Marriott Corp. said yesterday it will enter the all-suite hotel market next spring by opening its first property aimed at business travelers who prefer suites over conventional hotel rooms.
Bethesda-based Marriott, which owns 135 hotels and resorts worldwide, said the company plans to open about a dozen Marriott Suites hotels by early 1988.
"We've been watching the all-suite market closely to see whether there was legitimate, sustainable demand for this type of product," said President J. W. Marriott Jr. "We are convinced that the demand is there, and we intend to move rapidly to take advantage of the strong growth potential."
The all-suites venture will mark Marriott's second move into specialized hotel markets. A few months ago, Marriott opened the first of a chain of Courtyard hotels, a budget lodging concept aimed at the lower end of the business travel market.
Marriott said its new venture is designed to compete directly with other companies aleady in the all-suite hotel market.
The current leading company in that market is Holiday Inns, which announced last year that it was developing all-suite hotels under its wholly owned subsidiary, Embassy Suites Inc., said Joseph J. Doyle, a hotel financial analyst with Smith, Barney in New York.
Embassy Suites was founded by Holiday Inns in January 1983 to develop all-suite hotels. In March, Embassy Suites acquired Granada Royale, which is the largest all-suites hotel chain, Doyle said.
The combined Granada Royale-Embassy Suites chain has 27 hotels throughout the West and Midwest, said Judy Heinrich, an Embassy Suites spokeswoman. "Embassy Suites has 31 new hotels under construction, and eventually all of our Granada Royales will be converted to Embassy Suites," Heinrich said.
"There is good demand in the suites-only sector," Doyle said. "Demand comes particularly from the business traveler who is staying in a city more than one or two nights and may want to settle in with a small living room."
Rates at the new Marriott hotels will be in the $70- to $90-a-day range. "The trick is building a facility where you can offer suites in this range, just a notch above what the typical business traveler would pay now for a regular room," Doyle said. Suites in some traditional Washington hotels now range from $200 to $500.
The all-suites concept also may be attractive to the pleasure traveler, Doyle said. "A traveling family may want two rooms because they need extra space with children."
The key question is whether Marriott's all-suite hotels will cut into its traditional hotel market, Doyle said. "We see it as complementary to our traditional hotel business," Marriott spokesman R. A. Rankin said.
Most of the Marriott Suites hotels will be built in suburban areas and will have 200 to 250 suites and limited meeting space. "We have several possible all-suite properties already in our development pipelane and are actively looking for other opportunities," Marriott said.