Marriott International is deflagging underperforming Sheraton
hotels – about 6,000 rooms this year and 4,000 in 2018, CEO Arne Sorenson said during
Marriott's third-quarter earnings call Wednesday.
As of Sept. 30, there were 444 Sheraton hotels totaling
156,740 rooms, a decline of five hotels and about 2,100 rooms since the
beginning of the year. Sheraton is the company's third-largest brand by room
count behind Marriott and Courtyard.
"We believe we are making real progress, and owners are
noticing," Sorenson said.
Marriott, which acquired Sheraton and the rest of the Starwood
brand portfolio last year, said in February that it might raise Sheraton's
brand standards and drop hotels that didn't meet them. Sheraton's third-quarter
revenue per available room (RevPAR) in North America fell 0.9% from a year
earlier, compared with a companywide increase of 0.4% in North America.
Globally, Marriott's RevPAR advanced 2.1%.
With Marriott's acquisition of Starwood, the strategy for
Sheraton has changed. In 2015, Starwood launched a Sheraton marketing campaign,
saying it planned to spend $100 million on the five-year initiative and add as
many as 150 Sheraton hotels by 2020. At the time, Starwood launched the
Sheraton Grand sub-brand for higher-end Sheratons.