Global hotel giant Marriott International is targeting year-on-year corporate negotiated rate increases of “mid-single digit” percentages in 2025.

During Marriott’s third quarter earnings call on Monday (4 November), CEO Anthony Capuano said the company was “feeling pretty good about that target” for corporate rate increases next year after its “early set of discussions”, although he admitted it was still “relatively early in the process”.

Capuano said business transient travel in the third quarter remained on a steady upward trajectory, which was being led by increased demand from large corporates.

“We are encouraged by virtue of the fact that we continue to see RevPAR (revenue per available room) growth quarter-over-quarter in the business transient segment,” he added.

“And to me, one of the most encouraging facets of that recovery is on the big corporates. It’s been several years since we already got back to above pandemic levels of travel from the small and medium-sized (SME) companies, but the continued growth and the continued return to the road by the big corporates is an encouraging facet of the recovery.”

Capuano said that the groups market was the “standout customer segment”, with RevPAR up by 10 per cent year-on-year during the third quarter, while RevPAR for business travel “continued to grow nicely in the quarter” with a 2 per cent increase. By comparison, RevPAR for the leisure market was flat during Q3, although still “well ahead” of pre-Covid levels.

Marriott’s global systemwide third-quarter RevPAR in the third quarter increased by 3 per cent year-on-year to $131.72, while average daily rate (ADR) increased by 2.5 per cent to $182.24 and occupancy went up by 0.3 percentage points to 72.3 per cent.

In Europe, Marriott’s RevPAR rose by 9.5 per cent year-on-year to $191.93 in Q3, while ADR was up by 5.8 per cent to $248.42 and occupancy improved by 2.7 percentage points to 77.3 per cent.

Total third quarter revenue increased by 6 per cent year-on-year to nearly $6.3 billion, while Marriott’s net income was $584 million compared with $752 million during the same period of 2023. 

Marriott said it achieved global net rooms growth in the third quarter of 16,000 rooms year-on-year. The company now has around 9,100 properties worldwide on its system offering around 1.675 million rooms. It also has a development pipeline of 3,800 properties with 585,000 rooms.