American hotel chain Marriott International has decided to suspend all its activities in Russia.
“We have concluded that new sanctions imposed by the US, UK and EU will make it impossible for Marriott or the hotel franchise to continue operating in the Russian market,” he said. press office companies.
The company acknowledged that the process of suspending operations after 25 years in Russia has been difficult. Marriott has promised to “focus on looking after employees in the country”, including their employment abroad.
In addition, the company provided $1 million in internal funding to help network workers and their families in Russia and Ukraine relocate, including food and transportation vouchers, as well as medical and legal support.
As part of its support for Ukrainian refugees, Marriott provided them with more than $2.7 million in aid, recruited more than 250 Ukrainians in 15 European countries, and 85 hotels in the network provided them with shelter.
On March 10, the company announced that it is closing an office in Moscow, suspending hotel investments in Russia until it opens new ones and initiates chain development projects.
Marriott International hotel chain, which has 29 properties in 13 regions of the country, ranked first in Forbes’ “Russia’s Largest Hotel Chains” ranking in 2019.
Five hotels operating under the Marriott brands in Moscow are owned by businessman Mikhail Gutseriev’s Safmar: Marriott Tverskaya, Marriott Royal Aurora, Marriott Grand Hotel, Sheraton Palace and National, Luxury Collection Hotel. These hotels are managed by the British company Interstate Hotels & Resorts.
A source from the Safmar group told the publication: RBCthat all hotels will continue to work, but in what format and under what brand it will be known after receiving additional clarifications from the network.
Rostourism, on the other hand, said that the hotels operating under the Marriott brand in Russia will continue to operate after the company leaves.
“As with the booking: sad in general, we understand their contribution to the development of tourism. The main thing is that all hotels continue to work. And today, additional opportunities are opening up for our already numerous hotel chains, and I’m sure there will be even more soon. We will focus on their support and development,” said Zarina Doğuzova, head of the Federal Tourism Agency.
Hotel chains are leaving Russia
In March, the Hilton and Hyatt hotel chains limited their activities in Russia by closing offices and halting investments. Kommersant in April knowledgeableBritish hotel operator in Russia and owner of Holiday Inn, InterContinental, Crowne Plaza and Indigo brands is preparing to leave InterContinental Hotel Group.
Since May 14, Hyatt has suspended the operational management of hotels in Russia. The management of two hotels in Yekaterinburg will be transferred to Russian employees of Hotel Development Company LLC. The chain also terminated its relations with Moscow hotel Hyatt Regency Moscow Petrovsky Park and ceased to manage one of the largest hotels of Sochi – Hyatt Regency Sochi, which changed its name to Grand Karat Sochi from April 15.
Earlier, the head of the Restaurant and Hoteliers Federation, Igor Bukharov, told Izvestia that they are considering a scenario for the international hotel chains Marriott and Hilton to withdraw completely from Russia. This was confirmed by real estate consulting firm Knight Frank.
The press service of the Hilton chain also told the publication that the company has closed its office in Moscow and abandoned its future projects in Russia.
reasons for leaving the market
According to Bukharov, the location of Marriott and Hilton is connected not only with the geopolitical situation, but also with the decrease in the number of customers: in March, the flow of foreigners who rented rooms costing 60,000-100,000 rubles fell sharply. per day. It is noted that if both networks leave Russia, they can interfere with the operation of the reservation systems in the country, which allows you to save and use bonuses as part of the loyalty program.
Buharov said that the hotels of these chains in Russia are located in buildings that do not belong to them. The expert notes that if Marriott and Hilton leave Russia, it is possible for the owners to decide to restart the business using already familiar names, and reminds that Russian law now allows for compulsory licensing.
Knight Frank hotel consultancy director Natalia Rosenblum said that the Accor network (Mercure, Mövenpick, Novotel brands) is also considering leaving Russia.
According to him, the share of the Russian market for international operators is small, so in case of large reputational risks it is easier for them to stop working. At the same time, the specialist believes that even after the departure of international players, the domestic market will develop, as there are operators and employees with extensive experience in hotel management and business management in Russia.
Stopping Booking and Airbnb
In March, Booking and Airbnb announced the suspension of operations in Russia.
“Booking.com, a Dutch company, has to suspend the provision of travel services in Russia due to the increasing complexity of doing business in the country,” a company representative told RBC.
Airbnb reported that the site is having difficulty operating operations in Russia due to sanctions.
After the start of Russia’s military operation in Ukraine and the imposition of sanctions on Russia, foreign companies began to suspend their activities in Russia and withdraw from joint ventures. According to data from Yale University on June 3, such companies already more than 1000.