The marriage of the Marriott and Delta hotel brands is good for the companies and their two locations in downtown Victoria, hospitality experts say.
Marriott International Inc. announced Tuesday that it has signed agreements to buy the Delta Hotels and Resorts brand, management and franchise business from Victoria-based B.C. Investment Management Corp. for $168 million. The deal does not include hotel properties.
The companies said the agreement, which must be approved by the federal Competition Bureau, should close in the second quarter of this year.
The deal will make Marriott the largest full-service hotel company in Canada, with 120 hotels and 27,000 rooms. The Delta brand has 38 hotels with 10,000 rooms in 30 Canadian cities.
Marriott International has 4,100 hotels in 79 countries and about 49 million members in its loyalty program. It is based in Bethesda, Maryland, and operates and franchises hotels and resorts under 18 brands.
The deal includes two downtown Victoria hotels — the Delta Victoria Ocean Pointe and the Marriott Victoria Inner Harbour.
Former Marriott manager Francis Mairet, who teaches at Royal Roads University and operates a consulting and management company, said the sale will be good news for members of the Delta loyalty program. “Besides giving them access to more choice in hotel location and preferred rates, this deal will give them the ability to accumulate and redeem points toward greater value and destinations,” he said.
The Delta-Marriott agreement will raise the capital region’s profile in the hotel industry, Mairet said. The industry estimates that tourism generates nearly $2 billion a year in the capital region.
The deal will also benefit the two hotels, which can refer guests to the other property, Mairet said.
“The interesting aspect will be to see how Marriott positions the Delta hotels going forward within their own portfolio,” he said.
B.C. Investment Management Corp., an institutional fund manager, owns 13 Delta hotels, including the Ocean Pointe, and has one under development. “They are excellent owners,” Mairet said, noting it recently spent $14 million to upgrade the Ocean Pointe.
B.C. Investment Management Corp. bought the Delta brand in 2007 for an undisclosed price. Its Delta hotels will be run under a new 30-year management agreement with Marriott.
Third parties own the other 25 Delta hotels. Fifteen are managed by Delta and 10 are franchised.
Frank Bourree, tourism consultant at Victoria’s Chemistry Consulting, does not expect to see any staff changes at the Victoria hotels.
“It’s a good thing for Victoria. Both companies are exceptionally well-run and both brands are well-managed,” he said.
“I think this is good news in terms of strengthening of the system that they have in Canada, and certainly reflective of the optimism in the tourism industry for continued growth when you start to see acquisitions like this.”
Arne Sorenson, president and chief executive officer of Marriott International, said in a statement that Delta has “an impressive portfolio of hotels that are among the most preferred in Canada.
“With this acquisition, we are continuing our focus on building our brand portfolio and growing in attractive regions outside the U.S.,” he added.
B.C. Investment Management Corp. also owns the Harbour Towers Hotel in James Bay, which is not part of the new deal.
The corporation, based at Selkirk Water, manages investments for public sector pension funds as well as publicly administered trust funds and government operating funds.
