Western hotel companies are still making money in Russia, but this is a notable step for an industry that has been a holdout.
The person is Cameron Sperance.
Major hotel companies are finally taking a stance on Russia after so many other industries suspended operations in the country.
The companies decided to freeze new developments and suspend investments in Russia. The Moscow corporate office was closed by Hilton. Skift has learned that Accor suspended all planned openings and developments in Russia in recent days.
Following the initial publication of this story, the company closed its corporate office in Moscow and suspended future investments, development activity, and openings in Russia.
Marriott's position isn't publicly known, as a company representative didn't respond to Skift's request for comment in time for publication.
The hotel industry faced scrutiny for continuing to operate in Russia after major U.S. and European companies withdrew from the country in the wake of the invasion of Ukraine. The announcement states that the hotel companies are freezing development plans in Russia, but they still operate hotels there.
Our hotels have always been part of the fabric of our communities that we serve, and we take seriously our promise to positively impact the places where we live and work.
Hyatt will continue to evaluate hotel operations in Russia, while complying with applicable sanctions and U.S. government directives as we hope for a resolution to this crisis.
We are deeply sad and shocked by the war in Ukraine and our thoughts are with all those who have been affected by it. The company noted in its statement that it has a commitment to look after the people and communities where it has a presence around the world.
According to Lodging Econometrics, Accor has 29 hotels in Russia while IHG has five and Hyatt has one. Anthony Capuano, Marriott's CEO, said this week at a J.P. Morgan conference that Marriott has 28 managed and franchised hotels in Russia. There are 26.
Company leaders voiced their support for refugees fleeing the country in recent weeks, but they have largely taken a tone of downplaying their presence in Russia instead of moving to leave the country altogether.
Those hotels represent less than 1 percent of total fee volume. Capuano said at the J.P. Morgan that Russian travelers are less than 1 percent of room night generation around the world. In terms of the company's financial performance, it is not significant.
Accor continues to operate in the country in support of its 3,500 employees and also to offer hotels up as shelter for members of the media as well as non-governmental organizations, according to those familiar with company thinking.
The company plans to donate profits from its Russian operations to humanitarian relief efforts. Even if they are a small part of the company's overall business, the hotels are still operating.
Hyatt is giving supplies to the people of Ukrainian origin. The brands are giving up rooms to accommodate refugees and donating to humanitarian causes.
The hotel industry in Russia is notable because of the mass exodus of Western brands, but hotel experts say there are a variety of financial and pro-West political reasons for why these companies might be staying.
McDonald's temporarily pulling the plug on its 850 restaurants is a sharper stance, as it nixes food deliveries to the restaurants. Experts say that it is harder to keep a hotel running. The owner of one of the Russian hotels is likely to continue to operate with current branding and just find resources like bedding materials and food from a provider unrelated to their brand family.
I appreciate that they don't have a great look for them, and I think there's not much they can do about it. You can't operate Mcdonald's because you need Mcdonald's to give you food. The hotel is still there if Marriott stops providing food. It would be a token effort.
There is a political upside to having a presence in Russia. InterContinental Brazil's first location wasn't just happenstance. Juan Trippe was encouraged by the U.S. President to build a chain of luxury hotels for business travelers.
The first InterContinental was built in Brazil partly funded by the American government because they were worried that the center of the cities could become communist.
Following the publication of this story, IHG Hotels and Resorts announced it will close its Moscow corporate office as well as suspend hotel development, investments, and openings in Russia. The story has been changed.
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