"We may have been a little too optimistic about how fast we could get this thing closed," Sorenson said Thursday.
Marriott and Starwood — like other hotel chains — own very few individual hotels. Instead they manage or franchise their brands to hundreds of individual owners, often real estate development companies. Those individual hotel owners are responsible for setting nightly room rates. It isn't uncommon for a developer to own a Marriott, Hilton, Hyatt and Sheraton in the same city.
The purchase gives Marriott more leverage with corporate travel departments who often look for one giant chain to house all of their employees. It also gives Marriott more power over Expedia and Priceline, the two giant online travel agencies that sell rooms on behalf of hotel companies in exchange for a commission. The hotel industry has spent the last year trying to get travelers to book directly with them instead of the travel agencies to avoid paying those fees.
There are still many details to work out.
Marriott has thrived as an "asset light" company, owning a handful of hotels. Starwood has been selling off properties, while singing long-term management agreements for those same hotels. As of June 30, it still owned 23 properties. Sorenson said he believes there is a strong market to continue selling off many of those iconic hotels.
"There is always a market for the St. Regis in New York," he said, adding that other assets in the portfolio have comparable stature. "In great global cities, real estate like that always has a value."
The new company will keep Marriott's Bethesda, Maryland headquarters but hasn't announced if it will keep any presence at Starwood's Connecticut or New York offices.
Then there are the 30 brands. Some have performed better than others but Sorenson said all of them will probably survive the merger.
"I think so. Every one of them has hotels in them," he noted.
For now, Starwood and Marriott will keep separate loyalty programs. Starwood has a credit card deal with American Express as well as close partnerships with Delta Air Lines and Uber. Marriott has a much larger program with partnerships with Chase and United Airlines.
"Nothing changes immediately. We have to see how those partnerships evolve," Sorenson said.
Gary Leff, who writes about points and miles at ViewFromTheWing.com, called the three-to-one exchange rate of Starwood points to Marriott points "just right."
"It's one of the many reasonable and positive steps that Marriott has taken along the way as it acquires Starwood," Leff said. "But there's a whole lot still to happen between now and the programs actually being combined."