While we’ve seen sparse complaints from hotel guests about the integration of the world’s two largest hotel chains, Marriott and Starwood, things apparently aren’t going so well for some hotel owners.
Investors in some Starwood franchises have started complaining of revenue problems they claim are related to merger consolidation, per the Washington Business Journal.
Struggles at the Westin Beverly Hills, W Los Angeles, and Westin Boston Waterfront were the subject of recent earnings calls for the real estate investment groups that hold the properties.
Frequent Starwood guests and elites have reason to pay attention. Of course, ongoing revenue problems could result in service cutbacks or even closures, if not resurrected. It’s the second consecutive quarter some owners have voiced complaints.
The two real estate investment firms highlighted by the Business Journal control a variety of Westin properties coast-to-coast. One Westin, the Boston Waterfront, blamed sales team integration for a 9.4 percent drop in revenue per available room.
“When Marriott reorganized the group sales team, there were major integration issues that forced legacy Starwood sales teams to freeze their efforts,” said Jay Johnson, CEO at Real Estate Investment Corporation Diamondrock, which owns the Westin Boston Waterfront property.
Similarly, Pebblebrook real estate investment trust CEO Jon Bortz told investors on the company’s second quarter earnings call that the Westin Gaslamp District in San Diego saw revenue per available room drop over 11 percent, which he blamed on stagnant sales teams left dangling in the merger.
Marriott International attempted to sequester the problems, claiming the two real estate investment firms were experiencing isolated problems.
This is the second consecutive quarter Bortz has complained of problems, the Business Journal reported.
Starwood loyalists, stay tuned.
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