Marriott to acquire an affordable Latin American hotel brand, bringing its total to 31

Hotel brand bloat doesn't seem to be a problem that will go away soon.

Marriott International made a $100 million deal with Hoteles City Express, which is based in Mexico. Marriott will acquire the brand family of City Express, a chain of affordable midscale hotels in Latin America. Marriott is on the verge of becoming the largest hotel company in the Caribbean and Latin America, according to the company.

City Express is going to be different from the others because of its higher rates.

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The company's 31 st brand enables Marriott to expand further into more affordable segments of the hotel spectrum, something the bigger conglomerates have tried to distinguish themselves from in recent years, especially when trying to explain why their customers aren't so vulnerable to rising gas prices

Marriott CEO Anthony Capuano said in a statement that the company was excited to enter a new lodging category. With City Express by Marriott, we will be providing our customers with more choice through a new, moderate priced offering.

The brands that are part of the City Express umbrella include City Express Plus, City Express Suites, City Express Junior and City Centro. There is a portfolio of hotels in Mexico, Costa Rica, Brazil, and Argentina. The brand names are expected to stay the same.

A curious add? Maybe not

Marriott CEO Anthony Capuano downplayed the idea of acquisitions as recently as a month ago.

I'm still aware of it. Analysts generally see Marriott's portfolio of brands starting at the "upper midscale" category and above. Rates can be as high as $500 per night, depending on the location and time of year.

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Budget brand City Express operates urban, suburban and even extended stay hotels.

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Hoteles City CEO Luis Barrios said that they were convinced that a modern, efficient, and affordable brand would be very attractive to the local traveler. After working with the Marriott team, we were able to confirm that we share the same cultural values.

It makes sense for Marriott to move into the more economical midscale segment of the market because it fits in with Marriott's more narrowed scope about mergers and acquisitions.

Capuano and Oberg talk about the idea of "tuck-in" or "bolt-on" acquisitions that give the company a greater presence in a certain part of the world.

AC, which was centered on Europe before Marriott took it global, is a good example. Don't be surprised if City Express becomes a brand outside of Latin America. Marriott has recently pushed into all-inclusive resorts in the Caribbean.

Brian King is the president of the Caribbean and Latin America region for Marriott International. The transaction with Hoteles City Express will allow us to do that in the Caribbean and Latin America.

The reason to go low (in price)

There is a reason to expand into more budget-friendly prices. This is a segment of the hotel market dominated by players like Choice and Wyndham, both of which recently beefed up their own presence in pricier segments of the hotel market. Some people don't want to pay for the high costs of some of the larger companies' brands.

It is said that the worst thing for a hotel company is to not have an option for loyal customers, so they go to a competitor's brands. I don't think many Bonvoy members were fleeing Marriott in favor of Choice, but it's a smart strategy to have something at this price point.

It may be Marriott's 31 st brand, but this truly affordable offering will be a little easier to differentiate than other Marriott brands.

They haven't crossed Accor's 40- brand mark. It's not just brand bloat, it's brand fatiguing.