Marriott International will more than double the number of its hotels in the Middle East in the next three years. By 2011, the number of hotels the company operates in the region will increase from 26 at the end of 2007 to 65, adding 40,000 rooms, Chairman and Chief Executive J William Marriott Jr told Emirates Business.
The company has signed the first of four development transactions for hotels in Egypt, UAE and Saudi Arabia. The signings include nine properties and 2,000 rooms, which brings Marriott's Middle East hotel pipeline to 39.
Marriott International is represented by six brands in the Middle East – Ritz-Carlton, JW Marriott Hotels and Resorts, Courtyard by Marriott, and Marriott Hotel Apartments.
In Dubai, the company signed a joint venture with Al Futtaim Group for the 320-room Marriott Vacation Club International Resort in Dubai Festival City by 2011, which will be the first in the company's timeshare division in the Middle East. In Abu Dhabi, the venture includes the 411-room Renaissance hotel, and the 195-room Courtyard.
"The Middle East is not only a rapidly expanding centre of commerce, but also a thriving tourist destination. We now have a total of more than 134,000 rooms in our global development pipeline with more than a quarter located outside North America," Marriott said. Ed Fuller, president and managing director of Marriott Lodging International, told Emirates Business the credit crisis and the economic slowdown in the US has not affected business in the region.
"We have had not cancelled projects outside the United States as a result of the credit crisis. In markets such as India, China and the Middle East, the sources of funds are not dependent on the credit markets. Even globally, I think this is going to be a soft landing," Fuller said.
Marriott's two largest markets in the region are the UAE and Saudi Arabia. "We operate 26 hotels in the region, 31 have been announced, another one will be announced at the Arabian Travel Market," he said.
"We are one of the leading branded companies, at this point clearly in the top five and it's a question of whether we are in the top three," Fuller said.
Marriott's competitors in the region are the same companies with which the hotel operator goes head-to-head globally, Fuller said. "We are used to competing with them in various markets. Our products are designed to compete with them so there is nothing we would do here that we are not doing in the global market today."
Major competitors include Park Hyatt, Four Seasons, Grosvenor and St Regis in the luxury segment. Marriott's Courtyard is positioned against Holiday Inn and Novotel. The company has no plans to enter the budget segment.
"We are not in the budget category intentionally. Even our Fairfield brand in the United States is really a three-star project. We have no budget brands, this not our market today – but never say never," Fuller said.
The company seems to be unmoved by the recent increase in the cost of construction materials. "There is a chance it will have an impact going forward. But the owners we have talked to – who are the people affected – have not expressed any concerns that we will, especially in the Middle East, have a project that will be negatively impacted. It will not stop the various projects we have on hand."
Marriott has developed educational programmes to tackle the shortage of skilled staff in the region, Fuller said. "We are developing management [people] everyday; we will continue to supply this market with people from our other hotels, working with universities to find new people, educating our own hotel executives and continuing to look for great people. Other chains may have concerns but we believe we will be okay with the experience we have. We have a [staff] turnover of 20 per cent."
Half of Marriott's managers are internally groomed. The firm has courses for managers, executives and senior management.