Marriott International recently signed a long-term licensing agreement with Sonder Holdings, a company specializing in apartment-style accommodations. This partnership is expected to bring over 9,000 rooms to Marriott’s portfolio by the end of this year, with an additional 1,500 rooms in the works. These accommodations will be part of a new collection called Sonder by Marriott Bonvoy, catering to travelers looking for apartment-style and boutique hotel experiences in urban centers.
Under the terms of the agreement, Marriott will receive a royalty fee based on a percentage of Sonder’s gross room revenues. This strategic move allows Marriott to tap into Sonder’s expertise in operating digital-forward properties, offering hotel amenities in a more relaxed and informal setting. The addition of Sonder properties is expected to appeal to a wider demographic, particularly younger travelers and those looking for extended stays.
While this partnership presents significant growth opportunities for both Marriott and Sonder, the latter has faced challenges in recent months. Sonder had to lay off 17% of its corporate staff earlier this year and received a delinquency notice from Nasdaq due to accounting errors. The company’s struggles were further highlighted when it had to delay filing its financial results for 2022 and 2023. Despite these setbacks, Sonder remains optimistic about its future and is working towards compliance with Nasdaq listing rules.
Enhanced Benefits for Marriott Bonvoy Members
Marriott Bonvoy members are expected to benefit from this partnership by being able to earn and redeem points at approximately 200 Sonder by Marriott Bonvoy properties by the end of the year. The full integration of Sonder properties into Marriott’s digital channels is slated to be completed by 2025, providing members with more options for their stays. This expanded partnership is part of Marriott’s efforts to enhance the overall experience for its loyal guests.
Marriott International’s collaboration with Sonder Holdings represents a significant milestone for both companies. While there are challenges to overcome, the strategic benefits and growth opportunities presented by this partnership are substantial. As the hospitality industry continues to evolve, partnerships like this will play a crucial role in meeting the changing needs and preferences of travelers around the world.
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