hotel owners, who will shoulder the burden of this mandate," said Kamalesh “KP” Patel, AAHOA chairman. "Instead of working with industry leaders, the city moved forward with a policy that ignores economic realities and jeopardizes the jobs and businesses that keep this city's hospitality sector operating and supporting economic growth. Family-owned hotels now face choices—cutting staff, halting hiring, or raising rates—just as Los Angeles prepares to host millions of visitors for the World Cup and 2028 Olympics. You can't build a city by breaking the backs of the small businesses that make it run."
Laura Lee Blake, AAHOA president and CEO, said members are proud to create jobs in their communities, but the ordinance imposes costs that will affect the entire city.
“Even with a delayed rollout, the mandate represents a 70 percent wage increase above California's 2025 minimum wage,” she said. “This approach could remove more than $114 million each year from hotels, funds that could instead be invested in keeping workers employed and ensuring Los Angeles remains a competitive destination. The mandate increases the risk of closures, layoffs and a weaker Los Angeles."
A recent report from the American Hotel & Lodging Association found Los Angeles is still dealing with the effects of the pandemic and recent wildfires. International visitation remains below 2019 levels, more than in any other major U.S. city.
India-based TBO will acquire U.S. wholesaler Classic Vacations for up to $125 million.
The deal combines TBO’s distribution platform with Classic’s advisor network.
Classic will remain independent while integrating TBO’s global inventory and digital tools.
TRAVEL BOUTIQUE ONLINE, an Indian travel distribution platform, will acquire U.S. travel wholesaler Classic Vacations LLC from Phoenix-based The Najafi Cos., entering the North American market. The deal is valued at up to $125 million.
Gurugram-based TBO is led by co-founders and joint MDs Gaurav Bhatnagar and Ankush Nijhawan.
“We’re thrilled to bring Classic Vacations into the TBO family – the company’s longstanding delivery of services has earned the trust of more than 10,000 travel advisors in the U.S. and their end customers, making Classic Vacations a seamless fit for our vision in the travel and tourism industry,” said Bhatnagar. “Classic Vacations is led by a strong team and will continue as an independent brand while leveraging TBO’s technology and distribution capabilities to grow its business.”
Classic Vacations reported revenues of $111 million and an operating EBITDA of $11.2 million for the financial year ending Dec. 31, 2024, the companies said in a joint statement. The company has a network of more than 10,000 travel advisors and suppliers.
The acquisition combines TBO’s distribution platform with Classic’s advisor network to strengthen their position in the outbound market, the statement said. Classic will continue as an independent brand while integrating TBO’s global inventory and digital tools.
Nijhawan said the acquisition furthers TBO’s investment in organic and inorganic growth.
“As we begin integrating Classic Vacations with TBO, we will remain open to similar strategic alliances going forward,” he said.
Classic Vacations was acquired from Expedia Group by The Najafi Cos. in 2021.
“This acquisition and partnership are a natural next step for our portfolio company Classic Vacations, and we’re happy to have worked successfully with them for the last four years, maximising the company’s strengths and expertise in luxury travel,” said Jahm Najafi, founder and CEO, The Najafi Companies.
Moelis & Co. LLC was the financial adviser and Ballard Spahr LLP the legal adviser to Classic Vacations. Cooley LLP served as legal adviser and PwC as financial and tax adviser to TBO.