Marriott Lets Go Of Its Timeshare Business
Marriott International Inc. lets go of its timeshare business. This sector used to generate large amounts of profit for hotel companies but since the recession profits have trickled down. Marriott’s existing shareholders are going to own the newly created and independent company owning 71 properties with 33,000 rooms. With approximately 400,000 owners and $1.5 billion of unsold assets it is going to become the world’s largest standalone timeshare business.
The decision to cut ties with the timeshare business has not come abruptly but instead has been evolving for some time. Marriott’s chief operating officer, Arne Sorenson, explained that Marriott shareholders have lost interest and excitement for the timeshare business. “We’ve never really been interested in walking away from this business,” he said during an interview Monday. “But the last few years have been extraordinarily difficult. This recession was harder on the timeshare business than last recessions.” The timeshare business relies heavily on consumers opposed to business travelers and has therefore particularly been struggling in the fourth quarter of 2010. Compared to the previous year, Marriott’s timeshare sales fell by $2 million to $201 million.