Marriott International is debuting an extended-stay brand in the U.S. and Canada. Why buy a startup like Placemakr or Limehome when you can build your own brand?
Marriott International is debuting an extended-stay brand offering serviced apartment stays in the U.S. and Canada. The Apartments by Marriott Bonvoy product will play in the premium and luxury segments, syncing with Marriott’s overall portfolio — which is in the upper half of lodging categories.
It’s not the first time the world’s largest hotelier has played in the branded serviced apartment space with upscale residential extended-stay units. One of its brands, Marriott Executive Apartments, has been doing exactly that for more than two decades with a product currently in Asia, Europe, the Middle East, Africa, and Latin America.
Yet the pandemic’s boom in remote and hybrid working styles prompted a greater demand for home-like amenities and experiences as travelers mix work and leisure in the same trips — a megatrend in blended travel that Skift has also called The Great Merging.
“The introduction of Apartments by Marriott Bonvoy responds to those trends while offering developers a premium product backed by our trusted name and distribution platform,” said Stephanie Linnartz, president of Marriott International, in a statement.
Travelers will be able to find the listings via the company’s website and app with the ability to earn points and redeem points through the company’s rewards program, Bonvoy, the company said on Wednesday.
Apartments by Marriott Bonvoy offer between one and three bedrooms, a full kitchen, in-unit laundry facilities, and weekly housekeeping service.
Unlike its Executive Apartments product, the new Apartments by Marriott Bonvoy won’t require developers in typical multi-unit residential buildings to provide hotel-style perks such as on-site food options and meeting spaces. But it will require a public space, such as a lounge or host desk. The model includes weekly housekeeping.
Marriott didn’t name any initial development partners, implying that no properties may yet be available. Neither Marriott’s hotel site nor its Bonvoy rental home site had updated its filters to make it easy to find apartment listings as of Thursday.
A Challenge to Placemakr?
To keep the model friendly for developers, Marriott’s model lets franchisees or owners sign relatively short contracts. This could let a developer of a multi-rise residential complex use Marriott as a way to temporarily generate revenue from some units while finishing construction on the rest of a project for traditional long-term leases. Marriott won’t require a consistent aesthetic design — making property conversion easier.
If the Apartments by Marriott Bonvoy product sounds familiar, that may be because it overlaps with the business model of the upstart lodging brand Placmakr, based in Washington, D.C., and Limehome, based in Munich, among others. Placemakr and Limehome manage short-term rental apartments with hotel-style amenities. Their offerings aren’t exclusively extended stay, though their lodging is more spacious than the standard hotel provides. Placemakr raised $90 million in a round earlier this year, and Limehome raised $45 million earlier this week.
Marriott may believe that its established relationships with developers and its distribution network, thanks to having more than 170 million members of its loyalty program, enable it to build a serviced apartment brand that takes inspiration from what’s already been working in the market.
Tapping into corporate housing as a demand source is something Marriott already has some experience at, too. Corporate travel has helped Placemakr and Sonder is attempting to add corporate accounts for its travel lodging, too.