Hotels Struggle To Raise Room Rates: Marriott CEO
Hotel room rates have risen in the last year but they are still down 10 percent from before the 2008 economic downturn, Arne Sorenson, president of Marriott International, told CNBC Thursday.
"We're still building. Obviously you don't turn around overnight," he said. "There's still some distance before we get back to the levels we were in 2007 but we can see it in sight."
The Marriott executive said that at their worst, in 2008 and 2009, revenue per available room fell 25 percent, beyond the loss after the Sept. 11, 2001, attacks in New York and Washington.
Now, however, he sees business and leisure travel increasing at all Marriott's brands, including its luxury Ritz-Carlton and its Courtyard motels for business travelers.
"Economic growth is good for us," he said, although he is concerned about the price of gasoline.
In the short term, Sorenson said, "it's much better for travelers to get on the road if those gas dollars are going farther and, to some extent, if the airline miles are cheaper, too."
He said Marriott expects to spin off its time-share business in October or November.
"We're deep into the process with the IRS and the SEC to go through the steps that have to be done," he said, "but we're well on our way and feel pretty good about that happening."