Marriott International Inc (NASDAQ:MAR) reached a deal to add Atlantis Resort to its hotel portfolio, and the company’s CEO and President, Arne Sorenson, was on CNBC’s Newsmaker to discuss the development.
Mr. Sorenson stated that the deal has been in the works for six months, although they have been looking at Atlantis for many years. He believes that the business is a jewel in the Caribbean
“Atlantis is well known, many of us have been there and experienced this incredible hotel including water parks and other things.”
Mr. Sorenson told CNBC that Marriott International Inc (NASDAQ:MAR) has reward programs and a group of sales force that will help bring more business to Atlantis.
“We’ll see folks in the Marriott system who redeem to take their vacations there as well as folks who say ‘I can earn points there, and I want to be a part of that,'” Sorenson said.
Shift to luxury customers
Further discussing the deal, Mr. Sorenson admitted that even though Atlantis serves a variety of customers, the latest move signals a shift of Marriott International Inc (NASDAQ:MAR) to the luxury customer, albeit, partly.
Marriot seeks to not only offer places where people can stay, but also places where they aspire to redeem their points. Of course, Atlantis is one such place that offers a unique experience.
According to CEO Sorenson, Marriott International Inc (NASDAQ:MAR) is in for long-term growth opportunity, and the shift to leisure even makes the deal a great one. He expects corporate travel to be strong with the return of the corporate group. He further stated that that is something that should be expected especially after the deep recession noted in 2008 and 2009.
Finally, Marriott International Inc (NASDAQ:MAR)’s CEO said the owner of Atlantis came in and refinanced all of the existing debts. The property is owned by Brookfield Assets Management.
Marriott International Inc (NASDAQ:MAR) has a mezzanine financing for the deal at the tune of $100 million.